HOUSE AMENDED
PRIOR PRINTER'S NO. 212 | PRINTER'S NO. 1172 |
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. | 304 | Session of 2013 |
INTRODUCED BY GREENLEAF, ALLOWAY, FERLO, BROWNE, PILEGGI AND BREWSTER, JANUARY 24, 2013
AS REPORTED FROM COMMITTEE ON COMMERCE, HOUSE OF REPRESENTATIVES, AS AMENDED, JUNE 5, 2013
AN ACT
1Amending Titles 15 (Corporations and Unincorporated
2Associations) and 54 (Names) of the Pennsylvania Consolidated
3Statutes, in Title 15, making extensive revisions, additions
4and deletions to preliminary material on general provisions;
5to corporation material on general provisions, on
6incorporation, on corporate powers, duties and safeguards, on
7officers, directors and shareholders, on fundamental changes,
8on registered corporations, on insurance corporations, on
9benefit corporations, on foreign business corporations, on
10incorporation and on foreign nonprofit corporations; to
11material on limited liability companies; to material on
12unincorporated associations; and to material on business
13trusts; in Title 54, further providing for general provisions
14and for corporate and other association names; and making
15related repeals.
16The General Assembly of the Commonwealth of Pennsylvania
17hereby enacts as follows:
18Section 1. This act shall be known and may be cited as the
19GAA Amendments Act of 2013.
20Section 2. The definitions of "banking institution,"
21"representative" and "savings association" in section 102 of
22Title 15 of the Pennsylvania Consolidated Statutes are amended
23and the section is amended by adding definitions to read:
1§ 102. Definitions.
2Subject to additional or inconsistent definitions contained
3in subsequent provisions of this title that are applicable to
4specific provisions of this title, the following words and
5phrases when used in this title shall have, unless the context
6clearly indicates otherwise, the meanings given to them in this
7section:
8* * *
9"Banking institution." [A banking institution as defined in
10section 1103 (relating to definitions).] An institution as
11defined in section 102(r) of the act of November 30, 1965
12(P.L.847, No.356), known as the Banking Code of 1965.
13"Bureau." The Bureau of Corporations and Charitable
14Organizations of the department.
15* * *
16"Domestic banking institution." A domestic association which
17is an institution as defined in section 102(r) of the act of
18November 30, 1965 (P.L.847, No.356), known as the Banking Code
19of 1965.
20* * *
21"Domestic insurance corporation." An insurance corporation
22as defined in section 3102 (relating to definitions).
23"Domestic savings association." A domestic corporation for
24profit which is an association as defined in section 102(3) of
25the act of December 14, 1967 (P.L.746, No.345), known as the
26Savings Association Code of 1967.
27* * *
28"Execute." When used with respect to authenticating or
29adopting a filing, document or other record, means "sign."
30* * *
1"Obligation." Includes a note or other form of indebtedness,
2whether secured or unsecured.
3"Officially publish." Publish in two newspapers of general
4circulation in the English language in the county in which the
5registered office of the association is located or, in the case
6of a proposed association, will be located, one of which must be
7the legal newspaper, if any, designated by the rules of court
8for the publication of legal notices. If there is only one
9newspaper of general circulation in the county, advertisement in
10that newspaper is sufficient. If no other frequency is
11specified, the notice must be published one time. See section
12109(a)(2) (relating to name of commercial registered office
13provider in lieu of registered address).
14* * *
15"Record form." Inscribed on a tangible medium or stored in
16an electronic or other medium and retrievable in perceivable
17form.
18"Representative." [A representative as defined in section
191103 (relating to definitions).] When used with respect to an
20association, joint venture, trust or other enterprise, a person
21occupying the position or discharging the functions of a
22director, officer, partner, manager, trustee, fiduciary,
23employee or agent, regardless of the name or title by which the
24person may be designated. The term does not imply that a
25director, as such, is an agent of a corporation.
26"Savings association." [A savings association as defined in
27section 1103.] An association as defined in section 102(3) of
28the act of December 14, 1967 (P.L.746, No.345), known as the
29Savings Association Code of 1967.
30"Sign." With present intent to authenticate or adopt
1information in record form:
2(1) to sign manually or adopt a tangible symbol; or
3(2) to attach to, or logically associate with,
4information in record form, an electronic sound, symbol or
5process.
6* * *
7Section 3. Section 107 of Title 15 is amended to read:
8§ 107. Form of records.
9[Any records] (a) General rule.--Information maintained by a
10corporation or other association in the regular course of its
11business, including shareholder or membership records, books of
12account and minute books, may be kept [on, or be in the form of,
13punch cards, magnetic storage media, photographs,
14microphotographs or any other information storage device if the
15records so kept can be converted into reasonably legible written
16form within a reasonable time] in record form. [Any corporation
17or other association shall so convert any records so kept upon
18the request of any person entitled to inspect the records. Where
19records are kept in this manner, a reasonably legible written
20form produced from the information storage device that
21accurately portrays the record shall be admissible in evidence,
22and shall be accepted for all other purposes, to the same extent
23as an original written record of the same information would have
24been accepted.]
25(b) Meaning of "written."--References in this title to a
26document in writing or to a written provision of an agreement or
27other document shall be deemed to include and be satisfied by a
28document or provision of an agreement or document in record
29form.
30Section 4. Title 15 is amended by adding a section to read:
1§ 111. Relation of title to Electronic Signatures in Global and
2National Commerce Act.
3(a) General rule.--Except as set forth in subsection (b),
4this title modifies, limits and supersedes the Electronic
5Signatures in Global and National Commerce Act (Public Law 106-
6229, 15 U.S.C. § 7001, et seq.).
7(b) Exception.--This title does not do any of the following:
8(1) Modify, limit or supersede section 101(c) of the
9Electronic Signatures in Global and National Commerce Act (15
10U.S.C. § 7001(c)).
11(2) Authorize electronic delivery of a notice described
12in section 103(b) of the Electronic Signatures in Global and
13National Commerce Act (15 U.S.C. § 7003(b)).
14Section 5. Sections 131, 133(a) and (d), 134(a)(3), 135(a)
15(2) and (7) and (d), <-136(b)(2) and (3) 136(b), 152, 153(a) and
16155(a) and (b) of Title 15 are amended to read:
17§ 131. Application of subchapter.
18As used in this subchapter, the term "this title" includes
19Titles 17 (relating to credit unions) and 54 (relating to names)
<-20and any other provision of law that makes reference to the and
21any other provision of law that:
22(1) makes reference to the powers and procedures of this
23subchapter[.]<- or, to the extent not inconsistent with this
24subchapter, requires a filing in the bureau and does not
25specify some or all of the necessary procedures therefor;<- or
26(2) to the extent not inconsistent with this subchapter:
27(i) requires a filing in the bureau; and
28(ii) does not specify some or all of the necessary
29procedures for the filing provided in this subchapter.
30§ 133. Powers of Department of State.
1(a) General rule.--The [Department of State shall have]
2department has the power and authority reasonably necessary to
3enable it to administer this subchapter efficiently and to
4perform the functions specified in section 132 (relating to
5functions of Department of State), in 13 Pa.C.S. (relating to
6commercial code) and in 17 Pa.C.S. (relating to credit unions).
7The following shall not be agency regulations for the purposes
8of section 612 of the act of April 9, 1929 (P.L.177, No.175),
9known as The Administrative Code of 1929, the act of October 15,
101980 (P.L.950, No.164), known as the Commonwealth Attorneys Act,
11the act of June 25, 1982 (P.L.633, No.181), known as the
12Regulatory Review Act, or any similar provision of law, but
13shall be subject to the opportunity of public comment
14requirement under section 201 of the act of July 31, 1968 (P.L.
15769, No.240), referred to as the Commonwealth Documents Law:
16(1) Sample filing forms promulgated by the department
17[under subsection (d)].
18(2) Instructions accompanying sample filing forms and
19other explanatory material published in the Pennsylvania Code
20that is intended to substantially track applicable statutory
21provisions relating to the particular filing or to any of the
22functions of the department covered by this subsection, if a
23regulation of the department expressly states that [such]
24those instructions or explanatory materials shall not have
25the force of law.
26(3) Regulations, which the department is hereby
27authorized to promulgate, that:
28(i) Authorize payment of fees and other remittances
29through or by a credit or debit card issuer or other
30financial intermediary.
1(ii) Authorize contracts with credit or debit card
2issuers and other financial intermediaries relating to
3the collection, transmission and payment of fees and
4other remittances.
5[(iii) Adjust the level of fees and other
6remittances as otherwise fixed by law so as to facilitate
7their transmission through or by a credit card issuer or
8other financial intermediary pursuant to such regulations
9without net cost to the department.]
10(iv) Adjust, not more than once per year, the fees
11set forth in section 153(a) (relating to fee schedule)
12and 13 Pa.C.S. § 9525 (relating to fees) for filings
13transmitted to the department electronically.
14(v) Relate to the format or means of delivering
15documents to the department <-or for filing.
16* * *
17(d) [Physical characteristics and copies of documents.--All
18articles and other documents authorized or required to be filed
19in the department under this title shall be in such format as to
20size, shape and other physical characteristics as shall be
21prescribed by regulations promulgated by the department. The
22regulations may require the submission of not to exceed three
23conformed copies of any document in addition to the original and
24any copies thereof otherwise required by law. All formats
25promulgated by the department for use under this title shall
26include a statement of the number of copies required to be filed
27and shall be published in the Pennsylvania Code.]
28* * *
29§ 134. Docketing statement.
30(a) General rule.--The [Department of State] department may,
1but shall not be required to, prescribe by regulation one or
2more official docketing statement forms designed to elicit from
3a person effecting a filing under this title information that
4the department has found to be necessary or desirable in
5connection with the processing of a filing. A form of docketing
6statement prescribed under this subsection:
7* * *
8(3) May be required by the department in connection with
9a filing only if notice of the requirement appears on the
10official format for the filing prescribed [under section
11133(d) (relating to physical characteristics and copies of
12documents)] by the department.
13* * *
14§ 135. Requirements to be met by filed documents.
15(a) General rule.--A document shall be accepted for filing
16by the [Department of State] department if it satisfies the
17following requirements:
18* * *
19(2) The document complies with any regulations
20promulgated by the department [pursuant to section 133(d)
21(relating to physical characteristics and copies of
22documents)] and is accompanied by any applicable statement
23prescribed under section 134.
24* * *
25(7) It is in record form and executed. The department
26shall not examine a document to determine whether the
27document has been [executed] signed by an authorized person
28or by sufficient authorized persons or otherwise is duly
29[executed. A document shall be deemed executed if it contains
30a facsimile signature, so long as the operative portions of
1the document meet any applicable requirements prescribed
2under section 133(d) (relating to physical characteristics
3and copies of documents)] signed.
4* * *
<-5(d) [Method of filing.--The department may prescribe by
6regulation procedures for filing documents by electronic mail,
7facsimile transmission, telex or other similar means of
8communication] (Reserved).
9* * *
10§ 136. Processing of documents by Department of State.
11* * *
12(b) [Immediate<-] Duplicate certified copy.--
<-13* * *
<-14(1) If a duplicate copy, which may be either a signed or
15conformed copy, of any articles or other document authorized
16or required by this title to be filed in the department is
17delivered to the department with the original signed
18document, the department shall [compare the duplicate copy
19with the original signed document and, if it finds that they
20are identical, shall certify the duplicate copy by making
21upon it the same endorsement that is required to appear upon
22the original, together with a further endorsement that the
23duplicate copy is a true copy of the original signed
24document,] stamp the duplicate copy with the date received by
25the department and return the duplicate copy to the person
26who delivered it to the department.
27[(2) <-[If the duplicate copy is delivered by hand to the
28office of the department at the seat of government at least
29four hours before the close of business on any day not a
30holiday and relates to a matter other than a label or other
1mark requiring examination under Title 54 (relating to names)
2or the reservation or registration of a name under this title
3and, in the case of a document that creates a new
4association, effects or reflects a change in name or
5qualifies a foreign association to do business in this
6Commonwealth, if the duplicate copy is accompanied by
7evidence that the proposed name has been reserved or
8registered by or on behalf of the applicant, the department
9before the close of business on that day shall either:
10(i) Certify the duplicate copy as required by this
11subsection and make such certified copy available at the
12office of the department to or upon the order of the
13person who delivered it to the department.
14(ii) Make available at the office of the department
15to or upon the order of the person who delivered it to
16the department a brief statement in writing of the
17reasons of the department for refusing to certify such
18duplicate copy.
19See section 153(a)(10) (relating to certification fees).]
<-20(Reserved).
21(3) In lieu of [comparing<-] date-stamping the duplicate
22copy [with<-] of the original signed document as provided in
23[paragraphs (1) and (2)] paragraph (1), the department may
24make a copy of the original signed document at the cost of
25the person who delivered it to the department.
26* * *
27§ 152. Definitions.
28The following words and phrases when used in this subchapter
29shall have the meanings given to them in this section unless the
30context clearly indicates otherwise:
1"Ancillary transaction." Includes:
2(1) preclearance of document[,];
3(2) amendment of articles, charter, certificate or other
4organic document, restatement of articles, charter,
5certificate or other organic document[, change in registered
6or principal office, change in share structure,];
7(3) dissolution, cancellation or termination[,
8reorganization,] of an association;
9(4) withdrawal by foreign association[,];
10(5) withdrawal by a partner[, or];
11(6) any [similar transaction,] transaction similar to
12any item listed in paragraphs (1) through (5); or
13(7) [the deposit in the Department of State] delivery to
14the department for filing in, by or with the [Department of
15State] department or the Secretary of the Commonwealth of any
16articles, statements, proceedings, agreements or any [like]
17similar papers affecting associations under the statutes of
18this Commonwealth[.] for which a specific fee is not set
19forth in section 153 (relating to fee schedule) or other
20applicable statute.
21["Bureau." The Corporation Bureau of the Department of State
22or any successor agency within the department.]
23§ 153. Fee schedule.
24(a) General rule.--The nonrefundable fees of the bureau,
25including fees for the public acts and transactions of the
26Secretary of the Commonwealth administered through the bureau,
27shall be as follows:
28(1) Domestic corporations: | Â |
29(i) Articles of incorporation, letters
1corporation or association....................... | Â Â
$125 |
2(ii) Articles or agreement or similar | Â 70 |
4(iii) Additional fee for each association | Â 40 |
6(iv) Additional fee for each new association | Â 125 |
8(v) Articles of conversion or a similar | Â 70 |
10(vi) Each ancillary transaction............ | 70 |
11(2) Foreign corporations: | Â |
12(i) Certificates of authority or similar | Â 250 |
14(ii) Amended certificate of authority or | Â 250 |
16(iii) Domestication......................... | 125 |
17(iv) Statement of merger or consolidation or | Â Â Â 70 |
21(v) Additional fee for each qualified | Â Â 40 |
24(vi) Each ancillary transaction............. | 70 |
25(3) Partnerships and limited liability companies: | Â |
26(i) Certificate of limited partnership or | Â Â Â Â 125 | |||||
1(ii) Certificate of merger, consolidation or | Â 70 | |||||
3(iii) Additional fee for each association | Â 40 | |||||
5(iv) Additional fee for each new association | Â 125 | |||||
7(v) Application for registration of foreign | Â Â 250 | |||||
10(vi) Certificate of amendment of | Â Â 250 | |||||
13(vii) Statement of registration of | Â Â Â 125 | |||||
17(viii) Domestication of foreign limited | Â 125 | |||||
19(ix) Each ancillary transaction............. | 70 | |||||
20(4) Unincorporated nonprofit associations: | Â | |||||
21(i) Statement appointing an agent to receive | Â 70 | |||||
23(ii) Resignation of appointed agent.......... | 40 | |||||
24(iii) Amendment or cancellation of statement | Â 70 | |||||
26(5) Business trusts: | Â |
27(i) Deed of trust or other initial | Â 125 |
29(ii) Each ancillary transaction.............. | 70 |
30(6) Fictitious names: | Â |
1(i) Registration............................ | 70 | |||||
2(ii) Each ancillary transaction............. | 70 | |||||
3(7) Service of process: | Â |
4(i) Each defendant named or served........... | 70 |
5(ii) (Reserved).............................. | Â |
6(8) Trademarks, emblems, union labels, | Â Â |
8(i) Trademark registration.................. | 50 |
9(ii) Each ancillary trademark transaction... | 50 |
10(iii) Any other registration under this | Â 70 |
12(iv) Any other ancillary transaction under | Â 70 |
14(9) Uniform Commercial Code: As provided in 13 | Â Â |
16(10) Copy fees, including copies furnished under | Â Â |
18(i) Each page of photocopy furnished........ | 3 |
19(ii) (Reserved)............................. | Â |
20(11) Certification fees: | Â |
21(i) For certifying copies of any document or | Â Â Â 40 |
25(ii) (Reserved)............................. | Â |
26(iii) For issuing any other certificate of | Â Â Â 40 |
30(12) Report of record search other than a search
1under paragraph (9): | Â
 |
2(i) For preparing and providing a report of | Â Â 15 |
5(ii) (Reserved)............................. | Â |
6(13) Reservation and registration of names: | Â |
7(i) Reservation of association name......... | 70 |
8(ii) Registration of foreign or other | Â 70 |
10(14) Change of registered office or address: | Â |
11(i) Each statement of change of registered | Â 5 |
13(ii) Each statement or certificate of change | Â 5 |
15(iii) Each statement of change of address... | 5 |
16(15) Contingent domestication: | Â |
17(i) Statement of contingent domestication... | 125 |
18(ii) Each year, or portion of a year, during | Â Â 1,500 |
21(16) Expedited service: | Â |
22(i) For the processing of any filing under | Â Â Â Â 1,000 |
27(ii) For the processing of any filing under
1of............................................... | Â Â Â Â
300 |
<-2(iii) For processing of any filing under | Â Â Â 100 |
<-7(iii) For processing of any filing under | Â Â Â
100 |
12* * *
13§ 155. Disposition of funds.
14(a) [Establishment of restricted account.--] Corporation
15Bureau Restricted Account.--The Corporation Bureau Restricted
16Account, established under section 814 of the act of April 9,
171929 (P.L.177, No.175), known as The Administrative Code of
181929, is continued. This account shall receive 30% of the amount
19received by the department under this subchapter except for the
20fees collected under 13 Pa.C.S. § 9525(a)(1)(ii) (relating to
21fees). This account shall receive 5% of the amount received by
22the department under 13 Pa.C.S. § 9525(a)(1)(ii). The balance of
23the amount received by the department under this subchapter
24shall be deposited in the General Fund. Money in the account
25shall be used solely for the operation of the bureau and for its
26modernization as may be required for improved operations of the
27bureau unless a surplus arises after two consecutive years, at
28which time the Secretary of the Commonwealth shall transfer any
29amount in excess of the bureau's budget into the General Fund.
30(b) Expenditures.--The [Department of State] department
1shall submit a budget for the operation or modernization of the
2[Corporation Bureau] bureau to the Governor for approval. Such
3funds as are approved by the Governor are hereby appropriated
4from the Corporation Bureau Restricted Account to the
5[Department of State] department for the operation of the
6bureau.
7* * *
<-8Section 5.1. Title 15 is amended by adding a section to
9read:
10§ 156. References.
11In statutes, regulations and orders, a reference to the
12Corporation Bureau shall be deemed a reference to the Bureau of
13Corporations and Charitable Organization.
14Section 6. The introductory paragraph and the definitions of
15"act," "banking institution," "corporation for profit,"
16"corporation not-for-profit," "court," "credit union,"
17"department," "distribution," "domestic corporation for profit,"
18"domestic corporation not-for-profit," "foreign corporation for
19profit," "foreign corporation not-for-profit," "insurance
20corporation," "Internal Revenue Code of 1986," "obligation,"
21"officially publish," "representative," "savings association"
22and "voting" in section 1103 of Title 15 are amended and the
23section is amended by adding a subsection to read:
24§ 1103. Definitions.
25(a) General definitions.--Subject to additional definitions
26contained in subsequent provisions of this subpart that are
27applicable to specific provisions of this subpart, the following
28words and phrases when used in this subpart shall have the
29meanings given to them in this section unless the context
30clearly indicates otherwise:
1["Act" or "action." Includes failure to act.]
2* * *
3["Banking institution" or "domestic banking institution." A
4domestic corporation for profit that is an institution as
5defined in the act of November 30, 1965 (P.L.847, No.356), known
6as the Banking Code of 1965.]
7* * *
8["Corporation for profit." A corporation incorporated for a
9purpose or purposes involving pecuniary profit, incidental or
10otherwise, to its shareholders or members.
11"Corporation not-for-profit." A corporation not incorporated
12for a purpose or purposes involving pecuniary profit, incidental
13or otherwise.
14"Court." Subject to any inconsistent general rule prescribed
15by the Supreme Court of Pennsylvania:
16(1) the court of common pleas of the judicial district
17embracing the county where the registered office of the
18corporation is or is to be located; or
19(2) where a corporation results from a merger,
20consolidation, division or other transaction without
21establishing a registered office in this Commonwealth or
22withdraws as a foreign corporation, the court of common pleas
23in which venue would have been laid immediately prior to the
24transaction or withdrawal.
25"Credit union." A credit union as defined in 17 Pa.C.S. §
26102 (relating to application of title).
27"Department." The Department of State of the Commonwealth.]
28* * *
29"Distribution." A direct or indirect transfer of money or
30other property (except its own shares or options, rights or
1warrants to acquire its own shares) or incurrence of
2indebtedness by a corporation to or for the benefit of any or
3all of its shareholders in respect of any of its shares whether
4by dividend or by purchase, redemption or other acquisition of
5its shares or otherwise. Neither the making of, nor payment or
6performance upon, a guaranty or similar arrangement by a
7corporation for the benefit of any or all of its shareholders
8nor a direct or indirect transfer or allocation of assets or
9liabilities effected under Chapter 19 (relating to fundamental
10changes) with the approval of the shareholders shall constitute
11a distribution for the purposes of this subpart.
12["Domestic corporation for profit." A corporation for profit
13incorporated under the laws of this Commonwealth.
14"Domestic corporation not-for-profit." A corporation not-
15for-profit incorporated under the laws of this Commonwealth.]
16* * *
17["Foreign corporation for profit." A corporation for profit
18incorporated under any laws other than those of this
19Commonwealth.
20"Foreign corporation not-for-profit." A corporation not-for-
21profit incorporated under any laws other than those of this
22Commonwealth.]
23* * *
24["Insurance corporation" or "domestic insurance corporation."
25An insurance corporation as defined in section 3102 (relating to
26definitions).
27"Internal Revenue Code of 1986." The Internal Revenue Code
28of 1986 (Public Law 99-514, 26 U.S.C. § 1 et seq.).]
29* * *
30["Obligation." Includes a note or other form of
1indebtedness, whether secured or unsecured.]
2* * *
3["Officially publish." Publish in two newspapers of general
4circulation in the English language in the county in which the
5registered office of the corporation is located, or in the case
6of a proposed corporation is to be located, one of which shall
7be the legal newspaper, if any, designated by the rules of court
8for the publication of legal notices or, if there is no legal
9newspaper, in two newspapers of general circulation in the
10county. When there is but one newspaper of general circulation
11in any county, advertisement in that newspaper shall be
12sufficient. Where no other frequency is specified, the notice
13shall be published one time in the appropriate newspaper or
14newspapers. See section 109(a)(2) (relating to name of
15commercial registered office provider in lieu of registered
16address).]
17* * *
18["Representative." When used with respect to an association,
19joint venture, trust or other enterprise, means a person
20occupying the position or discharging the functions of a
21director, officer, employee or agent thereof, regardless of the
22name or title by which the person may be designated. The term
23does not imply that a director, as such, is an agent of a
24corporation.
25"Savings association" or "domestic savings association." A
26domestic corporation for profit that is an association as
27defined in the act of December 14, 1967 (P.L.746, No.345), known
28as the Savings Association Code of 1967.]
29* * *
30"Voting" or "casting a vote." Includes the giving of
1[written] consent in lieu of voting. The term does not include
2either recording the fact of abstention or failing to vote for a
3candidate or for approval or disapproval of a matter, whether or
4not the person entitled to vote characterizes the conduct as
5voting or casting a vote.
6(b) Index of other definitions.--The following is a
7nonexclusive list of words and phrases which when used in this
8subpart shall have the meanings given to them in section 102
9(relating to definitions):
10"Act" or "action."
11"Banking institution" or "domestic banking institution."
12"Corporation for profit."
13"Corporation not-for-profit."
14"Court."
15"Credit union."
16"Department."
17"Domestic corporation for profit."
18"Domestic corporation not-for-profit."
19"Execute."
20"Foreign corporation for profit."
21"Foreign corporation not-for-profit."
22"Insurance corporation" or "domestic insurance corporation."
23"Internal Revenue Code of 1986."
24"Obligation."
25"Officially publish."
26"Record form."
27"Representative."
28"Savings association" or "domestic savings association."
29"Sign."
30Section 7. Section 1104 of Title 15 is repealed:
1[§ 1104. Other general provisions.
2The following provisions of this title are applicable to
3corporations subject to this subpart:
4Section 101 (relating to short title and application of
5title).
6Section 102 (relating to definitions).
7Section 103 (relating to subordination of title to regulatory
8laws).
9Section 104 (relating to equitable remedies).
10Section 105 (relating to fees).
11Section 106 (relating to effect of filing papers required to
12be filed).
13Section 107 (relating to form of records).
14Section 108 (relating to change in location or status of
15registered office provided by agent).
16Section 109 (relating to name of commercial registered office
17provider in lieu of registered address).
18Section 110 (relating to supplementary general principles of
19law applicable).
20Section 132 (relating to functions of Department of State).
21Section 133 (relating to powers of Department of State).
22Section 134 (relating to docketing statement).
23Section 135 (relating to requirements to be met by filed
24documents).
25Section 136 (relating to processing of documents by
26Department of State).
27Section 137 (relating to court to pass upon rejection of
28documents by Department of State).
29Section 138 (relating to statement of correction).
30Section 139 (relating to tax clearance of certain fundamental
1transactions).
2Section 140 (relating to custody and management of orphan
3corporate and business records).
4Section 152 (relating to definitions).
5Section 153 (relating to fee schedule).
6Section 154 (relating to enforcement and collection).
7Section 155 (relating to disposition of funds).
8Section 162 (relating to contingent domestication of certain
9foreign associations).
10Section 501 (relating to reserved power of General Assembly).
11Section 503 (relating to actions to revoke corporate
12franchises).
13Section 504 (relating to validation of certain defective
14corporations).
15Section 505 (relating to validation of certain defective
16corporate acts).
17Section 506 (relating to scope and duration of certain
18franchises).
19Section 507 (relating to validation of certain share
20authorizations).]
21Section 8. Section 1306 of Title 15 is amended by adding a
22subsection to read:
23§ 1306. Articles of incorporation.
24* * *
25(e) Reference to external facts.--Except for the provisions
26required by subsection (a)(1), (2), (3), (4)(i), (5) and (7),
27any provision of the articles of incorporation may be made
28dependent upon facts ascertainable outside of the articles if
29the manner in which the facts will operate upon the provision is
30set forth in the articles. The facts may include actions or
1events within the control of or determinations made by the
2corporation or a representative of the corporation.
3Section 9. Sections 1504(c) and 1523 of Title 15 are amended
4to read:
5§ 1504. Adoption, amendment and contents of bylaws.
6* * *
7(c) Bylaw provisions in articles.--Where any provision of
8this subpart or any other provision of law refers to a rule as
9set forth in the bylaws of a corporation or in a bylaw adopted
10by the shareholders, the reference shall be construed to include
11and be satisfied by any rule on the same subject as set forth in
12the articles of the corporation.
13* * *
14§ 1523. Pricing and issuance of shares.
15Except as otherwise restricted in the bylaws, shares of a
16business corporation may be issued at a price determined by the
17board of directors[,]; or the board may [set a minimum price or
18establish a formula or method by which the price may be
19determined.] authorize one or more directors or one or more
20officers, acting alone or with the participation of one or more
21directors, to determine, within limits, pursuant to a formula or
22method or subject to relevant criteria specifically prescribed
23by the board:
24(1) the persons that shares will be issued to; and
25(2) the number of shares, price or consideration and
26other terms on which shares will be issued.
27Section 10. Section 1527(a)(3) of Title 15 is amended and
28the section is amended by adding a subsection to read:
29§ 1527. Issuance of fractional shares or scrip.
30(a) General rule.--A business corporation may but shall not
1be required to create and issue fractions of a share, either
2represented by a certificate or uncertificated, which, unless
3otherwise provided in the articles, shall represent proportional
4interests in all the voting rights, preferences, limitations and
5special rights, if any, of full shares. If the corporation
6creates but does not provide for the issuance of fractions of a
7share, it shall:
8* * *
9(3) issue scrip or other evidence of ownership, in
10registered form (either represented by a certificate or
11uncertificated) or in bearer form (represented by a
12certificate), entitling the holder to receive a full share
13upon the surrender of the scrip or other evidence of
14ownership aggregating a full share, or the transfer of
15uncertificated scrip aggregating a full share, but which
16shall not[, unless otherwise provided therein or with respect
17thereto,] entitle the holder to exercise any voting right, to
18receive dividends or to participate in any of the assets of
19the corporation in the event of liquidation.
20* * *
21(c) Limitation.--The articles may not provide that scrip or
22other evidence of ownership entitles the holder to exercise any
23voting right, to receive dividends or to participate in any of
24the assets of the corporation in the event of liquidation.
25Section 11. Section 1528 of Title 15 is amended by adding a
26subsection to read:
27§ 1528. Shares represented by certificates and uncertificated
28shares.
29* * *
30(g) Bearer shares prohibited.--A business corporation may
1not issue share certificates in bearer form. This subsection may
2not be varied by the articles.
3Section 12. Section 1529(b) of Title 15 is amended to read:
4§ 1529. Transfer of securities; restrictions.
5* * *
6(b) Transfer restrictions generally.--A restriction on the
7transfer or registration of transfer of securities of a business
8corporation may be imposed by the bylaws or by an agreement
9among any number of securityholders or among them and the
10corporation. A restriction so imposed shall not be binding with
11respect to securities issued prior to the adoption of the
12restriction unless the holders of the securities are parties to
13the agreement or voted in favor of the restriction. A
14restriction may be amended by the vote or consent, and otherwise
15in the manner, provided in the bylaws or agreement for amending
16the restriction or, in the absence of such a provision, as
17provided for amending the bylaws or agreement generally.
18* * *
19Section 13. Section 1552(b) of Title 15 is redesignated and
20the section is amended by adding subsections to read:
21§ 1552. Power of corporation to acquire its own shares.
22* * *
23(b) Security for acquisition.--In connection with an
24acquisition by a corporation of its shares, the corporation may
25grant a security interest in the acquired shares to secure an
26obligation to pay for the acquisition. A share shall not be
27canceled on the books of the corporation until the obligation of
28the corporation secured by the share is fully paid or
29discharged.
30(c) Application of distribution tests.--A corporation may
1acquire or agree to acquire its shares, even though the
2acquisition would violate section 1551 (relating to
3distributions to shareholders), if payment of all or part of the
4purchase price is deferred until the payment would not violate
5that section.
6[(b)] (d) Cross reference.--See section 1914(c)(2) (relating
7to adoption by board of directors).
8Section 14. Section 1575(a) introductory paragraph of Title
915 is amended to read:
10§ 1575. Notice to demand payment.
11(a) General rule.--If the proposed corporate action is
12approved by the required vote at a meeting of shareholders of a
13business corporation, the corporation shall mail a further
14notice to all dissenters who gave due notice of intention to
15demand payment of the fair value of their shares and who
16refrained from voting in favor of the proposed action. If the
17proposed corporate action is [to be] approved by the
18shareholders by less than unanimous consent without a meeting or
19is taken without [a vote of] the need for approval by the
20shareholders, the corporation shall send to all shareholders who
21are entitled to dissent and demand payment of the fair value of
22their shares a notice of the adoption of the plan or other
23corporate action. In either case, the notice shall:
24* * *
25Section 15. Section 1704(a) and (b) of Title 15 are amended
26and the section is amended by adding subsections to read:
27§ 1704. Place and notice of meetings of shareholders.
28(a) Place.--Meetings of shareholders may be held at such
29geographic location within or without this Commonwealth as may
30be provided in or fixed pursuant to the bylaws. Unless otherwise
1provided in or pursuant to the bylaws, all meetings of the
2shareholders shall be held at the executive office of the
3corporation wherever situated. If a meeting of the shareholders
4is held by means of the Internet or other electronic
5communications technology in a fashion pursuant to which the
6shareholders have the opportunity to read or hear the
7proceedings substantially concurrently with their occurrence,
8vote on matters submitted to the shareholders [and], pose
9questions to the directors, make appropriate motions and comment
10on the business of the meeting, the meeting need not be held at
11a particular geographic location.
12(b) Notice.--[Written notice] Notice in record form of every
13meeting of the shareholders shall be given by, or at the
14direction of, the secretary or other authorized person to each
15shareholder of record entitled to vote at the meeting at least:
16(1) ten days prior to the day named for a meeting that
17will consider a fundamental change under Chapter 19 (relating
18to fundamental changes); or
19(2) five days prior to the day named for the meeting in
20any other case.
21[If the secretary or other authorized person neglects or refuses
22to give notice of a meeting, the person or persons calling the
23meeting may do so.]
24* * *
25(d) Alternative authority.--If the secretary or other
26authorized person neglects or refuses to give notice of a
27meeting, a person calling the meeting may do so.
28(e) Cross reference.--See section 2528 (relating to notice
29of shareholder meetings).
30Section 16. Sections 1705(a), 1727(b), 1756(a)(4) and
11759(a), (c) and (e) of Title 15 are amended to read:
2§ 1705. Waiver of notice.
3(a) [Written waiver] General rule.--Whenever any [written]
4notice is required to be given under the provisions of this
5subpart or the articles or bylaws of any business corporation, a
6waiver thereof [in writing, signed] which is filed with the
7secretary of the corporation in record form signed by the person
8or persons entitled to the notice, whether before or after the
9time stated therein, shall be deemed equivalent to the giving of
10the notice. Neither the business to be transacted at, nor the
11purpose of, a meeting need be specified in the waiver of notice
12of the meeting.
13* * *
14§ 1727. Quorum of and action by directors.
15* * *
16(b) Action by consent.--Unless otherwise restricted in the
17bylaws, any action required or permitted to be [taken] approved
18at a meeting of the directors may be [taken] approved without a
19meeting if[, prior or subsequent to the action,] a consent or
20consents [thereto] to the action in record form are signed,
21before, on or after the effective date of the action, by all of
22the directors in office [is] on the date the first consent is
23signed. The consent or consents must be filed with the
24[secretary of the corporation] minutes of the proceedings of the
25board of directors.
26§ 1756. Quorum.
27(a) General rule.--A meeting of shareholders of a business
28corporation duly called shall not be organized for the
29transaction of business unless a quorum is present. Unless
30otherwise provided in a bylaw adopted by the shareholders:
1* * *
2(4) If a proxy casts a vote or takes other action on
3behalf of a shareholder on any issue other than a procedural
4motion considered at a meeting of shareholders, the
5shareholder shall be deemed to be present during the entire
6meeting for purposes of determining whether a quorum is
7present for consideration of any other issue.
8* * *
9§ 1759. Voting and other action by proxy.
10(a) General rule.--
11(1) Every shareholder entitled to vote at a meeting of
12shareholders or to express consent or dissent to corporate
13action [in writing] without a meeting may authorize another
14person to act for him by proxy.
15(2) The [presence of, or] vote or other action on behalf
16of a shareholder at a meeting of shareholders, or the
17expression of consent or dissent to corporate action [in
18writing], by a proxy of a shareholder shall constitute the
19[presence of, or] vote or action by, or [written] consent or
20dissent of the shareholder for the purposes of this subpart.
21(3) Where two or more proxies of a shareholder are
22present, the corporation shall, unless otherwise expressly
23provided in the proxy, accept as the vote or other action of
24all shares represented thereby the vote cast or other action
25taken by a majority of them and, if a majority of the proxies
26cannot agree whether the shares represented shall be voted or
27upon the manner of voting the shares or taking the other
28action, the voting of the shares or right to take other
29action shall be divided equally among those persons.
30* * *
1(c) Revocation.--A proxy, unless coupled with an interest,
2shall be revocable at will, notwithstanding any other agreement
3or any provision in the proxy to the contrary, but the
4revocation of a proxy shall not be effective until notice
5thereof has been given to the secretary of the corporation or
6its designated agent in writing or by electronic transmission.
7An unrevoked proxy shall not be valid after three years from the
8date of its [execution] signature, authentication or
9transmission unless a longer time is expressly provided therein.
10A proxy shall not be revoked by the death or incapacity of the
11maker unless, before the vote is counted or the authority is
12exercised, [written] notice in record form of the death or
13incapacity is given to the secretary of the corporation or its
14designated agent.
15* * *
16(e) Cross [reference] references.--See [section] sections
171702 (relating to manner of giving notice) and 3135 (relating to
18proxies of members of mutual insurance companies).
19Section 17. Section 1764(a) of Title 15 is amended and the
20section is amended by adding a subsection to read:
21§ 1764. Voting lists.
22(a) General rule.--The officer or agent having charge of the
23transfer books for shares of a business corporation shall make a
24complete list of the shareholders entitled to vote at any
25meeting of shareholders, arranged in alphabetical order, with
26the address of and the number of shares held by each. This
27section does not require the corporation to include electronic
28mail addresses or other electronic contact information on the
29list. The list shall be produced and kept open at the time and
30place of [the] each meeting of shareholders of a nonregistered
1corporation held at a geographic location and shall be subject
2to the inspection of any shareholder during the whole time of
3the meeting for the purposes thereof [except that, if a business
4corporation has 5,000 or more shareholders, in lieu of the
5making of the list the corporation may make the information
6therein available at the meeting by any other means]. See
7section 2529 (relating to voting lists).
8* * *
9(c) Electronic meetings.--If a meeting of shareholders of a
10nonregistered corporation is not held at a geographic location,
11the corporation shall make the list of shareholders required by
12subsection (a) available in a reasonably accessible manner.
13Section 18. Section 1766(a), (b) and (d) of Title 15 are
14amended to read:
15§ 1766. Consent of shareholders in lieu of meeting.
16(a) Unanimous consent.--Unless otherwise restricted in the
17bylaws, any action required or permitted to be taken at a
18meeting of the shareholders or of a class of shareholders of a
19business corporation may be taken without a meeting if[, prior
20or subsequent to the action,] a consent or consents [thereto] to
21the action in record form are signed, before, on or after the
22effective date of the action, by all of the shareholders who
23would be entitled to vote at a meeting for such purpose [shall
24be filed]. The consent or consents must be filed with the
25[secretary of the corporation] minutes of the proceedings of the
26shareholders.
27(b) Partial consent.--If the bylaws so provide, any action
28required or permitted to be taken at a meeting of the
29shareholders or of a class of shareholders may be taken without
30a meeting upon the signed consent of shareholders who would have
1been entitled to cast the minimum number of votes that would be
2necessary to authorize the action at a meeting at which all
3shareholders entitled to vote thereon were present and voting.
4The consents shall be filed in record form with the [secretary
5of the corporation] minutes of the proceedings of the
6shareholders.
7* * *
8(d) Cross [reference] references.--See [section] sections
91702 (relating to manner of giving notice) and 2524 (relating to
10consent of shareholders in lieu of meeting).
11Section 19. Section 1906(d)(3) of Title 15 is amended and
12the section is amended by adding a subsection to read:
13§ 1906. Special treatment of holders of shares of same class or
14series.
15* * *
16(c.1) Determination of groups.--For purposes of applying
17subsections (a)(1) and (b), the determination of which
18shareholders are part of each group receiving special treatment
19shall be made as of the record date for shareholder action on
20the plan.
21(d) Exceptions.--This section shall not apply to:
22* * *
23(3) A plan that contains an express provision that this
24section shall not apply or that fails to contain an express
25provision that this section shall apply. [The shareholders of
26a corporation that proposes a plan to which this section is
27not applicable by reason of this paragraph shall have the
28remedies contemplated by section 1105 (relating to
29restriction on equitable relief).]
30* * *
1Section 20. Title 15 is amended by adding sections to read:
2§ 1907. Purpose of fundamental transactions.
3A transaction under this chapter does not require an
4independent business purpose in order for the transaction to be
5lawful.
6§ 1908. Submission of matters to shareholders.
7A business corporation may agree, in record form, to submit
8an amendment or plan to its shareholders whether or not the
9board of directors determines, at any time after approving the
10matter, that the matter is no longer advisable and recommends
11that the shareholders reject or vote against it, regardless of
12whether the board of directors changes its recommendation. If a
13corporation so agrees to submit a matter to its shareholders,
14the matter is deemed to have been validly adopted by the
15corporation when it has been approved by the shareholders.
16Section 21. Sections 1911(a)(4), 1913, 1922(a)(3), 1923,
171931(a), (b)(2), (d) and (g), 1957(b)(1)(iv), 1973, 1978(b) and
182522 of Title 15 are amended to read:
19§ 1911. Amendment of articles authorized.
20(a) General rule.--A business corporation, in the manner
21provided in this subchapter, may from time to time amend its
22articles for one or more of the following purposes:
23* * *
24(4) To cancel or otherwise affect the right of holders
25of the shares of any class or series to receive dividends
26that have accrued but have not been declared or to otherwise
27effect a reclassification of or otherwise affect the
28substantial rights of the holders of any shares, including,
29without limitation, by providing special treatment of shares
30held by any shareholder or group of shareholders [as
1authorized by, and subject to the provisions of,] consistent
2with section 1906 (relating to special treatment of holders
3of shares of same class or series).
4* * *
5§ 1913. Notice of meeting of shareholders.
6(a) General rule.--[Written notice] Notice in record form of
7the meeting of shareholders of a business corporation that will
8act on the proposed amendment [shall] must be given to each
9shareholder entitled to vote thereon. [There shall be included
10in, or enclosed with, the notice a copy of] The notice must
11include the proposed amendment or a summary of the changes to be
12effected thereby and, if Subchapter D of Chapter 15 (relating to
13dissenters rights) is applicable, [a copy] the text of that
14subchapter.
15(b) Cross [reference] references.--See Subchapter A of
16Chapter 17 (relating to notice and meetings generally) and
17section 2528 (relating to notice of shareholder meetings).
18§ 1922. Plan of merger or consolidation.
19(a) Preparation of plan.--A plan of merger or consolidation,
20as the case may be, shall be prepared, setting forth:
21* * *
22(3) The manner and basis of converting the shares of
23each corporation into shares or other securities or
24obligations of the surviving or new corporation, or of
25canceling some or all of the shares of a corporation, as the
26case may be, and, if any of the shares of any of the
27corporations that are parties to the merger or consolidation
28are not to be canceled or converted solely into shares or
29other securities or obligations of the surviving or new
30corporation, the shares or other securities or obligations of
1any other person or cash, property or rights that the holders
2of such shares are to receive in exchange for, or upon
3conversion of, such shares, and the surrender of any
4certificates evidencing them, which securities or
5obligations, if any, of any other person or cash, property or
6rights may be in addition to or in lieu of the shares or
7other securities or obligations of the surviving or new
8corporation.
9* * *
10§ 1923. Notice of meeting of shareholders.
11(a) General rule.--[Written notice] Notice in record form of
12the meeting of shareholders that will act on the proposed plan
13[shall] must be given to each shareholder of record, whether or
14not entitled to vote thereon, of each domestic business
15corporation that is a party to the merger or consolidation.
16[There shall be included in, or enclosed with, the notice a copy
17of] The notice must include or be accompanied by the proposed
18plan or a summary thereof [and, if]. If Subchapter D of Chapter
1915 (relating to dissenters rights) is applicable to the holders
20of shares of any class or series, [a copy] the text of that
21subchapter and of section 1930 (relating to dissenters rights)
22[shall] must be furnished to the holders of shares of that class
23or series. If the surviving or new corporation will be a
24nonregistered corporation, the notice [shall] must state that a
25copy of its bylaws as they will be in effect immediately
26following the merger or consolidation will be furnished to any
27shareholder on request and without cost.
28(b) Cross references.--See Subchapter A of Chapter 17
29(relating to notice and meetings generally) and [section]
30sections 2512 (relating to dissenters rights procedure) and 2528
1(relating to notice of shareholder meetings).
2§ 1931. Share exchanges.
3(a) General rule.--All the outstanding shares of one or more
4classes or series of a domestic business corporation, designated
5in this section as the exchanging corporation, may, in the
6manner provided in this section, be acquired by any person,
7designated in this section as the acquiring person, through an
8exchange of all the shares pursuant to a plan of exchange. The
9plan of exchange may also provide for the [conversion of any
10other] shares of any other class or series of the exchanging
11corporation to be canceled or converted into shares, other
12securities or obligations of any person or cash, property or
13rights. The procedure authorized by this section shall not be
14deemed to limit the power of any person to acquire all or part
15of the shares or other securities of any class or series of a
16corporation through a voluntary exchange or otherwise by
17agreement with the holders of the shares or other securities.
18(b) Plan of exchange.--A plan of exchange shall be prepared,
19setting forth:
20* * *
21(2) The manner and basis of canceling the shares of the
22exchanging corporation or exchanging or converting the shares
23of the exchanging corporation into shares or other securities
24or obligations of the acquiring person, and, if any of the
25shares of the exchanging corporation are not to be exchanged
26or converted solely into shares or other securities or
27obligations of the acquiring person, the shares or other
28securities or obligations of any other person or cash,
29property or rights that the holders of the shares of the
30exchanging corporation are to receive in exchange for, or
1upon conversion of, the shares and the surrender of any
2certificates evidencing them, which securities or
3obligations, if any, of any other person or cash, property
4and rights may be in addition to or in lieu of the shares or
5other securities or obligations of the acquiring person.
6* * *
7(d) Dissenters rights in share exchanges.--Any holder of
8shares that are to be canceled, exchanged or converted pursuant
9to a plan of exchange who objects to the plan and complies with
10the provisions of Subchapter D of Chapter 15 shall be entitled
11to the rights and remedies of dissenting shareholders therein
12provided, if any. See section 1906(c) (relating to dissenters
13rights upon special treatment).
14* * *
15(g) Effect of plan.--Upon the plan of exchange becoming
16effective, the shares of the exchanging corporation that are,
17under the terms of the plan, to be canceled, converted or
18exchanged shall cease to exist or shall be converted or
19exchanged. The former holders of the shares shall thereafter be
20entitled only to the shares, other securities or obligations or
21cash, property or rights into which they have been converted or
22for which they have been exchanged in accordance with the plan,
23and the acquiring person shall be the holder of the shares of
24the exchanging corporation stated in the plan to be acquired by
25such person. The articles of incorporation of the exchanging
26corporation shall be deemed to be amended to the extent, if any,
27that changes in its articles are stated in the plan of exchange.
28* * *
29§ 1957. Effect of division.
30* * *
1(b) Property rights; allocations of assets and
2liabilities.--
3(1) * * *
4(iv) [To] Except as provided in section 1952(g)
5(relating to proposal and adoption of plan of division),
6to the extent allocations of liabilities are contemplated
7by the plan of division, the liabilities of the dividing
8corporation shall be deemed without further action to be
9allocated to and become the liabilities of the resulting
10corporations on such a manner and basis and with such
11effect as is specified in the plan; and one or more, but
12less than all, of the resulting corporations shall be
13free of the liabilities of the dividing corporation to
14the extent, if any, specified in the plan, if in either
15case:
16(A) no fraud on minority shareholders or
17shareholders without voting rights or violation of
18law shall be effected thereby; and
19(B) the plan does not constitute a fraudulent
20transfer under 12 Pa.C.S. Ch. 51 (relating to
21fraudulent transfers).
22* * *
23§ 1973. Notice of meeting of shareholders.
24(a) General rule.--[Written notice] Notice in record form of
25the meeting of shareholders that will consider the resolution
26recommending dissolution of the business corporation [shall]
27must be given to each shareholder of record entitled to vote
28thereon [and the purpose shall be included]. The purpose of the
29meeting must be stated in the notice [of the meeting].
30(b) Cross [reference] references.--See Subchapter A of
1Chapter 17 (relating to notice and meetings generally) and
2section 2528 (relating to notice of shareholder meetings).
3§ 1978. Winding up of corporation after dissolution.
4* * *
5(b) Standard of care of directors and officers.--The
6dissolution of the corporation shall not subject its directors
7or officers to standards of conduct different from those
8prescribed by or pursuant to Chapter 17 (relating to officers,
9directors and shareholders). Directors of a dissolved
10corporation who have complied with section 1975 (relating to
11predissolution provision for liabilities) or Subchapter H
12(relating to postdissolution provision for liabilities) and
13governing persons of a successor entity who have complied with
14Subchapter H shall not be personally liable to the creditors or
15claimants of the dissolved corporation.
16§ 2522. Adjournment of meetings of shareholders.
17[Any] Except as otherwise provided in the bylaws, any regular
18or special meeting of the shareholders of a registered
19corporation, including one at which directors are to be elected,
20may be adjourned for such period as the shareholders present and
21entitled to vote shall direct.
22Section 22. Title 15 is amended by adding sections to read:
23§ 2528. Notice of shareholder meetings.
24If a registered corporation solicits proxies generally with
25respect to a meeting of its shareholders, the corporation is not
26required to give notice of the meeting to any shareholder to
27whom the corporation is not required to send a proxy statement
28pursuant to the rules of the Securities and Exchange Commission.
29§ 2529. Voting lists.
30A registered corporation is not required to produce or make
1available to its shareholders a list of shareholders in
2connection with any meeting of its shareholders for which a
3judge or judges of election are appointed, but such a list must
4be furnished to the judge or judges of election.
5Section 23. Section 2545(b) of Title 15 is amended and the
6section is amended by adding a subsection to read:
7§ 2545. Notice to shareholders.
8* * *
9(b) Obligations of the corporation.--If the controlling
10person or group so requests, the corporation shall, at the
11option of the corporation and at the expense of the person or
12group, either furnish a list of all such shareholders and their
13postal addresses to the person or group or [mail] provide the
14notice to all such shareholders.
15* * *
16(e) Cross reference.--See section 1702 (relating to manner
17of giving notice).
18Section 24. Sections 3133(a) introductory paragraph and 3135
19of Title 15 are amended to read:
20§ 3133. Notice of meetings of members of mutual insurance
21companies.
22(a) General rule.--Unless otherwise restricted in the
23bylaws, persons authorized or required to give notice of an
24annual meeting of members of a mutual insurance company for the
25election of directors or of a meeting of members of a mutual
26insurance company called for the purpose of considering
27amendment of the articles or bylaws, or both, of the corporation
28may, in lieu of any [written] notice of meeting of members
29required to be given by this subpart, give notice of such
30meeting by causing notice of such meeting to be officially
1published. Such notice shall be published each week for at
2least:
3* * *
4§ 3135. Proxies of members of mutual insurance companies.
5In no event shall a proxy given by a member of a mutual
6insurance company, unless coupled with an interest, be voted on
7or utilized to express consent or dissent to corporate action
8[in writing] after 11 months from the date of execution of the
9proxy.
10Section 24.1. Section 3322(a) and (b) of Title 15 are
11amended and the section is amended by adding a subsection to
12read:
13§ 3322. Benefit director.
14(a) General rule.--
15(1) The board of directors of a benefit corporation
16which is a registered corporation shall include a director
17who:
18(i) shall be designated as the benefit director; and
19(ii) shall have, in addition to all of the powers,
20duties, rights and immunities of the other directors of
21the benefit corporation, the powers, duties, rights and
22immunities provided in this subchapter.
23(2) The board of directors of a benefit corporation
24which is not a registered corporation may include a director
25who:
26(i) shall be designated as the benefit director; and
27(ii) shall have, in addition to all of the powers,
28duties, rights and immunities of the other directors of
29the benefit corporation, the powers, duties, rights and
30immunities provided in this subchapter.
1(b) Election, removal and qualifications.--The benefit
2director shall be elected and may be removed in the manner
3provided under Subchapter C of Chapter 17 (relating to directors
4and officers) [and]. Except as set forth in subsection (e)(2)(i)
5or (g), the benefit director shall be an individual who is
6independent. The benefit director may serve as the benefit
7officer at the same time as serving as the benefit director. The
8articles or bylaws of a benefit corporation may prescribe
9additional qualifications of the benefit director not
10inconsistent with this subsection.
11* * *
12(g) Professional corporations.--The benefit director of a
13professional corporation does not need to be independent.
14Section 24.2. Sections 3325(b)(2)(i) and (iii) and 3331(a)
15(5) of Title 15, added October 24, 2012 (P.L.1228, No.152), are
16amended to read:
17§ 3325. Right of action.
18* * *
19(b) Parties with standing.--A benefit enforcement proceeding
20may be commenced or maintained only:
21* * *
22(2) derivatively by:
23(i) a shareholder that owned at least 2% of the
24total number of shares of a class or series outstanding
25at the time of the act complained of;
26* * *
27(iii) a person or group of persons that owns
28beneficially or of record 5% or more of the equity
29interests in an association of which the benefit
30corporation is a subsidiary at the time of the act
1complained of; or
2* * *
3§ 3331. Annual benefit report.
4(a) Contents.--A benefit corporation must deliver to each
5shareholder an annual benefit report including:
6* * *
7[(5) The name of each person that owns 5% or more of the
8outstanding shares of the benefit corporation either
9beneficially, to the extent known to the benefit corporation
10without independent investigation, or of record.]
11* * *
12Section 24.3. Section 4127(a) introductory paragraph and
13(5), (b) and (d) of Title 15 are amended to read:
14§ 4127. Merger, consolidation or division of qualified foreign
15corporations.
16(a) General rule.--Whenever a qualified foreign business
17corporation is a nonsurviving party to a statutory merger,
18consolidation or division permitted by the laws of the
19jurisdiction under which it is incorporated, the corporation or
20other association surviving the merger, or the new corporation
21or other association resulting from the consolidation or
22division, as the case may be, shall file in the [Department of
23State] department a statement of merger, consolidation or
24division, which shall be executed by the surviving or new
25corporation or other association and shall set forth:
26* * *
27(5) In the case of a merger, consolidation or division
28in which any of the new or resulting associations is a
29corporation, or if the surviving corporation in a merger was
30a nonqualified foreign business corporation prior to the
1merger, the statements on the part of the surviving or each
2new or resulting corporation required by section 4124(a)
3(relating to application for a certificate of authority).
4(b) Effect of filing.--The filing of the statement shall
5operate, as of the effective date of the merger, consolidation
6or division, to cancel the certificate of authority of each
7nonsurviving constituent corporation that was a qualified
8foreign business corporation and to qualify the surviving [or
9new corporation], new or resulting corporations, under this
10subchapter. If the surviving [or new corporation does], new or
11resulting corporations do not desire to continue as [a]
12qualified foreign business [corporation, it] corporations, they
13may thereafter withdraw in the manner provided by section 4129
14(relating to application for termination of authority).
15* * *
16(d) Cross [reference] references.--See [section] sections
17134 (relating to docketing statement) and 135 (relating to
18requirements to be met by filed documents).
19Section 25. The introductory paragraph and the definitions
20of "act," "board of directors," "bylaws," "charitable purposes,"
21"corporation for profit," "corporation not-for-profit," "court,"
22"department," "directors," "domestic corporation for profit,"
23"domestic corporation not-for-profit," "foreign corporation for
24profit," "foreign corporation not-for-profit," "fraternal
25benefit society," "member," "nonprofit corporation,"
26"nonqualified foreign corporation," "other body,"
27"representative," "trust instrument," "unless otherwise
28provided" and "unless otherwise restricted," in section 5103 of
29Title 15 are amended and the section is amended by adding
30definitions and a subsection to read:
1§ 5103. Definitions.
2(a) General definitions.--Subject to additional definitions
3contained in subsequent provisions of this subpart that are
4applicable to specific provisions of this subpart, the following
5words and phrases when used in this subpart shall have the
6meanings given to them in this section unless the context
7clearly indicates otherwise:
8["Act" or "action." Includes failure to act.]
9"Amendment." An amendment of the articles.
10* * *
11"Board of directors" or "board." The group of persons
12[vested with the management of] under the direction of whom the
13business and affairs of the corporation are managed irrespective
14of the name by which [such] the group is designated. The term
15does not include an other body. [The term, when used in any
16provision of this subpart relating to the organization or
17procedures of or the manner of taking action by the board of
18directors, shall be construed to include and refer to any
19executive or other committee of the board. Any provision of this
20subpart relating or referring to action to be taken by the board
21of directors or the procedure required therefor shall be
22satisfied by the taking of corresponding action by a committee
23of the board of directors to the extent authority to take such
24action has been delegated to such committee pursuant to section
255731 (relating to executive and other committees of the board).]
26See section 5731(c) (relating to executive and other committees
27of the board).
28* * *
29"Business corporation." A domestic corporation for profit
30defined in section 1103 (relating to definitions).
1"Bylaws." The code or codes of rules adopted for the
2regulation or management of the business and affairs of the
3corporation irrespective of the name or names by which [such]
4the rules are designated. The term includes provisions of the
5articles as provided by section 5504(c) (relating to adoption,
6amendment and contents of bylaws).
7"Charitable purposes." The relief of poverty, the
8advancement and provision of education, including postsecondary
9education, the advancement of religion, [the promotion of
10health,] the prevention and treatment of disease or injury,
11including mental retardation and mental disorders, governmental
12or municipal purposes, and any other [purposes] purpose the
13accomplishment of which is recognized as important and
14beneficial to the [community] public.
15* * *
16["Corporation for profit." A corporation incorporated for a
17purpose or purposes involving pecuniary profit, incidental or
18otherwise, to its shareholders or members.
19"Corporation not-for-profit." A corporation not incorporated
20for a purpose or purposes involving pecuniary profit, incidental
21or otherwise.
22"Court." Subject to any inconsistent general rule prescribed
23by the Supreme Court of Pennsylvania:
24(1) the court of common pleas of the judicial district
25embracing the county where the registered office of the
26corporation is or is to be located; or
27(2) where a corporation results from a merger,
28consolidation, division or other transaction without
29establishing a registered office in this Commonwealth or
30withdraws as a foreign corporation, the court of common pleas
1in which venue would have been laid immediately prior to the
2transaction or withdrawal.
3"Department." The Department of State of the Commonwealth.]
4"Directors." [Persons] Individuals designated, elected or
5appointed, by that or any other name or title, to act as members
6of the board of directors, and their successors. The term does
7not include a member of an other body, [as such] unless the
8person is also a director. The term, when used in relation to
9any power or duty requiring collective action, shall be
10construed to mean "board of directors."
11* * *
12["Domestic corporation for profit." A corporation for profit
13incorporated under the laws of this Commonwealth.
14"Domestic corporation not-for-profit." A corporation not-
15for-profit incorporated under the laws of this Commonwealth.]
16"Employee." The term does not include a member, director or
17member of an other body, unless the person is also an employee.
18See section 5730 (relating to compensation of directors) as to
19acceptance by a director of duties that make the director also
20an employee.
21* * *
22["Foreign corporation for profit." A corporation for profit
23incorporated under any laws other than those of this
24Commonwealth.
25"Foreign corporation not-for-profit." A corporation not-for-
26profit incorporated under any laws other than those of this
27Commonwealth.]
28"Foreign domiciliary corporation." A foreign nonprofit
29corporation described in section 6102 (relating to foreign
30domiciliary corporations).
1* * *
2"Fraternal benefit society." A domestic corporation not-for-
3profit that is a society as defined in [the act of July 29, 1977
4(P.L.105, No.38) known as the Fraternal Benefit Society Code]
5section 2402 of the act of May 17, 1921 (P.L.682, No.284), known
6as The Insurance Company Law of 1921.
7* * *
8"Member." [One having membership rights in a corporation in
9accordance with the provisions of its bylaws. The term, when
10used in relation to the taking of corporate action includes:
11(1) the proxy of a member, if action by proxy is
12permitted under the bylaws of the corporation; and
13(2) a delegate to any convention or assembly of
14delegates of members established pursuant to any provision of
15this subpart.
16If and to the extent the bylaws confer rights of members upon
17holders of securities evidencing indebtedness or governmental or
18other entities pursuant to any provision of this subpart the
19term shall be construed to include such security holders and
20governmental or other entities. The term shall be construed to
21include "shareholder" if the corporation issues shares of
22stock.] Any of the following:
23(1) A person that has voting rights in a membership
24corporation.
25(2) When used in relation to the taking of corporate
26action by a membership corporation, a delegate to a
27convention or assembly of delegates of members established
28pursuant to any provision of this subpart who has the right
29to vote at the convention or assembly in accordance with the
30rules of the convention or assembly.
1(3) A person that has been given voting rights or other
2membership rights in a membership corporation by a bylaw
3adopted by the members pursuant to section 5770 (relating to
4voting powers and other rights of certain securityholders and
5other entities) or other provision of law, but only to the
6extent of those rights.
7(4) A shareholder of a corporation, if the corporation
8issues shares of stock.
9"Membership corporation." A nonprofit corporation having
10articles of incorporation that do not provide that the
11corporation is to have no members.
12"Nonprofit corporation" or "domestic nonprofit corporation."
13A domestic corporation not-for-profit [which] that is not
14excluded from the scope of this subpart by section 5102
15(relating to application of subpart).
16"Nonqualified foreign corporation" or "nonqualified foreign
17nonprofit corporation." A foreign corporation not-for-profit
18[which] that is not a qualified foreign corporation, as defined
19in this section.
20* * *
21"Other body." A term employed in this subpart to denote a
22person or group, other than the board of directors or a
23committee thereof, who pursuant to authority expressly conferred
24by this subpart may be vested by the bylaws of the corporation
25with powers [which] that, if not vested by the bylaws in [such]
26the person or group, would by this subpart be required to be
27exercised by [either]:
28(1) the [membership of a corporation taken as a whole]
29members;
30(2) a convention or assembly of delegates of members
1established pursuant to any provision of this subpart; or
2(3) the board of directors.
3Except as otherwise provided in this subpart, a corporation may
4establish distinct persons or groups to exercise different
5powers [which] that this subpart authorizes a corporation to
6vest in an other body.
7"Plan." A plan of reclassification, merger, consolidation,
8asset transfer, division or conversion.
9* * *
10["Representative." When used with respect to a corporation,
11partnership, joint venture, trust or other enterprise, means a
12director, officer, employee or agent thereof.]
13"Trust instrument." Any lawful deed of gift, grant, will or
14other document by which the donor, grantor or testator [shall
15give, grant or devise] gives, grants or devises any real or
16personal property or the income [therefrom] from any real or
17personal property in trust for any charitable purpose.
18"Unless otherwise provided" or "except as otherwise
19provided." When used to introduce or modify a rule, the term
20implies that the alternative provisions contemplated may either
21relax or restrict the stated rule.
22"Unless otherwise restricted" or "except as otherwise
23restricted." When used to introduce or modify a rule, the term
24implies that the alternative provisions contemplated may further
25restrict, but may not relax, the stated rule.
26"Voting" or "casting a vote." Includes the giving of consent
27in lieu of voting. Whether or not the person entitled to vote
28characterizes the conduct as voting or casting a vote, the term
29does not include:
30(1) recording the fact of abstention; or
1(2) failing to vote for a candidate or for approval or
2disapproval of a matter.
3"Voting rights." The right of a person in a membership
4corporation, other than in the capacity of a director or member
5of an other body, to vote on the election or removal of
6directors or members of an other body or on approval of an
7amendment of the articles of incorporation, a plan or the
8dissolution of the corporation.
9(b) Index of other definitions.--The following is a
10nonexclusive list of words and phrases which when used in this
11subpart shall have the meanings given to them in section 102
12(relating to definitions):
13"Act" or "action."
14"Corporation for profit."
15"Corporation not-for-profit."
16"Court."
17"Department."
18"Domestic corporation for profit."
19"Domestic corporation not-for-profit."
20"Execute."
21"Foreign corporation for profit."
22"Foreign corporation not-for-profit."
23"Internal Revenue Code of 1986."
24"Obligation."
25"Officially publish."
26"Record form."
27"Representative."
28"Sign."
29Section 26. Sections 5104, 5105, 5106, 5107, 5108, 5109,
305302, 5306(a)(6) introductory paragraph and (11)(ii), 5307,
15308, 5309, 5310, 5331 and 5501 of Title 15 are amended to read:
2[§ 5104. Other general provisions.
3The following provisions of this title are applicable to
4corporations subject to this subpart:
5Section 101 (relating to short title and application of
6title).
7Section 102 (relating to definitions).
8Section 103 (relating to subordination of title to regulatory
9laws).
10Section 104 (relating to equitable remedies).
11Section 105 (relating to fees).
12Section 106 (relating to effect of filing papers required to
13be filed).
14Section 107 (relating to form of records).
15Section 108 (relating to change in location or status of
16registered office provided by agent).
17Section 109 (relating to name of commercial registered office
18provider in lieu of registered address).
19Section 110 (relating to supplementary general principles of
20law applicable).
21Section 132 (relating to functions of Department of State).
22Section 133 (relating to powers of Department of State).
23Section 134 (relating to docketing statement).
24Section 135 (relating to requirements to be met by filed
25documents).
26Section 136 (relating to processing of documents by
27Department of State).
28Section 137 (relating to court to pass upon rejection of
29documents by Department of State).
30Section 138 (relating to statement of correction).
1Section 139 (relating to tax clearance of certain fundamental
2transactions).
3Section 140 (relating to custody and management of orphan
4corporate and business records).
5Section 152 (relating to definitions).
6Section 153 (relating to fee schedule).
7Section 154 (relating to enforcement and collection).
8Section 155 (relating to disposition of funds).
9Section 162 (relating to contingent domestication of certain
10foreign associations).
11Section 501 (relating to reserved power of General Assembly).
12Section 503 (relating to actions to revoke corporate
13franchises).
14Section 504 (relating to validation of certain defective
15corporations).
16Section 505 (relating to validation of certain defective
17corporate acts).
18Section 2552 (relating to definitions) (definitions of
19"affiliate" and "associate").]
20§ 5105. [Saving clause and restriction] Restriction on
21equitable relief.
22[(a) General rule.--Except as otherwise provided in
23subsection (b) of this section, this subpart and its amendments
24shall not impair or affect any act done, offense committed, or
25substantial right accruing, accrued, or acquired, or liability,
26duty, obligation, penalty, judgment or punishment incurred prior
27to the time this subpart or any amendment thereto takes effect,
28but the same may be enjoyed, asserted, enforced, prosecuted, or
29inflicted as fully and to the same extent as if this subpart or
30any amendment thereto had not been enacted.
1(b) Exception.--] A member of a nonprofit corporation shall
2not have any right to claim the right to valuation [of] and
3payment [for] of the fair value of his membership interest or
4shares because of any proposed plan or amendment [of articles]
5authorized under any provision of this subpart, or to obtain, in
6the absence of fraud or fundamental unfairness, an injunction
7against [any such] the plan or amendment.
8§ 5106. [Limited uniform] Uniform application of subpart.
9(a) General rule.--Except as provided in subsection (b),
10this subpart and its amendments are intended to provide uniform
11rules for the [government] governance and regulation of the
12affairs of nonprofit corporations and of their officers,
13directors and members and of members of other bodies, regardless
14of the date or manner of incorporation or qualification, or of
15the issuance of any evidences of membership in or shares
16[thereof] of a nonprofit corporation.
17(b) Exceptions.--
18(1) Unless expressly provided otherwise in any amendment
19to this subpart [any such], the amendment shall take effect
20only prospectively.
21(2) Any existing corporation lawfully using a name[,]
22or, as a part of its name, a word[, which] that could not be
23used as or included in the name of a corporation [hereafter]
24subsequently incorporated or qualified under this subpart[,]
25may continue to use [such] the name[,] or word as part of its
26name[, provided] if the use or inclusion of [such] the word
27or name was lawful when first adopted by the corporation in
28this Commonwealth.
29(3) [Nothing in subsection] Subsection (a) shall not
30adversely affect the rights specifically provided for or
1saved [by the general terms of section 5105 (relating to
2saving clause and restriction on equitable relief)] in this
3subpart, including, without limiting the generality of the
4foregoing, the provisions of section 5952(d) (relating to
5proposal and adoption of plan of division).
6(4) Nothing in this subpart shall be deemed to repeal or
7supersede any provision in section 7 of the act of April 26,
81855 (P.L.328, No.347), entitled "An act relating to
9Corporations and to Estates held for Corporate, Religious and
10Charitable uses."
11§ 5107. Subordination of subpart to canon law.
12If and to the extent canon law or similar principles
13applicable to a corporation incorporated for religious purposes
14[shall set] sets forth provisions relating to the government and
15regulation of the affairs of the corporation [which] that are
16inconsistent with the provisions of this subpart on the same
17subject, the [provisions of] canon law or similar principles
18shall control except to the extent[, and only to the extent,
19required] prohibited by the Constitution of the United States or
20the Constitution of Pennsylvania[, or both].
21§ 5108. Limitation on incorporation.
22[No corporation which might] A corporation that can be
23incorporated under this subpart shall [hereafter] not be
24incorporated except under the provisions of this subpart.
25§ 5109. Execution of documents.
26(a) General rule.--Any document filed in the [Department of
27State] department under this title by a domestic or foreign
28nonprofit corporation [or a foreign corporation not-for-profit]
29subject to this subpart may be executed on behalf of the
30corporation by any one duly authorized officer [thereof] of the
1corporation. The corporate seal may be affixed and attested, but
2the affixation or attestation of the corporate seal shall not be
3necessary for the due execution of any filing by a corporation
4under this title.
5(b) Cross reference.--See section 135 (relating to
6requirements to be met by filed documents).
7[(c) Transitional provision.--This section supersedes any
8contrary provision of this subpart enacted prior to the
9enactment of the act of December 21, 1988 (P.L.1444, No.177),
10known as the General Association Act of 1988.]
11§ 5302. Number and qualifications of incorporators.
12One or more corporations for profit or not-for-profit or
13natural persons of full age may incorporate a nonprofit
14corporation under the provisions of this [article] subpart.
15§ 5306. Articles of incorporation.
16(a) General rule.--Articles of incorporation shall be signed
17by each of the incorporators and shall set forth in the English
18language:
19* * *
20(6) [A] If the corporation is a membership corporation,
21a statement whether the corporation is to be organized upon a
22nonstock basis or a stock share basis, and, if it is to be
23organized on a stock share basis:
24* * *
25(11) Any other provisions that the incorporators may
26choose to insert if:
27* * *
28(ii) such provisions are not inconsistent with this
29subpart and relate to the purpose or purposes of the
30corporation, the management of its business or affairs or
1the rights, powers or duties of its members, security
2holders, directors, members of an other body or officers.
3* * *
4§ 5307. Advertisement.
5The incorporators or the corporation shall officially publish
6a notice of intention to file or of the filing of articles of
7incorporation. The notice may appear prior to or after the day
8the articles of incorporation are filed in the [Department of
9State,] department and shall set forth briefly:
10(1) The name of the proposed corporation.
11(2) A statement that the corporation is to be or has
12been incorporated under the provisions of this [article]
13subpart.
14[(3) A brief summary of the purpose or purposes of the
15corporation.
16(4) A date on or before which the articles will be filed
17in the Department of State or the date the articles were
18filed.]
19§ 5308. Filing of articles.
20(a) General rule.--The articles of incorporation shall be
21[filed in the Department of State] delivered to the department
22for filing.
23(b) Cross [reference] references.--See [section] sections
24134 (relating to docketing statement) and 135 (relating to
25requirements to be met by filed documents).
26§ 5309. Effect of filing of articles of incorporation.
27(a) Corporate existence.--Upon the filing of the articles of
28incorporation in the [Department of State] department or upon
29the effective date specified in the articles of incorporation,
30whichever is later, the corporate existence shall begin.
1(b) Evidence of incorporation.--Subject to the provisions of
2section 503 (relating to actions to revoke corporate
3franchises), the articles of incorporation filed in the
4[Department of State, or approved by the court and] department,
5or recorded in the office of the recorder of deeds under the
6former provisions of law, shall be conclusive evidence of the
7fact that the corporation has been incorporated.
8§ 5310. Organization meeting.
9(a) General rule.--After the [filing of the articles of
10incorporation] corporate existence begins, an organization
11meeting of the initial directors[,] or, if directors are not
12named in the articles, of the [incorporator or] incorporators,
13shall be held, within or without this Commonwealth, for the
14purpose of adopting bylaws, which they shall have authority to
15do at [such] the meeting[,]; of electing directors [to hold
16office as provided in the bylaws], if directors are not named in
17the articles[,]; and [the transaction of such] of transacting
18other business as may come before the meeting. A bylaw adopted
19at [such] the organization meeting of directors or incorporators
20shall be deemed to be a bylaw adopted by the members for the
21purposes of this [article and of] subpart and any other
22provision of law.
23(b) Call of and action at meeting.--The meeting may be held
24at the call of any director or, if directors are not named in
25the articles, of any incorporator, who shall give at least five
26days' [written notice thereof] notice of the meeting to each
27other director or incorporator[, which]. The notice shall set
28forth the time and place of the meeting. For the purposes of
29this section [an], any director or incorporator may act in
30person, by consent or by proxy signed by him or his [attorney in
1fact] attorney-in-fact.
2(c) Death or incapacity of directors or incorporators.--If a
3designated director or an incorporator dies or is for any reason
4unable to act at the meeting, the other or others may act. If
5there is no other designated director or incorporator able to
6act, any person for whom [an] a director or incorporator was
7acting as agent may act or appoint another to act in his stead.
8§ 5331. [Unincorporated] Incorporation of unincorporated
9associations.
10In the case of the incorporation as a nonprofit corporation
11under this [article] subpart of an unincorporated association
12the articles of incorporation shall contain, in addition to the
13provisions [heretofore required in this chapter] required in
14Subchapter A (relating to incorporation generally), a statement
15that the incorporators constitute a majority of the members of
16the committee authorized to incorporate [such] the association
17by the requisite vote required by the organic law of the
18association for the amendment of [such] the organic law.
19§ 5501. Corporate capacity.
20Except as provided in section 103 [of this title] (relating
21to subordination of title to regulatory laws), a nonprofit
22corporation shall have the legal capacity of natural persons to
23act.
24Section 27. Section 5504(b), (c) and (d) of Title 15 are
25amended and the section is amended by adding a subsection to
26read:
27§ 5504. Adoption, amendment and contents of bylaws.
28* * *
29(b) Exception.--Except as provided in section 5310(a)
30(relating to organization meeting), the board of directors or
1other body shall not have the authority to adopt or change a
2bylaw on any subject that is committed expressly to the members
3by any of the provisions of this subpart. See:
4Subsection (d) (relating to amendment of voting provisions).
5Section 5713 (relating to personal liability of directors).
6Section 5721 (relating to board of directors).
7Section 5725(b) (relating to selection of directors).
8Section 5726(a) (relating to removal of directors by the
9members).
10Section 5726(b) (relating to removal of directors by the
11board).
12Section 5729 (relating to voting rights of directors).
13Section 5751(a) (relating to classes and qualifications of
14membership).
15Section 5752(c) (relating to rights of shareholders).
16Section 5754(a) (relating to members grouped in local units).
17Section 5755(a) (relating to regular meetings).
18Section 5756 (relating to quorum).
19Section 5757 (relating to action by members).
20Section 5758 (relating to voting rights of members).
21Section 5759(a) (relating to voting and other action by
22proxy).
23Section [5760(a)] 5762(a) (relating to voting [in nonprofit
24corporation matters] by corporations).
25Section [5762] 5765 (relating to judges of election).
26Section [5766(a)] 5769(a) (relating to termination and
27transfer of membership).
28Section [5767] 5770 (relating to voting powers and other
29rights of certain [security holders] securityholders and other
30entities).
1Section 5975(c) (relating to [winding up and distribution]
2predissolution provision for liabilities).
3(c) Bylaw provisions in articles.--Where any provision of
4this subpart or any other provision of law refers to a rule as
5set forth in the bylaws of a corporation or in a bylaw adopted
6by the members, the reference shall be construed to include and
7be satisfied by any rule on the same subject as set forth in the
8articles of the corporation.
9(d) Amendment of voting provisions.--
10(1) Unless otherwise restricted in a bylaw adopted by
11the members, whenever the bylaws require for the taking of
12any action by the members or a class of members a specific
13number or percentage of votes, the provision of the bylaws
14setting forth that requirement shall not be amended or
15repealed by any lesser number or percentage of votes of the
16members or of the class of members.
17(2) Paragraph (1) shall not apply to a bylaw setting
18forth the right of members to act by unanimous written
19consent as provided in section 5766(a) (relating to consent
20of members in lieu of meeting).
21(e) Cross reference.--See section 6145 (relating to
22applicability of certain safeguards to foreign domiciliary
23corporations).
24Section 28. Section 5509 of Title 15 is amended to read:
25§ 5509. Bylaws and other powers in emergency.
26(a) General rule.--[The] Except as otherwise restricted in
27the bylaws, the board of directors or other body of any
28nonprofit corporation may adopt emergency bylaws, subject to
29repeal or change by action of the members, which shall,
30notwithstanding any different provisions of law or of the
1articles or bylaws, be [operative] effective during any
2emergency resulting from [warlike damage or] an attack on the
3United States [or any], a nuclear [or atomic] disaster or
4another catastrophe as a result of which a quorum of the board
5cannot readily be assembled. The emergency bylaws may make any
6provision that may be [practical and necessary] appropriate for
7the circumstances of the emergency, including [provisions that]:
8(1) [A meeting of the board of directors or other body
9may be called by any officer or director or member of such
10other body in such manner and under such conditions as shall
11be prescribed in the emergency bylaws.] Procedures for
12calling meetings of the board or other body.
13(2) [The director or directors or the member or members
14of such other body in attendance at the meeting, or any other
15number fixed in the emergency bylaws, shall constitute a
16quorum.] Quorum requirements for meetings.
17(3) [The officers or other persons designated on a list
18approved by the board of directors or other body before the
19emergency, all in such order of priority and subject to such
20conditions and for such period of time, not longer than
21reasonably necessary after the termination of the emergency
22as may be provided in the emergency bylaws or in the
23resolution approving the list, shall, to the extent required
24to provide a quorum at any meeting of the board of directors
25or such other body, be deemed directors or members of such
26other body for such meeting.] Procedures for designating
27additional or substitute directors or members of an other
28body.
29(b) Lines of succession; head office.--The board of
30directors or [such] other body, or the officers, if given
1authorization by the board of directors or other body, either
2before or during any [such] emergency, may [provide,]:
3(1) provide, and from time to time modify, lines of
4succession in the event that during [such an] the emergency
5any or all officers or agents of the corporation shall for
6any reason be rendered incapable of discharging their
7duties[, and may,]; and
8(2) effective in the emergency, change the head offices
9or designate several alternative head offices or regional
10offices of the corporation[, or authorize the officers so to
11do].
12(c) Personnel not liable.--[No officer, director, member of
13such other body, or employee acting in accordance with any
14emergency bylaws shall be liable except for wilful misconduct.]
15A representative of the corporation:
16(1) Acting in accordance with any emergency bylaws shall
17not be liable except for willful misconduct.
18(2) Shall not be liable for any action taken by him in
19good faith in an emergency in furtherance of the ordinary
20business affairs of the corporation even though not
21authorized by the emergency or other bylaws then in effect.
22(d) Effect on regular bylaws.--To the extent that they are
23not inconsistent with any emergency bylaws [so] adopted, the
24bylaws of the corporation shall remain in effect during any
25emergency[,] and, upon its termination, the emergency bylaws
26shall cease to be [operative] effective.
27(e) Procedure in absence of emergency bylaws.--Unless
28otherwise provided in emergency bylaws, notice of any meeting of
29the board of directors or [such] an other body during [such] an
30emergency shall be given only to [such of the] those directors
1or members of [such] an other body [as it may be] it is feasible
2to reach at the time and by such means as [may be] are feasible
3at the time, including publication [or], radio or television. To
4the extent required to constitute a quorum at any meeting of the
5board of directors or [such] an other body during [such an] any
6emergency, the officers of the corporation who are present
7shall, unless otherwise provided in emergency bylaws, be deemed,
8in order of rank and within the same rank in order of seniority,
9directors or members of [such] the other body, as the case may
10be, for [such] the meeting.
11Section 29. Section 5511 of Title 15 is reenacted to read:
12§ 5511. Establishment of subordinate units.
13A nonprofit corporation may establish and terminate local
14branches, chapters, councils, clubs, churches, lodges, parishes
15or other subordinate units regardless of their designation, form
16of government, incorporated or unincorporated status or
17relationship to the corporation or other supervising and
18controlling organization of which the corporation is a member or
19with which it is in allegiance and to which it is subordinate.
20Section 30. Sections 5541, 5542, 5543, 5544, 5546, 5547(b),
215548(b) and 5550 of Title 15 are amended to read:
22§ 5541. Capital contributions of members.
23(a) General rule.--A nonprofit corporation organized on a
24nonstock basis may provide in its bylaws that members, upon or
25subsequent to admission, shall make capital contributions. The
26amount shall be specified in, or fixed by the board of directors
27or other body pursuant to authority granted by, the bylaws. The
28requirement of a capital contribution may apply to all members,
29[or] to the members of a single class, or to members of
30different classes in different amounts or proportions.
1(b) Consideration receivable.--[The capital contribution of
2a member shall consist of money or other property, tangible or
3intangible, or labor or services actually received by or
4performed for the corporation or for its benefit or in its
5formation or reorganization, or a combination thereof. In the
6absence of fraud in the transaction, the judgment of the board
7of directors or other body as to the value of the consideration
8received by the corporation shall be conclusive.] The capital
9contribution of a member, unless otherwise provided in the
10bylaws:
11(1) May consist of money, obligations (including an
12obligation of a member), services performed whether or not
13contracted for, contracts for services to be performed,
14memberships in or securities or obligations of the
15corporation or any other tangible or intangible property or
16benefit to the corporation. If a capital contribution is made
17in a form other than money, the value of the contribution
18shall be determined by or in the manner provided by the board
19of directors or other body.
20(2) Shall be provided or paid to or as ordered by the
21corporation.
22(c) Evidence of contribution.--The capital contribution of a
23member shall be recorded on the books of the corporation and may
24be evidenced by a written instrument delivered to the member,
25but [such] the instrument shall not be denominated a "share
26certificate" or by any other word or term implying that the
27instrument is a share certificate subject to section 5752
28(relating to organization on a stock share basis).
29(d) Transferability of interest.--Unless otherwise provided
30in the bylaws, the capital contribution of a member shall not be
1transferable.
2(e) Repayment of contribution.--The capital contribution of
3a member shall not be repaid by the corporation except upon
4dissolution of the corporation or as provided in this [article]
5subpart. A corporation may provide in its bylaws that its
6capital contributions, or some of them, shall be repayable, in
7whole or in part, at the option of the corporation only, [at
8such] in the amount or amounts (not to exceed the amount of the
9capital contribution), within [such] the period or periods[,]
10and on [such] the terms and conditions, not inconsistent with
11this [article] subpart, as are stated in, or fixed by the board
12of directors or other body pursuant to authority granted by, the
13bylaws.
14§ 5542. Subventions.
15(a) General rule.--The bylaws of a nonprofit corporation may
16provide that the corporation shall be authorized by resolution
17of the board of directors or other body to accept subventions
18from members or nonmembers on terms and conditions not
19inconsistent with this [article, and to issue certificates
20therefor] subpart. The resolution of the board or other body may
21provide that [holders of] the maker of a subvention
22[certificates] shall be entitled to a fixed or contingent
23periodic payment out of the corporate assets equal to a
24percentage of the original amount or value of the subvention.
25The rights of [holders of subvention certificates] makers of
26subventions shall at all times be subordinate to the rights of
27creditors of the corporation.
28(b) Consideration receivable.--[A subvention shall consist
29of money or other property, tangible or intangible, actually
30received by the corporation or expended for its benefit or in
1its formation or reorganization, or a combination thereof. In
2the absence of fraud in the transaction, the judgment of the
3board of directors or other body as to the value of the
4consideration received by the corporation shall be conclusive.
5(c) Form of certificate.--Each subvention certificate shall
6be signed by two duly authorized officers of the corporation,
7and may be sealed with the seal of the corporation or a
8facsimile thereof. The signatures of the officers upon a
9certificate may be facsimiles if the certificate is
10countersigned by a transfer agent or registered by a registrar
11other than the corporation itself or its employees. In case any
12officer who has signed or whose facsimile signature has been
13placed upon a certificate shall have ceased to be such officer
14before such certificate is issued, it may be issued by the
15corporation with the same effect as if he were such officer at
16the date of issue. The fact that the corporation is a nonprofit
17corporation shall be noted conspicuously on the face or back of
18each certificate.] Consideration for subventions, unless
19otherwise provided in the bylaws:
20(1) May consist of money, obligations (including an
21obligation of a subventor), services performed whether or not
22contracted for, contracts for services to be performed,
23memberships in or securities or obligations of the
24corporation, or any other tangible or intangible property or
25benefit to the corporation. If subventions are issued for
26other than money, the value of the consideration shall be
27determined by or in the manner provided by the board of
28directors or other body.
29(2) Shall be provided or paid to or as ordered by the
30corporation.
1(c.1) Form of subventions.--Subventions shall be represented
2by certificates or shall be uncertificated subventions. Each
3subvention certificate shall be executed by or on behalf of the
4corporation issuing the subvention in the manner it may
5determine. The fact that the corporation is a nonprofit
6corporation shall be noted conspicuously on the face or back of
7each certificate.
8(d) Transferability of subvention.--[Subvention
9certificates] Subventions shall be nontransferable unless the
10resolution of the board of directors or other body [shall
11provide] provides that they shall be transferable either at will
12or subject to specified restrictions.
13(e) Redemption at option of corporation.--The resolution of
14the board of directors or other body may provide that a
15subvention shall be redeemable, in whole or in part, at the
16option of the corporation at [such] the price or prices (not to
17exceed the original amount or value of the subvention plus any
18periodic payments due or accrued thereon), within [such] the
19period or periods, and on [such] the terms and conditions, not
20inconsistent with this [article] subpart, as are stated in the
21resolution.
22(f) Redemption at option of holders.--The resolution of the
23board of directors or other body may provide that makers or
24holders of all or some [subvention certificates] subventions
25shall have the right to require the corporation after a
26specified period of time to redeem [such certificates] the
27subventions, in whole or in part, at a price or prices that do
28not exceed the original amount or value of the subvention plus
29any periodic payments due or accrued [thereon] on the
30subvention, upon an affirmative showing that the financial
1condition of the corporation will permit the required payment to
2be made without impairment of its operations or injury to its
3creditors. The right to require redemption may in addition be
4conditioned upon the occurrence of a specified event. For the
5purpose of enforcing their rights under this subsection, makers
6or holders of [subvention certificates] subventions shall be
7entitled to inspect the books and records of the corporation.
8(g) Rights of makers or holders on dissolution.--[Holders]
9Makers or holders of [subvention certificates] subventions, upon
10dissolution of the corporation, shall be entitled, after the
11claims of creditors have been satisfied, to repayment of the
12original amount or value of the subvention plus any periodic
13payments due or accrued [thereon] on the subvention, unless a
14lesser sum is specified in the resolution of the board of
15directors or other body concerning [such] the subvention.
16§ 5543. Debt and security interests.
17(a) General rule.--[No corporation shall issue bonds or
18other evidences of indebtedness except for money or other
19property, tangible or intangible, or labor or services actually
20received by or performed for the corporation or for its benefit
21or in its formation or reorganization, or a combination thereof.
22In the absence of fraud in the transaction, the judgment of the
23board of directors or other body as to the value of the
24consideration received by the corporation shall be conclusive.]
25Unless otherwise provided in the bylaws, a nonprofit corporation
26may issue its bonds or other obligations for an amount and form
27of consideration as may be determined by or in the manner
28provided by the board of directors or other body.
29(b) Creation of lien on real or personal property.--The
30board of directors or other body may authorize any mortgage or
1pledge of, or the creation of a security interest in, all or any
2part of the real or personal property of the corporation, or any
3interest [therein. Unless] in the real or personal property. No
4application to or confirmation by a court shall be required and,
5unless otherwise restricted in the bylaws, no vote or consent of
6the members shall be required to make effective [such] the
7action by the board or other body.
8§ 5544. [Fees, dues] Dues and assessments.
9(a) General rule.--A nonprofit corporation may levy dues or
10assessments, or both, on its members, if authority to do so is
11conferred by the bylaws, subject to any limitations [therein]
12contained in the bylaws. [Such] The dues or assessments, or
13both, may be imposed upon all members of the same class either
14alike or in different amounts or proportions, and upon a
15different basis upon different classes of members. Members of
16one or more classes may be made exempt from either dues or
17assessments, or both, in the manner or to the extent provided in
18the bylaws.
19(b) Amount and method of collection.--The amount of the levy
20and method of collection of [such] the dues or assessments, or
21both, may be fixed in the bylaws, or the bylaws may authorize
22the board of directors or other body to fix the amount [thereof]
23of the dues or assessments from time to time, and make them
24payable at [such] the time and by [such] the methods of
25collection as the board of directors or other body may
26prescribe.
27(c) Enforcement of payment.--A nonprofit corporation may
28make bylaws necessary to enforce the collection of [such] dues
29or assessments, including provisions for the termination of
30membership, upon reasonable notice, for nonpayment of [such]
1dues or assessments, and for reinstatement of membership.
2§ 5546. Purchase, sale, mortgage and lease of real property.
3[Except for an industrial development corporation whose
4articles or bylaws otherwise provide, no purchase of real
5property shall be made by a nonprofit corporation and no
6corporation shall sell, mortgage, lease away or otherwise
7dispose of its real property, unless authorized by the vote of
8two-thirds of the members in office of the board of directors or
9other body, except that if there are 21 or more directors or
10members of such other body, the vote of a majority of the
11members in office shall be sufficient. No application to or
12confirmation of any court shall be required and, unless
13otherwise restricted in the bylaws, no vote or consent of the
14members shall be required to make effective such action by the
15board or other body. If the real property is subject to a trust
16the conveyance away shall be free of trust and the trust shall
17be impinged upon the proceeds of such conveyance.] Except as
18otherwise provided in this subpart and unless otherwise provided
19in the bylaws, no application to or confirmation of any court
20shall be required for the purchase by or the sale, lease or
21other disposition of the real or personal property, or any part
22of the real or personal property of a nonprofit corporation,
23and, unless otherwise restricted in section 5930 (relating to
24voluntary transfer of corporate assets) or in the bylaws, no
25vote or consent of the members shall be required to make
26effective such action by the board or other body. If the
27property is subject to a trust, the conveyance away shall be
28free of trust, and the trust shall be impinged upon the proceeds
29of the conveyance.
30§ 5547. Authority to take and hold trust property.
1* * *
2(b) Nondiversion of certain property.--Property committed to
3charitable purposes shall not, by any proceeding under Chapter
459 (relating to fundamental changes) or otherwise, be diverted
5from the objects to which it was donated, granted or devised,
6unless and until the board of directors or other body obtains
7from the court an order under 20 Pa.C.S. Ch. 77 [Subch. D]
8(relating to [creation, validity, modification and termination
9of trust] trusts) specifying the disposition of the property.
10§ 5548. Investment of trust funds.
11* * *
12(b) Use and management.--Except as otherwise permitted under
1320 Pa.C.S. Ch. 77 [Subch. D] (relating to [creation, validity,
14modification and termination of trust] trusts), the board of
15directors or other body shall apply all assets thus received to
16the purposes specified in the trust instrument. The directors or
17other body shall keep accurate accounts of all trust funds,
18separate and apart from the accounts of other assets of the
19corporation.
20* * *
21§ 5550. Devises, bequests and gifts after certain fundamental
22changes.
23A devise, bequest or gift to be effective in the future, in
24trust or otherwise, to or for a nonprofit corporation which has:
25(1) changed its purposes;
26(2) sold, leased away or exchanged all or substantially
27all its property and assets;
28(3) been converted into a business corporation;
29(4) become a party to a consolidation or a division;
30(5) become a party to a merger which it did not survive;
1or
2(6) been dissolved;
3after the execution of the document containing [such] the
4devise, bequest or gift and before the nonprofit corporation
5acquires a vested interest in the devise, bequest or gift shall
6be effective only as a court having jurisdiction over the assets
7may order under [the Estates Act of 1947] 20 Pa.C.S. Ch. 77
8(relating to trusts) or other applicable provisions of law.
9Section 31. Section 5551 of Title 15 is reenacted to read:
10§ 5551. Dividends prohibited; compensation and certain payments
11authorized.
12(a) General rule.--A nonprofit corporation shall not pay
13dividends or distribute any part of its income or profits to its
14members, directors, or officers. Nothing herein contained shall
15prohibit a fraternal benefit society operating under the
16insurance laws of Pennsylvania from paying dividends or refunds
17by whatever name known pursuant to the terms of its insurance
18contracts.
19(b) Reasonable compensation for services.--A nonprofit
20corporation may pay compensation in a reasonable amount to
21members, directors, or officers for services rendered.
22(c) Certain payments authorized.--A nonprofit corporation
23may confer benefits upon members or nonmembers in conformity
24with its purposes, may repay capital contributions, and may
25redeem its subvention certificates or evidences of indebtedness,
26as authorized by this article, except when the corporation is
27currently insolvent or would thereby be made insolvent or
28rendered unable to carry on its corporate purposes, or when the
29fair value of the assets of the corporation remaining after such
30conferring of benefits, payment or redemption would be
1insufficient to meet its liabilities. A nonprofit corporation
2may make distributions of cash or property to members upon
3dissolution or final liquidation as permitted by this article.
4Section 32. Title 15 is amended by adding a section to read:
5§ 5552. (Reserved).
6Section 33. Section 5552 of Title 15 is renumbered to read:
7§ [5552] 5553. Liabilities of members.
8(a) General rule.--A member of a nonprofit corporation shall
9not be liable, solely by reason of being a member, under an
10order of a court or in any other manner for a debt, obligation
11or liability of the corporation of any kind or for the acts of
12any member or representative of the corporation.
13(b) Obligations of member to corporation.--A member shall be
14liable to the corporation only to the extent of any unpaid
15portion of the capital contributions, membership dues or
16assessments which the corporation may have lawfully imposed upon
17him, or for any other indebtedness owed by him to the
18corporation. No action shall be brought by any creditor of the
19corporation to reach and apply any such liability to any debt of
20the corporation until after:
21(1) final judgment has been rendered against the
22corporation in favor of the creditor and execution thereon
23returned unsatisfied;
24(2) a case involving the corporation has been brought
25under 11 U.S.C. Ch. 7 (relating to liquidation) and a
26distribution has been made and the case closed or a notice of
27no assets has been issued; or
28(3) a receiver has been appointed with power to collect
29debts, and the receiver, on demand of a creditor to bring an
30action thereon, has refused to sue for the unpaid amount, or
1the corporation has been dissolved or ceased its activities
2leaving debts unpaid.
3(c) Action by a creditor.--An action by a creditor under
4subsection (b) shall not be brought more than three years after
5the happening of the first to occur of the events listed in
6subsection (b)(1) through (3).
7Section 34. Section 5553 of Title 15 is renumbered and
8amended to read:
9§ [5553] 5554. Annual report of directors or other body.
10(a) Contents.--The board of directors or other body of a
11nonprofit corporation shall present annually to the members a
12report, verified by the president and treasurer or by a majority
13of the directors or members of [such] the other body, showing in
14appropriate detail the following:
15(1) The assets and liabilities, including [the] trust
16funds, of the corporation as of the end of the fiscal year
17immediately preceding the date of the report.
18(2) The principal changes in assets and liabilities,
19including trust funds, during the fiscal year immediately
20preceding the date of the report.
21(3) The revenue or receipts of the corporation, both
22unrestricted and restricted to particular purposes, for the
23fiscal year immediately preceding the date of the report,
24including separate data with respect to each trust fund held
25by or for the corporation.
26(4) The expenses or disbursements of the corporation,
27for both general and restricted purposes, during the fiscal
28year immediately preceding the date of the report, including
29separate data with respect to each trust fund held by or for
30the corporation.
1(5) The number of members of the corporation as of the
2date of the report, together with a statement of increase or
3decrease in [such] their number during the year immediately
4preceding the date of the report, and a statement of the
5place where the names and addresses of the current members
6may be found.
7(b) Place of filing.--The annual report of the board of
8directors or other body shall be filed with the minutes of the
9meetings of members.
10(c) Report in absence of meeting of members.--The board of
11directors or other body of a corporation having no members shall
12direct the president and treasurer to present at the annual
13meeting of the board or [of such] other body a report in
14accordance with subsection (a) [of this section], but omitting
15the requirement of paragraph (5) [thereof]. [Such] The report
16shall be filed with the minutes of the annual meeting of the
17board or [of such] other body.
18(d) Cross reference.--See section 6145 (relating to
19applicability of certain safeguards to foreign domiciliary
20corporations).
21Section 35. Sections 5585, 5586, 5587, 5588, 5589, 5702(a),
225704(a) and (b), 5705(a), 5708, 5722(a), 5723, 5724, 5725, 5726,
235727, 5728(a) and (b), 5729(b) and 5730 of Title 15 are amended
24to read:
25§ 5585. Establishment or use of common trust funds authorized.
26(a) General rule.--Every nonprofit corporation may establish
27and maintain one or more common trust funds, the assets of which
28shall be held, invested and reinvested by the corporation itself
29or by a corporate trustee to which the assets have been
30transferred pursuant to section 5549 (relating to transfer of
1trust or other assets to institutional trustee). Upon the
2payment by the corporate trustee to the nonprofit corporation of
3the net income from [such] the assets, which income may be
4determined under section 5548(c) (relating to investment of
5trust funds) if [such] the election is properly made by the
6board of directors or other body of the corporation, for use and
7application to the several participating interests in [such] the
8common trust fund, the proportionate participation of each
9interest in [such] the net income shall be designated by the
10corporate trustee. The nonprofit corporation may, at any time,
11withdraw the whole or part of any participating interest in
12[such] the common trust fund for distribution by it as provided
13in this subchapter.
14(b) Limitations in trust instrument.--Nothing contained in
15this section shall be construed to authorize the corporation to
16invest assets of a trust or fund in any [such] common trust fund
17contrary to any specific limitation or restriction contained in
18the trust instrument[,] nor to limit or restrict the authority
19conferred upon the corporation with respect to investments by
20[any such] the trust instrument.
21(c) Effect of good faith mistakes.--[No mistakes] Mistakes
22made in good faith[,] and in the exercise of due care and
23prudence[,] in connection with the administration of any [such]
24common trust fund[,] shall not be held to exceed any power
25granted to or violate any duty imposed upon the corporation[,]
26if, promptly after the discovery of the mistake, the corporation
27takes [such] whatever action [as] may be practicable under the
28circumstances to remedy the mistake.
29§ 5586. Restrictions on investments.
30(a) Legal investments.--If the trust instrument [shall limit
1or restrict] limits or restricts the investment of [such] the
2assets to investments of the class authorized by law as legal
3investments, [the] a nonprofit corporation may invest and
4reinvest the assets of the trust or fund in any [such] common
5trust fund maintained by the corporation[, provided] if the
6investments composing [such] the fund consist solely of
7investments of the class authorized by [the Fiduciaries
8Investment Act of 1949] 20 Pa.C.S. Ch. 72 (relating to prudent
9investor rule) to be held by fiduciaries.
10(b) Other than legal investments.--If the trust instrument
11[shall] does not limit or restrict the investment of [such] the
12assets to investments of the class authorized by law as legal
13investments, the corporation may invest and reinvest the assets
14of the trust or fund in any [such] common trust fund maintained
15by the corporation[,] composed of [such] the investments as in
16the honest exercise of the judgment of the directors or other
17body of the corporation they may, after investigation, determine
18to be safe and proper investments.
19§ 5587. Determination of interests.
20A nonprofit corporation shall invest the assets of a trust or
21fund in a common trust fund authorized by this subchapter by
22adding [such] those assets thereto, and by apportioning a
23participation therein to [such] the trust or fund in the
24proportion that the assets of the trust or fund added thereto
25bears to the aggregate value of all the assets of [such] the
26common trust fund at the time of [such] the investment,
27including in [such] those assets the assets of the trust or fund
28so added. The withdrawal of a participation from [such] the
29common trust fund shall be on a basis of its proportionate
30interest in the aggregate value of all the assets of [such] the
1common trust fund at the time of [such] the withdrawal. The
2participating interest of any trust or fund in [such] the common
3trust fund may from time to time be withdrawn, in whole or in
4part, by the corporation. Upon [such withdrawals] a withdrawal,
5the corporation may make distribution in cash, or ratably in
6kind, or partly in cash and partly in kind. Participations in
7[such] the common trust funds shall not be sold by the
8corporation to any other corporation or person, but this
9sentence shall not prevent a corporate trustee designated under
10section 5585 (relating to establishment or use of common trust
11funds authorized) from investing the assets of [such a] the
12common trust fund in any collective investment fund established
13and maintained by it in accordance with law and to which the
14assets comprising [such a] the common trust fund are eligible
15contributions.
16§ 5588. Amortization of premiums on securities held.
17If a bond or other obligation for the payment of money is
18acquired as an investment for any common trust fund at a cost in
19excess of the par or maturity value thereof, the nonprofit
20corporation may, during [(but not beyond)] but not beyond the
21period that [such] the obligation is held as an investment in
22[such] the fund, amortize [such] the excess cost out of the
23income on [such] the obligation, by deducting from each payment
24of income and adding to principal an amount equal to the sum
25obtained by dividing [such] the excess cost by the number of
26periodic payments of income to accrue on [such] the obligation
27from the date of [such] the acquisition until its maturity date.
28§ 5589. Records; ownership of assets.
29The nonprofit corporation shall designate clearly upon its
30records the names of the trusts or funds on behalf of which
1[such] the corporation, as fiduciary or otherwise, owns a
2participation in any common trust fund and the extent of the
3interest of the trust or fund therein. [No such] The trust or
4fund shall not be deemed to have individual ownership of any
5asset in [such] the common trust fund, but shall be deemed to
6have a proportionate undivided interest in the common trust
7fund. The ownership of the individual assets comprising any
8common trust fund shall be solely in the nonprofit corporation
9as fiduciary or otherwise.
10§ 5702. Manner of giving notice.
11(a) General rule.--[Whenever written]
12(1) Any notice [is] required to be given to any person
13under the provisions of this subpart or by the articles or
14bylaws of any nonprofit corporation[, it may] shall be given
15to the person either personally or by sending a copy thereof
16[by]:
17(i) By first class or express mail, postage prepaid,
18[or by telegram (with messenger service specified), telex
19or TWX (with answer back received)] or courier service,
20charges prepaid, [or by facsimile transmission,] to [his]
21the person's postal address [(or to his telex, TWX or
22facsimile number)] appearing on the books of the
23corporation or, in the case of directors or members of an
24other body, supplied by [him] the person to the
25corporation for the purpose of notice. [If the notice is
26sent by mail, telegraph or courier service, it shall be
27deemed to have been given to the person entitled thereto
28when deposited in the United States mail or with a
29telegraph office or courier service for delivery to that
30person or, in the case of telex or TWX, when dispatched.]
1Notice under this subparagraph shall be deemed to have
2been given to the person entitled thereto when deposited
3in the United States mail or with a courier service for
4delivery to that person.
5(ii) By facsimile transmission, e-mail or other
6electronic communication to the person's facsimile number
7or address for e-mail or other electronic communications
8supplied by the person to the corporation for the purpose
9of notice. Notice under this subparagraph shall be deemed
10to have been given to the person entitled thereto when
11sent.
12(2) A notice of meeting shall specify the [place,] day
13[and], hour and geographic location, if any, of the meeting
14and any other information required by any other provision of
15this subpart.
16* * *
17§ 5704. Place and notice of meetings of members.
18(a) Place.--Meetings of members may be held at [such place]
19the geographic location within or without this Commonwealth [as
20may be] provided in or fixed pursuant to the bylaws. Unless
21otherwise provided in or pursuant to the bylaws, all meetings of
22the members shall be held [in this Commonwealth at the
23registered office of the corporation.] at the executive office
24of the corporation wherever situated. If a meeting of members is
25held by means of the Internet or other electronic communications
26technology in a fashion pursuant to which the members have the
27opportunity to read or hear the proceedings substantially
28concurrently with their occurrence, vote on matters submitted to
29the members, pose questions to the directors and members of any
30other body, make appropriate motions and comment on the business
1of the meeting, the meeting need not be held at a particular
2geographic location.
3(b) Notice.--[Written notice] Notice in record form of every
4meeting of the members shall be given by, or at the direction
5of, the secretary or other authorized person to each member of
6record entitled to vote at the meeting at least:
7(1) ten days prior to the day named for a meeting that
8will consider a fundamental change under Chapter 59 (relating
9to fundamental changes); or
10(2) five days prior to the day named for the meeting in
11any other case.
12If the secretary or other authorized person neglects or refuses
13to give notice of a meeting, the person or persons calling the
14meeting may do so.
15* * *
16§ 5705. Waiver of notice.
17(a) [Written waiver] General rule.--Whenever any [written]
18notice is required to be given under the provisions of this
19subpart or the articles or bylaws of any nonprofit corporation,
20a waiver thereof [in writing, signed] that is filed with the
21secretary of the corporation in record form, signed by the
22person or persons entitled to the notice, whether before or
23after the time stated therein, shall be deemed equivalent to the
24giving of the notice. [Except as otherwise required by this
25subsection, neither] Neither the business to be transacted at,
26nor the purpose of, a meeting need be specified in the waiver of
27notice of the meeting.
28* * *
29§ 5708. Use of conference telephone [and similar equipment.] or
30other electronic technology.
1(a) Incorporators, directors and members of an other body.--
2Except as otherwise provided in the bylaws, one or more persons
3may participate in a meeting of the incorporators, the board of
4directors or an other body[, or the members] of a nonprofit
5corporation by means of conference telephone or [similar
6communications equipment] other electronic technology by means
7of which all persons participating in the meeting can hear each
8other. Participation in a meeting pursuant to this section shall
9constitute presence in person at the meeting.
10(b) Members.--Except as otherwise provided in the bylaws,
11the presence or participation, including voting and taking other
12action, at a meeting of members, or the expression of consent or
13dissent to corporate action, by a member by conference telephone
14or other electronic means, including, without limitation, the
15Internet, shall constitute the presence of, or vote or action
16by, or consent or dissent of the member for the purposes of this
17subpart.
18§ 5722. Qualifications of directors.
19(a) General rule.--Each director of a nonprofit corporation
20shall be a natural person of full age, except as provided in
21subsection (b), who, unless otherwise restricted in the bylaws,
22need not be a resident of this Commonwealth or a member of the
23corporation. Except as otherwise provided in this section, the
24qualifications of directors may be prescribed in the bylaws.
25* * *
26§ 5723. Number of directors.
27The board of directors of a nonprofit corporation shall
28consist of one or more members. [Except as otherwise provided in
29this section, the] The number of directors shall be fixed by[,]
30or in the manner provided in[,] the bylaws[; or if]. If not so
1fixed, the number of directors shall be the same as that stated
2in the articles or three if no number is so stated.
3§ 5724. Term of office of directors.
4(a) General rule.--Each director of a nonprofit corporation
5shall hold office until the expiration of the term for which
6[he] the director was selected and until [his] a successor has
7been selected and qualified or until [his] the director's
8earlier death, resignation or removal. Directors, other than
9those selected by virtue of their office or former office in the
10corporation or in any other entity or organization, shall be
11selected for the term of office provided in the bylaws. In the
12absence of a provision fixing the term, it shall be one year.
13(b) Resignations.--Any director may resign at any time upon
14notice in record form to the corporation. The resignation shall
15be effective upon its receipt by the corporation or at a
16subsequent time specified in the notice of resignation.
17(c) Decrease in number.--A decrease in the number of
18directors shall not have the effect of shortening the term of
19any incumbent director.
20(d) Classified board of directors.--Except as otherwise
21provided in the bylaws, if the directors are classified in
22respect of the time for which they shall severally hold office:
23(1) Each class shall be as nearly equal in number as
24possible.
25(2) The term of office of at least one class shall
26expire in each year.
27(3) The members of a class shall not be elected for a
28longer period than four years.
29§ 5725. Selection of directors.
30(a) General rule.--Except as otherwise provided in this
1section, directors of a nonprofit corporation, other than those
2[named in the articles, if any,] constituting the first board of
3directors, shall be elected by the members.
4(b) Other methods.--If a bylaw adopted by the members so
5provides, directors may be elected, appointed, designated or
6otherwise selected by [such] the person or persons or by [such]
7the method or methods as shall be fixed by, or in the manner
8provided in, [such] the bylaw, and the directors may be
9classified as to the members who exercise the power to select
10directors.
11(c) Vacancies.--Except as otherwise provided in the
12bylaws[,]:
13(1) [vacancies] Vacancies in the board of directors,
14including vacancies resulting from an increase in the number
15of directors, [shall] may be filled by a majority of the
16remaining members of the board though less than a quorum, or
17by a sole remaining director, and each person so [elected]
18selected shall be a director to serve for the balance of the
19unexpired term unless otherwise restricted in the bylaws.
20(2) When one or more directors resign from the board
21effective at a future date, the directors then in office,
22including those who have so resigned, shall have power by the
23applicable vote to fill the vacancies, the vote thereon to
24take effect when the resignations become effective.
25(3) In the case of a corporation having a board of
26directors classified in respect of the time for which
27directors shall severally hold office, any director chosen to
28fill a vacancy, including a vacancy resulting from an
29increase in the number of directors, shall hold office until
30the next election of the class for which the director has
1been chosen and until a successor has been selected and
2qualified or until the director's earlier death, resignation
3or removal.
4(d) Alternate directors.--If the bylaws so provide, a person
5or group of persons entitled to elect, appoint, designate or
6otherwise select one or more directors may select [one or more
7alternates] an alternate for each [such] director. In the
8absence of a director from a meeting of the board [one of his
9alternates], the director's alternate may, in the manner and
10upon [such] the notice, if any, as may be provided in the
11bylaws, attend [such] the meeting or execute a consent in record
12form and exercise at the meeting [such of] or in the consent,
13the powers of the absent director as may be specified by, or in
14the manner provided in, the bylaws. When so exercising the
15powers of the absent director, [such] the alternate shall be
16subject in all respects to the provisions of this [article]
17subpart relating to directors.
18(e) Nomination of directors.--Unless otherwise provided in
19the bylaws [provide otherwise], directors shall be nominated by
20a nominating committee or from the floor.
21(f) Cross reference.--See the definition of "member" in
22section 5103 (relating to definitions).
23§ 5726. Removal of directors.
24(a) [By] Removal by the members.--
25(1) Unless otherwise provided in a bylaw adopted by the
26members, the entire board of directors, or a class of the
27board[,] where the board is classified with respect to the
28power to select directors, or any individual director[,] of a
29nonprofit corporation may be removed from office without
30assigning any cause by the vote of members, or a class of
1members, entitled to [cast at least a majority of the votes
2which all members present would be entitled to cast at any
3annual or other regular election of the directors or of such
4class of directors] elect directors, or the class of
5directors. In case the board or [such] a class of the board
6or any one or more directors are so removed, new directors
7may be elected at the same meeting. [If members are entitled
8to vote cumulatively for the board or a class of the board,
9no individual director shall be removed unless the entire
10board or class of the board is removed in case sufficient
11votes are cast against the resolution for his removal, which,
12if cumulatively voted at an annual or other regular election
13of directors, would be sufficient to elect one or more
14directors to the board or to the class.]
15(2) An individual director shall not be removed, unless
16the entire board or class of the board is removed, from the
17board of a corporation in which members are entitled to vote
18cumulatively for the board or a class of the board if
19sufficient votes are cast against the resolution for removal
20of the director which, if cumulatively voted at an annual or
21other regular election of directors, would be sufficient to
22elect one or more directors to the board or to the class.
23(b) [By] Removal by the board.--Unless otherwise provided in
24a bylaw adopted by the members, the board of directors may
25declare vacant the office of a director [if he is declared] who
26has been judicially declared of unsound mind [by an order of
27court or is convicted of felony] or who has been convicted of an
28offense punishable by imprisonment for a term of more than one
29year, or for any other proper cause which the bylaws may
30specify, or if, within 60 days, or [such] other time as the
1bylaws may specify, after notice of [his] selection, [he] a
2director does not accept [such] the office either in writing or
3by attending a meeting of the board of directors[,] and fulfill
4[such] the other requirements of qualification as the bylaws may
5specify.
6(c) [By] Removal by the court.--[The court may, upon
7petition of any member or director, remove from office any
8director in case of fraudulent or dishonest acts, or gross abuse
9of authority or discretion with reference to the corporation, or
10for any other proper cause, and may bar from office any director
11so removed for a period prescribed by the court. The corporation
12shall be made a party to such action.] Upon application of any
13member or director, the court may remove from office any
14director in case of fraudulent or dishonest acts, or gross abuse
15of authority or discretion with reference to the corporation, or
16for any other proper cause, and may bar from office any director
17so removed for a period prescribed by the court. The corporation
18shall be made a party to the action and as a prerequisite to the
19maintenance of an action under this subsection a member shall
20comply with Subchapter G (relating to judicial supervision of
21corporate action).
22(d) Effect of reinstatement.--An act of the board done
23during the period when a director has been suspended or removed
24for cause shall not be impugned or invalidated if the suspension
25or removal is thereafter rescinded by the members or by the
26board or by the final judgment of a court.
27§ 5727. Quorum of and action by directors.
28(a) General rule.--Unless otherwise provided in the bylaws,
29a majority of the directors in office of a nonprofit corporation
30shall be necessary to constitute a quorum for the transaction of
1business, and the acts of a majority of the directors present
2and voting at a meeting at which a quorum is present shall be
3the acts of the board of directors.
4(b) Action by [written] consent.--Unless otherwise
5restricted in the bylaws, any action [which may] required or
6permitted to be [taken] approved at a meeting of the directors
7may be [taken] approved without a meeting[,] if a consent or
8consents [in writing setting forth the action so taken shall be
9signed] to the action in record form are signed, before, on or
10after the effective date of the action, by all of the directors
11in office [and shall be] on the date the last consent is signed.
12The consent or consents must be filed with the secretary of the
13corporation.
14§ 5728. Interested [members,] directors or officers; quorum.
15(a) General rule.--[No] A contract or transaction between a
16nonprofit corporation and one or more of its [members,]
17directors or officers or between a nonprofit corporation and
18[any other corporation, partnership, association, or other
19organization] another domestic or foreign corporation for profit
20or not-for-profit, partnership, joint venture, trust or other
21association in which one or more of its directors or officers
22are directors or officers[,] or have a financial or other
23interest, shall not be void or voidable solely for [such] that
24reason, or solely because the [member,] director or officer is
25present at or participates in the meeting of the board of
26directors [which] that authorizes the contract or transaction,
27or solely because [his or their votes are] the vote of the
28director or officer is counted for [such] that purpose, if:
29(1) the material facts as to the relationship or
30interest and as to the contract or transaction are disclosed
1or are known to the board of directors and the board [in good
2faith] authorizes the contract or transaction by the
3affirmative votes of a majority of the disinterested
4directors even though the disinterested directors are less
5than a quorum;
6(2) the material facts as to [his] the director's or
7officer's relationship or interest and as to the contract or
8transaction are disclosed or are known to the members
9entitled to vote thereon, if any, and the contract or
10transaction is specifically approved in good faith by vote of
11[such] those members; or
12(3) the contract or transaction is fair as to the
13corporation as of the time it is authorized, approved or
14ratified by the board of directors or the members.
15(b) Quorum.--Common or interested directors may be counted
16in determining the presence of a quorum at a meeting of the
17board [which] that authorizes a contract or transaction
18specified in subsection (a) [of this section].
19* * *
20§ 5729. Voting rights of directors.
21* * *
22(b) Multiple and fractional voting.--The requirement of this
23[article] subpart for the presence of or vote or other action by
24a specified percentage of directors shall be satisfied by the
25presence of or vote or other action by directors entitled to
26cast [such] the specified percentage of the votes which all
27directors are entitled to cast.
28§ 5730. Compensation of directors.
29Except as otherwise restricted in the bylaws, the board of
30directors of a nonprofit corporation shall have the authority to
1fix the compensation of directors for their services as [such]
2directors, and a director may be a salaried officer of the
3corporation.
4Section 36. Section 5731 of Title 15 is amended by adding a
5subsection to read:
6§ 5731. Executive and other committees of the board.
7* * *
8(c) Status of committee action.--The term "board of
9directors" or "board," when used in any provision of this
10subpart relating to the organization or procedures of or the
11manner of taking action by the board of directors, shall be
12construed to include and refer to any executive or other
13committee of the board. Any provision of this subpart relating
14or referring to action to be taken by the board of directors or
15the procedure required therefor shall be satisfied by the taking
16of corresponding action by a committee of the board of directors
17to the extent authority to take the action has been delegated to
18the committee under this section.
19Section 37. Sections 5733, 5746(a), 5751, 5752, 5753, 5754,
205755, 5756(a)(1) and (3) and (b), 5757 and 5759 of Title 15 are
21amended to read:
22§ 5733. Removal of officers and agents.
23Unless otherwise provided in the bylaws, any officer or agent
24of a nonprofit corporation may be removed by the board of
25directors or other body [whenever in its judgment the best
26interests of the corporation will be served thereby, but such]
27with or without cause. The removal shall be without prejudice to
28the contract rights, if any, of any person so removed. Election
29or appointment of an officer or agent shall not of itself create
30contract rights.
1§ 5746. Supplementary coverage.
2(a) General rule.--The indemnification and advancement of
3expenses provided by or granted pursuant to the other sections
4of this subchapter shall not be deemed exclusive of any other
5rights to which a person seeking indemnification or advancement
6of expenses may be entitled under any bylaw, agreement, vote of
7members or disinterested directors or otherwise, both as to
8action in [his] an official capacity and as to action in another
9capacity while holding that office. Section 5728 (relating to
10interested [members,] directors or officers; quorum) shall be
11applicable to any bylaw, contract or transaction authorized by
12the directors under this section. A corporation may create a
13fund of any nature, which may, but need not, be under the
14control of a trustee, or otherwise secure or insure in any
15manner its indemnification obligations, whether arising under or
16pursuant to this section or otherwise.
17* * *
18§ 5751. Classes and qualifications of membership.
19(a) General rule.--Membership in a nonprofit corporation
20shall be of [such] the classes, and shall be governed by [such]
21the rules of admission, retention, suspension and expulsion,
22[as] prescribed in bylaws adopted by the members [shall
23prescribe], except that [all such] the rules shall be
24reasonable, germane to the purpose or purposes of the
25corporation[,] and equally enforced as to all members of the
26same class. Unless otherwise provided by a bylaw adopted by the
27members[, there]:
28(1) There shall be one class of members whose voting and
29other rights and interests shall be equal.
30(2) If there is only one class of members, the members
1shall have all the rights of members generally in a nonprofit
2corporation.
3(b) Corporations without voting members.--Where the articles
4provide that the corporation shall have no members, as such, or
5where a nonprofit corporation has under its bylaws or in fact no
6members entitled to vote on a matter, any provision of this
7[article] subpart or any other provision of law requiring notice
8to, the presence of, or the vote, consent or other action by
9members of the corporation in connection with [such] the matter
10shall be satisfied by notice to, the presence of, or the vote,
11consent or other action by the board of directors or other body
12of the corporation.
13(c) Membership status.--Regardless of whether a nonprofit
14corporation designates or refers to a person as a member of the
15corporation, the person is not a member of the corporation for
16purposes of this subpart unless the person satisfies the
17definition of "member" in section 5103(a) (relating to
18definitions).
19§ 5752. Organization on a stock share basis.
20(a) General rule.--A nonprofit corporation may be organized
21upon either a nonstock basis or, if so provided in its articles,
22upon a stock share basis[, as set forth in its articles].
23(b) Form of certificates; uncertificated shares.--The shares
24of nonprofit corporations organized upon a stock share basis
25shall be of [such] the denominations [as] provided in the bylaws
26[shall provide] and shall be represented by share
27certificates[.] unless the articles provide that any or all
28classes and series of shares, or any part thereof, shall be
29uncertificated shares. A provision of the articles providing for
30uncertificated shares shall not apply to shares represented by a
1certificate until the certificate is surrendered to the
2corporation. Except as otherwise expressly provided by law, the
3rights and obligations of the holders of shares represented by
4certificates and the rights and obligations of the holders of
5uncertificated shares of the same class and series shall be
6identical. The fact that the corporation is a nonprofit
7corporation shall be noted conspicuously on the face of each
8certificate. Within a reasonable time after the issuance or
9transfer of uncertificated shares, the corporation shall send to
10the registered owner thereof a written notice stating:
11(1) That the corporation is a nonprofit corporation
12incorporated under the laws of this Commonwealth.
13(2) The name of the registered owner.
14(3) The denomination and class of shares and the
15designation of the series, if any, of the shares issued or
16transferred.
17(c) Rights of shareholders.--Unless otherwise provided in a
18bylaw adopted by the members, each share shall entitle the
19holder thereof to one vote. No dividends shall be directly or
20indirectly paid on [any such] the shares, nor shall the
21shareholders be entitled to any portion of the earnings of
22[such] the corporation derived through increment of value upon
23its property, or otherwise incidentally made, until the
24dissolution of [any such] the corporation.
25(d) Transferability of shares.--Unless otherwise provided in
26the bylaws, [such] the shares shall not be transferable by
27operation of law or otherwise.
28(e) Power to cancel shares.--A nonprofit corporation shall
29have power to exclude from further membership any shareholder
30who fails to comply with the reasonable and lawful bylaws of the
1corporation, and may cancel the shares of any [such] offending
2member without liability for an accounting[,] except as may be
3provided in the bylaws.
4(f) Applicability of the Uniform Commercial Code.--The
5provisions of [Division 8 of Title 13] 13 Pa.C.S. Div. 8
6(relating to investment securities) shall not apply in any
7manner to the shares of a nonprofit corporation.
8(g) Cross reference.--See the definition of "member" in
9section 5103 (relating to definitions).
10§ 5753. Membership certificates.
11A nonprofit corporation organized upon a nonstock basis shall
12not issue shares of stock, but membership in [such] the
13corporation may be evidenced by certificates of membership. The
14fact that the corporation is a nonprofit corporation shall be
15noted conspicuously on the face of each certificate.
16§ 5754. Members grouped in local units.
17(a) General rule.--The bylaws of a nonprofit corporation may
18provide that the members of the corporation shall be grouped in
19incorporated or unincorporated local units formed upon the basis
20of territorial areas, or [such] other basis as may be determined
21in the bylaws, for the purpose of election of delegates or
22representatives to represent the members of [such] the local
23units at any regular or special meetings of [such] the
24corporation. Unless otherwise provided in a bylaw adopted by the
25members, each local unit participating in a representative
26capacity by means of one or more delegates or otherwise at a
27meeting of the corporation shall have a number of votes equal to
28the total membership of the local unit.
29(b) Voting at meetings of delegates.--The requirements of
30this [article] subpart for action by or the consent of a
1specified number or percentage of the members shall be satisfied
2by action by or the consent of [such] that number or percentage
3of votes of delegates or representatives of members selected
4pursuant to this section.
5(c) Calling and holding meetings of delegates.--The
6provisions of this [article] subpart relating to the manner of
7the calling and holding of and the taking of action at meetings
8of members shall be applicable to meetings of delegates or
9representatives of members.
10(d) Incorporation of local units.--A local unit of an
11incorporated or unincorporated parent body [which] that is
12incorporated or organized for a purpose or purposes not
13involving pecuniary profit, incidental or otherwise, to its
14members[,] may be incorporated under this [article] subpart by
15an incorporated parent body or by the members of [such] the
16local unit.
17§ 5755. Time of holding meetings of members.
18(a) Regular meetings.--The bylaws of a nonprofit corporation
19may provide for the number and the time of meetings of members,
20but unless otherwise provided in a bylaw adopted by the members
21at least one meeting of the members of a corporation [which]
22that has members, as such, entitled to vote, shall be held in
23each calendar year for the election of directors[, at such] at
24the time [as shall be] provided in or fixed pursuant to
25authority granted by the bylaws. Failure to hold the annual or
26other regular meeting at the designated time shall not work a
27dissolution of the corporation or affect otherwise valid
28corporate acts. If the annual or other regular meeting [shall
29not be] is not called and held within six months after the
30designated time, any member may call [such] the meeting at any
1time thereafter.
2(b) Special meetings.--Special meetings of the members may
3be called at any time by:
4(1) [by] the board of directors[, or];
5(2) members entitled to cast at least 10% of the votes
6[which] that all members are entitled to cast at the
7particular meeting[, or by such]; or
8(3) other officers or persons as may be provided in the
9bylaws.
10At any time, upon written request of any person who has called a
11special meeting, it shall be the duty of the secretary to fix
12the time of the meeting[,] which, if the meeting is called
13pursuant to a statutory right, shall be held not more than 60
14days after the receipt of the request. If the secretary [shall
15neglect or refuse] neglects or refuses to fix the time of the
16meeting, the person or persons calling the meeting may do so.
17(c) Adjournments.--Adjournments of any regular or special
18meeting may be taken[,] but any meeting at which directors are
19to be elected shall be adjourned only from day to day, or for
20[such] longer periods not exceeding 15 days each, as the members
21present and entitled to [cast at least a majority of the votes
22which all members present and voting are entitled to cast] vote
23shall direct, until [such] the directors have been elected.
24(d) Cross reference.--See section 6145 (relating to
25applicability of certain safeguards to foreign domiciliary
26corporations).
27§ 5756. Quorum.
28(a) General rule.--A meeting of members of a nonprofit
29corporation duly called shall not be organized for the
30transaction of business unless a quorum is present. Unless
1otherwise provided in a bylaw adopted by the members:
2(1) The presence of members entitled to cast at least a
3majority of the votes [which] that all members are entitled
4to cast on [the matters] a particular matter to be acted upon
5at the meeting shall constitute a quorum for the purposes of
6consideration and action on the matter.
7* * *
8(3) If a meeting cannot be organized because a quorum
9has not attended, those present may, except as otherwise
10provided in this [article] subpart, adjourn the meeting to
11[such] a time and place [as] they may determine.
12(b) Exceptions.--Notwithstanding any contrary provision in
13the articles or bylaws, those members entitled to vote who
14attend a meeting of members:
15(1) [In the case of any meeting called for the election
16of directors those who attend the second of such adjourned
17meetings] at which directors are to be elected that has been
18previously adjourned for lack of a quorum, although less than
19a quorum as fixed in this section[,] or in the [articles or]
20bylaws, shall nevertheless constitute a quorum for the
21purpose of election of directors[.];
22(2) [In the case of any meeting called for any other
23purpose those who attend the second of such adjourned
24meetings] that has been previously adjourned for one or more
25periods aggregating at least 15 days because of an absence of
26a quorum, although less than a quorum as fixed in this
27section[,] or in the [articles or] bylaws, shall nevertheless
28constitute a quorum for the purpose of acting upon any
29[resolution or other] matter set forth in the notice of the
30meeting[, if written notice of such second adjourned meeting,
1stating] if the notice states that those members who attend
2the adjourned meeting shall nevertheless constitute a quorum
3for the purpose of acting upon [such resolution or other] the
4matter[, is given to each member of record entitled to vote
5at such second adjourned meeting at least ten days prior to
6the day named for the second adjourned meeting].
7§ 5757. Action by members.
8(a) General rule.--[Except as otherwise provided in this
9article or in a bylaw adopted by the members, the acts at a duly
10organized meeting of members present entitled to cast at least a
11majority of the votes which all members present and voting are
12entitled to cast shall be the acts of the members.
13(b) Increased minimum vote.--Whenever in this article a
14specified number or percentage of votes of members or of a class
15of members is required for the taking of any action, a nonprofit
16corporation may prescribe in a bylaw adopted by the members that
17a higher number or percentage of votes shall be required for
18such action.] Except as otherwise provided in this subpart or in
19a bylaw adopted by the members, whenever any corporate action is
20to be taken by vote of the members of a nonprofit corporation,
21it shall be authorized upon receiving the affirmative vote of a
22majority of the votes cast by the members entitled to vote
23thereon and, if any members are entitled to vote thereon as a
24class, upon receiving the affirmative vote of a majority of the
25votes cast by the members entitled to vote as a class.
26(b) Changes in required vote.--Whenever a provision of this
27subpart requires a specified number or percentage of votes of
28members or of a class of members for the taking of any action, a
29nonprofit corporation may prescribe in a bylaw adopted by the
30members that a higher number or percentage of votes shall be
1required for the action. The number or percentage of members
2necessary to call a special meeting of members or to petition
3for the proposal of an amendment of articles under this subpart
4may not be increased under this subsection. See sections 5504(d)
5(relating to adoption, amendment and contents of bylaws) and
65914(d) (relating to adoption of amendments).
7(c) Expenses.--Unless otherwise restricted in the articles,
8the corporation shall pay the reasonable expenses of
9solicitation of votes, proxies or consents of members by or on
10behalf of the board of directors or its nominees for election to
11the board, including solicitation by professional proxy
12solicitors and otherwise, and may pay the reasonable expenses of
13a solicitation by or on behalf of other persons.
14§ 5759. Voting and other action by proxy.
15(a) General rule.--Voting by members of a nonprofit
16corporation shall be only in person unless a bylaw adopted by
17the members provides for voting by proxy. [The presence of or
18vote or other action at a meeting of members, or the expression
19of consent or dissent to corporate action in writing, by a proxy
20of a member pursuant to such a bylaw shall constitute the
21presence of, or vote or action by, or written consent or dissent
22of such member for the purposes of this article.] Unless
23otherwise restricted by a bylaw adopted by the members:
24(1) The presence of, or vote or other action at a
25meeting of members, or the expression of consent or dissent
26to corporate action, by a proxy of a member pursuant to a
27bylaw shall constitute the presence of, or vote or action by,
28or consent or dissent of the member for the purposes of this
29subpart.
30(2) Where two or more proxies of a member are present,
1the corporation shall, unless otherwise expressly provided in
2the proxy, accept as the vote or other action of all the
3members or shares represented thereby the vote cast or other
4action taken by a majority of them, and, if a majority of the
5proxies cannot agree whether the memberships or shares
6represented shall be voted or upon the manner of voting the
7memberships or shares or taking the other action, the voting
8of the memberships or shares or right to take other action
9shall be divided equally among those persons.
10(b) [Minimum requirements] Execution and filing.--Every
11proxy shall be executed [in writing] or authenticated by the
12member or by [his] the member's duly authorized [attorney in
13fact] attorney-in-fact and filed with or transmitted to the
14secretary of the corporation[.] or its designated agent. A
15member or the member's duly authorized attorney-in-fact may
16execute or authenticate a writing or transmit an electronic
17message authorizing another person to act for the member by
18proxy. A telegram, telex, cablegram, datagram, e-mail, Internet
19communication or other means of electronic transmission from a
20member or attorney-in-fact, or a photographic, facsimile or
21similar reproduction of a writing executed by a member or
22attorney-in-fact:
23(1) may be treated as properly executed or authenticated
24for purposes of this subsection; and
25(2) shall be so treated if it sets forth or utilizes a
26confidential and unique identification number or other mark
27furnished by the corporation to the member for the purposes
28of a particular meeting or transaction.
29(c) Revocation.--A proxy shall be revocable at will,
30notwithstanding any other agreement or any provision in the
1proxy to the contrary, but the revocation of a proxy shall not
2be effective until notice thereof has been given to the
3secretary of the corporation[. No] or its designated agent in
4writing or by electronic transmission. An unrevoked proxy shall
5not be valid after 11 months from the date of its execution,
6authentication or transmission unless a longer time is expressly
7provided therein[, but in no event shall a proxy be voted on
8after three years from the date of its execution]. A proxy shall
9not be revoked by the death or incapacity of the maker unless,
10before the vote is counted or the authority is exercised,
11[written] notice of [such] the death or incapacity is given to
12the secretary of the corporation[.] or its designated agent. See
13section 6145 (relating to applicability of certain safeguards to
14foreign domiciliary corporations).
15Section 38. Title 15 is amended by adding sections to read:
16§ 5760. (Reserved).
17§ 5761. (Reserved).
18Section 39. Sections 5760 and 5761 of Title 15 are
19renumbered and amended to read:
20§ [5760] 5762. Voting by corporations.
21(a) Voting in nonprofit corporation matters.--Unless
22otherwise provided in a bylaw of a nonprofit corporation adopted
23by the members, any other [corporation which is a member of such
24a nonprofit corporation may vote therein by any of its
25officers,] domestic or foreign corporation for profit or not-
26for-profit that is a member of the nonprofit corporation may
27vote by any of its officers or agents, or by proxy appointed by
28any officer or agent, unless some other person, by resolution of
29the board of directors of [such] the other corporation[,] or a
30provision of its articles or bylaws, a copy of which resolution
1or provision certified to be correct by one of its officers
2[shall have] has been filed with the secretary of the nonprofit
3corporation, [shall be] is appointed its general or special
4proxy[,] in which case [such] that person shall be entitled to
5vote [therein] as the proxy.
6(b) Voting by nonprofit corporations.--Shares of or
7memberships in a domestic or foreign corporation for profit or
8not-for-profit other than a nonprofit corporation, standing in
9the name of a shareholder or member [which] that is a nonprofit
10corporation, may be voted by the persons and in the manner
11provided for in the case of nonprofit corporations by subsection
12(a) [of this section] unless the laws of the jurisdiction in
13which the issuer of [any such] the shares or memberships is
14incorporated [shall] require the shares or memberships to be
15voted by some other person or persons or in some other manner[,]
16in which case, to the extent that [such] those laws are
17inconsistent [herewith] with this subsection, this subsection
18shall not apply.
19§ [5761] 5763. Determination of members of record.
20(a) Fixing record date.--Unless otherwise restricted in the
21bylaws, the board of directors of a nonprofit corporation may
22fix a time[, not more than 70 days] prior to the date of any
23meeting of members [or any adjournment thereof,] as a record
24date for the determination of the members entitled to notice of,
25or to vote at, [such] the meeting[. In such case only], which
26time, except in the case of an adjourned meeting, shall not be
27more than 90 days prior to the date of the meeting of members.
28Only members of record on the date [so] fixed shall [so] be so
29entitled notwithstanding any increase or other change in
30membership on the books of the corporation after any record date
1fixed as [aforesaid] provided in this subsection. Unless
2otherwise [restricted] provided in the bylaws, the board of
3directors may similarly fix a record date for the determination
4of members of record for any other purpose. When a determination
5of members of record has been made as provided in this section
6for purposes of a meeting, the determination shall apply to any
7adjournment thereof unless otherwise restricted in the bylaws or
8unless the board fixes a new record date for the adjourned
9meeting.
10(b) Determination when no record date fixed.--Unless
11otherwise [restricted] provided in the bylaws, if [no] a record
12date is not fixed:
13(1) The record date for determining members entitled to
14notice of or to vote at a meeting of members shall be at the
15close of business on the day next preceding the day on which
16notice is given, or, if notice is waived, at the close of
17business on the day [next] immediately preceding the day on
18which the meeting is held.
19(2) The record date for determining members entitled to:
20(i) express consent or dissent to corporate action
21in writing without a meeting, when [no] prior action by
22the board of directors or other body is not necessary[,];
23(ii) call a special meeting of the members; or
24(iii) propose an amendment of the articles;
25shall be the close of business on the day on which the first
26written consent or dissent, request for a special meeting or
27petition proposing an amendment of the articles is
28[expressed] filed with the secretary of the corporation.
29(3) The record date for determining members for any
30other purpose shall be at the close of business on the day on
1which the board of directors or other body adopts the
2resolution relating thereto.
3Section 40. Title 15 is amended by adding a section to read:
4§ 5764. (Reserved).
5Section 41. Sections 5762, 5763, 5764, 5765, 5766 and 5767
6of Title 15 are renumbered and amended to read:
7§ [5762] 5765. Judges of election.
8(a) General rule.--Unless otherwise provided in a bylaw
9adopted by the members:
10(1) In advance of any meeting of members of a nonprofit
11corporation, the board of directors or other body may appoint
12judges of election, who need not be members, to act at [such]
13the meeting or any adjournment thereof. If judges of election
14are not so appointed, the presiding officer of [any such] the
15meeting may, and on the request of any member shall, [make
16such appointment] appoint judges of election at the meeting.
17The number of judges shall be one or three. [No] A person who
18is a candidate for office to be filled at the meeting shall
19not act as a judge.
20(2) In case any person appointed as judge fails to
21appear or fails or refuses to act, the vacancy may be filled
22by appointment made by the board of directors or other body
23in advance of the convening of the meeting, or at the meeting
24by the presiding officer thereof.
25(3) The judges of election shall determine the number of
26members of record and the voting power of each, the members
27present at the meeting, the existence of a quorum, the
28authenticity, validity[,] and effect of proxies, if voting by
29proxy is permitted under the bylaws, receive votes or
30ballots, hear and determine all challenges and questions in
1any way arising in connection with the right to vote, count
2and tabulate all votes, determine the result[,] and [do such]
3perform the acts as may be proper to conduct the election or
4vote with fairness to all members. The judges of election
5shall perform their duties impartially, in good faith, to the
6best of their ability[,] and as expeditiously as is
7practical. If there are three judges of election, the
8decision, act or certificate of a majority shall be effective
9in all respects as the decision, act or certificate of all.
10(4) On request of the presiding officer of the meeting,
11or of any member, the judges shall make a report in writing
12of any challenge or question or matter determined by them,
13and execute a certificate of any fact found by them. Any
14report or certificate made by them shall be prima facie
15evidence of the facts stated therein.
16(b) Cross reference.--See section 6145 (relating to
17applicability of certain safeguards to foreign domiciliary
18corporations).
19§ [5763] 5766. Consent of members in lieu of meeting.
20(a) Unanimous consent.--Unless otherwise restricted in the
21bylaws, any action [which may] required or permitted to be taken
22at a meeting of the members or of a class of members of a
23nonprofit corporation may be taken without a meeting[,] if a
24consent or consents [in writing, setting forth the action so
25taken, shall be signed] to the action in record form are signed,
26before, on or after the effective date of the action, by all of
27the members who would be entitled to vote at a meeting for [such
28purpose and shall be filed] that purpose. The consent or
29consents must be filed with the [secretary of the corporation]
30minutes of the proceedings of the members.
1(b) Partial consent.--If the bylaws so provide, any action
2required or permitted to be taken at a meeting of the members or
3of a class of members may be taken without a meeting upon the
4signed consent of members who would have been entitled to cast
5the minimum number of votes that would be necessary to authorize
6the action at a meeting at which all members entitled to vote
7thereon were present and voting. The consents must be filed in
8record form with the minutes of the proceedings of the members.
9(c) Effectiveness of action by partial consent.--An action
10taken pursuant to subsection (b) shall not become effective
11until after at least ten days' notice of the action has been
12given to each member entitled to vote thereon who has not
13consented thereto.
14§ [5764] 5767. Appointment of custodian of corporation on
15deadlock or other cause.
16(a) General rule.--[The court, upon] Upon application of any
17member, the court may appoint one or more persons to be
18custodians of and for any nonprofit corporation when it [is made
19to appear] appears that:
20(1) [that] at any meeting for the election of directors
21or members of an other body, the members are so divided that
22they have failed to elect successors to [directors] those
23whose terms have expired or would have expired upon the
24qualification of their successors; or
25(2) [that] any of the conditions specified in section
265981 (relating to proceedings upon [petition of member, etc.)
27exists] application of member or director), other than that
28it is beneficial to the interest of the members that the
29corporation be wound up and dissolved, exist with respect to
30the corporation.
1(a.1) Exception.--The court shall not appoint a custodian to
2resolve a deadlock if the members by agreement or otherwise have
3provided for the appointment of a provisional director or member
4of an other body or other means for the resolution of the
5deadlock, but the court shall enforce the remedy so provided, if
6appropriate.
7(b) Power and title of custodian.--A custodian appointed
8under this section shall have all the power and title of a
9receiver appointed under Subchapter G of Chapter 59 (relating to
10involuntary liquidation and dissolution), but the authority of
11the custodian shall be to continue the business of the
12corporation and not to liquidate its affairs and distribute its
13assets[,] except when the court shall otherwise order [and
14except in cases arising under section 5981(1), (2) and (3)
15(relating to proceedings upon petition of member, etc.)].
16(c) Cross reference.--See section 6145 (relating to
17applicability of certain safeguards to foreign domiciliary
18corporations).
19§ [5765] 5768. Reduction of membership below stated number.
20Whenever the membership of a nonprofit corporation having a
21stated number of members [shall be] is reduced below [such] that
22number by death, withdrawal[,] or otherwise, the corporation
23shall not on that account be dissolved, but it shall be lawful
24for the surviving or continuing members to continue the
25corporate existence[,] unless otherwise restricted in the
26bylaws.
27§ [5766] 5769. Termination and transfer of membership.
28(a) General rule.--Membership in a nonprofit corporation
29shall be terminated in the manner provided in a bylaw adopted by
30the members. If [the] membership in any such corporation is
1limited to persons who are members in good standing in another
2corporation, or in any lodge, church, club, society or other
3entity or organization, the bylaws shall in each case define
4[such] the limitations, and may provide that failure on the part
5of [any such] a member to keep himself in good standing in
6[such] the other entity or organization shall be sufficient
7cause for [expelling the member from] terminating the membership
8of the member in the corporation requiring such eligibility.
9(b) Expulsion.--
10(1) [No] A member shall not be expelled from any
11nonprofit corporation without notice, trial and conviction,
12the form of which shall be prescribed by the bylaws.
13(2) Paragraph (1) [of this subsection] shall not apply
14to termination of membership pursuant to section 5544[(c)]
15(relating to [enforcement of payment of fees,] dues and
16assessments).
17(3) See section 6145 (relating to applicability of
18certain safeguards to foreign domiciliary corporations).
19(c) Effect of termination of membership.--Unless otherwise
20provided in the bylaws, the right of a member of a nonprofit
21corporation to vote, and his right, title and interest in or to
22the corporation or its property, shall cease [on the] upon
23termination of [his] membership.
24(d) Transfer of membership.--Unless otherwise provided in
25the bylaws, [no] a member may not transfer his membership or any
26right arising therefrom. The adoption of an amendment to the
27articles or bylaws of a nonprofit corporation that changes the
28identity of some or all of the members or the criteria for
29membership does not constitute a transfer for purposes of this
30subsection.
1§ [5767] 5770. Voting powers and other rights of certain
2securityholders and other entities.
3[Such] The power to vote in respect to the corporate affairs
4and management of a [nonprofit] membership corporation and other
5membership rights as may be provided in a bylaw adopted by the
6members may be conferred upon:
7(1) Registered holders of [securities evidencing
8indebtedness] obligations issued or to be issued by the
9corporation.
10(2) The United States of America, the Commonwealth, a
11state, or any political subdivision [thereof or other] of any
12of the foregoing, or any entity prohibited by law from
13becoming a member of a corporation.
14Section 42. Sections 5791, 5792, 5793, 5911, 5913, 5914,
155921, 5923(a), 5924, 5925, 5926(2) and (4), 5928, 5930, 5951,
165956, 5957(b)(1)(ii) and (iv) and (h)(1) and (3), 5972(b),
175973(a), 5975(c), 5976(a), 5977(a) and 5978(b) of Title 15 are
18amended to read:
19§ 5791. Corporate action subject to subchapter.
20(a) General rule.--This subchapter shall apply to, and the
21term "corporate action" in this subchapter shall mean any of the
22following actions:
23(1) The election, appointment, designation or other
24selection and the suspension, removal or expulsion of
25members, directors, members of an other body or officers of a
26nonprofit corporation.
27(2) The taking of any action on any matter [which] that
28is required under this [article] subpart or under any other
29provision of law to be, or [which] that under the bylaws may
30be, submitted for action to the members, directors, members
1of an other body or officers of a nonprofit corporation.
2(b) Cross reference.--See section 6145 (relating to
3applicability of certain safeguards to foreign domiciliary
4corporations).
5§ 5792. Proceedings prior to corporate action.
6(a) General rule.--Where under applicable law or the bylaws
7of a nonprofit corporation there has been a failure to hold a
8meeting to take corporate action and [such] the failure has
9continued for 30 days after the [date] designated or appropriate
10[therefor] date, the court may summarily order a meeting to be
11held upon the application of any person entitled, either alone
12or in conjunction with other persons similarly seeking relief
13under this section, to call a meeting to consider the corporate
14action in issue.
15(b) Conduct of meeting.--The court may determine the right
16to vote at [such] the meeting of persons claiming [such] that
17right, may appoint a master to hold [such] the meeting under
18such orders and powers as the court [may deem proper,] deems
19proper and may take [such action as may be] any action required
20to give due notice of the meeting and to convene and conduct the
21meeting in the interests of justice.
22(c) Cross reference.--See section 6145 (relating to
23applicability of certain safeguards to foreign domiciliary
24corporations).
25§ 5793. Review of contested corporate action.
26(a) General rule.--Upon [petition] application of any person
27[whose status as, or whose rights or duties as, a member,
28director, member of an other body, officer or otherwise of a
29nonprofit corporation are or may be affected] aggrieved by any
30corporate action, the court may hear and determine the validity
1of [such] the corporate action.
2(b) Powers and procedures.--[The court may make such orders
3in any such case as may be just and proper, with power to] By
4entering an appropriate order, the court may enforce the
5production of any books, papers and records of the corporation
6and other relevant evidence [which] that may relate to the
7issue. The court shall provide for notice of the pendency of the
8proceedings under this section to all persons affected thereby.
9If it is determined that no valid corporate action has been
10taken, the court may order a meeting to be held in accordance
11with section 5792 (relating to proceedings prior to corporate
12action).
13(c) Cross reference.--See section 6145 (relating to
14applicability of certain safeguards to foreign domiciliary
15corporations).
16§ 5911. Amendment of articles authorized.
17(a) General rule.--A nonprofit corporation, in the manner
18[hereinafter] provided in this subchapter, may [from time to
19time] amend its articles for one or more of the following
20purposes:
21(1) To adopt a new name, subject to the restrictions
22[heretofore] provided in this [article] subpart.
23(2) To modify any provision of the articles relating to
24its term of existence.
25(3) To change, add to[,] or diminish its purposes[,] or
26to set forth different or additional purposes.
27(4) To restate the articles in their entirety.
28(5) [In] To make any and as many other [respects]
29changes as desired.
30(b) Exceptions.--[No] An amendment adopted under this
1section shall not amend articles in such a way that as so
2amended they would not be authorized by this [article] subpart
3as original articles of incorporation[,] except that:
4(1) Restated articles shall, subject to section 109
5(relating to name of commercial registered office provider in
6lieu of registered address), state the address of the current
7instead of the initial registered office of the corporation
8in this Commonwealth[,] and need not state the names and
9addresses [of the first directors or] of the incorporators.
10(2) The corporation shall not be required to revise any
11other provision of its articles if [such] the provision is
12valid and operative immediately prior to the filing of [such]
13the amendment in the [Department of State] department.
14§ 5913. Notice of meeting of members.
15[Written notice shall, not less than ten days before the
16meeting of members called for the purpose of considering the
17proposed amendment,] (a) General rule.--Notice in record form
18of the meeting of members of a nonprofit corporation that will
19act on the proposed amendment shall be given to each member of
20record entitled to vote thereon. [There shall be included in, or
21enclosed with, such notice] The notice shall include a copy of
22the proposed amendment or a summary of the changes to be
23effected thereby.
24(b) Cross reference.--See Subchapter A of Chapter 57
25(relating to notice and meetings generally).
26§ 5914. Adoption of amendments.
27(a) General rule.--[The] Unless a bylaw adopted by the
28members or a specific provision of this subpart requires a
29greater vote, a proposed amendment of the articles of a
30nonprofit corporation shall be adopted upon receiving the
1affirmative vote of the members present entitled to cast at
2least a majority of the votes [which] that all members present
3are entitled to cast thereon, and if any class of members is
4entitled to vote thereon as a class, the affirmative vote of the
5members present of such class entitled to cast at least a
6majority of the votes [which] that all members present of such
7class are entitled to cast thereon. Any number of amendments may
8be submitted to the members and voted upon by them at one
9meeting.
10(a.1) Adoption by board of directors or other body.--Unless
11otherwise restricted in the bylaws, an amendment of articles
12shall not require the approval of the members of the corporation
13if:
14(1) the amendment is to provide for perpetual existence;
15(2) to the extent the amendment has not been approved by
16the members, it restates without change all of the operative
17provisions of the articles as theretofore amended or as
18amended thereby; or
19(3) the amendment accomplishes any combination of
20purposes specified in this subsection.
21Whenever a provision of this subpart authorizes the board of
22directors or other body to take any action without the approval
23of the members and provides that a statement, certificate, plan
24or other document relating to such action shall be filed in the
25department and shall operate as an amendment of the articles,
26the board upon taking such action may, in lieu of filing the
27statement, certificate, plan or other document, amend the
28articles under this subsection without the approval of the
29members to reflect the taking of such action. The amendment
30shall be deemed adopted by the corporation when it has been
1adopted by the board of directors or other body in the manner
2provided by subsection (b).
3(b) Adoption in absence of voting members.--If the
4corporation has no members entitled to vote thereon, or no
5members entitled to vote thereon other than persons who also
6constitute the board of directors or other body, the amendment
7shall be deemed adopted by the corporation when it has been
8adopted by the board of directors or other body pursuant to
9section 5912 (relating to proposal of amendments).
10(c) Termination of proposal.--[The resolution or petition
11may contain a provision that at any time prior to the filing of
12articles of amendment in the Department of State the proposal
13may be terminated by the board of directors or other body
14notwithstanding the adoption of the amendment by the
15corporation.] Prior to the time when an amendment becomes
16effective, the amendment may be terminated pursuant to
17provisions for amendment, if any, set forth in the resolution or
18petition. If articles of amendment have been filed in the
19department prior to the termination, a statement under section
205902 (relating to statement of termination) shall be filed in
21the department.
22(d) Amendment of voting provisions.--[Notwithstanding any
23contrary provision of the articles or bylaws,] Unless otherwise
24provided in the articles, whenever the articles [shall] require
25for the taking of any action by the members or a class of
26members a specific number or percentage of votes, the provision
27of the articles setting forth [such] that requirement shall not
28be amended or repealed by any lesser number or percentage of
29votes of the members or of [such] the class of members.
30§ 5921. Merger and consolidation authorized.
1(a) Domestic surviving or new corporation.--Any two or more
2domestic nonprofit corporations, or any two or more foreign
3nonprofit corporations [not-for-profit], or any one or more
4domestic nonprofit corporations[,] and any one or more foreign
5nonprofit corporations [not-for-profit], may, in the manner
6provided in this subchapter, be merged into one of [such] the
7domestic nonprofit corporations, [hereinafter] designated in
8this subchapter as the surviving corporation, or consolidated
9into a new corporation to be formed under this [article, if
10such] subpart, if the foreign corporations [not-for-profit] are
11authorized by the [law or] laws of the jurisdiction under which
12they are incorporated to effect [such] a merger or consolidation
13with a corporation of another jurisdiction.
14(b) Foreign surviving or new corporation.--Any one or more
15domestic nonprofit corporations, and any one or more foreign
16nonprofit corporations [not-for-profit], may, in the manner
17[hereinafter] provided in this subchapter, be merged into one of
18[such foreign corporations not-for-profit, hereinafter] the
19foreign nonprofit corporations, designated in this subchapter as
20the surviving corporation, or consolidated into a new
21corporation to be incorporated under the [law or] laws of the
22jurisdiction under which one of the foreign nonprofit
23corporations [not-for-profit] is incorporated, if the laws of
24[such] that jurisdiction authorize [such] a merger with or
25consolidation into a corporation of another jurisdiction.
26§ 5923. Notice of meeting of members.
27(a) General rule.--[Written notice] Notice in record form of
28the meeting of members that will act on the proposed plan shall
29be given to each member of record, whether or not entitled to
30vote thereon, of each domestic nonprofit corporation that is a
1party to the merger or consolidation. [There shall be included
2in, or enclosed with, the notice] The notice shall include or be
3accompanied by a copy of the proposed plan or a summary thereof.
4The notice shall [state] provide that a copy of the bylaws of
5the surviving or new corporation will be furnished to any member
6on request and without cost.
7* * *
8§ 5924. Adoption of plan.
9(a) General rule.--The plan of merger or consolidation shall
10be adopted upon receiving the affirmative vote of the members
11present entitled to cast at least a majority of the votes
12[which] that all members present are entitled to cast thereon of
13each of the [merging or consolidating] domestic nonprofit
14corporations[,] that is a party to the merger or consolidation
15and, if any class of members is entitled to vote thereon as a
16class, the affirmative vote of the members present of such class
17entitled to cast at least a majority of the votes [which] that
18all members present of such class are entitled to cast thereon.
19(b) Adoption in absence of voting members.--If [the] a
20merging or consolidating corporation has no members entitled to
21vote thereon, or no members entitled to vote thereon other than
22persons who also constitute the board of directors or other
23body, a plan of merger or consolidation shall be deemed adopted
24by the corporation when it has been adopted by the board of
25directors or other body pursuant to section 5922 (relating to
26plan of merger or consolidation).
27(c) Termination of plan.--[Any plan of merger or
28consolidation may contain a provision that at any time prior to
29the filing of articles of merger or consolidation in the
30Department of State the plan may be terminated by the board of
1directors or other body of any corporation which is a party to
2the plan notwithstanding adoption of the plan by all or any of
3the corporations which are parties to the plan.] Prior to the
4time when a merger or consolidation becomes effective, the
5merger or consolidation may be terminated pursuant to provisions
6for termination, if any, set forth in the plan. If articles of
7merger or consolidation have been filed in the department prior
8to the termination, a statement under section 5902 (relating to
9statement of termination) shall be filed in the department.
10§ 5925. Authorization by foreign corporations.
11The plan of merger or consolidation shall be authorized,
12adopted or approved by each foreign nonprofit corporation
13[which] that desires to merge or consolidate[,] in accordance
14with the laws of the jurisdiction in which it is incorporated[.]
15and, in the case of a foreign domiciliary corporation, in
16accordance with the provisions of this subpart to the extent
17provided by section 6145 (relating to applicability of certain
18safeguards to foreign domiciliary corporations).
19§ 5926. Articles of merger or consolidation.
20Upon the adoption of the plan of merger or consolidation by
21the corporations desiring to merge or consolidate, as provided
22in this subchapter, articles of merger or articles of
23consolidation, as the case may be, shall be executed by each
24corporation and shall, subject to section 109 (relating to name
25of commercial registered office provider in lieu of registered
26address), set forth:
27* * *
28(2) The name and address, including street and number,
29if any, of the registered office of each other domestic
30nonprofit corporation and qualified foreign nonprofit
1corporation that is a party to the [plan] merger or
2consolidation.
3* * *
4(4) The manner in which the plan was adopted by each
5domestic corporation and, if one or more foreign corporations
6are parties to the [plan] merger or consolidation, the fact
7that the plan was authorized, adopted or approved, as the
8case may be, by each of the foreign corporations in
9accordance with the laws of the jurisdiction in which it is
10incorporated.
11* * *
12§ 5928. Effective date of merger or consolidation.
13Upon the filing of the articles of merger or the articles of
14consolidation in the [Department of State,] department or upon
15the effective date specified in the plan of merger or
16consolidation, whichever is later, the merger or consolidation
17shall be effective. The merger or consolidation of one or more
18domestic nonprofit corporations into a foreign nonprofit
19corporation shall be effective according to the provisions of
20law of the jurisdiction in which [such] the foreign corporation
21is incorporated, but not until articles of merger or articles of
22consolidation have been adopted and filed, as provided in this
23subchapter.
24§ 5930. Voluntary transfer of corporate assets.
25(a) General rule.--[A nonprofit corporation shall not sell,
26lease away or exchange all, or substantially all, its property
27and assets, with or without good will, unless and until a plan
28of sale, lease or exchange of assets with respect thereto shall
29have been adopted by the corporation in the manner provided in
30this subchapter with respect to the adoption of a plan of
1merger.] A sale, lease, exchange or other disposition of all, or
2substantially all, of the property and assets, with or without
3goodwill, of a nonprofit corporation, if not made pursuant to
4Subchapter D of Chapter 19 (relating to division), may be made
5only pursuant to a plan of asset transfer. The property or
6assets of a direct or indirect subsidiary corporation that is
7controlled by a parent corporation shall also be deemed the
8property or assets of the parent corporation for purposes of
9this subsection. The plan of asset transfer shall set forth the
10terms and consideration of the sale, lease, exchange or other
11disposition or may authorize the board of directors or other
12body to fix any or all of the terms and conditions, including
13the consideration to be received by the corporation. Any of the
14terms of the plan may be made dependent upon facts ascertainable
15outside of the plan if the manner in which the facts will
16operate upon the terms of the plan is set forth in the plan. The
17plan of asset transfer shall be proposed and adopted, and may be
18amended after its adoption and terminated, by a nonprofit
19corporation in the manner provided in this subchapter for the
20proposal, adoption, amendment and termination of a plan of
21merger. A copy or summary of the plan shall be included in, or
22enclosed with, the notice of the meeting at which members will
23act on the plan. In order to make effective any plan [of sale,
24lease or exchange of assets] so adopted, it shall not be
25necessary to file any articles or other document in the
26[Department of State] department, but the corporation shall
27comply with the requirements of section 5547(b) (relating to
28nondiversion of certain property).
29(b) Exceptions.--Subsection (a) [of this section] shall not
30apply to a sale, lease [away or], exchange or other disposition
1of all, or substantially all, the property and assets of a
2nonprofit corporation [when made in connection with the
3dissolution or liquidation of the corporation. Such a
4transaction shall be governed by the provisions of Subchapter F
5(relating to voluntary dissolution and winding up) or Subchapter
6G (relating to involuntary liquidation and dissolution), as the
7case may be.]:
8(1) that directly or indirectly owns all of the
9outstanding shares or other ownership interest of another
10corporation to the other corporation;
11(2) if made in connection with the dissolution or
12liquidation of the corporation, which transaction shall be
13governed by the provisions of Subchapter F (relating to
14voluntary dissolution and winding up) or G of Chapter 19
15(relating to involuntary liquidation and dissolution), as
16appropriate; or
17(3) if made in connection with a transaction pursuant to
18which all the assets sold, leased, exchanged or otherwise
19disposed of are simultaneously leased back to the
20corporation.
21(c) Mortgage.--A mortgage [or pledge], pledge or grant of a
22security interest or dedication of property to the repayment of
23indebtedness, with or without recourse, shall not be deemed a
24sale, lease [or exchange], exchange or other disposition for the
25purposes of this section.
26(d) Restrictions.--[Nothing in this] This section shall not
27be construed to authorize the conversion or exchange of property
28or assets in fraud of corporate creditors or in violation of
29law.
30§ 5951. Division authorized.
1(a) Division of domestic corporation.--Any domestic
2nonprofit corporation may, in the manner provided in this
3subchapter, be divided into two or more domestic nonprofit
4corporations incorporated or to be incorporated under this
5article, or into one or more [such] domestic nonprofit
6corporations and one or more foreign nonprofit corporations
7[not-for-profit] to be incorporated under the laws of another
8jurisdiction or jurisdictions, or into two or more [of such]
9foreign nonprofit corporations [not-for-profit], if the [law or]
10laws of [such] the other jurisdictions [authorized such]
11authorize the division.
12(b) Division of foreign corporation.--Any foreign nonprofit
13corporation [not-for-profit] may, in the manner provided in this
14subchapter, be divided into one or more domestic nonprofit
15corporations to be incorporated under this [article] subpart and
16one or more foreign nonprofit corporations [not-for-profit]
17incorporated or to be incorporated under the laws of another
18jurisdiction or jurisdictions, or into two or more [of such]
19domestic nonprofit corporations, if [such foreign] the foreign
20nonprofit corporation [not-for-profit] is authorized under the
21laws of the jurisdiction under which it is incorporated to
22effect [such] a division.
23(c) Surviving and new corporations.--The corporation
24effecting a division, if it [shall survive] survives the
25division, is [hereinafter] designated in this subchapter as the
26surviving corporation. All corporations originally incorporated
27by a division are [hereinafter] designated in this subchapter as
28new corporations. The surviving corporation, if any, and the new
29corporation or corporations are [hereinafter] collectively
30designated in this subchapter as the resulting corporations.
1§ 5956. Effective date of division.
2Upon the filing of articles of division in the [Department of
3State,] department or upon the effective date specified in the
4plan of division, whichever is later, the division shall become
5effective. The division of a domestic nonprofit corporation into
6one or more foreign nonprofit corporations [not-for-profit] or
7the division of a foreign nonprofit corporation [not-for-profit]
8shall be effective according to the laws of the jurisdictions
9where [such] the foreign corporations are or are to be
10incorporated and, in the case of a foreign domiciliary
11corporation, the provisions of this subpart to the extent
12provided by section 6145 (relating to applicability of certain
13safeguards to foreign domiciliary corporations), but not until
14articles of division have been adopted and filed[,] as provided
15in this subchapter.
16§ 5957. Effect of division.
17* * *
18(b) Property rights; allocations of assets and
19liabilities.--
20(1) Except as otherwise provided by order, if any,
21obtained pursuant to section 5547(b) (relating to
22nondiversion of certain property):
23* * *
24(ii) Upon the division becoming effective, the
25resulting corporations shall each thenceforth be
26responsible as separate and distinct corporations only
27for such liabilities as each corporation may undertake or
28incur in its own name, but shall be liable for the
29liabilities of the dividing corporation in the manner and
30on the basis provided in [paragraphs (4) and (5)]
1subparagraphs (iv) and (v).
2* * *
3(iv) [To] Except as provided in section 5952(f)
4(relating to proposal and adoption of plan of division),
5to the extent allocations of liabilities are contemplated
6by the plan of division, the liabilities of the dividing
7corporation shall be deemed without further action to be
8allocated to and become the liabilities of the resulting
9corporations on such a manner and basis and with such
10effect as is specified in the plan; and one or more, but
11less than all, of the resulting corporations shall be
12free of the liabilities of the dividing corporation to
13the extent, if any, specified in the plan, if in either
14case:
15(A) no fraud on members without voting rights or
16violation of law shall be effected thereby; and
17(B) the plan does not constitute a fraudulent
18transfer under 12 Pa.C.S. Ch. 51 (relating to
19fraudulent transfers).
20* * *
21(h) Conflict of laws.--It is the intent of the General
22Assembly that:
23(1) The effect of a division of a domestic [business]
24nonprofit corporation shall be governed solely by the laws of
25this Commonwealth and any other jurisdiction under the laws
26of which any of the resulting corporations is incorporated.
27* * *
28(3) The validity of any allocations of assets or
29liabilities by a plan of division of a domestic [business]
30nonprofit corporation, regardless of whether [or not] any of
1the new corporations is a foreign [business] nonprofit
2corporation, shall be governed solely by the laws of this
3Commonwealth.
4* * *
5§ 5972. Proposal of voluntary dissolution.
6* * *
7(b) Submission to members.--The board of directors or other
8body or the petitioning members shall direct that the [question
9of] resolution recommending dissolution be submitted to a vote
10of the members of the corporation entitled to vote thereon at a
11regular or special meeting of the members.
12* * *
13§ 5973. Notice of meeting of members.
14(a) General rule.--[Written notice] Notice in record form of
15the meeting of members that will consider the [advisability of
16voluntarily dissolving a] resolution recommending dissolution of
17the nonprofit corporation shall be given to each member of
18record entitled to vote thereon [and the purpose shall be
19included]. The purpose of the meeting shall be stated in the
20notice [of the meeting].
21* * *
22§ 5975. Predissolution provision for liabilities.
23* * *
24(c) Winding up and distribution.--The corporation shall, as
25speedily as possible, proceed to collect all sums due it,
26convert into cash all corporate assets the conversion of which
27into cash is required to discharge its liabilities and, out of
28the assets of the corporation, discharge or make adequate
29provision for the discharge of all liabilities of the
30corporation, according to their respective priorities. Except as
1otherwise provided in a bylaw adopted by the members or in this
2subpart or by any other provision of law, any surplus remaining
3after paying or providing for all liabilities of the corporation
4shall be distributed to the shareholders, if any, pro rata, or
5if there be no shareholders, among the members per capita. See
6section [1972(a)] 5972(a) (relating to proposal of voluntary
7dissolution).
8§ 5976. Judicial supervision of proceedings.
9(a) General rule.--A nonprofit corporation that has elected
10to proceed under section [1975] 5975 (relating to predissolution
11provision for liabilities), at any time during the winding up
12proceedings, may apply to the court to have the proceedings
13continued under the supervision of the court and thereafter the
14proceedings shall continue under the supervision of the court as
15provided in Subchapter G (relating to involuntary liquidation
16and dissolution).
17* * *
18§ 5977. Articles of dissolution.
19(a) General rule.--Articles of dissolution and the
20certificates or statement required by section 139 (relating to
21tax clearance of certain fundamental transactions) shall be
22filed in the [Department of State] department when:
23(1) all liabilities of the nonprofit corporation have
24been discharged, or adequate provision has been made
25therefor, in accordance with section 5975 (relating to
26predissolution provision for liabilities), and all of the
27remaining assets of the corporation have been distributed as
28provided in section 5975 or in case its assets are not
29sufficient to discharge its liabilities, when all the assets
30have been fairly and equitably applied, as far as they will
1go, to the payment of such liabilities; or
2(2) an election to proceed under Subchapter H (relating
3to postdissolution provision for liabilities) has been made.
4[See section 134 (relating to docketing statement).]
5* * *
6§ 5978. Winding up of corporation after dissolution.
7* * *
8(b) Standard of care of directors, members of an other body
9and officers.--The dissolution of the corporation shall not
10subject its directors, members of an other body or officers to
11standards of conduct different from those prescribed by or
12pursuant to Chapter 57 (relating to officers, directors and
13members). Directors and members of an other body of a dissolved
14corporation who have complied with section 5975 (relating to
15predissolution provision for liabilities) or Subchapter H
16(relating to postdissolution provision for liabilities) and
17governing persons of a successor entity who have complied with
18Subchapter H shall not be personally liable to the creditors or
19claimants of the dissolved corporation.
20Section 43. Section 5979(a) of Title 15 is amended and the
21section is amended by adding a subsection to read:
22§ 5979. Survival of remedies and rights after dissolution.
23(a) General rule.--The dissolution of a nonprofit
24corporation, either under this subchapter or under Subchapter G
25(relating to involuntary liquidation and dissolution) or by
26expiration of its period of duration or otherwise, shall not
27eliminate nor impair any remedy available to or against the
28corporation or its directors, members of an other body, officers
29or members for any right or claim existing, or liability
30incurred, prior to the dissolution, if an action thereon is
1brought on behalf of:
2(1) the corporation within the time otherwise limited by
3law; or
4(2) any other person before or within two years after
5the date of the dissolution or within the time otherwise
6limited by this subpart or other provision of law, whichever
7is less. See sections 5987 (relating to proofs of claims),
85993 (relating to acceptance or rejection of matured claims)
9and 5994 (relating to disposition of unmatured claims).
10[The actions or proceedings may be prosecuted against and
11defended by the corporation in its corporate name.]
12* * *
13(e) Conduct of actions.--An action or proceeding may be
14prosecuted against and defended by a dissolved corporation in
15its corporate name.
16Section 44. Title 15 is amended by adding a section to read:
17§ 5980. Dissolution by domestication.
18Whenever a domestic nonprofit corporation has domesticated
19itself under the laws of another jurisdiction by action similar
20to that provided under section 6161 (relating to domestication)
21and has authorized that action by the vote required by this
22subchapter for the approval of a proposal that the corporation
23dissolve voluntarily, the corporation may surrender its charter
24under the laws of this Commonwealth by filing in the department
25articles of dissolution under this subchapter containing the
26statements specified under section 5977(b)(1) through (4)
27(relating to articles of dissolution). If the corporation as
28domesticated in the other jurisdiction qualifies to do business
29in this Commonwealth either prior to or simultaneously with the
30filing of the articles of dissolution under this section, the
1corporation shall not be required to file with the articles of
2dissolution the tax clearance certificates that would otherwise
3be required under section 139 (relating to tax clearance of
4certain fundamental transactions).
5Section 45. Sections 5981, 5982, 5983, 5984, 5986, 5987,
65988, 5992(c)(2), 5997(d) and 6101(c) of Title 15 are amended to
7read:
8§ 5981. Proceedings upon [petition] application of member[,
9etc.] or director.
10[The court may, upon petition] Upon application filed by a
11member or director of a nonprofit corporation, the court may
12entertain proceedings for the involuntary winding up and
13dissolution of the corporation[,] when any of the following [are
14made to appear] occur:
15(1) [That the] The objects of the corporation have
16wholly failed[;], or are entirely abandoned, or [that] their
17accomplishment is impracticable.
18(2) [That the] The acts of the directors, or those in
19control of the corporation, are illegal, oppressive[,] or
20fraudulent[, and that] and it is beneficial to the interests
21of the members that the corporation be wound up and
22dissolved.
23(3) [That the] The corporate assets are being misapplied
24or wasted[, and that] and it is beneficial to the interests
25of the members that the corporation be wound up and
26dissolved.
27(4) [That the] The directors or other body are
28deadlocked in the direction of the management of the
29[corporate] business and affairs of the corporation and the
30members are unable to break the deadlock[, and that] and
1irreparable injury to the corporation is being suffered or is
2threatened by reason thereof. The court shall not appoint a
3receiver or grant other similar relief under this paragraph
4if the members by agreement or otherwise have provided for
5appointment of a provisional director or member of an other
6body or other means for the resolution of a deadlock, but the
7court shall enforce the remedy provided by the members, if
8appropriate.
9§ 5982. Proceedings upon [petition] application of creditor.
10[The court may, upon petition] Upon application filed by a
11creditor of a nonprofit corporation whose claim has either been
12reduced to judgment and an execution thereon returned
13unsatisfied[,] or whose claim is admitted by the corporation,
14the court may entertain proceedings for the involuntary winding
15up and dissolution of the corporation when, in either case, it
16is made to appear that the corporation is unable to [pay its
17debts and obligations] discharge its liabilities in the regular
18course of business, as they mature, or is unable to afford
19reasonable security to those who may deal with it.
20§ 5983. Proceedings upon petition of superior religious
21organization.
22The court may, in the case of any nonprofit corporation
23organized for the support of public worship, upon [petition
24filed by] application of the diocesan convention, presbytery,
25synod, conference, council, or other supervising or controlling
26organization of which the corporation is a member or with which
27it is in allegiance and to which it is subordinate, entertain
28proceedings for the involuntary winding up and dissolution of
29the corporation when it is made to appear that by reason of
30shifting population, withdrawal of membership[,] or any other
1cause whatsoever, the corporation has ceased to support public
2worship within the intent and meaning of its articles[,] and the
3dissolution of the corporation may be effected without prejudice
4to the public welfare and the interests of the members of the
5corporation.
6§ 5984. Appointment of receiver pendente lite and other interim
7powers.
8Upon the filing of [a petition] an application under this
9subchapter, the court [shall have all the ordinary powers of a
10court of equity to] may issue injunctions, [to] appoint a
11receiver [or receivers,] pendente lite[,] with such powers and
12duties as the court from time to time may direct[, to take such
13other proceedings] and proceed as may be requisite to preserve
14the corporate assets wherever situated and carry on the business
15of the corporation until a full hearing can be had.
16§ 5986. Qualifications of receivers.
17A receiver shall in all cases be a [resident of this
18Commonwealth,] natural person of full age or a corporation
19authorized to act as receiver, which corporation, if so
20authorized, may be a domestic corporation for profit or not-for-
21profit or a foreign corporation for profit or not-for-profit
22authorized to do business in this Commonwealth, and shall give
23such bond, if any, as the court may direct, with such sureties,
24if any, as the court may require.
25§ 5987. Proofs of claims.
26(a) General rule.--In a proceeding under this subchapter,
27the court may require all creditors of the nonprofit corporation
28to file with the [prothonotary] office of the clerk of the court
29of common pleas, or with the receiver, in such form as the court
30may prescribe, verified proofs[, under oath,] of their
1respective claims. If the court requires the filing of claims,
2it shall fix a date, which shall not be less than [four months]
3120 days from the date of the order, as the last day for filing
4of claims[,] and shall prescribe the notice that shall be given
5to creditors and claimants of the date so fixed. Prior to or
6after the date so fixed, the court may extend the time for the
7filing of claims. Creditors and claimants [failing to] who do
8not file proofs of claim on or before the date so fixed may be
9barred, by order of court, from participating in the
10distribution of the assets of the corporation.
11(b) Cross reference.--See section 5979 (relating to survival
12of remedies and rights after dissolution).
13§ 5988. Discontinuance of proceedings; reorganization.
14[The proceedings under this subchapter may be discontinued at
15any time during the winding up proceedings, in the following
16manner:
17(1) If the proceedings shall have been instituted by a
18member or director and it is made to appear to the court that
19the deadlock in the corporate affairs has been broken or the
20management or control of the corporation has been changed,
21the court, in its discretion, may dismiss the proceeding and
22direct the receiver to redeliver to the corporation all its
23remaining assets.
24(2) If the proceedings shall have been instituted by a
25creditor and it is made to appear that the debts of the
26corporation have been paid or provided for, and that there
27remain or can be obtained sufficient funds to enable the
28corporation to resume its business, the court, in its
29discretion, may dismiss the proceeding and direct the
30receiver to redeliver to the corporation all its remaining
1assets.
2(3) When a compromise or reorganization of the
3corporation is proposed, whether the proceedings shall have
4been instituted by a member or director or by a creditor, the
5court, upon the summary application of any member, director,
6creditor, or receiver, may order a meeting of the creditors,
7or members to be summoned in such manner as the court may
8direct. If a majority in number, representing 75% in value of
9the creditors or if 75% of the members present in person, or
10if a majority in number, representing 75% in value of any
11class of creditors, or if 75% of the members of any class
12present in person, as the case may be, agree to any
13compromise or reorganization of the corporation, such
14compromise or reorganization, if approved by the court as
15fair and feasible, shall be binding on all creditors or on
16all members, or both, or on the class of creditors or class
17of members, or both, as the case may be, and also on the
18corporation and its receiver, if any.
19(4) If the proceedings shall have been instituted by a
20superior religious organization and it is made to appear that
21appropriate arrangements for the conduct of the affairs of
22the corporation have been made, the court, in its discretion,
23may dismiss the proceedings and direct the receiver to
24redeliver to the corporation its remaining assets.]
25The proceedings under this subchapter may be discontinued at
26any time if it is established that cause for liquidation no
27longer exists, in which event the court shall dismiss the
28proceedings and direct the receiver to redeliver to the
29nonprofit corporation all its remaining property and assets.
30§ 5992. Notice to claimants.
1* * *
2(c) Publication and service of notices.--
3* * *
4(2) Concurrently with or preceding the publication, the
5corporation or successor entity shall send a copy of the
6notice by certified or registered mail, return receipt
7requested, to each:
8(i) known creditor or claimant;
9(ii) holder of a claim described in subsection (b);
10and
11(iii) municipal corporation in which [the registered
12office or principal] a place of business of the
13corporation in this Commonwealth was located at the time
14of filing the articles of dissolution in the department.
15* * *
16§ 5997. Payments and distributions.
17* * *
18[(d) Liability of directors.--Directors or members of an
19other body of a dissolved corporation or governing persons of a
20successor entity that has complied with this section shall not
21be personally liable to the claimants of the dissolved
22corporation.]
23§ 6101. Application of article.
24* * *
25(c) Admitted foreign fraternal benefit society exclusion.--
26This article shall not apply to any foreign corporation not-for-
27profit qualified to do business in this Commonwealth under
28section [603 of the act of July 29, 1977 (P.L.105, No.38) known
29as the Fraternal Benefit Society Code.] 2455 of the act of May
3017, 1921 (P.L.682, No.284), known as The Insurance Company Law
1of 1921.
2Section 46. Title 15 is amended by adding sections to read:
3§ 6102. Foreign domiciliary corporations.
4A foreign nonprofit corporation is a foreign domiciliary
5corporation if it is a corporation:
6(1) which derived more than one-half of its revenues for
7the preceding three fiscal years, or such portion thereof as
8the corporation was in existence, from sources in this
9Commonwealth and was at any time during that period doing
10business in this Commonwealth on the basis of the most
11minimal contacts with this Commonwealth permitted under the
12Constitution of the United States; or
13(2) at least a majority of the bona fide members of
14which are residents of this Commonwealth.
15§ 6103. Acquisition of foreign domiciliary corporation status.
16(a) General rule.--A foreign nonprofit corporation shall
17become a foreign domiciliary corporation under section 6102
18(relating to foreign domiciliary corporations) on the first day
19of the month following the month in which the corporation first
20has knowledge that either test has been met or upon entry of an
21order by any court of competent jurisdiction declaring that
22either test has been met.
23(b) Newly incorporated corporations.--Where the test or
24tests under section 6102 are met at the time of the admission of
25the first members of the corporation and continuously
26thereafter, foreign domiciliary corporation status when
27established shall be retroactive to the incorporation of the
28corporation.
29§ 6104. Termination of foreign domiciliary corporation status.
30A foreign domiciliary corporation shall cease to have that
1status on the first day of the month following the month in
2which the corporation first has knowledge that it no longer
3meets either test under section 6102 (relating to foreign
4domiciliary corporations) or upon entry of an order of any court
5of competent jurisdiction declaring that the corporation no
6longer meets either test.
7Section 47. Sections 6122(b)(3), 6123(b), 6141, 6142, 6143,
86145 and, 8911(a)(1) <-and 8925(a) of Title 15 are amended to
9read:
10§ 6122. Excluded activities.
11* * *
12(b) Exceptions.--The specification of activities in
13subsection (a) does not establish a standard for activities that
14may subject a foreign corporation to:
15* * *
16(3) The provisions of section 6145 (relating to
17applicability of certain safeguards to foreign domiciliary
18corporations).
19§ 6123. Requirements for foreign corporation names.
20* * *
21(b) Exceptions.--
22(1) The provisions of section 5303(b) (relating to
23duplicate use of names) shall not prevent the issuance of a
24certificate of authority to a foreign nonprofit corporation
25setting forth a name that is [confusingly similar to] not
26distinguishable upon the records of the department from the
27name of any other domestic or foreign corporation for profit
28or [corporation] not-for-profit, [or of any domestic or
29foreign limited partnership that has filed a certificate or
30qualified under Chapter 85 (relating to limited partnerships)
1or corresponding provisions of prior law,] or of any
2corporation or other association then registered under 54
3Pa.C.S. Ch. 5 (relating to corporate and other association
4names) or to any name reserved or registered as provided in
5this part, if the foreign nonprofit corporation applying for
6a certificate of authority files in the department [one of
7the following:
8(i) A] a resolution of its board of directors or
9other body adopting a fictitious name for use in
10transacting business in this Commonwealth, which
11fictitious name is [not confusingly similar to]
12distinguishable upon the records of the department from
13the name of the other corporation or other association
14[or to] and from any name reserved or registered as
15provided in this part [and] that is otherwise available
16for use by a domestic nonprofit corporation.
17[(ii) The written consent of the other corporation
18or other association or holder of a reserved or
19registered name to use the same or confusingly similar
20name and one or more words are added to make the name
21applied for distinguishable from the other name.]
22(2) The provisions of section 5303(c) (relating to
23required approvals or conditions) shall not prevent the
24issuance of a certificate of authority to a foreign nonprofit
25corporation setting forth a name that is prohibited by that
26subsection if the foreign nonprofit corporation applying for
27a certificate of authority files in the department a
28resolution of its board of directors or other body adopting a
29fictitious name for use in transacting business in this
30Commonwealth that is available for use by a domestic
1nonprofit corporation.
2§ 6141. Penalty for doing business without certificate of
3authority.
4(a) Right to bring actions suspended.--[No] A nonqualified
5foreign nonprofit corporation doing business in this
6Commonwealth within the meaning of Subchapter B [of this
7chapter] (relating to qualification) shall not be permitted to
8maintain any action or proceeding in any court of this
9Commonwealth until [such] the corporation [shall have] has
10obtained a certificate of authority. [Nor, except] Except as
11provided in subsection (b) [of this section, shall any action],
12an action or proceeding may not be maintained in any court of
13this Commonwealth by any successor or assignee of [such] the
14corporation on any right, claim or demand arising out of the
15doing of business by [such] the corporation in this Commonwealth
16until a certificate of authority [shall have] has been obtained
17by [such] the corporation or by a corporation [which] that has
18acquired all or substantially all of its assets.
19(a.1) Contracts, property and defense against actions
20unaffected.--The failure of a foreign nonprofit corporation to
21obtain a certificate of authority to transact business in this
22Commonwealth shall not impair the validity of any contract or
23act of [such] the corporation [and], shall not prevent [such]
24the corporation from defending any action in any court of this
25Commonwealth and shall not render escheatable any of its real or
26personal property.
27[(b) Title to real property.--The title to any real estate
28situate in this Commonwealth which is derived through any
29nonqualified foreign corporation not authorized under the laws
30of this Commonwealth to hold the same, and which has vested or
1vests in any foreign corporation for profit or not-for-profit
2authorized to hold such real estate or in any citizen or
3citizens of the United States or domestic corporation for profit
4or not-for-profit shall be good and valid and free and clear of
5any right of escheat by the Commonwealth; and the holder thereof
6may convey an estate indefeasible as to any right of escheat
7which the Commonwealth might otherwise have by reason of the
8unauthorized holding and conveyance by such nonqualified foreign
9corporation.]
10§ 6142. General powers and duties of qualified foreign
11corporations.
12(a) General rule.--A qualified foreign nonprofit
13corporation, so long as its certificate of authority [shall] is
14not [be] revoked, shall enjoy the same rights and privileges as
15a domestic nonprofit corporation, but no more, and, except as in
16this [part] subpart otherwise provided, shall be subject to the
17same liabilities, restrictions, duties and penalties now in
18force or hereafter imposed upon domestic nonprofit corporations,
19to the same extent as if it had been incorporated under this
20[part to transact the business set forth in its certificate of
21authority] subpart.
22(b) Agricultural lands.--Interests in agricultural land
23shall be subject to the restrictions of, and escheatable as
24provided by, the act of April 6, 1980 (P.L.102, No.39), referred
25to as the Agricultural Land Acquisition by Aliens Law.
26§ 6143. General powers and duties of nonqualified foreign
27corporations.
28(a) Acquisition of real and personal property.--Every
29nonqualified foreign nonprofit corporation[, the activities of
30which in this Commonwealth do not constitute doing business in
1this Commonwealth for the purposes of Subchapter B of this
2chapter (relating to qualification),] may acquire, hold,
3mortgage, lease and transfer real and personal property in this
4Commonwealth, in the same manner and subject to the same
5limitations as [domestic] a qualified foreign nonprofit
6[corporations] corporation.
7(b) Duties.--[A] Except as provided in section 6141(a)
8(relating to penalty for doing business without certificate of
9authority), a nonqualified foreign nonprofit corporation doing
10business in this Commonwealth within the meaning of Subchapter B
11[of this chapter] (relating to qualification) shall be subject
12to the same liabilities, restrictions, duties and penalties now
13or hereafter imposed upon a qualified foreign nonprofit
14corporation.
15§ 6145. Applicability of certain safeguards to foreign
16domiciliary corporations.
17[(a) Application.--This section shall be applicable to any
18qualified or nonqualified foreign corporation:
19(1) which derived more than one-half of its revenues for
20the preceding three fiscal years, or such portion thereof as
21the corporation was in existence, from sources within this
22Commonwealth and was at any time during such period doing
23business within this Commonwealth on the basis of the most
24minimal contacts with this Commonwealth permitted under the
25Constitution of the United States; or
26(2) at least a majority of the bona fide members of
27which are residents of this Commonwealth.]
28(b) Internal affairs doctrine not applicable.--The General
29Assembly hereby finds and determines that [the] foreign
30domiciliary corporations [to which this section applies]
1substantially affect this Commonwealth. [No court] The courts of
2this Commonwealth shall [hereafter] not dismiss or stay any
3action or proceeding brought by a member[, director, officer or
4agent of such a] or representative of a foreign domiciliary
5corporation, as such, against [such] the corporation or any one
6or more of the members[, directors, officers or agents] or
7representatives thereof, as such, on the ground that [such] the
8corporation is a foreign corporation not-for-profit or that the
9cause of action relates to the internal affairs thereof, but
10every such action shall proceed with like effect as if [such]
11the corporation were a domestic corporation. Except as provided
12in subsection (c) [of this section], the court having
13jurisdiction of the action or proceeding shall apply the law of
14the jurisdiction under which the foreign domiciliary corporation
15was incorporated.
16(c) Minimum safeguards.--The following provisions of this
17subpart shall be applicable to foreign domiciliary corporations
18[to which this section applies], except that nothing in this
19subsection shall require the filing of any document in the
20[Department of State] department as a prerequisite to the
21validity of any corporate action or the doing of any corporate
22action by the foreign domiciliary corporation which is
23impossible under the laws of its domiciliary jurisdiction:
24[(1)] Section 5504(b) (relating to adoption and contents
25of bylaws).
26[(2)] Section 5508 (relating to corporate records;
27inspection by members).
28[(3)] Section [5553] 5554 (relating to annual report of
29directors or other body).
30[(4)] Section 5743 (relating to mandatory
1indemnification).
2[(5)] Section 5755 (relating to time of holding meetings
3of members).
4[(6)] Section 5758(e) (relating to [voting lists] voting
5rights of members).
6[(7)] Section [5759(b) (relating to minimum
7requirements)] 5759(c) (relating to voting and other action
8by proxy).
9[(8)] Section [5762] 5765 (relating to judges of
10election).
11[(9)] Section [5764] 5767 (relating to appointment of
12custodian of corporation on deadlock or other cause).
13[(10)] Section [5766(b)] 5769(b) (relating to
14[expulsion] termination and transfer of membership).
15[(11) Subchapter G of Chapter 57 (relating to judicial
16supervision of corporate action).]
17[(12)] Chapter 59 (relating to fundamental changes).
18For the purposes of this subsection, corporate action shall not
19be deemed to be impossible under the laws of the domiciliary
20jurisdiction of a foreign corporation merely because prohibited
21or restricted by the terms of the articles, certificate of
22incorporation, bylaws or other organic law of the corporation,
23but the court may require the corporation to amend such organic
24law so as to be consistent with the minimum safeguards
25prescribed by this subsection.
26(d) Section exclusive.--[No provision of this article] The
27provisions of this subpart, other than the provisions of this
28section, shall not be construed to regulate the incorporation or
29internal affairs of a foreign corporation not-for-profit.
30§ 8911. Purposes.
1(a) General rule.--Limited liability companies may be
2organized under this chapter for any lawful purpose, except for
3the purpose of [banking or] insurance. Unless otherwise
4restricted in its certificate of organization, every limited
5liability company has as its purpose the engaging in all lawful
6business for which limited liability companies may be organized
7under this chapter. Nothing in this section shall prohibit the
8following:
9(1) A banking institution organized under this chapter
10or a limited liability company organized by one or more
11[banks or a banking organization for the sole purposes of]
12banking institutions, savings associations or credit unions
13from engaging in the marketing and [selling] sale of title
14insurance.
15* * *
<-16§ 8925. Taxation of limited liability companies.
17(a) General rule.--For the purposes of the imposition by the
18Commonwealth of any tax or license fee on or with respect to any
19income, property, privilege, transaction, subject or occupation,
20a domestic or foreign limited liability company that is not a
21domestic or qualified foreign restricted professional company
22shall be deemed to be a corporation organized and existing under
23Part II (relating to corporations), and a member of such a
24company, as such, shall be deemed to be a shareholder of a
25corporation. Such a company may elect to be treated as a
26Pennsylvania S corporation, and its members shall be deemed
27shareholders of such a corporation, only if the company
28satisfies the conditions for electing that status. For purposes
29of the corporate net income tax and the capital stock and
30franchise tax, such a company shall be considered a
1"corporation" and an "entity" as defined in Articles IV and VI
2of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
3Reform Code of 1971, and, if such a company is not required to
4file a Federal corporate income tax return, these taxes shall be
5computed as if such a Federal return had been filed. For
6purposes of the bank shares tax and the mutual thrift
7institutions tax, a bank, bank and trust company, trust company,
8savings bank, building and loan association, savings and loan
9association or savings institution that is a domestic or foreign
10limited liability company shall be considered an "institution"
11as defined by Article VII or Article XV of the Tax Reform Code
12of 1971. Nothing in this subsection shall impair or preempt the
13ability of a political subdivision to levy, assess or collect
14any applicable taxes or license fees authorized pursuant to the
15act of December 31, 1965 (P.L.1257, No.511), known as The Local
16Tax Enabling Act, on any company which elects limited liability
17company status in accordance with the provisions of this
18chapter.
19* * *
20Section 48. Chapter 91 heading of Title 15 is amended to
21read:
22CHAPTER 91
23[UNINCORPORATED ASSOCIATIONS GENERALLY]
24UNINCORPORATED NONPROFIT
25ASSOCIATIONS
26Section 49. Sections 9101, 9102 and 9103 of Title 15 are
27repealed:
28[§ 9101. Customary parliamentary law applicable.
29Except as otherwise provided by statute or by the organic
30documents under which an unincorporated association is
1constituted, each unincorporated association shall be governed
2by customary usages and principles of parliamentary law and
3procedure.
4§ 9102. Funeral and similar benefits.
5Members of unincorporated associations paying periodic or
6funeral benefits shall not be individually liable for the
7payment of periodic or funeral benefits or other similar
8liabilities of the association. The liabilities shall be payable
9only out of the treasury of the association.
10§ 9103. Nontransferable membership interests.
11(a) General rule.--For the purpose of encouraging lawful
12associational activity among agricultural and industrial workers
13through the organization of unincorporated associations for
14mutual benefit insurance, saving or other lawful objects where
15the persons so organizing derive benefits from the preservation
16and continuance of the membership and interest among persons
17engaged in a common calling, labor or enterprise, the
18unincorporated association may provide, in its organic
19documents, that membership in the association or interest in its
20funds or property shall be nontransferable without the consent
21of the association.
22(b) Assignments and pledges.--No attempted assignment,
23transfer or pledge of a membership or interest made in violation
24of a transfer restriction adopted pursuant to subsection (a)
25shall pass any right or interest, legal or equitable, to the
26person to whom it is attempted to be made if the transfer
27restriction is brought to the knowledge of that person.
28(c) Knowledge of nontransferability.--Whenever the interest
29of a member in the funds or property of any unincorporated
30association subject to subsection (a) is evidenced by a
1certificate, an endorsement thereon that the certificate is
2nontransferable shall be conclusive evidence that the person to
3whom any attempted assignment, transfer or pledge of the
4certificate is made has knowledge of the nontransferable
5character of the interest of the member.]
6Section 50. Title 15 is amended by adding sections to read:
7§ 9111. Short title and application of chapter.
8(a) Short title.--This chapter shall be known and may be
9cited as the Pennsylvania Uniform Unincorporated Nonprofit
10Association Law.
11(b) Transitional provisions concerning property.--
12(1) If, before {the Legislative Reference Bureau shall
13insert here the effective date of this section}, an interest
14in property was by the terms of a transfer purportedly
15transferred to a nonprofit association but under the law of
16this Commonwealth the interest did not vest in the nonprofit
17association, or in one or more persons on behalf of the
18nonprofit association under paragraph (2), on {the
19Legislative Reference Bureau shall insert here the effective
20date of this section}, the interest vests in the nonprofit
21association, unless the parties to the transfer have treated
22the transfer as ineffective.
23(2) If, before {the Legislative Reference Bureau shall
24insert here the effective date of this section}, an interest
25in property was by the terms of a transfer purportedly
26transferred to a nonprofit association but the interest was
27vested in one or more persons to hold the interest for the
28nonprofit association, its members or both, on or after {the
29Legislative Reference Bureau shall insert here the effective
30date of this section}, the persons, or their successors in
1interest, may transfer the interest to the nonprofit
2association in its name; or the nonprofit association may
3require that the interest be transferred to it in its name.
4(c) Savings provisions.--
5(1) This chapter supplements the law of this
6Commonwealth that applies to nonprofit associations operating
7in this Commonwealth, but if a conflict exists between this
8chapter and another statute, the other statute applies.
9(2) Nothing in this chapter shall be deemed to repeal or
10supersede any provision in section 7 of the act of April 26,
111855 (P.L.328, No.347), entitled "An act relating to
12Corporations and to Estates held for Corporate, Religious and
13Charitable uses."
14(d) Cross reference.--See section 5331 (relating to
15unincorporated associations).
16§ 9112. Definitions.
17The following words and phrases when used in this chapter
18shall have the meanings given to them in this section unless the
19context clearly indicates otherwise:
20"Established practices." The practices used by a nonprofit
21association without material change during:
22(1) the most recent five years of its existence; or
23(2) if it has existed for less than five years, its
24entire existence.
25"Governing principles." The agreements, whether oral, in
26record form or implied from its established practices, that
27govern the purpose or operation of a nonprofit association and
28the rights and obligations of its members and managers. The term
29includes any amendment or restatement of the agreements
30constituting the governing principles.
1"Manager." A person that is responsible, alone or in concert
2with others, for the management of a nonprofit association.
3"Member." A person that, under the governing principles, may
4participate in the selection of persons authorized to manage the
5affairs of the nonprofit association or in the development of
6policies and activities of the nonprofit association.
7"Nonprofit association." An unincorporated organization
8consisting of two or more members joined together under an
9agreement that is oral, in record form or implied from conduct
10for one or more common, nonprofit purposes. The term does not
11include:
12(1) a trust;
13(2) a marriage, domestic partnership, common law
14domestic relationship, civil union or other domestic living
15arrangement;
16(3) an organization formed under any other statute that
17governs the organization and operation of unincorporated
18associations;
19(4) a joint tenancy, tenancy in common or tenancy by the
20entireties, even if the co-owners share use of the property
21for a nonprofit purpose; or
22(5) a relationship under an agreement in record form
23that expressly provides that the relationship between the
24parties does not create a nonprofit association.
25"Property." Includes:
26(1) real property;
27(2) personal property which is tangible or intangible;
28(3) mixed real and personal property; and
29(4) a right or interest in property.
30"Transfer." Includes:
1(1) an assignment;
2(2) a conveyance;
3(3) a sale;
4(4) a lease;
5(5) an encumbrance, including a mortgage or security
6interest;
7(6) a gift; and
8(7) a transfer by operation of law.
9§ 9113. Governing law.
10(a) Operations.--Except as provided in subsection (b), the
11law of this Commonwealth governs the operation in this
12Commonwealth of a nonprofit association formed or operating in
13this Commonwealth.
14(b) Internal affairs.--Unless the governing principles
15specify a different jurisdiction, the law of the jurisdiction in
16which a nonprofit association has its main place of activities
17governs the internal affairs of the nonprofit association.
18§ 9114. Entity status.
19(a) Legal entity.--A nonprofit association is a legal entity
20distinct from its members and managers.
21(b) Perpetual duration.--A nonprofit association has
22perpetual duration unless the governing principles specify
23otherwise.
24(c) Powers.--A nonprofit association has the same powers as
25an individual to do all things necessary or convenient to carry
26on its purposes.
27(d) Profits.--A nonprofit association may engage in profit-
28making activities, but profits from any activities must be used
29or set aside for the nonprofit purposes of the nonprofit
30association.
1§ 9115. Ownership and transfer of property.
2(a) General rule.--A nonprofit association may acquire, hold
3or transfer, in its name, an interest in property.
4(b) Testamentary and fiduciary dispositions.--A nonprofit
5association may be a beneficiary of a trust or contract, a
6legatee or a devisee.
7§ 9116. Statement of authority as to real property.
8(a) General rule.--An interest in real property held in the
9name of a nonprofit association may be transferred by a person
10authorized to do so in a statement of authority recorded by the
11nonprofit association in the office of the recorder of deeds for
12the county in which a transfer of the property would be
13recorded.
14(b) Contents of statement.--The statement of authority must
15set forth:
16(1) the name of the nonprofit association;
17(2) the address in this Commonwealth, including the
18street and number, if any, of the nonprofit association or,
19if the nonprofit association does not have an address in this
20Commonwealth, its address outside of this Commonwealth;
21(3) that the association is a nonprofit association; and
22(4) the name, title or position of a person authorized
23to transfer an estate or interest in real property held in
24the name of the nonprofit association.
25(c) Execution.--A statement of authority must be executed in
26the same manner as a deed by a person other than the person
27authorized in the statement to transfer the interest.
28(d) Recording fee.--The recorder of deeds may collect a fee
29for recording a statement of authority in the amount authorized
30for recording a transfer of real property, but the mere
1recording of a statement of authority does not constitute a
2transfer of an interest in the real property for the purpose of
3the taxation of real property transfers.
4(e) Changes.--A document amending, revoking or canceling a
5statement of authority or stating that the statement is
6unauthorized or erroneous must meet the requirements for
7executing and recording an original statement.
8(f) Cancellation by operation of law.--Unless canceled
9earlier, a recorded statement of authority and its most recent
10amendment expire five years after the date of the most recent
11recording.
12(g) Effect of filing.--If the record title to real property
13is in the name of a nonprofit association and a statement of
14authority is recorded in the office of the recorder of deeds for
15the county in which a transfer of the property would be
16recorded, the authority of the person named in the statement to
17transfer is conclusive in favor of a person that gives value
18without notice that the person lacks authority.
19§ 9117. Liability.
20(a) Scope.--
21(1) A debt, obligation or other liability of a nonprofit
22association, whether arising in contract, tort or otherwise,
23is solely the debt, obligation or other liability of the
24nonprofit association.
25(2) A member or manager is not personally liable,
26directly or indirectly, by way of contribution or otherwise,
27for a debt, obligation or other liability of the nonprofit
28association solely by reason of being or acting as a member
29or manager.
30(3) This subsection applies regardless of the
1dissolution of the nonprofit association.
2(b) Liability for conduct.--A person's status as a member or
3manager does not prevent or restrict law other than this chapter
4from imposing liability on the person or the nonprofit
5association because of the person's conduct.
6(c) Agents.--A person that makes a contract or incurs an
7obligation on behalf of a nonprofit association after {the
8Legislative Reference Bureau shall insert here the effective
9date of this section} is not liable for performance or breach of
10the contract or other obligation if the fact that the person was
11acting for the nonprofit association was disclosed to, was known
12by or reasonably should have been known by the other party to
13the contract or to the party owed performance.
14(d) Observation of formalities.--The failure of a nonprofit
15association to observe formalities relating to the exercise of
16its powers or the management of its activities and affairs is
17not a ground for imposing liability on a member or manager of
18the nonprofit association for a debt, obligation or other
19liability of the nonprofit association.
20§ 9118. Assertion and defense of claims.
21(a) General rule.--A nonprofit association may sue or be
22sued in its own name.
23(b) Permissible claims.--A member or manager may assert a
24claim the member or manager has against the nonprofit
25association. A nonprofit association may assert a claim it has
26against a member or manager.
27(c) Representational status.--A nonprofit association may
28assert a claim in its name on behalf of its members if one or
29more members of the nonprofit association have standing to
30assert a claim in their own right, the interests the nonprofit
1association seeks to protect are germane to its purposes and
2neither the claim asserted nor the relief requested requires the
3participation of a member.
4§ 9119. Effect of judgment or order.
5A judgment or order against a nonprofit association is not by
6itself a judgment or order against a member or manager.
7§ 9120. Appointment of agent to receive service of process.
8(a) Statement.--A nonprofit association may deliver to the
9department for filing a statement appointing an agent to receive
10service of process.
11(b) Contents.--A statement appointing an agent to receive
12service of process must state:
13(1) the name of the nonprofit association;
14(2) the address, if any, in this Commonwealth; and
15(3) the name of the person in this Commonwealth
16authorized to receive service of process and the person's
17address, including street and number, in this Commonwealth.
18(c) Signature and effect.--
19(1) A statement appointing an agent to receive service
20of process must be signed by:
21(i) a person authorized to manage the affairs of the
22nonprofit association; and
23(ii) the person appointed as the agent.
24(2) The signing of the statement is an affirmation:
25(i) by the person authorized to manage the affairs
26of the nonprofit association that the person has that
27authority; and
28(ii) by the person appointed as agent that the
29person consents to act as agent.
30(d) Amendment or cancellation.--An amendment to or
1cancellation of a statement appointing an agent to receive
2service of process must meet the requirements for signature of
3an original statement. An agent may resign by delivering a
4resignation to the department for filing and giving notice to
5the nonprofit association.
6(e) Rejection of statement.--A statement appointing an agent
7to receive service of process may not be rejected for filing
8because the name of the nonprofit association signing the
9statement is not distinguishable on the records of the
10department from the name of another association appearing in
11those records. The filing of such a statement does not make the
12name of the nonprofit association signing the statement
13unavailable for use by another association.
14(f) Effectiveness.--A statement appointing an agent to
15receive service of process:
16(1) takes effect on filing by the department; and
17(2) is effective for five years after the date of filing
18unless canceled or terminated earlier.
19(g) Duty of agent.--The only duty under this chapter of an
20agent to receive service of process is to forward to the
21nonprofit association at the address most recently supplied to
22the agent by the nonprofit association any process, notice or
23demand pertaining to the nonprofit association which is served
24or received by the agent.
25(h) Cross references.--See section 135 (relating to
26requirements to be met by filed documents).
27§ 9121. Action or proceeding not abated by change of members or
28managers.
29An action or proceeding against a nonprofit association does
30not abate merely because of a change in its members or managers.
1§ 9122. Member not agent.
2A member is not an agent of the nonprofit association solely
3by reason of being a member.
4§ 9123. Approval by members.
5(a) General rule.--Except as provided in the governing
6principles, a nonprofit association must have the approval of
7its members to:
8(1) admit, suspend, dismiss or expel a member;
9(2) select or dismiss a manager;
10(3) adopt, amend or repeal the governing principles;
11(4) transfer all, or substantially all, of the property
12of the nonprofit association, with or without its goodwill,
13outside the ordinary course of its activities;
14(5) dissolve under section 9134 (relating to
15dissolution);
16(6) undertake any other act outside the ordinary course
17of the activities of the nonprofit association; or
18(7) determine the policy and purposes of the nonprofit
19association.
20(b) Other actions.--A nonprofit association must have the
21approval of the members to do any other act or exercise a right
22that the governing principles require to be approved by members.
23§ 9124. Action by members.
24(a) General rule.--Except as provided in the governing
25principles:
26(1) approval of a matter by the members requires the
27affirmative vote of at least a majority of the votes cast at
28a meeting of members; and
29(2) each member is entitled to one vote on each matter
30that is submitted for approval by the members.
1(b) Procedural matters.--The governing principles may
2provide for the:
3(1) calling, location and timing of member meetings;
4(2) notice and quorum requirements for member meetings;
5(3) conduct of member meetings;
6(4) taking of action by the members by consent without a
7meeting or by ballot;
8(5) participation by members in a meeting of the members
9by telephone or other means of electronic communication; and
10(6) taking of action by members by proxy.
11(c) Absence of governing principles.--If the governing
12principles do not provide for a matter described in subsection
13(b), customary usages and principles of parliamentary law and
14procedure apply.
15§ 9125. Duties of member.
16(a) No fiduciary duties generally.--A member does not have a
17fiduciary duty to a nonprofit association or to another member
18solely by being a member.
19(b) Discharge of duties and exercise of rights.--A member
20shall, consistent with the governing principles and the
21contractual obligation of good faith and fair dealing:
22(1) discharge duties under the governing principles to
23the nonprofit association and the other members; and
24(2) exercise any rights under the governing principles
25and this chapter.
26§ 9126. Membership.
27(a) Admission, suspension, dismissal and expulsion of
28member.--
29(1) A person becomes a member and may be suspended,
30dismissed or expelled in accordance with the governing
1principles. If there are no applicable governing principles,
2a person may become a member or be suspended, dismissed or
3expelled only with the approval of the members. A person may
4not be admitted as a member without the person's consent.
5(2) Except as provided in the governing principles, the
6suspension, dismissal or expulsion of a member does not
7relieve the member from any unpaid capital contribution,
8dues, assessments, fees or other obligation incurred or
9commitment made by the member before the suspension,
10dismissal or expulsion.
11(b) Resignation of member.--
12(1) A member may resign as a member in accordance with
13the governing principles. In the absence of applicable
14governing principles, a member may resign at any time.
15(2) Except as provided in the governing principles,
16resignation of a member does not relieve the member from any
17unpaid capital contribution, dues, assessments, fees or other
18obligation incurred or commitment made by the member before
19resignation.
20§ 9127. Member's interest not transferable.
21(a) General rule.--Except as set forth in subsection (b) or
22the governing principles, a member's interest or any right under
23the governing principles is not transferable.
24(b) Certain nonprofit associations formed prior to effective
25date.--
26(1) This subsection applies to a nonprofit association:
27(i) which was formed before {the Legislative
28Reference Bureau shall insert here the effective date of
29this section};
30(ii) which was formed for the purpose of encouraging
1lawful associational activity among agricultural and
2industrial workers through the organization of a
3nonprofit association for mutual benefit insurance,
4saving or other lawful objects; and
5(iii) in which the persons that organized the
6nonprofit association derive benefits from the
7preservation and continuance of the membership and
8interest among persons engaged in a common calling, labor
9or enterprise.
10(2) For a nonprofit association subject to paragraph
11(1), the following apply:
12(i) Except as set forth in subparagraph (ii), a
13member's interest or any right under the governing
14principles is transferable.
15(ii) A member's interest or any right under the
16governing principles is nontransferable if the governing
17principles so provide.
18(c) Assignments and pledges.--No legal or equitable right or
19interest shall pass as a result of an attempted transfer in
20violation of:
21(1) subsection (a); or
22(2) a transfer restriction under subsection (b)(2)(ii).
23(d) Knowledge of nontransferability.--Whenever the interest
24of a member in a nonprofit association is evidenced by a
25certificate, an endorsement on the certificate that the
26certificate is nontransferable shall be conclusive evidence that
27the person to whom any attempted transfer of the certificate is
28made has knowledge of the nontransferable character of the
29interest of the member.
30§ 9128. Selection and management rights of managers.
1Except as provided in this chapter or the governing
2principles:
3(1) if there is no manager selected and serving, all
4members are managers;
5(2) only the members may select a manager;
6(3) a manager may be a member or a nonmember;
7(4) each manager has equal rights in the management and
8conduct of the activities of the nonprofit association;
9(5) all matters relating to the activities of the
10nonprofit association are decided by its managers except for
11matters reserved for approval by the members in section 9123
12(relating to approval by members); and
13(6) a difference among the managers is decided by a
14majority of the managers.
15§ 9129. Duties of managers.
16(a) Duty of care.--
17(1) A manager shall manage the nonprofit association:
18(i) in good faith;
19(ii) in a manner the manager reasonably believes to
20be in the best interests of the nonprofit association;
21and
22(iii) with such care, including reasonable inquiry,
23as a prudent person would reasonably exercise in a
24similar position and under similar circumstances.
25(2) A manager may rely in good faith on any opinion,
26report, statement or other information provided by another
27person that the manager reasonably believes is a competent
28and reliable source for the information.
29(b) Conflicts of interest.---
30(1) A manager owes a fiduciary duty of loyalty to the
1nonprofit association with respect to the responsibilities of
2the manager.
3(2) After full disclosure of all material facts, a
4specific act or transaction that would otherwise violate the
5duty of loyalty by a manager may be authorized or ratified by
6a majority of the members that are not interested directly or
7indirectly in the act or transaction.
8(c) Presumption.--A manager that makes a judgment in good
9faith satisfies the duties specified in subsection (a) if the
10manager:
11(1) is not interested, directly or indirectly, in the
12subject of the judgment and is otherwise able to exercise
13independent judgment;
14(2) is informed with respect to the subject of the
15judgment to the extent the manager reasonably believes to be
16appropriate under the circumstances; and
17(3) believes that the judgment is in, or not opposed to,
18the best interests of the nonprofit association.
19(d) Limitation of liability.--
20(1) Except as set forth in paragraph (2), the governing
21principles in record form may provide that a manager shall
22not be personally liable, as a manager, for monetary damages
23for any action taken unless:
24(i) the manager has breached or failed to perform
25the manager's duties under this chapter; and
26(ii) the breach or failure to perform constitutes
27self-dealing, willful misconduct or recklessness.
28(2) Paragraph (1) shall not apply to:
29(i) the responsibility or liability of a manager
30under a criminal statute; or
1(ii) the liability of the manager for the payment of
2taxes under Federal, State or local law.
3§ 9130. Action by managers.
4(a) General rule.--Except as provided in the governing
5principles:
6(1) approval of a matter by the managers requires the
7affirmative vote of at least a majority of the votes cast at
8a meeting of managers; and
9(2) each manager is entitled to one vote on each matter
10that is submitted for approval by the managers.
11(b) Procedural matters.--The governing principles may
12provide for the:
13(1) delegation to a manager of authority to act without
14a meeting of the managers;
15(2) creation and authority of committees of the
16managers;
17(3) calling, location and timing of meetings of the
18managers or a committee of the managers;
19(4) notice and quorum requirements for meetings of the
20managers or a committee of the managers;
21(5) conduct of meetings of the managers or a committee
22of the managers;
23(6) taking of action by the managers or a committee of
24the managers by consent without a meeting or by ballot;
25(7) participation by managers in a meeting of the
26managers or a committee of the managers by telephone or other
27means of electronic communication; and
28(8) taking of action by a manager by proxy.
29(c) Absence of governing principles.--If the governing
30principles do not provide for a matter described in subsection
1(b), customary usages and principles of parliamentary law and
2procedure apply.
3§ 9131. Right of member or manager to information.
4(a) Inspection.--On reasonable notice, a member or manager
5of a nonprofit association may inspect and copy, at a reasonable
6time and location specified by the nonprofit association, any
7record maintained by the nonprofit association regarding its
8activities, financial condition and other circumstances, to the
9extent the information is material to the rights and duties of
10the member or manager under the governing principles.
11(b) Restrictions.--A nonprofit association may impose
12reasonable restrictions on access to and use of information to
13be furnished under this section, including designating the
14information confidential and imposing on the recipient
15obligations of nondisclosure and safeguarding.
16(c) Costs.--A nonprofit association may charge a person that
17makes a demand under this section reasonable copying costs.
18(d) Former member or manager.--A former member or manager is
19entitled to information to which the member or manager was
20entitled while a member or manager if:
21(1) the information pertains to the period during which
22the person was a member or manager;
23(2) the former member or manager seeks the information
24in good faith; and
25(3) the former member or manager satisfies subsections
26(a), (b) and (c).
27§ 9132. Distributions prohibited; compensation and other
28permitted payments.
29(a) General rule.--Except as provided in subsection (b), a
30nonprofit association may not pay dividends or make
1distributions to a member or manager.
2(b) Permitted payments.--A nonprofit association may:
3(1) pay reasonable compensation or reimburse reasonable
4expenses to a member or manager for services rendered;
5(2) confer benefits on or make contributions to a member
6or manager in conformity with its nonprofit purposes;
7(3) repurchase a membership and repay a capital
8contribution made by a member to the extent authorized by its
9governing principles;
10(4) repay indebtedness to a member or manager; and
11(5) make distributions of property to members upon
12winding up and termination to the extent permitted by section
139135 (relating to winding up).
14§ 9133. Reimbursement, indemnification and advancement of
15expenses.
16(a) Reimbursement.--Except as provided in the governing
17principles, a nonprofit association shall reimburse a member or
18manager for authorized expenses reasonably incurred in the
19course of the activities of the member or manager on behalf of
20the nonprofit association.
21(b) Indemnification and advancement of expenses.--
22(1) A nonprofit association is subject to Ch. 57 Subch.
23D (relating to indemnification).
24(2) For purposes of applying Ch. 57 Subch. D, references
25to the "articles" or "bylaws," "directors" and "members"
26shall mean the "governing principles," "managers" and
27"members," respectively.
28§ 9134. Dissolution.
29(a) General rule.--A nonprofit association may be dissolved
30as follows:
1(1) if the governing principles provide a time or method
2for dissolution, at that time or by that method;
3(2) if the governing principles do not provide a time or
4method for dissolution, upon approval by the members;
5(3) if no member can be located and the operations of
6the nonprofit association have been discontinued for at least
7three years, by:
8(i) the managers; or
9(ii) if the nonprofit association has no current
10manager, its last manager;
11(4) by court order; or
12(5) under law other than this chapter.
13(b) Continuation during winding up.--After dissolution, a
14nonprofit association continues in existence until its
15activities have been wound up under section 9135 (relating to
16winding up).
17§ 9135. Winding up.
18Winding up of a nonprofit association must proceed in
19accordance with the following rules:
20(1) All known debts and liabilities shall be paid or
21adequately provided for.
22(2) Any property subject to a condition requiring return
23to the person designated by the donor shall be transferred to
24that person.
25(3) Any property subject to a trust shall be distributed
26in accordance with the trust agreement.
27(4) Any property committed to a charitable purpose shall
28be distributed in accordance with that purpose unless the
29nonprofit <-association obtains a court order under 20 Pa.C.S.
30Ch. 77 (relating to trusts) specifying the disposition of the
1property.
2(5) Any remaining property shall be distributed as
3follows:
4(i) Distribution shall be made:
5(A) in accordance with the governing principles
6of the nonprofit association; or
7(B) in the absence of applicable governing
8principles, to the members of the nonprofit
9association:
10(I) per capita; or
11(II) as the members direct.
12(ii) If subparagraph (i) does not apply,
13distribution shall be made under Article XIII.1 of the
14act of April 9, 1929 (P.L.343, No.176), known as The
15Fiscal Code.
16§ 9136. Subordination of chapter to canon law.
17If and to the extent canon law or similar principles
18applicable to a nonprofit association organized for religious
19purposes sets forth provisions relating to the government and
20regulation of the affairs of the nonprofit association that are
21inconsistent with the provisions of this chapter on the same
22subject, the provisions of canon law or similar principles shall
23control except to the extent prohibited by the Constitution of
24the United States or the Constitution of Pennsylvania.
25Section 51. Section 9503(e) of Title 15 is amended and the
26section is amended by adding a subsection to read:
27§ 9503. Documentation of trust.
28* * *
29(d.1) Bearer certificates prohibited.--A business trust may
30not issue a certificate of beneficial interest in bearer form.
1This subsection may not be varied by the instrument or other
2documentation of the business trust.
3(e) Cross [reference] references.--See [section] sections
4134 (relating to docketing statement) and 135 (relating to
5requirements to be met by filed documents).
6Section 52. The definition of "domestic corporation not-for-
7profit" in section 101 of Title 54 is amended to read:
8§ 101. Definitions.
9Subject to additional definitions contained in subsequent
10provisions of this title which are applicable to specific
11provisions of this title, the following words and phrases when
12used in this title shall have, unless the context clearly
13indicates otherwise, the meanings given to them in this section:
14* * *
15"Domestic corporation not-for-profit." A domestic
16corporation [not-for-profit as defined in 15 Pa.C.S. § 1103
17(relating to definitions).] not incorporated for a purpose or
18purposes involving pecuniary profit, incidental or otherwise.
19* * *
20Section 53. Section 501(a)(5) and (7) of Title 54 are
21amended to read:
22§ 501. Register established.
23(a) General rule.--A register is established by this chapter
24which shall consist of such of the following names as are not
25deleted therefrom by operation of section 504 (relating to
26effect of failure to make filings) or 506 (relating to voluntary
27termination of registration by corporations and other
28associations):
29* * *
30(5) In the case of a business trust which exists subject
1to 15 Pa.C.S. Ch. 95 (relating to business trusts), the name
2of the trust as set forth in the:
3(i) instrument filed in the department under 15
4Pa.C.S. § 9503 (relating to documentation of trust); or
5(ii) application for registration filed under 15
6Pa.C.S. § 9507 (relating to foreign business trusts).
7* * *
8[(7) In the case of a business trust which exists
9subject to 15 Pa.C.S. Ch. 95 (relating to business trusts),
10the name of the trust as set forth in the instrument filed in
11the department under 15 Pa.C.S. § 9503 (relating to
12documentation of trust), or in the application for
13registration filed pursuant to 15 Pa.C.S. § 9507 (relating to
14foreign business trusts).]
15* * *
16Section 54. Repeals are as follows:
17(1) The General Assembly declares as follows:
18(i) The repeal under paragraph (2)(i) is necessary
19because the material is supplied by 15 Pa.C.S. § 1511.
20(ii) The repeal under paragraph (2)(ii) is necessary
21to effectuate the amendment of 15 Pa.C.S. §§ 153(a) and
22155(a).
23(iii) The repeal under paragraph (2)(iii) is
24necessary because the material is supplied by 40 Pa.C.S.
25§ 6322(f).
26(iv) The repeal under paragraph (2)(iv) is necessary
27because the material is supplied by 40 Pa.C.S. § 6301.
28(v) The repeal under paragraph (2)(v) is necessary
29because the material is supplied by 15 Pa.C.S. § 1106(b)
30(2).
1(vi) The repeal under paragraph (2)(vi) is necessary
2because the material is supplied by 40 Pa.C.S. § 6322(f).
3(vii) The repeal under paragraph (2)(vii) is
4necessary because the material is supplied by 1 Pa.C.S. §
51978.
6(2) The following acts and parts of acts are repealed:
7(i) Act of April 27, 1855 (P.L.365, No.383),
8entitled "An act extending the right of Trial by Jury to
9certain cases."
10(ii) Sections 618-A(2) and 814 of the act of April
119, 1929 (P.L.177, No.175), known as The Administrative
12Code of 1929.
13(iii) Act of April 18, 1949 (P.L.583, No.123),
14entitled "An act to further amend the act, approved the
15fifth day of May, one thousand nine hundred thirty-three
16(Pamphlet Laws 289), entitled 'An act relating to
17nonprofit corporations; defining and providing for the
18organization, merger, consolidation, and dissolution of
19such corporations; conferring certain rights, powers,
20duties, and immunities upon them and their officers and
21members; prescribing the conditions on which such
22corporations may exercise their powers; providing for the
23inclusion of certain existing corporations of the first
24class within the provisions of this act; prescribing the
25terms and conditions upon which foreign nonprofit
26corporations may be admitted or may continue to do
27business within the Commonwealth; conferring powers and
28imposing duties on the courts of common pleas,
29prothonotaries of such courts, recorders of deeds, and
30certain State departments, commissions, and officers;
1authorizing certain local public officers and State
2departments to collect fees for services required to be
3rendered by this act; imposing penalties; and repealing
4certain acts and parts of acts relating to corporations,'
5by making further provisions relating to nonprofit
6medical service corporations; by extending the provisions
7of said act relating to the furnishing of medical
8services by nonprofit medical service corporations so as
9to include the furnishing of osteopathic services by
10doctors of osteopathy to subscribers and their
11dependents, and by providing that the articles of
12incorporation of existing nonprofit medical service
13corporations are amended by the provisions of this act so
14as to authorize the furnishing of such osteopathic
15services by doctors of osteopathy."
16(iv) Act of December 9, 1955 (P.L.818, No.238),
17entitled "An act amending the act of May five, one
18thousand nine hundred thirty-three (Pamphlet Laws 289),
19entitled 'An act relating to nonprofit corporations;
20defining and providing for the organization, merger,
21consolidation, and dissolution of such corporations;
22conferring certain rights, powers, duties, and immunities
23upon them and their officers and members; prescribing the
24conditions on which such corporations may exercise their
25powers; providing for the inclusion of certain existing
26corporations of the first class within the provisions of
27this act; prescribing the terms and conditions upon which
28foreign nonprofit corporations may be admitted or may
29continue to do business within the Commonwealth;
30conferring powers and imposing duties on the courts of
1common pleas, prothonotaries of such courts, recorders of
2deeds, and certain State departments, commissions, and
3officers; authorizing certain local public officers and
4State departments to collect fees for services required
5to be rendered by this act; imposing penalties; and
6repealing certain acts and parts of acts relating to
7corporations,' providing for the incorporation and
8regulation of nonprofit dental service corporations
9furnishing dental services only to certain subscribers
10and their dependents."
11(v) Act of September 30, 1965 (P.L.570, No.294),
12entitled "An act amending the act of May 5, 1933 (P.L.
13289), entitled 'An act relating to nonprofit
14corporations; defining and providing for the
15organization, merger, consolidation, and dissolution of
16such corporations; conferring certain rights, powers,
17duties, and immunities upon them and their officers and
18members; prescribing the conditions on which such
19corporations may exercise their powers; providing for the
20inclusion of certain existing corporations of the first
21class within the provisions of this act; prescribing the
22terms and conditions upon which foreign nonprofit
23corporations may be admitted or may continue to do
24business within the Commonwealth; conferring powers and
25imposing duties on the courts of common pleas,
26prothonotaries of such courts, recorders of deeds, and
27certain State departments, commissions, and officers;
28authorizing certain local public officers and State
29departments to collect fees for services required to be
30rendered by this act; imposing penalties; and repealing
1certain acts and parts of acts relating to corporations,'
2requiring approval by the State Registration Board for
3Professional Engineers prior to the use of certain words
4in corporate names."
5(vi) Act of December 27, 1965 (P.L.1250, No.507),
6entitled "An act amending the act of May 5, 1933 (P.L.
7289), entitled 'An act relating to nonprofit
8corporations; defining and providing for the
9organization, merger, consolidation, and dissolution of
10such corporations; conferring certain rights, powers,
11duties, and immunities upon them and their officers and
12members; prescribing the conditions on which such
13corporations may exercise their powers; providing for the
14inclusion of certain existing corporations of the first
15class within the provisions of this act; prescribing the
16terms and conditions upon which foreign nonprofit
17corporations may be admitted or may continue to do
18business within the Commonwealth; conferring powers and
19imposing duties on the courts of common pleas,
20prothonotaries of such courts, recorders of deeds, and
21certain State departments, commissions, and officers;
22authorizing certain local public officers and State
23departments to collect fees for services required to be
24rendered by this act; imposing penalties; and repealing
25certain acts and parts of acts relating to corporations,'
26making further provisions relating to nonprofit medical,
27dental and osteopathic service corporations; extending
28the provisions of said act relating to the furnishing of
29medical, dental and osteopathic services by nonprofit
30medical, dental and osteopathic service corporations so
1as to include the furnishing of optometric services to
2subscribers and their dependents, and providing that the
3articles of incorporation of existing nonprofit medical,
4dental and osteopathic service corporations are amended
5by the provisions of this act so as to authorize the
6furnishing of optometric services by doctors of
7optometry."
8(vii) Section 2 of the act of November 15, 1972
9(P.L.1063, No.271), entitled "An act amending the act of
10November 25, 1970 (No.230), entitled 'An act codifying
11and compiling a part of the law of the Commonwealth,'
12adding provisions relating to burial grounds,
13corporations, including corporations not-for-profit,
14educational institutions, private police, certain
15charitable or eleemosynary institutions, certain
16nonprofit insurers, service of process on certain
17nonresident persons, names, prescribing penalties and
18making repeals."
19Section 55. When the Department of State is ready to provide
20expedited services under the addition of 15 Pa.C.S. § 153(a)
21(16), it shall transmit notice of that fact to the Legislative
22Reference Bureau for publication as a notice in the Pennsylvania
23Bulletin.
24Section 56. Notwithstanding 1 Pa.C.S. § 1957, it is declared
25to be the intent of the former act of December 21, 1988
26(P.L.1444, No.177), known as the General Association Act of
271988, the act of December 19, 1990 (P.L.834, No.198), known as
28the GAA Amendments Act of 1990, the act of December 18, 1992
29(P.L.1333, No.169), known as the GAA Amendments Act of 1992, the
30act of June 22, 2001 (P.L.418, No.34), known as the GAA
1Amendments Act of 2001, and this act cumulatively to restore all
2provisions of 15 Pa.C.S. added by the act of November 15, 1972
3(P.L.1063, No.271), entitled "An act amending the act of
4November 25, 1970 (No.230), entitled 'An act codifying and
5compiling a part of the law of the Commonwealth,' adding
6provisions relating to burial grounds, corporations, including
7corporations not-for-profit, educational institutions, private
8police, certain charitable or eleemosynary institutions, certain
9nonprofit insurers, service of process on certain nonresident
10persons, names, prescribing penalties and making repeals," to
11their status prior to the partial repeal effected by section 905
12of the former act of July 29, 1977 (P.L.105, No.38), known as
13the Fraternal Benefit Society Code, except as otherwise
14expressly provided by such provisions as reenacted and amended
15by the former General Association Act of 1988, the GAA
16Amendments Act of 1990, the GAA Amendments Act of 1992, the GAA
17Amendments Act of 2001, and this act.
18Section 57. Section 56 of this act shall apply retroactively
19to January 30, 1978.
20Section 58. This act shall take effect as follows:
21(1) The following provisions shall take effect
22immediately:
23(i) Section 55 of this act.
24(ii) This section.
25(2) The addition of 15 Pa.C.S. § 153(a)(16) shall take
26effect upon publication of the notice under section 55 of
27this act.
28(3) The remainder of this act shall take effect in 60
29days.