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TABLE OF CONTENTS

 

TITLE 15

CORPORATIONS AND UNINCORPORATED ASSOCIATIONS

 

PART I.  PRELIMINARY PROVISIONS

 

Chapter 1.  General Provisions

 

Subchapter A.  Preliminary Provisions

 

§ 101.  Short title and application of title.

§ 102.  Definitions.

§ 103.  Subordination of title to regulatory laws.

§ 104.  Equitable remedies.

§ 105.  Fees.

§ 106.  Effect of filing papers required to be filed.

§ 107.  Form of records.

§ 108.  Change in location or status of registered office provided by agent.

§ 109.  Name of commercial registered office provider in lieu of registered address.

§ 110.  Supplementary general principles of law applicable.

§ 111.  Relation of title to Electronic Signatures in Global and National Commerce Act.

 

Subchapter B.  Functions and Powers of Department of State

 

§ 131.  Application of subchapter.

§ 132.  Functions of Department of State.

§ 133.  Powers of Department of State.

§ 134.  Docketing statement.

§ 135.  Requirements to be met by filed documents.

§ 136.  Processing of documents by Department of State.

§ 137.  Court to pass upon rejection of documents by Department of State.

§ 138.  Statement of correction.

§ 139.  Tax clearance of certain fundamental transactions.

§ 140.  Custody and management of orphan corporate and business records.

 

Subchapter C.  Corporation Bureau and UCC Fees

 

§ 151.  Short title and application of subchapter.

§ 152.  Definitions.

§ 153.  Fee schedule.

§ 154.  Enforcement and collection.

§ 155.  Disposition of funds.

§ 156.  References.

 

Subchapter D.  Definitive and Contingent Domestication of Alien Associations

 

§ 161.  Domestication of certain alien associations.

§ 162.  Contingent domestication of certain alien associations.

 

PART II.  CORPORATIONS

 

SUBPART A.  CORPORATIONS GENERALLY

 

Chapter 5.  Corporations

 

Subchapter A.  In General

 

§ 501.  Reserved power of General Assembly.

§ 502.  Application of chapter.

§ 503.  Actions to revoke corporate franchises.

§ 504.  Validation of certain defective corporations.

§ 505.  Validation of certain defective corporate acts.

§ 506.  Scope and duration of certain franchises.

§ 507.  Validation of certain share authorizations.

 

Subchapter B.  Fiduciary Duty and Indemnification

 

§ 511.  Application and effect of subchapter.

§ 512.  Standard of care and justifiable reliance.

§ 513.  Personal liability of directors.

§ 514.  Notation of dissent.

§ 515.  Exercise of powers generally.

§ 516.  Alternative standard.

§ 517.  Limitation on standing.

§ 518.  Nonexclusivity and supplementary coverage.

 

Subchapter C.  Provisions Applicable to Particular Types of Corporations

 

§ 521.  Pensions and allowances.

§ 522.  Indemnification of authorized representatives.

§ 523.  Actions by shareholders or members to enforce a secondary right.

 

SUBPART B.  BUSINESS CORPORATIONS

 

ARTICLE A.  PRELIMINARY PROVISIONS

 

Chapter 11.  General Provisions

 

§ 1101.  Short titles.

§ 1102.  Application of subpart.

§ 1103.  Definitions.

§ 1104.  Other general provisions (Repealed).

§ 1105.  Restriction on equitable relief.

§ 1106.  Uniform application of subpart.

§ 1107.  (Reserved).

§ 1108.  Limitation on incorporation.

§ 1109.  Execution of documents.

§ 1110.  Annual report information.

 

ARTICLE B.  DOMESTIC BUSINESS CORPORATIONS

GENERALLY

 

Chapter 13.  Incorporation

 

Subchapter A.  Incorporation Generally

 

§ 1301.  Purposes.

§ 1302.  Number and qualifications of incorporators.

§ 1303.  Corporate name.

§ 1304.  Required name changes by senior corporations.

§ 1305.  Reservation of corporate name.

§ 1306.  Articles of incorporation.

§ 1307.  Advertisement.

§ 1308.  Filing of articles.

§ 1309.  Effect of filing of articles of incorporation.

§ 1310.  Organization meeting.

§ 1311.  Filing of statement of summary of record by certain corporations.

 

Subchapter B.  Revival

 

§ 1341.  Statement of revival.

 

Chapter 15.  Corporate Powers, Duties and Safeguards

 

Subchapter A.  General Provisions

 

§ 1501.  Corporate capacity.

§ 1502.  General powers.

§ 1503.  Defense of ultra vires.

§ 1504.  Adoption, amendment and contents of bylaws.

§ 1505.  Persons bound by bylaws.

§ 1506.  Form of execution of instruments.

§ 1507.  Registered office.

§ 1508.  Corporate records; inspection by shareholders.

§ 1509.  Bylaws and other powers in emergency.

§ 1510.  Certain specifically authorized debt terms.

§ 1511.  Additional powers of certain public utility corporations.

§ 1512.  Informational rights of a director.

 

Subchapter B.  Shares and Other Securities

 

§ 1521.  Authorized shares.

§ 1522.  Issuance of shares in classes or series; board action.

§ 1523.  Pricing and issuance of shares.

§ 1524.  Payment for shares.

§ 1525.  Stock rights and options.

§ 1526.  Liability of shareholders.

§ 1527.  Issuance of fractional shares or scrip.

§ 1528.  Shares represented by certificates and uncertificated shares.

§ 1529.  Transfer of securities; restrictions.

§ 1530.  Preemptive rights of shareholders.

§ 1531.  Voting powers and other rights of certain securityholders and other entities.

§ 1532.  Effect of failure to surrender securities converted by reorganization.

 

Subchapter C.  Corporate Finance

 

§ 1551.  Distributions to shareholders.

§ 1552.  Power of corporation to acquire its own shares.

§ 1553.  Liability for unlawful dividends and other distributions.

§ 1554.  Financial reports to shareholders.

 

Subchapter D.  Dissenters Rights

 

§ 1571.  Application and effect of subchapter.

§ 1572.  Definitions.

§ 1573.  Record and beneficial holders and owners.

§ 1574.  Notice of intention to dissent.

§ 1575.  Notice to demand payment.

§ 1576.  Failure to comply with notice to demand payment, etc.

§ 1577.  Release of restrictions or payment for shares.

§ 1578.  Estimate by dissenter of fair value of shares.

§ 1579.  Valuation proceedings generally.

§ 1580.  Costs and expenses of valuation proceedings.

 

Chapter 17.  Officers, Directors and Shareholders

 

Subchapter A.  Notice and Meetings Generally

 

§ 1701.  Applicability of subchapter.

§ 1702.  Manner of giving notice.

§ 1703.  Place and notice of meetings of board of directors.

§ 1704.  Place and notice of meetings of shareholders.

§ 1705.  Waiver of notice.

§ 1706.  Modification of proposal contained in notice.

§ 1707.  Exception to requirement of notice.

§ 1708.  Use of conference telephone or other electronic technology.

§ 1709.  Conduct of shareholders meeting.

 

Subchapter B.  Fiduciary Duty

 

§ 1711.  Alternative provisions.

§ 1712.  Standard of care and justifiable reliance.

§ 1713.  Personal liability of directors.

§ 1714.  Notation of dissent.

§ 1715.  Exercise of powers generally.

§ 1716.  Alternative standard.

§ 1717.  Limitation on standing.

§ 1718.  Inconsistent articles ineffective.

 

Subchapter C.  Directors and Officers

 

§ 1721.  Board of directors.

§ 1722.  Qualifications of directors.

§ 1723.  Number of directors.

§ 1724.  Term of office of directors.

§ 1725.  Selection of directors.

§ 1726.  Removal of directors.

§ 1727.  Quorum of and action by directors.

§ 1728.  Interested directors or officers; quorum.

§ 1729.  Voting rights of directors.

§ 1730.  Compensation of directors.

§ 1731.  Executive and other committees of the board.

§ 1732.  Officers.

§ 1733.  Removal of officers and agents.

 

Subchapter D.  Indemnification

 

§ 1741.  Third-party actions.

§ 1742.  Derivative and corporate actions.

§ 1743.  Mandatory indemnification.

§ 1744.  Procedure for effecting indemnification.

§ 1745.  Advancing expenses.

§ 1746.  Supplementary coverage.

§ 1747.  Power to purchase insurance.

§ 1748.  Application to surviving or new corporations.

§ 1749.  Application to employee benefit plans.

§ 1750.  Duration and extent of coverage.

 

Subchapter E.  Shareholders

 

§ 1755.  Time of holding meetings of shareholders.

§ 1756.  Quorum.

§ 1757.  Action by shareholders.

§ 1758.  Voting rights of shareholders.

§ 1759.  Voting and other action by proxy.

§ 1760.  Voting by fiduciaries and pledgees.

§ 1761.  Voting by joint holders of shares.

§ 1762.  Voting by corporations.

§ 1763.  Determination of shareholders of record.

§ 1764.  Voting lists.

§ 1765.  Judges of election.

§ 1766.  Consent of shareholders in lieu of meeting.

§ 1767.  Appointment of custodian of corporation on deadlock or other cause.

§ 1768.  Voting trusts and other agreements among shareholders.

§ 1769.  Minors as securityholders.

§ 1770.  Interested shareholders (Repealed).

 

Subchapter F.  Derivative Actions

 

§ 1781.  (Reserved).

§ 1782.  Actions against directors and officers.

 

Subchapter G.  Judicial Supervision of Corporate Action

 

§ 1791.  Corporate action subject to subchapter.

§ 1792.  Proceedings prior to corporate action.

§ 1793.  Review of contested corporate action.

 

Chapter 19.  Fundamental Changes

 

Subchapter A.  Preliminary Provisions

 

§ 1901.  Omission of certain provisions from filed plans.

§ 1902.  Statement of termination.

§ 1903.  Bankruptcy or insolvency proceedings.

§ 1904.  De facto transaction doctrine abolished.

§ 1905.  Proposal of fundamental transactions.

§ 1906.  Special treatment of holders of shares of same class or series.

§ 1907.  Purpose of fundamental transactions.

§ 1908.  Submission of matters to shareholders.

 

Subchapter B.  Amendment of Articles

 

§ 1911.  Amendment of articles authorized.

§ 1912.  Proposal of amendments.

§ 1913.  Notice of meeting of shareholders.

§ 1914.  Adoption of amendments.

§ 1915.  Articles of amendment.

§ 1916.  Filing and effectiveness of articles of amendment.

 

Subchapter C.  Merger, Consolidation, Share Exchanges and Sale of Assets

 

§ 1921.  Merger and consolidation authorized.

§ 1922.  Plan of merger or consolidation.

§ 1923.  Notice of meeting of shareholders.

§ 1924.  Adoption of plan.

§ 1925.  Authorization by foreign corporations.

§ 1926.  Articles of merger or consolidation.

§ 1927.  Filing of articles of merger or consolidation.

§ 1928.  Effective date of merger or consolidation.

§ 1929.  Effect of merger or consolidation.

§ 1929.1. Limitations on asbestos-related liabilities relating to certain mergers or consolidations.

§ 1930.  Dissenters rights.

§ 1931.  Share exchanges.

§ 1932.  Voluntary transfer of corporate assets.

 

Subchapter D.  Division

 

§ 1951.  Division authorized.

§ 1952.  Proposal and adoption of plan of division.

§ 1953.  Division without shareholder approval.

§ 1954.  Articles of division.

§ 1955.  Filing of articles of division.

§ 1956.  Effective date of division.

§ 1957.  Effect of division.

 

Subchapter E.  Conversion

 

§ 1961.  Conversion authorized.

§ 1962.  Proposal and adoption of plan of conversion.

§ 1963.  Articles of conversion.

§ 1964.  Filing of articles of conversion.

§ 1965.  Effective date of conversion.

§ 1966.  Effect of conversion.

 

Subchapter F.  Voluntary Dissolution and Winding Up

 

§ 1971.  Voluntary dissolution by shareholders or incorporators.

§ 1972.  Proposal of voluntary dissolution.

§ 1973.  Notice of meeting of shareholders.

§ 1974.  Adoption of proposal.

§ 1975.  Predissolution provision for liabilities.

§ 1976.  Judicial supervision of proceedings.

§ 1977.  Articles of dissolution.

§ 1978.  Winding up of corporation after dissolution.

§ 1979.  Survival of remedies and rights after dissolution.

§ 1980.  Dissolution by domestication.

 

Subchapter G.  Involuntary Liquidation and Dissolution

 

§ 1981.  Proceedings upon application of shareholder or director.

§ 1982.  Proceedings upon application of creditor.

§ 1983.  (Reserved).

§ 1984.  Appointment of receiver pendente lite and other interim powers.

§ 1985.  Liquidating receiver.

§ 1986.  Qualifications of receivers.

§ 1987.  Proof of claims.

§ 1988.  Discontinuance of proceedings; reorganization.

§ 1989.  Articles of involuntary dissolution.

 

Subchapter H.  Postdissolution Provision for Liabilities

 

§ 1991.  Definitions.

§ 1991.1. Authority of board of directors.

§ 1992.  Notice to claimants.

§ 1993.  Acceptance or rejection of matured claims.

§ 1994.  Disposition of unmatured claims.

§ 1995.  Court proceedings.

§ 1996.  No revival or waiver.

§ 1997.  Payments and distributions.

§ 1998.  Liability of shareholders (Repealed).

 

ARTICLE C.  DOMESTIC BUSINESS CORPORATION

ANCILLARIES

 

Chapter 21.  Nonstock Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 2101.  Application and effect of chapter.

§ 2102.  Formation of nonstock corporations.

§ 2103.  Contents of articles and other documents of nonstock corporations.

§ 2104.  Election of an existing business corporation to become a nonstock corporation.

§ 2105.  Termination of nonstock corporation status.

 

Subchapter B.  Powers, Duties and Safeguards

 

§ 2121.  Corporate name of nonstock corporations.

§ 2122.  Classes of membership.

§ 2123.  Evidence of membership; liability of members.

§ 2124.  Voting rights of members.

§ 2125.  Inapplicability of certain provisions to nonstock corporations.

§ 2126.  Dissolution of nonstock corporations.

 

Chapter 23.  Statutory Close Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 2301.  Application and effect of chapter.

§ 2302.  Definition of minimum vote.

§ 2303.  Formation of statutory close corporations.

§ 2304.  Additional contents of articles of statutory close corporations.

§ 2305.  Election of an existing business corporation to become a statutory close corporation.

§ 2306.  Limitations on continuation of statutory close corporation status.

§ 2307.  Voluntary termination of statutory close corporation status by amendment of articles.

§ 2308.  Issuance or transfer of shares of a statutory close corporation in breach of qualifying conditions.

§ 2309.  Involuntary termination of statutory close corporation status; proceeding to prevent loss of status.

 

Subchapter B.  Shares

 

§ 2321.  Shares.

§ 2322.  Share transfer restrictions.

§ 2323.  Transfer of shares in breach of transfer restrictions.

§ 2324.  Corporation option where a restriction on transfer of a security is held invalid.

§ 2325.  Sale option of estate of shareholder.

 

Subchapter C.  Powers, Duties and Safeguards

 

§ 2331.  Directors.

§ 2332.  Management by shareholders.

§ 2333.  Appointment of custodian for statutory close corporation.

§ 2334.  Appointment of provisional director in certain cases.

§ 2335.  Operating corporation as partnership.

§ 2336.  Fundamental changes.

§ 2337.  Option of shareholder to dissolve corporation.

 

Chapter 25.  Registered Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 2501.  Application and effect of chapter.

§ 2502.  Registered corporation status.

§ 2503.  Acquisition of registered corporation status.

§ 2504.  Termination of registered corporation status.

 

Subchapter B.  Powers, Duties and Safeguards

 

§ 2511.  Financial reports to shareholders.

§ 2512.  Dissenters rights procedure.

§ 2513.  Disparate treatment of certain persons.

 

Subchapter C.  Directors and Shareholders

 

§ 2521.  Call of special meetings of shareholders.

§ 2522.  Adjournment of meetings of shareholders.

§ 2523.  Quorum at shareholder meetings.

§ 2524.  Consent of shareholders in lieu of meeting.

§ 2525.  Appointment of custodian.

§ 2526.  Voting rights of directors.

§ 2527.  Authority of board of directors.

§ 2528.  Notice of shareholder meetings.

§ 2529.  Voting lists.

 

Subchapter D.  Fundamental Changes Generally

 

§ 2535.  Proposal of amendment to articles.

§ 2536.  Application by director for involuntary dissolution.

§ 2537.  Dissenters rights in asset transfers.

§ 2538.  Approval of transactions with interested shareholders.

§ 2539.  Adoption of plan of merger by board of directors.

 

Subchapter E.  Control Transactions

 

§ 2541.  Application and effect of subchapter.

§ 2542.  Definitions.

§ 2543.  Controlling person or group.

§ 2544.  Right of shareholders to receive payment for shares.

§ 2545.  Notice to shareholders.

§ 2546.  Shareholder demand for fair value.

§ 2547.  Valuation procedures.

§ 2548.  Coordination with control transaction.

 

Subchapter F.  Business Combinations

 

§ 2551.  Application and effect of subchapter.

§ 2552.  Definitions.

§ 2553.  Interested shareholder.

§ 2554.  Business combination.

§ 2555.  Requirements relating to certain business combinations.

§ 2556.  Certain minimum conditions.

 

Subchapter G.  Control-Share Acquisitions

 

§ 2561.  Application and effect of subchapter.

§ 2562.  Definitions.

§ 2563.  Acquiring person safe harbor.

§ 2564.  Voting rights of shares acquired in a control-share acquisition.

§ 2565.  Procedure for establishing voting rights of control shares.

§ 2566.  Information statement of acquiring person.

§ 2567.  Redemption.

§ 2568.  Board determinations.

 

Subchapter H.  Disgorgement by Certain Controlling Shareholders Following Attempts to Acquire Control

 

§ 2571.  Application and effect of subchapter.

§ 2572.  Policy and purpose.

§ 2573.  Definitions.

§ 2574.  Controlling person or group safe harbor.

§ 2575.  Ownership by corporation of profits resulting from certain transactions.

§ 2576.  Enforcement actions.

 

Subchapter I.  Severance Compensation for Employees Terminated Following Certain Control-Share Acquisitions

 

§ 2581.  Definitions.

§ 2582.  Severance compensation.

§ 2583.  Enforcement and remedies.

 

Subchapter J.  Business Combination Transactions - Labor Contracts

 

§ 2585.  Application and effect of subchapter.

§ 2586.  Definitions.

§ 2587.  Labor contracts preserved in business combination transactions.

§ 2588.  Civil remedies.

 

Chapter 27.  Management Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 2701.  Application and effect of chapter.

§ 2702.  Formation of management corporations.

§ 2703.  Additional contents of articles of management corporations.

§ 2704.  Election of an existing business corporation to become a management corporation.

§ 2705.  Termination and renewal of status as a management corporation.

 

Subchapter B.  Directors and Shareholders

 

§ 2711.  Selection and removal of directors.

§ 2712.  Shareholder meetings unnecessary.

 

Subchapter C.  Fundamental Changes

 

§ 2721.  Bylaw and fundamental change procedures.

§ 2722.  Changes in authorized shares.

 

Chapter 29.  Professional Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 2901.  Application and effect of chapter.

§ 2902.  Definitions and index of definitions.

§ 2903.  Formation of professional corporations.

§ 2904.  Election of an existing business corporation to become a professional corporation.

§ 2905.  Election of professional associations to become professional corporations.

§ 2906.  Termination of professional corporation status.

§ 2907.  Proceedings to terminate breach of qualifying conditions.

 

Subchapter B.  Powers, Duties and Safeguards

 

§ 2921.  Corporate name.

§ 2922.  Stated purposes.

§ 2923.  Issuance and retention of shares.

§ 2924.  Rendering professional services.

§ 2925.  Professional relationship retained.

 

Chapter 31.  Insurance Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 3101.  Application and effect of chapter.

§ 3102.  Definitions.

 

Subchapter B.  Powers, Duties and Safeguards

 

§ 3121.  Bylaws.

§ 3122.  Distributions by insurance corporations.

 

Subchapter C.  Officers, Directors and Shareholders

 

§ 3131.  Directors.

§ 3132.  Officers.

§ 3133.  Notice of meetings of members of mutual insurance companies.

§ 3134.  Quorum at shareholder or member meetings.

§ 3135.  Proxies of members of mutual insurance companies.

§ 3136.  Judges of election.

§ 3137.  Appointment of custodian.

§ 3138.  Judicial supervision of corporate action.

 

Chapter 33.  Benefit Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 3301.  Application and effect of chapter.

§ 3302.  Definitions.

§ 3303.  Formation of benefit corporations.

§ 3304.  Election of benefit corporation status.

§ 3305.  Termination of benefit corporation status.

 

Subchapter B.  Corporate Purposes

 

§ 3311.  Corporate purposes.

 

Subchapter C.  Accountability

 

§ 3321.  Standard of conduct for directors.

§ 3322.  Benefit director.

§ 3323.  Standard of conduct for officers.

§ 3324.  Benefit officer.

§ 3325.  Right of action.

 

Subchapter D.  Transparency

 

§ 3331.  Annual benefit report.

 

ARTICLE D.  FOREIGN BUSINESS CORPORATIONS

 

Chapter 41.  Foreign Business Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 4101.  Application of article.

§ 4102.  Foreign domiciliary corporations.

§ 4103.  Acquisition of foreign domiciliary corporation status.

§ 4104.  Termination of foreign domiciliary corporation status.

 

Subchapter B.  Qualification

 

§ 4121.  Admission of foreign corporations.

§ 4122.  Excluded activities.

§ 4123.  Requirements for foreign corporation names.

§ 4124.  Application for a certificate of authority.

§ 4125.  Issuance of certificate of authority.

§ 4126.  Amended certificate of authority.

§ 4127.  Merger, consolidation or division of qualified foreign corporations.

§ 4128.  Revocation of certificate of authority.

§ 4129.  Application for termination of authority.

§ 4130.  Change of address after withdrawal.

§ 4131.  Registration of name.

 

Subchapter C.  Powers, Duties and Liabilities

 

§ 4141.  Penalty for doing business without certificate of authority.

§ 4142.  General powers and duties of qualified foreign corporations.

§ 4143.  General powers and duties of nonqualified foreign corporations.

§ 4144.  Registered office of qualified foreign corporations.

§ 4145.  Applicability of certain safeguards to foreign domiciliary corporations.

§ 4146.  Provisions applicable to all foreign corporations.

 

Subchapter D.  Domestication

 

§ 4161.  Domestication.

§ 4162.  Effect of domestication.

 

SUBPART C.  NONPROFIT CORPORATIONS

 

ARTICLE A.  PRELIMINARY PROVISIONS

 

Chapter 51.  General Provisions

 

§ 5101.  Short titles.

§ 5102.  Application of subpart.

§ 5103.  Definitions.

§ 5104.  Other general provisions (Deleted by amendment).

§ 5105.  Restriction on equitable relief.

§ 5106.  Uniform application of subpart.

§ 5107.  Subordination of subpart to canon law.

§ 5108.  Limitation on incorporation.

§ 5109.  Execution of documents.

§ 5110.  Annual report.

 

ARTICLE B.  DOMESTIC NONPROFIT CORPORATIONS

GENERALLY

 

Chapter 53.  Incorporation

 

Subchapter A.  Incorporation Generally

 

§ 5301.  Purposes.

§ 5302.  Number and qualifications of incorporators.

§ 5303.  Corporate name.

§ 5304.  Required name changes by senior corporations.

§ 5305.  Reservation of corporate name.

§ 5306.  Articles of incorporation.

§ 5307.  Advertisement.

§ 5308.  Filing of articles.

§ 5309.  Effect of filing of articles of incorporation.

§ 5310.  Organization meeting.

§ 5311.  Filing of statement of summary of record by certain

corporations.

 

Subchapter B.  Special Procedures Applicable to Certain Corporations

 

§ 5331.  Incorporation of unincorporated associations.

 

Subchapter C.  Revival

 

§ 5341.  Statement of revival.

 

Chapter 55.  Corporate Powers, Duties and Safeguards

 

Subchapter A.  General Provisions

 

§ 5501.  Corporate capacity.

§ 5502.  General powers.

§ 5503.  Defense of ultra vires.

§ 5504.  Adoption, amendment and contents of bylaws.

§ 5505.  Persons bound by bylaws.

§ 5506.  Form of execution of instruments.

§ 5507.  Registered office.

§ 5508.  Corporate records; inspection by members.

§ 5509.  Bylaws and other powers in emergency.

§ 5510.  Certain specifically authorized debt terms.

§ 5511.  Establishment of subordinate units.

§ 5512.  Informational rights of a director.

 

Subchapter B.  Financial Matters

 

§ 5541.  Capital contributions of members.

§ 5542.  Subventions.

§ 5543.  Debt and security interests.

§ 5543.1. Usury not a defense (Repealed).

§ 5544.  Dues and assessments.

§ 5545.  Income from corporate activities.

§ 5546.  Purchase, sale, mortgage and lease of real property.

§ 5546.1. Insolvency or bankruptcy (Repealed).

§ 5547.  Authority to take and hold trust property.

§ 5548.  Investment of trust funds.

§ 5549.  Transfer of trust or other assets to institutional trustee.

§ 5550.  Devises, bequests and gifts after certain fundamental changes.

§ 5551.  Dividends prohibited; compensation and certain payments authorized.

§ 5552.  (Reserved).

§ 5553.  Liabilities of members.

§ 5554.  Annual report of directors or other body.

 

Subchapter C.  Common Trust Funds

 

§ 5585.  Establishment or use of common trust funds authorized.

§ 5586.  Restrictions on investments.

§ 5587.  Determination of interests.

§ 5588.  Amortization of premiums on securities held.

§ 5589.  Records; ownership of assets.

 

Chapter 57.  Officers, Directors and Members

 

Subchapter A.  Notice and Meetings Generally

 

§ 5701.  Applicability of subchapter.

§ 5702.  Manner of giving notice.

§ 5702.1. Optional procedures for giving of notice (Repealed).

§ 5703.  Place and notice of meetings of board of directors or other body.

§ 5704.  Place and notice of meetings of members.

§ 5705.  Waiver of notice.

§ 5706.  Modification of proposal contained in notice.

§ 5707.  Exception to requirement of notice.

§ 5708.  Use of conference telephone or other electronic technology.

§ 5709.  Conduct of members meeting.

 

Subchapter B.  Fiduciary Duty

 

§ 5711.  Alternative provisions.

§ 5712.  Standard of care and justifiable reliance.

§ 5713.  Personal liability of directors.

§ 5714.  Notation of dissent.

§ 5715.  Exercise of powers generally.

§ 5716.  Alternative standard.

§ 5717.  Limitation on standing.

 

Subchapter C.  Directors, Officers and Members of An Other Body

 

§ 5721.  Board of directors.

§ 5722.  Qualifications of directors.

§ 5723.  Number of directors.

§ 5724.  Term of office of directors.

§ 5725.  Selection of directors.

§ 5726.  Removal of directors.

§ 5727.  Quorum of and action by directors.

§ 5728.  Interested directors or officers; quorum.

§ 5729.  Voting rights of directors.

§ 5730.  Compensation of directors.

§ 5731.  Executive and other committees of the board.

§ 5732.  Officers.

§ 5733.  Removal of officers and agents.

§ 5734.  Other body.

 

Subchapter D.  Indemnification

 

§ 5741.  Third-party actions.

§ 5742.  Derivative and corporate actions.

§ 5743.  Mandatory indemnification.

§ 5744.  Procedure for effecting indemnification.

§ 5745.  Advancing expenses.

§ 5746.  Supplementary coverage.

§ 5747.  Power to purchase insurance.

§ 5748.  Application to surviving or new corporations.

§ 5749.  Application to employee benefit plans.

§ 5750.  Duration and extent of coverage.

 

Subchapter E.  Members

 

§ 5751.  Classes and qualifications of membership.

§ 5752.  Organization on a stock share basis.

§ 5753.  Membership certificates.

§ 5754.  Members grouped in local units.

§ 5755.  Time of holding meetings of members.

§ 5756.  Quorum.

§ 5757.  Action by members.

§ 5758.  Voting rights of members.

§ 5759.  Voting and other action by proxy.

§ 5760.  (Reserved).

§ 5761.  (Reserved).

§ 5762.  Voting by corporations.

§ 5763.  Determination of members of record.

§ 5764.  (Reserved).

§ 5764.1. Actions by members to enforce a secondary right (Repealed).

§ 5765.  Judges of election.

§ 5766.  Consent of members in lieu of meeting.

§ 5767.  Appointment of custodian of corporation on deadlock or other cause.

§ 5768.  Reduction of membership below stated number.

§ 5769.  Termination and transfer of membership.

§ 5770.  Voting powers and other rights of certain securityholders and other entities.

 

Subchapter F.  Derivative Actions

 

§ 5782.  Actions against directors, members of an other body and officers.

 

Subchapter G.  Judicial Supervision of Corporate Action

 

§ 5791.  Corporate action subject to subchapter.

§ 5792.  Proceedings prior to corporate action.

§ 5793.  Review of contested corporate action.

 

Chapter 59.  Fundamental Changes

 

Subchapter A.  Preliminary Provisions

 

§ 5901.  Omission of certain provisions from filed plans.

§ 5902.  Statement of termination.

§ 5903.  Bankruptcy or insolvency proceedings.

§ 5904.  (Reserved).

§ 5905.  Proposal of fundamental transactions.

 

Subchapter B.  Amendment of Articles

 

§ 5911.  Amendment of articles authorized.

§ 5912.  Proposal of amendments.

§ 5913.  Notice of meeting of members.

§ 5914.  Adoption of amendments.

§ 5915.  Articles of amendment.

§ 5916.  Filing and effectiveness of articles of amendment.

 

Subchapter C.  Merger, Consolidation and Sale of Assets

 

§ 5921.  Merger and consolidation authorized.

§ 5922.  Plan of merger or consolidation.

§ 5923.  Notice of meeting of members.

§ 5924.  Adoption of plan.

§ 5925.  Authorization by foreign corporations.

§ 5926.  Articles of merger or consolidation.

§ 5927.  Filing of articles of merger or consolidation.

§ 5928.  Effective date of merger or consolidation.

§ 5929.  Effect of merger or consolidation.

§ 5930.  Voluntary transfer of corporate assets.

 

Subchapter D.  Division

 

§ 5951.  Division authorized.

§ 5952.  Proposal and adoption of plan of division.

§ 5953.  Division without member approval.

§ 5954.  Articles of division.

§ 5955.  Filing of articles of division.

§ 5956.  Effective date of division.

§ 5957.  Effect of division.

 

Subchapter E.  Conversion

 

§ 5961.  Conversion authorized.

§ 5962.  Proposal and adoption of plan of conversion.

§ 5963.  Articles of conversion.

§ 5964.  Filing of articles of conversion.

§ 5965.  Effective date of conversion.

§ 5966.  Effect of conversion.

 

Subchapter F.  Voluntary Dissolution and Winding Up

 

§ 5971.  Voluntary dissolution by members or incorporators.

§ 5972.  Proposal of voluntary dissolution.

§ 5973.  Notice of meeting of members.

§ 5974.  Adoption of proposal.

§ 5974.1. Articles of election to dissolve (Repealed).

§ 5974.2. Articles rescinding election to dissolve (Repealed).

§ 5975.  Predissolution provision for liabilities.

§ 5976.  Judicial supervision of proceedings.

§ 5977.  Articles of dissolution.

§ 5978.  Winding up of corporation after dissolution.

§ 5979.  Survival of remedies and rights after dissolution.

§ 5980.  Dissolution by domestication.

 

Subchapter G.  Involuntary Liquidation and Dissolution

 

§ 5981.  Proceedings upon application of member or director.

§ 5982.  Proceedings upon application of creditor.

§ 5983.  Proceedings upon petition of superior religious organization.

§ 5984.  Appointment of receiver pendente lite and other interim powers.

§ 5985.  Liquidating receiver.

§ 5986.  Qualifications of receivers.

§ 5987.  Proofs of claims.

§ 5988.  Discontinuance of proceedings; reorganization.

§ 5989.  Articles of involuntary dissolution.

 

Subchapter H.  Postdissolution Provision for Liabilities

 

§ 5991.  Definitions.

§ 5991.1. Authority of board of directors.

§ 5992.  Notice to claimants.

§ 5993.  Acceptance or rejection of matured claims.

§ 5994.  Disposition of unmatured claims.

§ 5995.  Court proceedings.

§ 5996.  No revival or waiver.

§ 5997.  Payments and distributions.

§ 5998.  Liability of members (Repealed).

 

ARTICLE C.  FOREIGN NONPROFIT CORPORATIONS

 

Chapter 61.  Foreign Nonprofit Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 6101.  Application of article.

§ 6102.  Foreign domiciliary corporations.

§ 6103.  Acquisition of foreign domiciliary corporation status.

§ 6104.  Termination of foreign domiciliary corporation status.

 

Subchapter B.  Qualification

 

§ 6121.  Admission of foreign corporations.

§ 6122.  Excluded activities.

§ 6123.  Requirements for foreign corporation names.

§ 6124.  Application for a certificate of authority.

§ 6125.  Issuance of certificate of authority.

§ 6126.  Amended certificate of authority.

§ 6127.  Merger, consolidation or division of qualified foreign corporations.

§ 6128.  Revocation of certificate of authority.

§ 6129.  Application for termination of authority.

§ 6130.  Change of address after withdrawal.

§ 6131.  Registration of name.

 

Subchapter C.  Powers, Duties and Liabilities

 

§ 6141.  Penalty for doing business without certificate of authority.

§ 6142.  General powers and duties of qualified foreign corporations.

§ 6143.  General powers and duties of nonqualified foreign corporations.

§ 6144.  Registered office of qualified foreign corporations.

§ 6145.  Applicability of certain safeguards to foreign domiciliary corporations.

§ 6146.  Provisions applicable to all foreign corporations.

 

Subchapter D.  Domestication

 

§ 6161.  Domestication.

§ 6162.  Effect of domestication.

 

SUBPART D.  COOPERATIVE CORPORATIONS

 

ARTICLE A.  COOPERATIVE CORPORATIONS GENERALLY

 

Chapter 71.  Cooperative Corporations Generally

 

Subchapter A.  General Provisions

 

§ 7101.  Short title of subpart.

§ 7102.  Cooperative corporations generally.

§ 7103.  Use of term "cooperative" in corporate name.

§ 7104.  Election of an existing business corporation to become a cooperative corporation.

§ 7105.  Termination of status as a cooperative corporation for profit.

§ 7106.  Election of an existing nonprofit corporation to become a cooperative corporation.

§ 7107.  Termination of nonprofit cooperative corporation status.

 

Subchapter B.  Membership and Corporate Finance

 

§ 7111.  Voting rights.

§ 7112.  Distributions.

 

Subchapter C.  Cooperative Contracts

 

§ 7121.  Cooperative contracts generally.

§ 7122.  Notice of cooperative contracts.

§ 7123.  Filing procedures.

§ 7124.  Relief against breach or threatened breach of contract; penalty for interference.

§ 7125.  Action for civil penalty for inducing breach or spreading false reports.

 

ARTICLE B.  DOMESTIC COOPERATIVE CORPORATION

ANCILLARIES

 

Chapter 73.  Electric Cooperative Corporations

 

Subchapter A.  Preliminary Provisions

 

§ 7301.  Short titles.

§ 7302.  Application of chapter.

§ 7303.  Definitions.

§ 7304.  Number and qualifications of incorporators.

§ 7305.  Purpose.

§ 7306.  Articles of incorporation.

§ 7307.  Prohibition on use of words "electric cooperative."

§ 7308.  Liberal construction.

 

Subchapter B.  Powers, Duties and Safeguards

 

§ 7321.  Special powers and limitations.

§ 7322.  Bylaws.

§ 7323.  Exemption of members from liability for debts of corporation.

§ 7324.  Qualifications of members.

§ 7325.  Annual meeting of members.

§ 7326.  Voting by members.

§ 7327.  Certificates of membership.

§ 7328.  Quorum of members.

§ 7329.  Directors.

§ 7330.  Nonprofit operation.

§ 7331.  Merger, consolidation, division or sale of assets.

§ 7332.  Dissolution.

§ 7333.  License fee; exemption from excise taxes.

§ 7334.  Exemption from jurisdiction of Public Utility Commission.

§ 7335.  Limited exemption from Securities Act.

 

Subchapter C.  Unincorporated Area Certified Territory

 

§ 7351.  Application of subchapter.

§ 7352.  Definitions.

§ 7353.  Geographical areas.

§ 7354.  Boundaries of certified territories; hearings.

§ 7355.  Obligations and rights within certified territory; new electric-consuming facilities.

§ 7356.  Borderline service.

§ 7357.  Effect of incorporation, annexation or consolidation.

§ 7358.  Enforcement of compliance by commission.

§ 7359.  Expenses.

 

Chapter 74.  Generation Choice for Customers of Electric Cooperatives

 

§ 7401.  Short title of chapter.

§ 7402.  Application.

§ 7403.  Declaration of policy.

§ 7404.  Definitions.

§ 7405.  Customer choice in electric cooperative service territories.

§ 7406.  Competition by electric cooperatives.

§ 7407.  Transition surcharge and stranded cost recovery.

§ 7408.  Option to elect commission review.

§ 7409.  Universal service and energy conservation.

§ 7410.  Savings provision and repealer.

 

Chapter 75.  Cooperative Agricultural Associations

 

Subchapter A.  Preliminary Provisions

 

§ 7501.  Short title of chapter.

§ 7502.  Application of chapter.

§ 7503.  Definitions.

§ 7504.  Policy.

§ 7505.  Number and qualifications of incorporators.

§ 7506.  Purposes.

§ 7507.  Articles of incorporation.

 

Subchapter B.  Powers, Duties and Safeguards

 

§ 7521.  Special powers and limitations.

§ 7522.  Records of salary or other payments.

§ 7523.  Members.

§ 7524.  Issuance of shares.

§ 7525.  Sale, transfer or redemption of shares.

§ 7526.  Termination of membership.

§ 7527.  Voting by proxy or mail.

§ 7528.  Meetings.

§ 7529.  Fundamental changes.

§ 7530.  Bylaws.

§ 7531.  Directors.

§ 7532.  Removal of directors.

§ 7533.  Officers.

§ 7534.  Marketing arrangements.

§ 7535.  Patronage distributions.

§ 7536.  Audit of operations.

§ 7537.  Contract assignments to association.

§ 7538.  Exemption from tax on capital stock and indebtedness.

 

Chapter 77.  Workers' Cooperative Corporations

 

§ 7701.  Short title of chapter.

§ 7702.  Definitions.

§ 7703.  Corporations.

§ 7704.  Articles of incorporation.

§ 7705.  Capital stock.

§ 7706.  Internal capital accounts and net worth.

§ 7707.  Voting.

§ 7708.  Acceptance and termination of membership.

§ 7709.  Power to buy, sell or trade.

§ 7710.  Individual liability of members.

§ 7711.  Corporate powers.

§ 7712.  Investment of capital stock in other corporations.

§ 7713.  Meetings.

§ 7714.  Records.

§ 7715.  Audit.

§ 7716.  Directors and officers.

§ 7717.  Patronage distributions.

§ 7718.  Indemnity.

§ 7719.  Unlawful dividends.

§ 7720.  Amendments of articles.

§ 7721.  Bylaws.

§ 7722.  Benefits bestowed on associations by compliance with this chapter.

§ 7723.  Dissolution.

§ 7724.  Conversion to a corporation governed by the Business Corporation Law.

§ 7725.  Savings provisions.

§ 7726.  Applicability.

 

Chapter 79.  Fundamental Changes (Transferred)

 

Subchapter A.  Amendment of Articles (Transferred)

 

§ 7901 - § 7906 (Transferred)

 

Subchapter B.  Merger, Consolidation and Sale of Assets (Transferred)

 

§ 7921 - § 7930 (Transferred)

 

Subchapter C.  Division (Transferred)

 

§ 7941 - § 7946 (Transferred)

 

Subchapter D.  Conversion (Transferred)

 

§ 7951 - § 7956 (Transferred)

 

Subchapter E.  Voluntary Dissolution and Winding Up (Transferred)

 

§ 7961 - § 7971 (Transferred)

 

Subchapter F.  Involuntary Liquidation and Dissolution (Transferred)

 

§ 7981 - § 7990 (Transferred)

 

PART III.  PARTNERSHIPS AND LIMITED LIABILITY

COMPANIES

 

Chapter 81.  General Provisions

 

§ 8101.  Short title of part.

§ 8102.  Interchangeability of partnership, limited liability company and corporate forms of organization.

§ 8103.  Continuation of certain limited partnerships and limited liability companies (Repealed).

§ 8104.  Reserved power of General Assembly.

§ 8105.  Ownership of certain professional partnerships.

 

Chapter 82.  Registered Limited Liability Partnerships

 

Subchapter A.  Domestic Registered Limited Liability Partnerships

 

§ 8201.  Scope.

§ 8202.  Definitions.

§ 8203.  Name.

§ 8204.  Limitation on liability of partners.

§ 8205.  Liability of withdrawing partner.

§ 8206.  Insurance (Repealed).

§ 8207.  Extraterritorial application of subchapter.

 

Subchapter B.  Foreign Registered Limited Liability Partnerships

 

§ 8211.  Foreign registered limited liability partnerships.

 

Subchapter C.  Annual Registration

 

§ 8221.  Annual registration.

 

Chapter 83.  General Partnerships

 

Subchapter A.  Preliminary Provisions

 

§ 8301.  Short title and application of chapter.

§ 8302.  Definitions.

§ 8303.  "Knowledge" and "notice."

§ 8304.  Rules of construction.

§ 8305.  Rules for cases not provided for in chapter.

 

Subchapter B.  Nature of a Partnership

 

§ 8311.  Partnership defined.

§ 8312.  Rules for determining the existence of a partnership.

§ 8313.  Partnership property.

 

Subchapter C.  Relation of Partners to Persons Dealing With the Partnership

 

§ 8321.  Partner agent of partnership as to partnership business.

§ 8322.  Conveyance of real property of the partnership.

§ 8323.  Admissions or representations by partner.

§ 8324.  Partnership charged with knowledge of or notice to partner.

§ 8325.  Wrongful act of partner.

§ 8326.  Breach of trust by partner.

§ 8327.  Nature of liability of partner.

§ 8328.  Partner by estoppel.

§ 8329.  Liability of incoming partner.

 

Subchapter D.  Relations of Partners to One Another

 

§ 8331.  Rules determining rights and duties of partners.

§ 8332.  Partnership books.

§ 8333.  Duty to render information.

§ 8334.  Partner accountable as fiduciary.

§ 8335.  Right of partner to an account.

§ 8336.  Continuation of partnership beyond fixed term.

 

Subchapter E.  Property Rights of a Partner

 

§ 8341.  Extent of property rights of partner.

§ 8342.  Nature of right of partner in specific partnership property.

§ 8343.  Nature of interest of partner in partnership.

§ 8344.  Assignment of interest of partner.

§ 8345.  Interest of partner subject to charging order.

 

Subchapter F.  Dissolution and Winding Up

 

§ 8351.  "Dissolution" defined.

§ 8352.  Partnership continued for winding up affairs.

§ 8353.  Causes of dissolution.

§ 8354.  Dissolution by decree of court.

§ 8355.  Effect of dissolution on authority of partner.

§ 8356.  Right of partner to contribution from copartners.

§ 8357.  Power of partner to bind partnership to third persons.

§ 8358.  Effect of dissolution on existing liability of partner.

§ 8359.  Right to wind up affairs.

§ 8360.  Rights of partners to application of partnership property.

§ 8361.  Rights after dissolution for fraud or misrepresentation.

§ 8362.  Rules for distribution.

§ 8363.  Liability of persons continuing the business.

§ 8364.  Rights of retiring partner or estate of deceased partner when business is continued.

§ 8365.  Accrual of right to account.

 

Chapter 85.  Limited Partnerships

 

Subchapter A.  Preliminary Provisions

 

§ 8501.  Short title of chapter.

§ 8502.  Applicability of chapter to existing limited partnerships.

§ 8503.  Definitions and index of definitions.

§ 8504.  Rules for cases not provided for in this chapter.

§ 8505.  Name.

§ 8506.  Registered office.

§ 8507.  Records to be kept.

§ 8508.  Business that may be carried on.

§ 8509.  Business transactions of partner with limited partnership.

§ 8510.  Indemnification.

 

Subchapter B.  Formation

 

§ 8511.  Certificate of limited partnership.

§ 8512.  Amendment of certificate.

§ 8513.  Cancellation of certificate.

§ 8514.  Execution of certificates.

§ 8515.  Execution by judicial act.

§ 8516.  Liability for false statement in certificate.

§ 8517.  Notice.

§ 8518.  Delivery of filed documents to limited partners.

§ 8519.  Filing of certificate of summary of record by limited partnerships formed prior to 1976.

§ 8520.  Partnership agreement.

 

Subchapter C.  Limited Partners

 

§ 8521.  Admission of limited partners.

§ 8522.  Classes of limited partners.

§ 8523.  Liability of limited partners to third parties.

§ 8524.  Person erroneously believing himself limited partner.

§ 8525.  Information.

 

Subchapter D.  General Partners

 

§ 8531.  Admission of additional general partners.

§ 8532.  Events of withdrawal.

§ 8533.  General powers and liabilities of general partners.

§ 8534.  Contributions by a general partner.

§ 8535.  Classes of general partners.

 

Subchapter E.  Finance

 

§ 8541.  Form of contribution.

§ 8542.  Liability for contributions.

§ 8543.  Sharing of profits and losses.

§ 8544.  Sharing of distributions.

 

Subchapter F.  Merger and Consolidation

 

§ 8545.  Merger and consolidation of limited partnerships authorized.

§ 8546.  Approval of merger or consolidation.

§ 8547.  Certificate of merger or consolidation.

§ 8548.  Effective date of merger or consolidation.

§ 8549.  Effect of merger or consolidation.

 

Subchapter G.  Distributions and Withdrawal

 

§ 8551.  Interim distributions.

§ 8552.  Voluntary withdrawal of general partner.

§ 8553.  Voluntary withdrawal of limited partner.

§ 8554.  Distribution upon withdrawal.

§ 8555.  Distribution in kind.

§ 8556.  Right to distribution.

§ 8557.  Distributions and allocation of profits and losses.

§ 8558.  Liability upon return of contribution.

 

Subchapter H.  Assignment of Partnership Interests

 

§ 8561.  Nature of partnership interest.

§ 8562.  Assignment of partnership interest.

§ 8563.  Rights of creditor.

§ 8564.  Right of assignee to become limited partner.

§ 8565.  Power of estate of deceased or incompetent partner.

 

Subchapter I.  Dissolution

 

§ 8571.  Nonjudicial dissolution.

§ 8572.  Judicial dissolution.

§ 8573.  Winding up.

§ 8574.  Distribution of assets.

§ 8575.  Survival of remedies and rights after dissolution.

 

Subchapter J.  Division

 

§ 8576.  Division authorized.

§ 8577.  Proposal and adoption of plan of division.

§ 8578.  Division without approval of limited partners.

§ 8579.  Certificate of division.

§ 8580.  Effect of division.

 

Subchapter K.  Foreign Limited Partnerships

 

§ 8581.  Governing law.

§ 8582.  Registration.

§ 8583.  Effect of filing.

§ 8584.  Name.

§ 8585.  Changes and amendments.

§ 8586.  Cancellation of registration.

§ 8587.  Doing business without registration.

§ 8588.  Action by Attorney General.

§ 8589.  General powers and duties of qualified foreign limited partnerships.

§ 8590.  Domestication.

 

Subchapter L.  Derivative Actions

 

§ 8591.  Right of action.

§ 8592.  Proper plaintiff.

§ 8593.  Pleading.

§ 8594.  Expenses.

 

Chapter 87.  Electing Partnerships

 

§ 8701.  Scope and definition.

§ 8702.  Centralized management.

§ 8703.  Continuity of life.

§ 8704.  Free transferability of interests.

§ 8705.  Limited liability in certain cases.

§ 8706.  One person as both partner and employee.

§ 8707.  Modification by agreement.

§ 8708.  Taxation of electing partnerships.

 

Chapter 89.  Limited Liability Companies

 

Subchapter A.  Preliminary Provisions

 

§ 8901.  Short title of chapter.

§ 8902.  Legislative intent.

§ 8903.  Definitions and index of definitions.

§ 8904.  Rules for cases not provided for in this chapter.

§ 8905.  Name.

§ 8906.  Registered office.

§ 8907.  Execution of documents.

§ 8908.  Election of professional association to become limited liability company.

 

Subchapter B.  Organization

 

§ 8911.  Purposes.

§ 8912.  Organization.

§ 8913.  Certificate of organization.

§ 8914.  Filing of certificate of organization.

§ 8915.  Modification by agreement.

§ 8916.  Operating agreement.

 

Subchapter C.  Powers, Duties and Safeguards

 

§ 8921.  Powers and capacity.

§ 8922.  Liability of members.

§ 8923.  Property.

§ 8924.  Limited transferability of membership interest.

§ 8925.  Taxation of limited liability companies.

§ 8926.  Certain specifically authorized debt terms.

 

Subchapter D.  Financial Provisions

 

§ 8931.  Contributions to capital.

§ 8932.  Distributions and allocation of profits and losses.

§ 8933.  Distributions upon an event of dissociation.

§ 8934.  Distributions in kind.

§ 8935.  Right to distribution.

 

Subchapter E.  Management and Members

 

§ 8941.  Management.

§ 8942.  Voting.

§ 8943.  Duties of managers and members.

§ 8944.  Members.

§ 8945.  Indemnification.

§ 8946.  Transactions by member or manager.

§ 8947.  Resignation of manager.

§ 8948.  Limitation on dissociation or assignment of membership interest.

 

Subchapter F.  Amendment of Certificate

 

§ 8951.  Amendment of certificate of organization.

 

Subchapter G.  Mergers and Consolidations

 

§ 8956.  Merger and consolidation of limited liability companies authorized.

§ 8957.  Approval of merger or consolidation.

§ 8958.  Certificate of merger or consolidation.

§ 8959.  Effect of merger or consolidation.

 

Subchapter H.  Division

 

§ 8961.  Division authorized.

§ 8962.  Proposal and adoption of plan of division.

§ 8963.  Division without member approval.

§ 8964.  Certificate of division.

§ 8965.  Effect of division.

 

Subchapter I.  Dissolution

 

§ 8971.  Dissolution.

§ 8972.  Judicial dissolution.

§ 8973.  Winding up.

§ 8974.  Distribution of assets upon dissolution.

§ 8975.  Certificate of dissolution.

§ 8976.  Effect of filing certificate of dissolution.

§ 8977.  Survival of remedies and rights after dissolution.

§ 8978.  Dissolution by domestication.

 

Subchapter J.  Foreign Companies

 

§ 8981.  Foreign limited liability companies.

§ 8982.  Domestication.

 

Subchapter K.  Actions

 

§ 8991.  Parties to actions.

§ 8992.  Authority to sue.

§ 8993.  Effect of lack of authority to sue.

 

Subchapter L.  Restricted Professional Companies

 

§ 8995.  Application and effect of subchapter.

§ 8996.  Restrictions.

§ 8997.  Taxation of restricted professional companies.

§ 8998.  Annual registration.

 

PART IV.  UNINCORPORATED ASSOCIATIONS

 

Chapter 91.  Unincorporated Nonprofit Associations

 

§ 9101.  Customary parliamentary law applicable (Repealed).

§ 9102.  Funeral and similar benefits (Repealed).

§ 9103.  Nontransferable membership interests (Repealed).

§ 9111.  Short title and application of chapter.

§ 9112.  Definitions.

§ 9113.  Governing law.

§ 9114.  Entity status.

§ 9115.  Ownership and transfer of property.

§ 9116.  Statement of authority as to real property.

§ 9117.  Liability.

§ 9118.  Assertion and defense of claims.

§ 9119.  Effect of judgment or order.

§ 9120.  Appointment of agent to receive service of process.

§ 9121.  Action or proceeding not abated by change of members or managers.

§ 9122.  Member not agent.

§ 9123.  Approval by members.

§ 9124.  Action by members.

§ 9125.  Duties of member.

§ 9126.  Membership.

§ 9127.  Member's interest not transferable.

§ 9128.  Selection and management rights of managers.

§ 9129.  Duties of managers.

§ 9130.  Action by managers.

§ 9131.  Right of member or manager to information.

§ 9132.  Distributions prohibited; compensation and other permitted payments.

§ 9133.  Reimbursement, indemnification and advancement of expenses.

§ 9134.  Dissolution.

§ 9135.  Winding up.

§ 9136.  Subordination of chapter to canon law.

 

Chapter 93.  Professional Associations

 

§ 9301.  Short title of chapter.

§ 9302.  Application of chapter.

§ 9303.  Definitions.

§ 9304.  Purpose of association.

§ 9305.  Articles of association.

§ 9306.  Board of governors.

§ 9307.  Bylaws.

§ 9308.  Employees.

§ 9309.  Compensation.

§ 9310.  Distribution of excess earnings.

§ 9311.  Interests of associates.

§ 9312.  Transfer of interests.

§ 9313.  Redemption of interests.

§ 9314.  Term of existence.

§ 9315.  Name.

§ 9316.  Voting of associates.

§ 9317.  Liability of associates.

§ 9318.  Professional disqualifications.

§ 9319.  Dissolution.

 

PART V.  BUSINESS TRUSTS

 

Chapter 95.  Business Trusts

 

§ 9501.  Application and effect of chapter.

§ 9502.  Creation, status and termination of business trusts.

§ 9503.  Documentation of trust.

§ 9504.  Registered office.

§ 9505.  Trustees.

§ 9506.  Liability of trustees and beneficiaries.

§ 9507.  Foreign business trusts.

15c101h

 

 

TITLE 15

CORPORATIONS AND UNINCORPORATED ASSOCIATIONS

 

Part

I.  Preliminary Provisions

II.  Corporations

III.  Partnerships and Limited Liability Companies

IV.  Unincorporated Associations

V.  Business Trusts

 

Enactment.  Unless otherwise noted, the provisions of Title 15 were added November 15, 1972, P.L.1063, No.271, effective in 90 days.

Special Provisions in Appendix.  See sections 104, 107, 206, 303 and 304 of Act 177 of 1988 in the appendix to this title for special provisions relating to legislative findings as to acceptance of Constitution of Pennsylvania, transitional provision, conforming cross references in unconsolidated statutes, preparation of act for printing and effective date and applicability.

See sections 309, 402 and 404 of Act 198 of 1990 in the appendix to this title for special provisions relating to conforming cross references in unconsolidated statutes, preparation of act for printing and effective dates and applicability.

See sections 56 and 57 of Act 67 of 2013 in the appendix to this title for special provisions relating to restoration of provisions and retroactivity.

Short Titles of Implementing Statutes.  Section 101 of Act 177 of 1988 provided that the act shall be known and may be cited as the General Association Act of 1988.

Section 101 of Act 198 of 1990 provided that the act shall be known and may be cited as the GAA Amendments Act of 1990.

Section 1 of Act 169 of 1992 provided that the act shall be known and may be cited as the GAA Amendments Act of 1992.

Section 1 of Act 106 of 1994 provided that the act shall be known and may be cited as the Limited Liability Company Act.

Section 1 of Act 34 of 2001 provided that the act shall be known and may be cited as the GAA Amendments Act of 2001.

Section 1 of Act 67 of 2013 provided that the act shall be known and may be cited as the GAA Amendments Act of 2013.

 

 

PART I

PRELIMINARY PROVISIONS

 

Chapter

1.  General Provisions

 

Enactment.  Part I was added December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

Prior Provisions.  Former Part I, which related to corporations generally, was added November 15, 1972, P.L.1063, No.271, and repealed December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

 

 

CHAPTER 1

GENERAL PROVISIONS

 

Subchapter

A.  Preliminary Provisions

B.  Functions and Powers of Department of State

C.  Corporation Bureau and UCC Fees

D.  Definitive and Contingent Domestication of Alien Associations

 

Enactment.  Chapter 1 was added December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

Prior Provisions.  Former Chapter 1, which related to the same subject matter, was added November 15, 1972, P.L.1063, No.271, and repealed December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

Cross References.  Chapter 1 is referred to in section 7102 of this title.

 

 

SUBCHAPTER A

PRELIMINARY PROVISIONS

 

Sec.

101.  Short title and application of title.

102.  Definitions.

103.  Subordination of title to regulatory laws.

104.  Equitable remedies.

105.  Fees.

106.  Effect of filing papers required to be filed.

107.  Form of records.

108.  Change in location or status of registered office provided by agent.

109.  Name of commercial registered office provider in lieu of registered address.

110.  Supplementary general principles of law applicable.

111.  Relation of title to Electronic Signatures in Global and National Commerce Act.

15c101s

§ 101.  Short title and application of title.

(a)  Short title of title.--This title shall be known and may be cited as the Associations Code.

(b)  Application of title.--Except as otherwise provided in the scope provisions of subsequent provisions of this title, this title shall apply to every association heretofore or hereafter incorporated or otherwise organized.

(c)  References to prior statutes.--A reference in the articles or bylaws or other organic documents of an association to any provision of law supplied or repealed by this title shall be deemed to be a reference to the superseding provision of this title.

15c101v

 

Cross References.  Section 101 is referred to in sections 1102, 2541, 2551, 5102 of this title.

15c102s

§ 102.  Definitions.

Subject to additional or inconsistent definitions contained in subsequent provisions of this title that are applicable to specific provisions of this title, the following words and phrases when used in this title shall have, unless the context clearly indicates otherwise, the meanings given to them in this section:

"Act" or "action."  Includes failure to act.

"Association."  A corporation, a partnership, a limited liability company, a business trust or two or more persons associated in a common enterprise or undertaking. The term does not include a testamentary trust or an inter vivos trust as defined in 20 Pa.C.S. § 711(3) (relating to mandatory exercise of jurisdiction through orphans' court division in general).

"Banking institution."  An institution as defined in section 102(r) of the act of November 30, 1965 (P.L.847, No.356), known as the Banking Code of 1965.

"Bureau."  The Bureau of Corporations and Charitable Organizations of the Department of State.

"Business trust."  A trust subject to Chapter 95 (relating to business trusts).

"Cooperative corporation."  A corporation that is subject to Subpart D of Part II (relating to cooperative corporations).

"Corporation for profit."  A corporation incorporated for a purpose or purposes involving pecuniary profit, incidental or otherwise, to its shareholders or members.

"Corporation not-for-profit."  A corporation not incorporated for a purpose or purposes involving pecuniary profit, incidental or otherwise.

"Court."  Subject to any inconsistent general rule prescribed by the Supreme Court of Pennsylvania:

(1)  the court of common pleas of the judicial district embracing the county where the registered office of the corporation or other association is or is to be located; or

(2)  where an association results from a merger, consolidation, division or other transaction without establishing a registered office in this Commonwealth or withdraws as a foreign corporation or association, the court of common pleas in which venue would have been laid immediately prior to the transaction or withdrawal.

"Credit union."  A credit union as defined in 17 Pa.C.S. § 102 (relating to application of title).

"Department."  The Department of State of the Commonwealth.

"Domestic banking institution."  A domestic association which is an institution as defined in section 102(r) of the act of November 30, 1965 (P.L.847, No.356), known as the Banking Code of 1965.

"Domestic corporation."  A corporation for profit or not-for-profit incorporated under the laws of this Commonwealth.

"Domestic corporation for profit."  A corporation for profit incorporated under the laws of this Commonwealth.

"Domestic corporation not-for-profit."  A corporation not-for-profit incorporated under the laws of this Commonwealth.

"Domestic insurance corporation."  An insurance corporation as defined in section 3102 (relating to definitions).

"Domestic savings association."  A domestic corporation for profit which is an association as defined in section 102(3) of the former act of December 14, 1967 (P.L.746, No.345), known as the Savings Association Code of 1967.

"Electing partnership."  An electing partnership as defined in section 8701(c) (relating to scope and definition).

"Execute."  When used with respect to authenticating or adopting a filing, document or other record, means "sign."

"Foreign corporation for profit."  A corporation for profit incorporated under any laws other than those of this Commonwealth.

"Foreign corporation not-for-profit."  A corporation not-for-profit incorporated under any laws other than those of this Commonwealth.

"Insurance corporation."  An insurance corporation as defined in section 3102 (relating to definitions).

"Internal Revenue Code of 1986."  The Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 1 et seq.).

"Licensed person."  A natural person who is duly licensed or admitted to practice his profession by a court, department, board, commission or other agency of the Commonwealth or another jurisdiction to render a professional service that is or will be rendered by the association of which he is, or intends to become, a shareholder, partner, owner, director, officer, manager, member, employee or agent.

"Limited liability company."  A domestic or foreign limited liability company as defined in section 8903 (relating to definitions and index of definitions).

"Obligation."  Includes a note or other form of indebtedness, whether secured or unsecured.

"Officially publish."  Publish in two newspapers of general circulation in the English language in the county in which the registered office of the association is located or, in the case of a proposed association, will be located, one of which must be the legal newspaper, if any, designated by the rules of court for the publication of legal notices. If there is only one newspaper of general circulation in the county, advertisement in that newspaper is sufficient. If no other frequency is specified, the notice must be published one time. See section 109(a)(2) (relating to name of commercial registered office provider in lieu of registered address).

"Profession."  Includes the performance of any type of personal service to the public that requires as a condition precedent to the performance of the service the obtaining of a license or admission to practice or other legal authorization from the Supreme Court of Pennsylvania or a licensing board or commission under the Bureau of Professional and Occupational Affairs in the Department of State. Except as otherwise expressly provided by law, this definition shall be applicable to this title only and shall not affect the interpretation of any other statute or any local zoning ordinance or other official document heretofore or hereafter enacted or promulgated.

"Professional services."  Any type of services that may be rendered by a member of a profession within the purview of his profession.

"Record form."  Inscribed on a tangible medium or stored in an electronic or other medium and retrievable in perceivable form.

"Representative." When used with respect to an association, joint venture, trust or other enterprise, a person occupying the position or discharging the functions of a director, officer, partner, manager, trustee, fiduciary, employee or agent, regardless of the name or title by which the person may be designated. The term does not imply that a director, as such, is an agent of a corporation.

"Savings association."  An association as defined in section 102(3) of the former act of December 14, 1967 (P.L.746, No.345), known as the Savings Association Code of 1967.

"Sign."  With present intent to authenticate or adopt information in record form:

(1)  to sign manually or adopt a tangible symbol; or

(2)  to attach to, or logically associate with, information in record form, an electronic sound, symbol or process.

"Verified."  Includes an unsworn document containing a statement by the signatory that is made subject to the penalties of 18 Pa.C.S. § 4904 (relating to unsworn falsification to authorities).

15c102v

(Apr. 27, 1990, P.L.129, No.36, eff. imd.; Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; Dec. 7, 1994, P.L.703, No.106, eff. 60 days; June 22, 2001, P.L.418, No.34, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 amended the defs. of "banking institution," "representative" and "savings association" and added the defs. of "bureau," "domestic banking institution," "domestic insurance corporation," "domestic savings association," "execute," "obligation," "officially publish," "record form" and "sign."

2001 Amendment.  Act 34 amended the def. of "limited liability company" and added the defs. of "profession" and "professional services."

1994 Amendment.  Act 106 amended the defs. of "association" and "limited liability company" and added the def. of "licensed person."

1992 Amendment.  Act 169 amended the def. of "association" and added the defs. of "business trust," "Internal Revenue Code of 1986" and "limited liability company."

1990 Amendments.  Act 36 added the def. of "act" or "action" and Act 198 amended the defs. of "association," "credit union" and "insurance corporation" and added the defs. of "corporation for profit," "corporation not-for-profit," "electing partnership" and "representative."

Cross References.  Section 102 is referred to in sections 1103, 2902, 5103, 8503, 8903 of this title; section 1991 of Title 1 (General Provisions).

15c103s

§ 103.  Subordination of title to regulatory laws.

(a)  Regulatory laws unaffected.--This title is not intended to authorize any corporation or other association to do any act prohibited by any statute regulating the business of the association or by any rule or regulation validly promulgated thereunder by any department, board or commission of this Commonwealth. Except as otherwise provided by the statutes and prescribed by the rules and regulations promulgated thereunder applicable to the business of the association, the issuance by the Department of State of any certificate evidencing the incorporation of a corporation or the filing of an instrument with respect to or the organization or qualification of an association under this title or any amendment to its articles or certificate or other change in its status or other action under this title shall not be effective to exempt the association from any of the requirements of those statutes or rules and regulations.

(b)  Compliance with regulatory laws condition precedent to effectiveness of corporate or other action.--Any document filed in the Department of State or any bylaw adopted or other corporate or other action taken under the authority of this title or other action pursuant thereto in violation of any statutes or rules or regulations regulating the business of the association shall be ineffective as against the Commonwealth, including the departments, boards and commissions thereof, unless and until the violation is cured.

(c)  Structural provisions in regulatory statutes controlling.--If and to the extent that a statute regulating the business of a corporation or other association sets forth provisions relating to the government and regulation of the affairs of associations that are inconsistent with the provisions of this title on the same subject, the provisions of the other statute shall control.

15c103v

(Dec. 18, 1992, P.L.1333, No.169, eff. 60 days)

 

1992 Amendment.  Act 169 amended subsec. (a).

Cross References.  Section 103 is referred to in sections 1501, 1524, 1903, 2105, 5501, 5903, 8102, 8204, 8921 of this title.

15c104s

§ 104.  Equitable remedies.

Except to the extent otherwise provided in this title in cases where a statutory remedy is provided by this title, the court shall have the powers of a court of equity or chancery insofar as those powers relate to the supervision and control of corporations and other associations.

15c105s

§ 105.  Fees.

(a)  General rule.--The Department of State shall be entitled to receive for services performed, as required by this title and other applicable provisions of law, such fees as are specified in or pursuant to Subchapter C (relating to Corporation Bureau and UCC fees).

(b)  Other services.--Any other department, board, commission or officer of this Commonwealth shall be entitled to receive for services performed, as required by this title, such fees as are or may be lawfully charged for those or similar services.

15c105v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

15c106s

§ 106.  Effect of filing papers required to be filed.

The filing of articles or of any other papers or documents pursuant to the provisions of this title is required for the purpose of affording all persons the opportunity of acquiring knowledge of the contents thereof, but, except as otherwise provided by statute, no person shall be charged with constructive notice of the contents of any articles, papers or documents by reason of the filing.

15c107s

§ 107.  Form of records.

(a)  General rule.--Information maintained by a corporation or other association in the regular course of its business, including shareholder or membership records, books of account and minute books, may be kept in record form.

(b)  Meaning of "written".--References in this title to a document in writing or to a written provision of an agreement or other document shall be deemed to include and be satisfied by a document or provision of an agreement or document in record form.

15c107v

(July 9, 2013, P.L.476, No.67, eff. 60 days)

 

Cross References.  Section 107 is referred to in sections 1508, 1512, 5508, 5512, 8525 of this title.

15c108s

§ 108.  Change in location or status of registered office provided by agent.

(a)  General rule.--Where the registered office of a corporation or other association is stated to be in care of or is in fact in care of an agent who maintains the registered office for the corporation or other association and the agent changes its name or the location of its office in a county from one address to another within the county or ceases to provide a registered office for one or more associations, the agent may, in the manner provided in this section, reflect such change of name or effect a corresponding change in the registered office address of or cease to provide a registered office for one or more or all of the associations represented by it. The agent shall execute and file in the Department of State with respect to each association represented by it a statement of change of registered office by agent, setting forth:

(1)  The name of the association represented.

(2)  The address, including street and number, if any, of its then registered office.

(3)  The address, including street and number, if any, of the new registered office of the association represented if the registered office of the association represented is to be changed.

(4)  The name of the person in care of the office and a statement that the person has been designated in fact as the agent in care of the registered office of the association represented in this Commonwealth and that the change in registered office reflects a change of name of the agent, the removal of the place of business of the agent to a new location within the county or a termination of the status of the agent as the provider of the registered office of the association represented, as the case may be.

If the status of an agent as a provider of a registered office is terminated under this section, the location of the registered office of the association represented shall not be affected, but the person formerly in care of the office shall thereafter not have any responsibility with respect to matters tendered to the office in the name of the association represented.

(b)  Action by and notice to association.--It is not necessary for the association represented to take any action in order to effect a termination of status of agent or other change of registered office under this section, but the person representing the association shall promptly furnish the association represented with a copy of the statement of change of registered office by agent as filed in the Department of State.

15c108v

 

Cross References.  Section 108 is referred to in sections 109, 1103, 5103, 8503, 8506, 8903, 8906, 9503 of this title.

15c109s

§ 109.  Name of commercial registered office provider in lieu of registered address.

(a)  General rule.--Where any provision of this title authorizes or requires the inclusion of a registered office address in any document filed in the Department of State, the person filing the document may substitute in lieu thereof the term "c/o" followed by:

(1)  The name of an association or a division thereof that has filed in the department, and not withdrawn, a statement of address of commercial registered office.

(2)  The name of any county of this Commonwealth and a statement that the registered office of the association represented shall be deemed for venue and official publication purposes to be located in the county so named. For venue and official publication purposes, the county so named shall control over the address contained in the currently applicable statement filed under subsection (b).

(b)  Statement of address of commercial registered office.--A domestic business corporation or qualified foreign business corporation, partnership or other association engaged in the business of maintaining registered offices in this Commonwealth for corporations or other associations may file in the department a statement of address of commercial registered office executed by the representing association or a division thereof and setting forth:

(1)  The name of the representing association.

(2)  The form of organization of the representing association.

(3)  A statement that it is in the business of maintaining registered offices in this Commonwealth for corporations or other associations.

(4)  The address, including street and number, if any, of a place of business of the representing association in this Commonwealth to which communications and other matters directed to each person represented by it may be delivered.

(c)  Change or withdrawal.--A representing association that has effected a filing in the department under subsection (b) may:

(1)  Amend the filing by filing in the department a superseding statement of address of commercial registered office.

(2)  Withdraw its filing under subsection (b) and cease to provide registered office service by filing in the department a statement of termination of commercial registered office setting forth:

(i)  The name of the representing association.

(ii)  A statement that it has ceased to be in the business of maintaining registered offices in this Commonwealth for corporations and other associations.

(d)  Action by and notice to association.--It is not necessary for an association represented to take any action in connection with a change or withdrawal effected under subsection (c), but a representing association that has effected a filing under subsection (c) (other than to reflect a change in the information required by subsection (b)(2)) shall promptly file a statement of change of registered office by agent under section 108 (relating to change in location or status of registered office provided by agent) with respect to each association represented.

15c109v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

1990 Amendment.  Act 198 amended subsecs. (c) and (d).

Cross References.  Section 109 is referred to in sections 102, 138, 1306, 1311, 1341, 1507, 1911, 1915, 1926, 1931, 1954, 1963, 1971, 1977, 2309, 2905, 4124, 4126, 4129, 4161, 5103, 5306, 5311, 5341, 5507, 5911, 5915, 5926, 5954, 5963, 5971, 5977, 6124, 6126, 6129, 6161, 7306, 7502, 7704, 8201, 8503, 8506, 8511, 8519, 8547, 8579, 8582, 8585, 8586, 8590, 8903, 8906, 8913, 8951, 8958, 8964, 8982, 9504 of this title.

15c110s

§ 110.  Supplementary general principles of law applicable.

Unless displaced by the particular provisions of this title, the principles of law and equity, including, but not limited to, the law relating to principal and agent, estoppel, waiver, fraud, misrepresentation, duress, coercion, mistake, bankruptcy or other validating or invalidating cause, shall supplement its provisions.

15c110v

 

Cross References.  Section 110 is referred to in section 8904 of this title.

15c111s

§ 111.  Relation of title to Electronic Signatures in Global and National Commerce Act.

(a)  General rule.--Except as set forth in subsection (b), this title modifies, limits and supersedes the Electronic Signatures in Global and National Commerce Act (Public Law 106-229, 15 U.S.C. § 7001 et seq.).

(b)  Exception.--This title does not do any of the following:

(1)  Modify, limit or supersede section 101(c) of the Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001(c)).

(2)  Authorize electronic delivery of a notice described in section 103(b) of the Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7003(b)).

15c111v

(July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 added section 111.

15c131h

 

 

SUBCHAPTER B

FUNCTIONS AND POWERS OF DEPARTMENT OF STATE

 

Sec.

131.  Application of subchapter.

132.  Functions of Department of State.

133.  Powers of Department of State.

134.  Docketing statement.

135.  Requirements to be met by filed documents.

136.  Processing of documents by Department of State.

137.  Court to pass upon rejection of documents by Department of State.

138.  Statement of correction.

139.  Tax clearance of certain fundamental transactions.

140.  Custody and management of orphan corporate and business records.

 

Cross References.  Subchapter B is referred to in section 7123 of this title; section 102 of Title 54 (Names).

15c131s

§ 131.  Application of subchapter.

As used in this subchapter, the term "this title" includes Titles 17 (relating to credit unions) and 54 (relating to names) and any other provision of law that:

(1)  makes reference to the powers and procedures of this subchapter; or

(2)  to the extent not inconsistent with this subchapter:

(i)  requires a filing in the bureau; and

(ii)  does not specify some or all of the necessary procedures for the filing provided in this subchapter.

15c131v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; July 9, 2013, P.L.476, No.67, eff. 60 days)

15c132s

§ 132.  Functions of Department of State.

(a)  General rule.--The function of the Department of State under this title is to act in a manner comparable to the offices of recorder of deeds under former provisions of law as an office of public record wherein articles and other papers relating to association affairs may be filed to establish the permanent and definitive text thereof and to afford all persons the opportunity of acquiring knowledge of the contents thereof.

(b)  Names and marks.--The department shall supervise and administer the provisions of this title and of Title 54 (relating to names) concerning names and marks.

(c)  Collection of taxes and charges imposed by statute.--This subchapter shall not limit the power and duty of the department to assess and collect taxes and charges imposed or authorized by statute.

(d)  Notice of decennial filings.--Whenever a decennial filing is required by Title 54 to be made in the department, the department shall, not earlier than the November 1 prior to the commencement of the decennial year wherever practicable, give notice by mail to the registrant or other party of the decennial filing requirement, which notice shall be accompanied by appropriate application blanks or forms. Failure by the department to give notice to any party, or failure by any party to receive notice, of a decennial filing requirement shall not relieve any party of the obligation to make the decennial filing.

15c132v

 

Cross References.  Section 132 is referred to in section 133 of this title.

15c133s

§ 133.  Powers of Department of State.

(a)  General rule.--The department has the power and authority reasonably necessary to enable it to administer this subchapter efficiently and to perform the functions specified in section 132 (relating to functions of Department of State), in 13 Pa.C.S. (relating to commercial code) and in 17 Pa.C.S. (relating to credit unions). The following shall not be agency regulations for the purposes of section 612 of the act of April 9, 1929 (P.L.177, No.175), known as The Administrative Code of 1929, the act of October 15, 1980 (P.L.950, No.164), known as the Commonwealth Attorneys Act, the act of June 25, 1982 (P.L.633, No.181), known as the Regulatory Review Act, or any similar provision of law, but shall be subject to the opportunity of public comment requirement under section 201 of the act of July 31, 1968 (P.L.769, No.240), referred to as the Commonwealth Documents Law:

(1)  Sample filing forms promulgated by the department.

(2)  Instructions accompanying sample filing forms and other explanatory material published in the Pennsylvania Code that is intended to substantially track applicable statutory provisions relating to the particular filing or to any of the functions of the department covered by this subsection, if a regulation of the department expressly states that those instructions or explanatory materials shall not have the force of law.

(3)  Regulations, which the department is hereby authorized to promulgate, that:

(i)  Authorize payment of fees and other remittances through or by a credit or debit card issuer or other financial intermediary.

(ii)  Authorize contracts with credit or debit card issuers and other financial intermediaries relating to the collection, transmission and payment of fees and other remittances.

(iii)  (Deleted by amendment).

(iv)  Adjust, not more than once per year, the fees set forth in section 153(a) (relating to fee schedule) and 13 Pa.C.S. § 9525 (relating to fees) for filings transmitted to the department electronically.

(v)  Relate to the format or means of delivering documents to the department for filing.

(b)  Language and content of documents.--Except to the extent required in order to determine whether a document complies with section 135 (relating to requirements to be met by filed documents), the department shall not examine articles and other documents authorized or required to be filed in the department under this title to determine whether the language or content thereof conforms to the provisions of this title.

(c)  Meaning of term "conform to law".--A document delivered to the department for the purpose of filing in the department shall be deemed to be in accordance with law and to conform to law, as those terms are used in statutes relating to the powers and duties of the department, if the document conforms to section 135.

(d)  (Reserved).

(e)  Engrossed certificate.--Whenever the department has taken any action under this title, the Secretary of the Commonwealth shall, upon request and payment of the fee or additional fee therefor fixed by regulation of the department, issue to any person entitled thereto an engrossed certificate evidencing the action, executed by the Secretary of the Commonwealth under the seal of the Commonwealth.

15c133v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 7, 1994, P.L.703, No.106, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 amended subsecs. (a) and (d).

15c134s

§ 134.  Docketing statement.

(a)  General rule.--The department may, but shall not be required to, prescribe by regulation one or more official docketing statement forms designed to elicit from a person effecting a filing under this title information that the department has found to be necessary or desirable in connection with the processing of a filing. A form of docketing statement prescribed under this subsection:

(1)  Shall be published in the Pennsylvania Code.

(2)  Shall not be integrated into a single document covering the requirements of the filing and its related docketing statement.

(3)  May be required by the department in connection with a filing only if notice of the requirement appears on the official format for the filing prescribed by the department.

(4)  Shall not be required to be submitted on department-furnished forms.

(5)  Shall not constitute a document filed in, with or by the department for the purposes of this title or any other provision of law except 18 Pa.C.S. § 4904 (relating to unsworn falsification to authorities).

(b)  Transmission to Department of Revenue.--The department shall note on the docketing statement the fact and date of the filing to which the docketing statement relates and shall transmit a copy of the docketing statement or the information contained therein to the Department of Revenue. If a docketing statement is not required for a particular filing, the Department of State may transmit a copy of the filing or the information contained therein to the Department of Revenue at no cost to the person effecting the filing.

(c)  Transmission to other agencies.--If the docketing statement delivered to the Department of State sets forth any kind of business in which a corporation, partnership or other association may not engage without the approval of or a license from any department, board or commission of the Commonwealth, the Department of State shall, upon processing the filing, promptly transmit a copy of the docketing statement or the information contained therein to each such department, board or commission.

15c134v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; June 22, 2001, P.L.418, No.34, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 amended subsec. (a)(3).

Cross References.  Section 134 is referred to in sections 135, 161, 162, 1305, 1308, 1311, 1341, 1507, 1522, 1902, 1916, 1927, 1931, 1955, 1964, 1971, 1977, 1989, 2309, 2704, 2905, 4124, 4126, 4127, 4129, 4130, 4131, 4161, 5110, 5305, 5308, 5311, 5341, 5507, 5902, 5916, 5927, 5955, 5964, 5971, 5977, 5989, 6124, 6126, 6127, 6129, 6130, 6131, 6161, 7306, 7704, 7720, 8201, 8205, 8506, 8511, 8512, 8513, 8515, 8519, 8524, 8532, 8546, 8547, 8579, 8582, 8585, 8586, 8590, 8701, 8906, 8908, 8914, 8951, 8957, 8958, 8964, 8975, 8982, 9305, 9503 of this title; sections 304, 903, 904, 1101, 1102, 1105, 1302, 1305 of Title 17 (Credit Unions); sections 311, 312, 313, 502, 503, 506, 1112, 1114, 1115, 1116, 1311, 1312, 1313, 1314, 1511, 1512, 1513, 1514, 1515 of Title 54 (Names).

15c135s

§ 135.  Requirements to be met by filed documents.

(a)  General rule.--A document shall be accepted for filing by the department if it satisfies the following requirements:

(1)  The document purports on its face to relate to matters authorized or required to be filed under this title or contains a caption indicating that relationship and, if no applicable statement has been prescribed under section 134 (relating to docketing statement), contains sufficient information to permit the department to prepare a docket record entry:

(i)  Identifying the name of the association or other person to which the document relates.

(ii)  Identifying the association or associations, if any, the existence of which is to be created, extended, limited or terminated by reason of the filing and the duration of existence of any such association.

(iii)  Specifying the date upon which the creation or termination of existence, if any, of the association or associations effected by the filing will take effect.

(2)  The document complies with any regulations promulgated by the department and is accompanied by any applicable statement prescribed under section 134.

(3)  In the case of a document that creates a new association or effects or reflects a change in name:

(i)  the document is accompanied by evidence that the proposed name has been reserved by or on behalf of the applicant; or

(ii)  the proposed name is available for use under the applicable standard established by this title and any other applicable provision of law.

(4)  In the case of any other document that sets forth a name or mark, the proposed name or mark is available for use under the applicable standard established by law.

(5)  All fees, taxes and certificates or statements relating thereto required by section 139 (relating to tax clearance of certain fundamental transactions) or otherwise have been tendered therewith.

(6)  All certificates and other instruments required by statute evidencing the consent or approval of any department, board, commission or other agency of this Commonwealth as a prerequisite to the filing of the document in the Department of State have been incorporated into, attached to or otherwise tendered with the document.

(7)  It is in record form and executed. The department shall not examine a document to determine whether the document has been signed by an authorized person or by sufficient authorized persons or otherwise is duly signed.

(b)  Attorney-in-fact.--Any person, other than an incorporator or officer of a corporation, as such, may sign a document by an attorney-in-fact or fiduciary. It shall not be necessary to present to or file in the department the original or a copy of any document evidencing the authority of an attorney-in-fact or fiduciary.

(c)  Addresses.--

(1)  Whenever any provision of this title requires that any person set forth an address in any document, such provision shall be construed to require the submission of an actual street address or rural route box number, and the department shall refuse to receive or file any document that sets forth only a post office box address.

(2)  Whenever any provision of this title requires the statement of a registered office address in any document filed in the department, such provision shall be construed to require the statement also of the county in which the registered office address is located.

(d)  (Reserved).

(e)  Distinguishable names.--A name shall not be considered distinguishable upon the records of the department from another name for purposes of this title and 54 Pa.C.S. (relating to names) solely because the names differ from each other in any or all of the following respects:

(1)  Use of punctuation marks.

(2)  Use of a definite or indefinite article.

(3)  Use of any of the following terms to designate the status of an association: corporation, company, incorporated, limited, association, fund, syndicate, limited partnership, limited liability company, trust or business trust. This paragraph includes abbreviations, in any language, of the terms listed in this paragraph.

15c135v

(Dec. 19, 1990, P.L.834, No.198; June 22, 2000, P.L.356, No.43, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 amended subsecs. (a) intro. par., (2) and (7) and (d).

2000 Amendment.  Act 43 added subsec. (e).

1990 Amendment.  Act 198 amended subsec. (c) and added subsecs. (a)(7) and (d), effective in four months as to subsec. (c)(2) and immediately as to the other amendments.

Cross References.  Section 135 is referred to in sections 133, 136, 137, 138, 161, 162, 1109, 1303, 1311, 1931, 1955, 1977, 1989, 4126, 4127, 4161, 5109, 5303, 5308, 5311, 5977, 5989, 8201, 8205, 8511, 8519, 8546, 8579, 8590, 8906, 8907, 8908, 8914, 8951, 8957, 8958, 8964, 8975, 8982, 9120, 9503 of this title; sections 103, 503 of Title 54 (Names).

15c136s

§ 136.  Processing of documents by Department of State.

(a)  Filing of documents.--If a document conforms to section 135 (relating to requirements to be met by filed documents) the Department of State shall forthwith file the document, certify that the document has been filed by endorsing upon the document the fact and date of filing, make and retain a copy thereof and return the document or a copy thereof so endorsed to or upon the order of the person who delivered the document to the department.

(b)  Duplicate copy.--

(1)  If a duplicate copy, which may be either a signed or conformed copy, of any articles or other document authorized or required by this title to be filed in the department is delivered to the department with the original signed document, the department shall stamp the duplicate copy with the date received by the department and return the duplicate copy to the person who delivered it to the department.

(2)  (Reserved).

(3)  In lieu of date stamping the duplicate copy of the original signed document as provided in paragraph (1), the department may make a copy of the original signed document at the cost of the person who delivered it to the department.

(c)  Effective date.--Except as otherwise provided in this title, a document shall become effective upon the filing thereof in the department.

(d)  Copies.--The department may make a copy, on microfilm or otherwise, of any document filed in, with or by it pursuant to this title, or any statute hereby supplied or repealed, and thereafter destroy the document or return it to or upon the order of the person who delivered the document to the department.

15c136v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 amended subsec. (b).

1990 Amendment.  Act 198 amended subsecs. (a) and (b).

Cross References.  Section 136 is referred to in sections 137, 8518 of this title.

15c137s

§ 137.  Court to pass upon rejection of documents by Department of State.

(a)  General rule.--Whenever the Department of State rejects a document delivered for filing under this title or fails to make available a certified duplicate copy within the time provided by section 136(b) (relating to immediate certified copy):

(1)  the original document or copies thereof;

(2)  the statement, if any, of the department made under section 136(b)(1)(ii); and

(3)  any other papers relating thereto;

may be delivered to the prothonotary or clerk of the court vested by or pursuant to Title 42 (relating to judiciary and judicial procedure) with jurisdiction of appeals from the department. Immediately the prothonotary or clerk shall transmit the papers to the court without formality or expense to the person who delivered the original document to the department. The question of the eligibility of the document for filing in the department shall thereupon, at the earliest possible time, be heard by a judge of the court, without jury, in the court or in chambers. The finding of the court, or any judge thereof, that the document is eligible for filing in the department shall be final and the department shall act in accordance therewith. The true intent of this section is to secure for applicants an immediate hearing in court and a determination by the court without delay or expense to the applicants.

(b)  Further appellate review.--The corporation or any incorporator of a proposed corporation or other aggrieved applicant may within the time and in the manner provided by law seek judicial review of an adverse order of court entered pursuant to subsection (a). The department shall not have any right in the exercise of its functions under this title to seek judicial review of an adverse order entered pursuant to subsection (a) and any such right which the department might otherwise enjoy under the Constitution of Pennsylvania or otherwise is hereby waived, but any department, board or commission of the Commonwealth which contends that the document fails to comply with section 135(a)(6) (relating to requirements to be met by filed documents) may seek judicial review of the order.

(c)  Exceptions.--

(1)  This section shall not impair the right of any person to proceed under section 138 (relating to statement of correction) nor impair the right of the Attorney General to institute proceedings under section 503 (relating to actions to revoke corporate franchises).

(2)  A determination by the department with respect to the registrability of a label or other mark under Title 54 (relating to names) or otherwise affecting the status of a label or other mark shall be subject to judicial review under Title 2 (relating to administrative law and procedure) and not under this section.

15c137v

 

Saved from Suspension.  Pennsylvania Rule of Appellate Procedure No. 5102, as amended July 7, 1997, provided that section 137 shall not be deemed suspended or affected by the Pennsylvania Rules of Appellate Procedure.

15c138s

§ 138.  Statement of correction.

(a)  Filing of statement.--Whenever any document authorized or required to be filed in the Department of State by any provision of this title has been so filed and is an inaccurate record of the corporate or other action therein referred to or was defectively or erroneously executed, the document may be corrected by filing in the department a statement of correction of the document. The statement of correction, except as provided in subsection (c), shall be executed by the association or other person that effected the defective or erroneous filing and shall set forth:

(1)  The name of the association or other person and, subject to section 109 (relating to name of commercial registered office provider in lieu of registered address), the location, including street and number, if any, of its registered or other office.

(2)  The statute by or under which the corporation was incorporated, or the preceding filing was made, in the case of a filing that does not constitute a part of the articles of incorporation of a corporation.

(3)  The inaccuracy or defect to be corrected.

(4)  The portion of the document requiring correction in corrected form or, if the document was erroneously executed, a statement that the original document shall be deemed reexecuted or stricken from the records of the department, as the case may be.

(b)  Effect of filing.--

(1)  The corrected document shall be effective:

(i)  Upon filing in the department, as to those persons who are substantially and adversely affected by the correction.

(ii)  As of the date the original document was effective, as to all other persons.

(2)  A filing under this section shall not have the effect of causing original articles of incorporation of a corporation or a similar type of document creating any other form of association to be stricken from the records of the department but the articles or other document may be corrected under this section.

(c)  Filing pursuant to court order.--If the association or other person refuses to file an appropriate statement of correction under this section within ten business days after any person adversely affected has made a written demand therefor, the affected person may apply to the court for an order to compel the filing. If the court finds that a document on file in the department is inaccurate or defective, it may direct the association or other person who effected the defective or erroneous filing to file an appropriate statement of correction in the department, or it may order the clerk to execute the statement under the seal of the court and cause the statement to be filed in the department. In the absence of fraud, an application may not be made to a court under this subsection with respect to a document more than one year after the date on which it was originally filed in the department.

(d)  Cross reference.--See section 135 (relating to requirements to be met by filed documents).

15c138v

(June 22, 2001, P.L.418, No.34, eff. 60 days)

 

2001 Amendment.  Act 34 amended subsec. (b)(2) and added subsec. (d).

Cross References.  Section 138 is referred to in sections 137, 1103, 1902, 5103, 5902, 8503, 8546, 8585, 8903, 8957, 9503 of this title.

15c139s

§ 139.  Tax clearance of certain fundamental transactions.

(a)  General rule.--Except as provided in subsection (c), a domestic association shall not file articles or a certificate of merger or consolidation effecting a merger or consolidation into a nonqualified foreign association or articles or a certificate of dissolution or a statement of revival, a qualified foreign association shall not file an application for termination of authority or similar document in the Department of State and a domestic association shall not file articles or a certificate of division dividing solely into nonqualified foreign associations unless the articles, certificate, application or other document are accompanied by clearance certificates from the Department of Revenue and the Office of Employment Security of the Department of Labor and Industry, evidencing the payment by the association of all taxes and charges due the Commonwealth required by law.

(b)  Tax clearance in judicial proceedings.--Until the clearance certificates described in subsection (a) have been filed with the court:

(1)  The court shall not order the dissolution of a domestic business corporation, nonprofit corporation or business trust.

(2)  The court shall not approve a final distribution of the assets of a domestic general partnership, limited partnership, electing partnership or limited liability company if the court is supervising the winding up of the association.

(c)  Alternative provisions.--If clearance certificates are filed with the court as required under subsection (b), it shall not be necessary to file the clearance certificates with the Department of State.

15c139v

(Dec. 7, 1994, P.L.703, No.106, eff. 60 days; June 22, 2001, P.L.418, No.34, eff. 60 days)

 

Cross References.  Section 139 is referred to in sections 135, 1341, 1927, 1955, 1977, 1980, 1989, 4129, 5341, 5927, 5955, 5977, 5980, 5989, 6129, 8359, 8513, 8547, 8571, 8573, 8579, 8586, 8958, 8964, 8973, 8975, 8978, 5980 of this title; section 1305 of Title 17 (Credit Unions).

15c140s

§ 140.  Custody and management of orphan corporate and business records.

(a)  General rule.--Any orphan corporate and business record under the custody or control of a county, including the City and County of Philadelphia, may become a Commonwealth record in the manner provided in this section. The Department of State, with the concurrence of the county records committee existing under the act of August 14, 1963 (P.L.839, No.407), may provide for the transfer on a progressive and phased basis to the custody and management of the department of any or all orphan corporate and business records. To the extent feasible, such records shall be integrated with records of the department relating to the same type of matters or transactions.

(b)  Procedure.--The transfer contemplated by subsection (a) shall be effected on a basis consistent with the availability of appropriations. It is the intention of this section to encourage the department to schedule work under this section on a seasonal or otherwise intermittent basis in order to facilitate the smoothing of the workload of the department. The department may classify orphan corporate and business records for purposes of priority of transfer by county of origin, type of matter or transaction, vintage of matter or transaction, or on any other basis or combination of bases which the department may deem to be appropriate. The department shall publish and update in the Pennsylvania Code a schedule, by county and type of matter or transaction, setting forth where, as between a county and the department, custody of all orphan corporate and business records then resides.

(c)  Fictitious name records.--The following statutes provided for duplicate filing of fictitious name registrations in both the department and in the office of the clerk of the court of common pleas or an equivalent row office in a home rule charter county:

(1)  Act of June 28, 1917 (P.L.645, No.227), relating to individual fictitious names.

(2)  Act of May 24, 1945 (P.L.967, No.380), referred to as the Fictitious Names Act.

(3)  Act of July 11, 1957 (P.L.783, No.374), known as the Fictitious Corporate Name Act.

The county records committee may provide for the destruction of such duplicate records without transfer to the custody of the department.

(d)  Definition.--As used in this section, the term "orphan corporate and business records" means corporate and limited partnership filings and recordings which were formerly effected in the office of the clerk of the court of common pleas or the office for the recording of deeds or an equivalent row office in a home rule charter county and which are no longer effected in such offices by reason of the enactment of:

(1)  The act of December 19, 1990 (P.L.834, No.198), known as the GAA Amendments Act of 1990, with respect to insurance corporations, including corporations incorporated under or subject to the act of May 17, 1921 (P.L.682, No.284), known as The Insurance Company Law of 1921, or incorporated under the acts of: April 28, 1903 (P.L.329, No.259); April 20, 1927 (P.L.317, No.190); June 24, 1939 (P.L.686, No.320); June 20, 1947 (P.L.687, No.298); June 28, 1951 (P.L.941, No.184); or July 15, 1957 (P.L.929, No.401); or any similar act relating to the incorporation or reincorporation of limited life insurance companies.

(2)  The act of December 21, 1988 (P.L.1444, No.177), known as the General Association Act of 1988, with respect to certain:

(i)  cooperative corporations incorporated under or subject to the act of June 7, 1887 (P.L.365, No.252), referred to as the Cooperative Association Act; and

(ii)  public utility corporations, including corporations incorporated under or subject to the act of April 4, 1868 (P.L.62, No.29), referred to as the General Railroad Law; the act of April 29, 1874 (P.L.73, No.32), known as the Corporation Act of 1874; or the act of May 29, 1885 (P.L.29, No.32), referred to as the Natural Gas Company Act of 1885.

(3)  The act of December 19, 1975 (P.L.524, No.155), with respect to certain limited partnerships, including limited partnerships formed under the act of April 12, 1917 (P.L.55, No.37), known as The Uniform Limited Partnership Act, or the act of March 21, 1836 (P.L.143, No.51), referred to as the Limited Partnerships Act of 1836.

(4)  The act of November 15, 1972 (P.L.1063, No.271), with respect to nonprofit corporations incorporated under or subject to the act of May 5, 1933 (P.L.289, No.105), known as the Nonprofit Corporation Law of 1933, including corporations of the first class incorporated under or subject to the Corporation Act of 1874.

(5)  Any similar act providing for the central filing in the department of a document of a type previously filed or recorded solely on a county or other decentralized basis.

15c140v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

1990 Amendment.  Act 198 added section 140.

Cross References.  Section 140 is referred to in sections 1311, 5311, 8519 of this title.

15c151h

 

 

SUBCHAPTER C

CORPORATION BUREAU AND UCC FEES

 

Sec.

151.  Short title and application of subchapter.

152.  Definitions.

153.  Fee schedule.

154.  Enforcement and collection.

155.  Disposition of funds.

156.  References.

 

Enactment.  Subchapter C was added December 19, 1990, P.L.834, No.198, effective January 1, 1991.

Subchapter Heading.  The heading of Subchapter C was carried without amendment June 8, 2001, P.L.123, No.18, effective July 1, 2001.

Prior Provisions.  Former Subchapter C, which related to definitive and contingent domestication of foreign associations, was added December 21, 1988, P.L.1444, No.177, and relettered to Subchapter D December 19, 1990, P.L.834, No.198, effective immediately.

Cross References.  Subchapter C is referred to in sections 105, 8221, 8998 of this title.

15c151s

§ 151.  Short title and application of subchapter.

(a)  Short title.--This subchapter shall be known and may be cited as the Corporation Bureau and UCC Fee Law.

(b)  Application.--This subchapter contains an enumeration of fees to be charged by the Corporation Bureau of the department for services performed under this title or any other provision of law relating to corporations or associations and under Titles 13 (relating to commercial code), 17 (relating to credit unions) and 54 (relating to names).

15c151v

(June 8, 2001, P.L.123, No.18, eff. July 1, 2001)

 

2001 Amendment.  Act 18 amended subsec. (b).

15c152s

§ 152.  Definitions.

The following words and phrases when used in this subchapter shall have the meanings given to them in this section unless the context clearly indicates otherwise:

"Ancillary transaction."  Includes:

(1)  preclearance of document;

(2)  amendment of articles, charter, certificate or other organic document, restatement of articles, charter, certificate or other organic document;

(3)  dissolution, cancellation or termination of an association;

(4)  withdrawal by foreign association;

(5)  withdrawal by a partner;

(6)  any transaction similar to any item listed in paragraphs (1) through (5); or

(7)  delivery to the department for filing in, by or with the department or the Secretary of the Commonwealth of any articles, statements, proceedings, agreements or any similar papers affecting associations under the statutes of this Commonwealth for which a specific fee is not set forth in section 153 (relating to fee schedule) or other applicable statute.

"Bureau."  (Deleted by amendment).

15c152v

(July 9, 2013, P.L.476, No.67, eff. 60 days)

15c153s

§ 153.  Fee schedule.

(a)  General rule.--The nonrefundable fees of the bureau, including fees for the public acts and transactions of the Secretary of the Commonwealth administered through the bureau, shall be as follows:

(1)  Domestic corporations:

 

(i)  Articles of incorporation, letters patent or similar instruments incorporating a corporation or association

 

 

$125

(ii)  Articles or agreement or similar instrument of merger, consolidation or division

 

70

(iii)  Additional fee for each association which is a party to a merger or consolidation

 

40

(iv)  Additional fee for each new association resulting from a division

 

125

(v)  Articles of conversion or a similar instrument

 

70

(vi)  Each ancillary transaction

70

(2)  Foreign corporations:

 

(i)  Certificates of authority or similar qualifications to do business

 

250

(ii)  Amended certificate of authority or similar change in qualification to do business

 

250

(iii)  Domestication

125

(iv)  Statement of merger or consolidation or similar instrument reporting occurrence of merger or consolidation not effected by a filing in the department

 

 

 

70

(v)  Additional fee for each qualified foreign corporation which is named in a statement of merger or consolidation or similar instrument

 

 

40

(vi)  Each ancillary transaction

70

(3)  Partnerships and limited liability companies:

 

(i)  Certificate of limited partnership or certificate of organization of a limited liability company or similar instrument forming a limited partnership or organizing a limited liability company

 

 

 

 

125

(ii)  Certificate of merger, consolidation or division

 

70

(iii)  Additional fee for each association which is a party to a merger or consolidation

 

40

(iv)  Additional fee for each new association resulting from a division

 

125

(v)  Application for registration of foreign limited partnership or limited liability company

 

250

(vi)  Certificate of amendment of registration of foreign limited partnership or limited liability company

 

 

250

(vii)  Statement of registration of registered limited liability partnership or statement of election as an electing partnership

 

 

125

(viii)  Domestication of foreign limited liability company

 

125

(ix)  Each ancillary transaction

70

(4)  Unincorporated nonprofit associations:

 

(i)  Statement appointing an agent to receive service of process

 

70

(ii)  Resignation of appointed agent

40

(iii)  Amendment or cancellation of statement appointing an agent

 

70

(5)  Business trusts:

 

(i)  Deed of trust or other initial instrument for a business trust

 

125

(ii)  Each ancillary transaction

70

(6)  Fictitious names:

 

(i)  Registration

70

(ii)  Each ancillary transaction

70

(7)  Service of process:

 

(i)  Each defendant named or served

70

(ii)  (Reserved)

 

(8)  Trademarks, emblems, union labels, description of bottles and similar matters:

 

 

(i)  Trademark registration

50

(ii)  Each ancillary trademark transaction

50

(iii)  Any other registration under this paragraph

 

70

(iv)  Any other ancillary transaction under this paragraph

 

70

(9)  Uniform Commercial Code: As provided in 13 Pa.C.S. § 9525 (relating to fees).

 

 

(10)  Copy fees, including copies furnished under the Uniform Commercial Code:

 

 

(i)  Each page of photocopy furnished

3

(ii)  (Reserved)

 

(11)  Certification fees:

 

(i)  For certifying copies of any document or paper on file, the fee specified in paragraph (10), if the department furnished the copy, plus

 

 

40

(ii)  (Reserved)

 

(iii)  For issuing any other certificate of the Secretary of the Commonwealth or the department (other than an engrossed certificate)

 

 

40

(12)  Report of record search other than a search under paragraph (9):

 

 

(i)  For preparing and providing a report of a record search, the fee specified in paragraph (10), if any, plus

 

 

15

(ii)  (Reserved)

 

(13)  Reservation and registration of names:

 

(i)  Reservation of association name

70

(ii)  Registration of foreign or other corporation name

 

70

(14)  Change of registered office or address:

 

(i)  Each statement of change of registered office by agent

 

5

(ii)  Each statement or certificate of change of registered office

 

5

(iii)  Each statement of change of address

5

(15)  Contingent domestication:

 

(i)  Statement of contingent domestication

125

(ii)  Each year, or portion of a year, during which a contingent domestication or temporary domiciliary status is in effect

 

 

1,500

(16)  Expedited service:

 

(i)  For the processing of any filing under this title or 13 Pa.C.S. (relating to commercial code) which is received by the bureau before 4 p.m. and is requested to be completed within one hour, an additional fee of

 

 

 

 

1,000

(ii)  For the processing of any filing under this title or 13 Pa.C.S. which is received by the bureau before 2 p.m. and is requested to be completed within three hours, an additional fee of

 

 

 

 

300

(iii)  For processing of any filing under this title or 13 Pa.C.S. which is received by the bureau before 10 a.m. and is requested to be completed the same day, an additional fee of

 

 

 

100

(b)  Daily listings.--The bureau may provide listings or copies of microfilm, or both, of complete daily filings of any class of documents or papers for a fee of 25¢ per filing listed or set forth therein.

(c)  Other services.--The bureau may charge equivalent fees for any like service not specified in subsection (a) or (b).

(d)  Restriction.--UCC Revenue received by a county recorder of deeds under 13 Pa.C.S. § 9525 (relating to fees) after June 30, 2001, shall be restricted for use by the county recorder of deeds and the county prothonotary. The revenue shall be credited to the offices of the county recorder of deeds and the county prothonotary on the basis of the amount collected in each office in calendar year 2000, excluding any amounts paid to the Commonwealth. Revenue received in excess of the total amount received by each office during the year 2000, excluding amounts paid to the Commonwealth, shall be distributed pro rata to the county recorder of deeds and the county prothonotary. In a county without a recorder of deeds or a prothonotary, the provisions of this subsection shall apply to the equivalent county officials.

15c153v

(Dec. 18, 1992, P.L.1269, No.167, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; Dec. 7, 1994, P.L.703, No.106, eff. 60 days; Dec. 3, 1998, P.L.944, No.124, eff. 60 days; June 8, 2001, P.L.123, No.18, eff. July 1, 2001; Dec. 23, 2003, P.L.282, No.47, eff. imd.; July 9, 2013, P.L.476, No.67)

 

2013 Amendment.  Act 67 added subsec. (a), effective in 60 days as to pars. (1), (2), (3), (4), (5), (6), (7), (8), (9), (10), (11), (12), (13), (14) and (15). Section 58(2) of Act 67 provided that subsec. (a)(16) shall take effect upon publication of the notice under section 55 of Act 67. See section 55 of Act 67 in the appendix to this title for special provisions relating to publication of notice.

2003 Repeal.  Act 47 repealed subsec. (a).

2001 Amendment.  Act 18 amended subsec. (a) intro. par. and (8) and added subsec. (d).

Cross References.  Section 153 is referred to in sections 133, 152, 162 of this title; section 1112 of Title 54 (Names).

15c154s

§ 154.  Enforcement and collection.

(a)  General rule.--

(1)  The department shall not be required to receive or file any document or paper unless the same shall be accompanied by the proper fee, but the department may in its discretion permit the filing of any document or paper without first requiring payment of the fee required by this subchapter when satisfied that the fee will be paid promptly. If any such fee is not paid in the manner and within the time prescribed by regulation of the department, the filing to which such fee relates shall become void.

(2)  With respect to filings under 13 Pa.C.S. Div. 9 (relating to secured transactions), paragraph (1) is subject to 13 Pa.C.S. §§ 9516 (relating to what constitutes filing; effectiveness of filing) and 9520 (relating to acceptance and refusal to accept record).

(b)  Extension of credit.--The department may make provision by regulation for the extension of credit to persons dealing with it. Any person who shall fail or refuse to satisfy any indebtedness owing to the Commonwealth under this subchapter in the manner and within the time prescribed by regulation adopted pursuant to this subsection shall pay to the Commonwealth, in addition to the principal amount of such indebtedness and interest thereon, liquidated damages in the amount of $500.

15c154v

(June 8, 2001, P.L.123, No.18, eff. July 1, 2001)

 

2001 Amendment.  Act 18 amended subsec. (a).

15c155s

§ 155.  Disposition of funds.

(a)  Corporation Bureau Restricted Account.--The Corporation Bureau Restricted Account, established under former section 814 of the act of April 9, 1929 (P.L.177, No.175), known as The Administrative Code of 1929, is continued. This account shall receive 30% of the amount received by the department under this subchapter except for the fees collected under 13 Pa.C.S. § 9525(a)(1)(ii) (relating to fees). This account shall receive 5% of the amount received by the department under 13 Pa.C.S. § 9525(a)(1)(ii). The balance of the amount received by the department under this subchapter shall be deposited in the General Fund. Money in the account shall be used solely for the operation of the bureau and for its modernization as may be required for improved operations of the bureau unless a surplus arises after two consecutive years, at which time the Secretary of the Commonwealth shall transfer any amount in excess of the bureau's budget into the General Fund.

(b)  Expenditures.--The department shall submit a budget for the operation or modernization of the bureau to the Governor for approval. Such funds as are approved by the Governor are hereby appropriated from the Corporation Bureau Restricted Account to the department for the operation of the bureau.

(c)  Advisory committee.--The Secretary of the Commonwealth shall appoint a Corporation Bureau Advisory Committee. The committee shall be composed of persons knowledgeable in matters covered by this title and related provisions of law and who have been recommended for appointment to the committee by the organized bar or other organized users of the facilities and services of the bureau. Members shall serve without compensation other than reimbursement for reasonable and necessary expenses in accordance with Commonwealth policy or regulations, shall serve for terms fixed by the secretary and may be reappointed. The Chairman of the committee shall be elected by the committee. The committee shall make recommendations to the Governor with respect to each budget submitted under subsection (b) and may consult with the department in the administration of this title and related provisions of law. The committee, in consultation with the bureau and the department, shall submit, by June 1 of each odd-numbered year, a report to the General Assembly describing its activities under this title and any recommended changes to this title.

15c155v

(June 8, 2001, P.L.123, No.18, eff. July 1, 2001; June 22, 2001, P.L.418, No.34, eff. 60 days; Dec. 23, 2003, P.L.282, No.47, eff. imd.; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 amended subsec. (b) and added subsec. (a).

2003 Repeal.  Act 47 repealed subsec. (a).

2001 Amendments.  Act 18 amended subsec. (a) and Act 34 amended subsec. (c).

Cross References.  Section 155 is referred to in sections 8221, 8998 of this title.

15c156s

§ 156.  References.

In statutes, regulations and orders, a reference to the Corporation Bureau shall be deemed a reference to the bureau.

15c156v

(July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 added section 156.

15c161h

 

 

SUBCHAPTER D

DEFINITIVE AND CONTINGENT DOMESTICATION OF

ALIEN ASSOCIATIONS

 

Sec.

161.  Domestication of certain alien associations.

162.  Contingent domestication of certain alien associations.

 

Enactment.  Subchapter D was added as Subchapter C December 21, 1988, P.L.1444, No.177, effective October 1, 1989, and was relettered to Subchapter D December 19, 1990, P.L.834, No.198, effective immediately.

Subchapter Heading.  The heading of Subchapter D was amended December 19, 1990, P.L.834, No.198, effective immediately.

15c161s

§ 161.  Domestication of certain alien associations.

(a)  General rule.--Except as restricted by subsection (e), any association as defined in subsection (f) may become a domestic association by filing in the Department of State a statement of domestication.

(b)  Statement of domestication.--The statement of domestication shall be executed by the association and shall set forth in the English language:

(1)  The name of the association. If the name is in a foreign language, it shall be set forth in Roman letters or characters or Arabic or Roman numerals. If the name is one that is rendered unavailable for use by a corporation by any provision of section 1303(b) or (c) (relating to corporate name), the association shall adopt a new name, in accordance with any procedures for changing the name of the association that are applicable prior to the domestication of the association, and shall set forth the new name in the statement.

(2)  The name of the jurisdiction under the laws of which and the date on which it was first formed, incorporated or otherwise came into being.

(3)  The name of the jurisdiction that constituted the seat, siege social or principal place of business or control administration of the association, or any equivalent under applicable law, immediately prior to the filing of the statement.

(4)  A statement of the type of domestic association that the association will be upon domestication.

(5)  A statement that the filing of the statement of domestication and, if desired, the renunciation of the prior domicile has been authorized (unless its charter or other organic documents require a greater vote) by a majority in interest of the shareholders, members or other proprietors of the association.

(6)  If the association will be a type of domestic association that is created by a filing in the department, such other provisions as are required to be included in an initial filing to create that type of domestic association, except that it shall not be necessary to set forth the name of the person organizing the association.

(7)  Any other provision that the association may choose to insert unless this title prohibits the inclusion of such a provision in a filing that creates the type of domestic association that the association will be upon domestication.

(c)  Execution.--The statement shall be signed on behalf of the association by any authorized person.

(d)  Effect of domestication.--Upon the filing of the statement of domestication, the association shall be domesticated in this Commonwealth and the association shall thereafter be subject to any applicable provisions of this title and any other provisions of law applicable to associations existing under the laws of this Commonwealth. If the association will be a type of domestic association that is created by a filing in the department, the statement of domestication shall constitute that filing. The domestication of any association in this Commonwealth pursuant to this section shall not be deemed to affect any obligations or liabilities of the association incurred prior to its domestication.

(e)  Exclusion.--An association that can be domesticated under any of the following sections shall not be domesticated under this section:

Section 4161 (relating to domestication).

Section 6161 (relating to domestication).

Section 8590 (relating to domestication).

Section 8982 (relating to domestication).

Section 9501(a)(1)(ii) (relating to application and effect of chapter).

(f)  Definition.--As used in this section, the term "association," except as restricted by subsection (e), includes any alien incorporated organization, private law corporation (whether or not organized for business purposes), public law corporation, partnership, proprietorship, joint venture, foundation, trust, association or similar organization or entity existing under the laws of any jurisdiction other than this Commonwealth.

(g)  Cross references.--See sections 134 (relating to docketing statement) and 135 (relating to requirements to be met by filed documents).

15c161v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; June 22, 2001, P.L.418, No.34, eff. 60 days)

 

2001 Amendment.  Act 34 amended subsecs. (b), (d), (e), (f) and (g) and carried without amendment subsec. (c).

1990 Amendment.  Act 198 renumbered section 151 to section 161 and amended the section heading and subsecs. (e) and (f).

Cross References.  Section 161 is referred to in section 162 of this title.

15c162s

§ 162.  Contingent domestication of certain alien associations.

(a)  General rule.--Any association as defined in subsection (i) may become a contingent domestic association by filing in the Department of State a statement of contingent domestication. The statement of contingent domestication and all papers and information relating thereto shall remain confidential and shall not be available for public inspection until and unless the association files a statement of consummation of domestication as provided in subsection (c).

(b)  Statement of contingent domestication.--The statement of contingent domestication shall be executed by the association and shall set forth in the English language:

(1)  In the case of:

(i)  a corporation subject to section 4161 (relating to domestication), the statements required to be set forth in articles of domestication (except the statement required by section 4161(b)(6));

(ii)  a corporation subject to section 6161 (relating to domestication), the statements required to be set forth in articles of domestication (except the statement required by section 6161(b)(6));

(iii)  a limited partnership subject to section 8590 (relating to domestication), the statements required to be set forth in a certificate of domestication (except the statement required by section 8590(b)(5));

(iv)  a limited liability company subject to section 8982 (relating to domestication), the statements required to be set forth in a certificate of domestication (except the statement required by section 8982(b)(5));or

(v)  any other association, the statements required by section 161(b) (relating to statement of domestication) to be set forth in a statement of domestication (except the statement required by section 161(b)(5)).

(2)  A statement that the effectiveness of the statement is contingent upon the subsequent filing of a statement of consummation of domestication.

(3)  A statement that the filing of the statement of contingent domestication and the delegation of authority to file a statement of consummation of domestication has been authorized (unless its charter or other organic documents require a greater vote):

(i)  by a majority vote of the votes cast by all shareholders entitled to vote thereon and, if any class of shares is entitled to vote thereon as a class, a majority of the votes cast in each class vote, in the case of a corporation subject to section 4161;

(ii)  by a majority vote of the votes cast by all members, if any, entitled to vote thereon and, if any class of members is entitled to vote thereon as a class, a majority of the votes cast in each class vote, in the case of a corporation subject to section 6161;

(iii)  by a majority vote of the votes cast by all partners entitled to vote thereon and, if any class of partners is entitled to vote thereon as a class, a majority of the votes cast in each class vote, in the case of a limited partnership subject to section 8590;

(iv)  by a majority vote of the votes cast by all members entitled to vote thereon and, if any class of members is entitled to vote thereon as a class, a majority of the votes cast in each class vote, in the case of a limited liability company subject to section 8982; or

(v)  by a majority in interest of the shareholders, members or other proprietors of the association in any other case.

(c)  Statement of consummation of domestication.--At any time after the filing of a statement of contingent domestication, the association may file in the department a statement of consummation of domestication which shall be executed by the association and shall set forth:

(1)  The name of the association as set forth in its statement of contingent domestication.

(2)  A statement that either:

(i)  an emergency condition exists in the jurisdiction the law of which governs the internal affairs of the association and that in the judgment of the management of the association a temporary transfer of the domicile of the association to this Commonwealth is warranted by the circumstances; or

(ii)  an event has occurred that, under the law of the jurisdiction governing the internal affairs of the association, permits the association to transfer its domicile.

(d)  Statement of termination of domestication.--At any time after the filing of a statement of consummation of domestication, the association may file in the department a statement of termination of domestication which shall be executed by the association and shall set forth:

(1)  The name of the association in the form set forth in the prior filings under this section.

(2)  If a statement of consummation of domestication has theretofore been filed and is then in effect, a statement that the association elects to terminate its domicile in this Commonwealth.

(3)  A statement that either:

(i)  the statement of contingent domestication is reinstated pending the filing in the department of a new statement of consummation of domestication; or

(ii)  the statement of contingent domestication is withdrawn.

(e)  Execution of filings.--All documents filed under this section shall be signed on behalf of the association by any authorized person.

(f)  Effect of filing statement of consummation of domestication.--Upon the filing of a statement of consummation of domestication, and until the filing of a statement of termination of domestication, the association shall have the status under the law of this Commonwealth of:

(1)  a business corporation domesticated under section 4161, in the case of a corporation subject to that section;

(2)  a nonprofit corporation domesticated under section 6161, in the case of a corporation subject to that section;

(3)  a limited partnership domesticated under section 8590, in the case of a limited partnership subject to that section;

(4)  a limited liability company domesticated under section 8982, in the case of a limited liability company subject to that section; or

(5)  an association domesticated under section 161, in any other case.

(g)  Effect of filing a statement of termination of domestication.--Upon the filing of a statement of termination of domestication, the association shall under the law of this Commonwealth revert to the status it held prior to the filing of:

(1)  the statement of consummation of domestication, if the statement of termination of domestication states that the statement of contingent domestication is reinstated; or

(2)  the statement of contingent domestication, if the statement of termination of domestication states that the statement of contingent domestication is withdrawn.

(h)  Annual renewal.--A renewal application may be filed between October 1 and December 31 in each year and shall extend the applicability of this section for the following calendar year. Otherwise the association shall not be entitled to any of the benefits of this section. See section 153(a)(14) (relating to contingent domestication).

(i)  Definition.--As used in this section, the term "association" includes any incorporated organization, private law corporation (whether or not organized for business purposes), public law corporation, partnership, proprietorship, joint venture, foundation, trust, association or similar organization or entity if such association or entity immediately prior to effecting an initial filing under this section is an association or entity governed by the law of any jurisdiction other than the United States or any state, Puerto Rico or any possession or territory of the United States.

(j)  Cross references.--See sections 134 (relating to docketing statement) and 135 (relating to requirements to be met by filed documents).

15c162v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; Dec. 7, 1994, P.L.703, No.106, eff. 60 days; June 22, 2001, P.L.418, No.34, eff. 60 days)

 

2001 Amendment.  Act 34 amended subsecs. (c)(1) and (j).

1994 Amendment.  Act 106 amended subsecs. (b) and (f).

1992 Amendment.  Act 169 amended the section heading.

1990 Amendment.  Act 198 renumbered section 152 to section 162 and amended subsecs. (a), (b), (c), (d), (e), (f), (g) and (h).

15c501h

 

 

PART II

CORPORATIONS

 

Subpart

A.  Corporations Generally

B.  Business Corporations

C.  Nonprofit Corporations

D.  Cooperative Corporations

 

Enactment.  Part II was added December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

Prior Provisions.  Former Part II (Reserved) was added November 15, 1972, P.L.1063, No.271, and repealed December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

 

 

SUBPART A

CORPORATIONS GENERALLY

 

Chapter

   5.  Corporations

 

 

CHAPTER 5

CORPORATIONS

 

Subchapter

A.  In General

B.  Fiduciary Duty and Indemnification

C.  Provisions Applicable to Particular Types of Corporations

 

Enactment.  Chapter 5 was added December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

Cross References.  Chapter 5 is referred to in section 7102 of this title.

 

 

SUBCHAPTER A

IN GENERAL

 

Sec.

501.  Reserved power of General Assembly.

502.  Application of chapter.

503.  Actions to revoke corporate franchises.

504.  Validation of certain defective corporations.

505.  Validation of certain defective corporate acts.

506.  Scope and duration of certain franchises.

507.  Validation of certain share authorizations.

15c501s

§ 501.  Reserved power of General Assembly.

(a)  General rule.--All charters of private corporations and all present and future common or statutory law with respect to the formation or regulation of private corporations or prescribing powers, rights, duties or liabilities of private corporations or their officers, directors, shareholders or members may be revoked, amended or repealed.

(b)  Scope.--Subsection (a) is applicable to all corporations incorporated under the authority of the Commonwealth or of the late Proprietaries of the Province of Pennsylvania, the General Assembly having found in section 104 of the act of December 21, 1988 (P.L.1444, No.177), known as the General Association Act of 1988, that all corporations incorporated prior to October 14, 1857, which purported to register under the act of January 18, 1966 (1965 P.L.1443, No.521), referred to as the Registry Act of 1966, or companion statutes, either failed to register effectively or accepted the benefit of a law or laws passed by the General Assembly after 1873 governing the affairs of corporations.

15c501v

 

Cross References.  Section 501 is referred to in section 501 of Title 17 (Credit Unions).

15c502s

§ 502.  Application of chapter.

(a)  General rule.--Except as otherwise provided in the scope provisions of subsequent provisions of this chapter, this chapter shall apply to and the word "corporation" in this chapter shall mean:

(1)  A domestic or foreign corporation for profit.

(2)  A domestic or foreign corporation not-for-profit.

(b)  Corporations claiming exemption from power of the General Assembly.--Any provision of this chapter otherwise applicable to a corporation claiming exemption from the power of the General Assembly shall be inapplicable to such corporation to the extent, and only to the extent, required by the Constitution of the United States or the Constitution of Pennsylvania, or both.

15c503s

§ 503.  Actions to revoke corporate franchises.

(a)  General rule.--The Attorney General may institute proceedings to revoke the articles and franchises of a corporation if it:

(1)  misused or failed to use its powers, privileges or franchises;

(2)  procured its articles by fraud; or

(3)  should not have been incorporated under the statutory authority relied upon.

(b)  Powers of court.--In every action or proceeding instituted under subsection (a), the court shall have power to wind up the affairs of and to dissolve the corporation in the manner provided in this part or as otherwise provided by law.

15c503v

 

Cross References.  Section 503 is referred to in sections 137, 1309, 1502, 1503, 2907, 5309, 5502, 5503 of this title.

15c504s

§ 504.  Validation of certain defective corporations.

Where heretofore or hereafter any act has been or may be done or any transfer or conveyance of any property has been or may be made to or by any corporation created or intended to be created under any statute supplied or repealed by this part, in good faith, after the approval of the articles or application for a charter or issuance of letters patent but without the actual recording of the original papers with the endorsements thereon, or a certified copy thereof, in the office of any recorder of deeds, as provided in such statutes then in force, the acts, transfers and conveyances shall nevertheless be deemed and taken to be valid and effectual for all purposes, regardless of the omission to record the original papers with the endorsements thereon, or a certified copy thereof, as heretofore required by such statutes. Every such corporation shall be deemed and taken to have been incorporated on the date of approval of its articles or application for a charter or on the date of issuance of its letters patent, whichever event shall have last occurred.

15c505s

§ 505.  Validation of certain defective corporate acts.

Where any corporation governed by this part or created or intended to be created or governed by any statute supplied or repealed by this part has, in good faith, extended its territory or term of existence, changed its name, merged, consolidated or otherwise altered or amended its charter or articles under any statute supplied or repealed by this part but without the actual recording of a document or documents evidencing the corporate action in the office of any recorder of deeds, as provided in such statutes then in force, and a record of the corporate action is on file in the office of the clerk of any court of this Commonwealth or in the Department of State, the corporate action shall nevertheless be deemed and taken to be valid for all purposes, regardless of the omission to record the document or documents as heretofore required by such statutes, and every such corporate action shall be deemed and taken to have been effected upon the filing of the corporate action in the office of the clerk of any court or in the department, or upon the approval of the action, if required, by a court, or by the Governor, Secretary of the Commonwealth or other officer performing corresponding functions with respect to corporate affairs, whichever event has last occurred.

15c506s

§ 506.  Scope and duration of certain franchises.

(a)  General rule.--Except as provided in subsection (b), whenever any corporation has sold, assigned, disposed of and conveyed all or any part of its franchises and all or any part of its property, real, personal and mixed, to any other corporation, and the franchises and property have vested in the vendee corporation, or whenever any corporation has heretofore merged or may hereafter merge with and into or consolidate into a surviving or new corporation, the vendee, surviving or new corporation or its successor corporation shall be deemed to possess as a constituent of its own charter, and not as a direct or indirect acquisition from the vendor or nonsurviving corporation, franchise rights of identical scope and character as those originally acquired by it and any of its predecessors in interest from every vendor or nonsurviving predecessor corporation regardless of the fact, if such is the case, that the franchises of any vendor or nonsurviving predecessor corporation, had they been separately existing, would have theretofore expired of their own limitations. The charter of any vendee, surviving, new or successor corporation to which this section may become applicable and all franchise rights thereof attributable under this section or otherwise to or acquired from any vendor or nonsurviving predecessor corporation shall expire upon the same date, which date shall be the later of the dates on which the charter or the most remotely limited of the franchise rights would otherwise expire, and every renewal, extension or change in the term of existence of the vendee, surviving, new or successor corporation by merger, consolidation or otherwise shall inure to the franchise rights attributable to or acquired from all such vendor or nonsurviving predecessor corporations.

(b)  Exception.--This section shall not operate to revive any franchise rights heretofore or hereafter expressly surrendered by the affirmative action of any such vendee, surviving, new or successor corporation.

15c507s

§ 507.  Validation of certain share authorizations.

(a)  General rule.--Where heretofore any domestic corporation for profit shall have redeemed and canceled any shares subject to redemption and cancellation, acquired its own shares on conversion thereof into or exchange thereof for other shares of the corporation, purchased or redeemed and canceled any shares, canceled any treasury shares, redeemed any shares or adopted any resolution of the board with respect to authorized but unissued shares reducing the number of shares that the corporation is authorized to issue without filing in the Department of State a statement of redemption and cancellation, a statement of cancellation of shares, a statement of reduction of authorized shares or similar document as then provided by any statute supplied or repealed by Subpart B (relating to business corporations), such action shall be deemed not to have had any effect on the authorized share structure of the corporation and the number and class of shares authorized to be issued by the corporation from time to time and at any time shall be deemed and taken to be the number and class of shares as set forth at the time in the most recently amended text of the charter or articles of the corporation as then on file in the department.

(b)  Restriction on reissuance.--Subsection (a) shall not validate any shares reissued in violation of a provision of the charter or articles prohibiting the reissuance of redeemed or otherwise acquired shares. Except as otherwise expressly provided therein, such a provision shall not be interpreted as prohibiting the reissuance of redeemed or otherwise acquired shares as shares of a different class or series.

15c511h

 

 

SUBCHAPTER B

FIDUCIARY DUTY AND INDEMNIFICATION

 

Sec.

511.  Application and effect of subchapter.

512.  Standard of care and justifiable reliance.

513.  Personal liability of directors.

514.  Notation of dissent.

515.  Exercise of powers generally.

516.  Alternative standard.

517.  Limitation on standing.

518.  Nonexclusivity and supplementary coverage.

 

Enactment.  Subchapter B was added December 19, 1990, P.L.834, No.198, effective immediately.

Prior Provisions.  Former Subchapter B, which related to indemnification and corporate directors' liability, was added December 21, 1988, P.L.1444, No.177, and repealed December 19, 1990, P.L.834, No.198, effective immediately.

Special Provisions in Appendix.  See section 404(b) of Act 198 of 1990 in the appendix to this title for special provisions relating to applicability.

Cross References.  Subchapter B is referred to in section 8332.5 of Title 42 (Judiciary and Judicial Procedure).

15c511s

§ 511.  Application and effect of subchapter.

(a)  General rule.--This subchapter shall apply to and the terms "corporation" or "domestic corporation" in this subchapter shall mean a domestic corporation except:

(1)  A business corporation as defined in section 1103 (relating to definitions).

(2)  A nonprofit corporation as defined in section 5103 (relating to definitions).

(b)  Alternative provisions.--Section 516 (relating to alternative standard) shall not be applicable to any corporation to which section 515 (relating to exercise of powers generally) is applicable. Section 515 shall be applicable to any corporation except a corporation:

(1)  the bylaws of which, by amendment adopted by the board of directors on or before July 26, 1990, and not subsequently rescinded by an articles amendment, explicitly provide that section 515 or corresponding provisions of prior law shall not be applicable to the corporation; or

(2)  the articles of which explicitly provide that section 515 or corresponding provisions of prior law shall not be applicable to the corporation.

15c511v

 

Cross References.  Section 511 is referred to in sections 515, 516, 1711 of this title.

15c512s

§ 512.  Standard of care and justifiable reliance.

(a)  Directors.--A director of a domestic corporation shall stand in a fiduciary relation to the corporation and shall perform his duties as a director, including his duties as a member of any committee of the board upon which he may serve, in good faith, in a manner he reasonably believes to be in the best interests of the corporation and with such care, including reasonable inquiry, skill and diligence, as a person of ordinary prudence would use under similar circumstances. In performing his duties, a director shall be entitled to rely in good faith on information, opinions, reports or statements, including financial statements and other financial data, in each case prepared or presented by any of the following:

(1)  One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented.

(2)  Counsel, public accountants or other persons as to matters which the director reasonably believes to be within the professional or expert competence of such person.

(3)  A committee of the board upon which he does not serve, duly designated in accordance with law, as to matters within its designated authority, which committee the director reasonably believes to merit confidence.

(b)  Effect of actual knowledge.--A director shall not be considered to be acting in good faith if he has knowledge concerning the matter in question that would cause his reliance to be unwarranted.

(c)  Officers.--Except as otherwise provided in the articles, an officer shall perform his duties as an officer in good faith, in a manner he reasonably believes to be in the best interests of the corporation and with such care, including reasonable inquiry, skill and diligence, as a person of ordinary prudence would use under similar circumstances. A person who so performs his duties shall not be liable by reason of having been an officer of the corporation.

15c512v

 

Cross References.  Section 512 is referred to in sections 515, 516, 517 of this title; section 712 of Title 17 (Credit Unions).

15c513s

§ 513.  Personal liability of directors.

(a)  General rule.--If a bylaw adopted by the shareholders entitled to vote or members entitled to vote of a domestic corporation so provides, a director shall not be personally liable, as such, for monetary damages for any action taken unless:

(1)  the director has breached or failed to perform the duties of his office under this subchapter; and

(2)  the breach or failure to perform constitutes self-dealing, willful misconduct or recklessness.

(b)  Exceptions.--Subsection (a) shall not apply to:

(1)  the responsibility or liability of a director pursuant to any criminal statute; or

(2)  the liability of a director for the payment of taxes pursuant to Federal, State or local law.

(c)  Cross reference.--See 42 Pa.C.S. § 8332.5 (relating to corporate representatives).

15c513v

 

Cross References.  Section 513 is referred to in section 712 of Title 17 (Credit Unions).

15c514s

§ 514.  Notation of dissent.

A director of a domestic corporation who is present at a meeting of its board of directors, or of a committee of the board, at which action on any corporate matter is taken on which the director is generally competent to act, shall be presumed to have assented to the action taken unless his dissent is entered in the minutes of the meeting or unless he files his written dissent to the action with the secretary of the meeting before the adjournment thereof or transmits the dissent in writing to the secretary of the corporation immediately after the adjournment of the meeting. The right to dissent shall not apply to a director who voted in favor of the action. Nothing in this subchapter shall bar a director from asserting that minutes of the meeting incorrectly omitted his dissent if, promptly upon receipt of a copy of such minutes, he notifies the secretary in writing of the asserted omission or inaccuracy.

15c515s

§ 515.  Exercise of powers generally.

(a)  General rule.--In discharging the duties of their respective positions, the board of directors, committees of the board and individual directors of a domestic corporation may, in considering the best interests of the corporation, consider to the extent they deem appropriate:

(1)  The effects of any action upon any or all groups affected by such action, including shareholders, members, employees, suppliers, customers and creditors of the corporation, and upon communities in which offices or other establishments of the corporation are located.

(2)  The short-term and long-term interests of the corporation, including benefits that may accrue to the corporation from its long-term plans and the possibility that these interests may be best served by the continued independence of the corporation.

(3)  The resources, intent and conduct (past, stated and potential) of any person seeking to acquire control of the corporation.

(4)  All other pertinent factors.

(b)  Consideration of interests and factors.--The board of directors, committees of the board and individual directors shall not be required, in considering the best interests of the corporation or the effects of any action, to regard any corporate interest or the interests of any particular group affected by such action as a dominant or controlling interest or factor. The consideration of interests and factors in the manner described in this subsection and in subsection (a) shall not constitute a violation of section 512 (relating to standard of care and justifiable reliance).

(c)  Specific applications.--In exercising the powers vested in the corporation, and in no way limiting the discretion of the board of directors, committees of the board and individual directors pursuant to subsections (a) and (b), the fiduciary duty of directors shall not be deemed to require them to act as the board of directors, a committee of the board or an individual director solely because of the effect such action might have on an acquisition or potential or proposed acquisition of control of the corporation or the consideration that might be offered or paid to shareholders or members in such an acquisition.

(d)  Presumption.--Absent breach of fiduciary duty, lack of good faith or self-dealing, any act as the board of directors, a committee of the board or an individual director shall be presumed to be in the best interests of the corporation. In assessing whether the standard set forth in section 512 has been satisfied, there shall not be any greater obligation to justify, or higher burden of proof with respect to, any act as the board of directors, any committee of the board or any individual director relating to or affecting an acquisition or potential or proposed acquisition of control of the corporation than is applied to any other act as a board of directors, any committee of the board or any individual director. Notwithstanding the preceding provisions of this subsection, any act as the board of directors, a committee of the board or an individual director relating to or affecting an acquisition or potential or proposed acquisition of control to which a majority of the disinterested directors shall have assented shall be presumed to satisfy the standard set forth in section 512, unless it is proven by clear and convincing evidence that the disinterested directors did not assent to such act in good faith after reasonable investigation.

(e)  Definition.--The term "disinterested director" as used in subsection (d) and for no other purpose means:

(1)  A director of the corporation other than:

(i)  A director who has a direct or indirect financial or other interest in the person acquiring or seeking to acquire control of the corporation or who is an affiliate or associate, as defined in section 2552 (relating to definitions), of, or was nominated or designated as a director by, a person acquiring or seeking to acquire control of the corporation.

(ii)  Depending on the specific facts surrounding the director and the act under consideration, an officer or employee or former officer or employee of the corporation.

(2)  A person shall not be deemed to be other than a disinterested director solely by reason of any or all of the following:

(i)  The ownership by the director of shares of or a membership in the corporation.

(ii)  The receipt as a holder of shares of or as a member of any class or series of any distribution made to all owners of shares of or members of that class or series.

(iii)  The receipt by the director of director's fees or other consideration as a director.

(iv)  Any interest the director may have in retaining the status or position of director.

(v)  The former business or employment relationship of the director with the corporation.

(vi)  Receiving or having the right to receive retirement or deferred compensation from the corporation due to service as a director, officer or employee.

(f)  Cross reference.--See section 511(b) (relating to alternative provisions).

15c515v

 

Cross References.  Section 515 is referred to in sections 511, 517, 1711 of this title.

15c516s

§ 516.  Alternative standard.

(a)  General rule.--In discharging the duties of their respective positions, the board of directors, committees of the board and individual directors of a domestic corporation may, in considering the best interests of the corporation, consider the effects of any action upon employees, upon suppliers and customers of the corporation and upon communities in which offices or other establishments of the corporation are located, and all other pertinent factors. The consideration of those factors shall not constitute a violation of section 512 (relating to standard of care and justifiable reliance).

(b)  Presumption.--Absent breach of fiduciary duty, lack of good faith or self-dealing, actions taken as a director shall be presumed to be in the best interests of the corporation.

(c)  Cross reference.--See section 511(b) (relating to alternative provisions).

15c516v

 

Cross References.  Section 516 is referred to in sections 511, 517 of this title.

15c517s

§ 517.  Limitation on standing.

The duty of the board of directors, committees of the board and individual directors under section 512 (relating to standard of care and justifiable reliance) is solely to the domestic corporation and may be enforced directly by the corporation or may be enforced by a shareholder or member, as such, by an action in the right of the corporation, and may not be enforced directly by a shareholder, member or by any other person or group. Notwithstanding the preceding sentence, sections 515(a) and (b) (relating to exercise of powers generally) and 516(a) (relating to alternative standard) do not impose upon the board of directors, committees of the board and individual directors any legal or equitable duties, obligations or liabilities or create any right or cause of action against, or basis for standing to sue, the board of directors, committees of the board and individual directors.

15c518s

§ 518.  Nonexclusivity and supplementary coverage.

(a)  General rule.--The indemnification and advancement of expenses provided by or pursuant to section 522 (relating to indemnification of authorized representatives) or any other provisions of law providing for indemnification or advancement of expenses applicable to any domestic corporation shall not be deemed exclusive of any other rights to which a person seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of shareholders, members or directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding that office. Any domestic corporation may create a fund of any nature, which may, but need not be, under the control of a trustee, or otherwise secure or insure in any manner its indemnification obligations, whether arising under or pursuant to this section or otherwise.

(b)  When indemnification is not to be made.--Indemnification pursuant to subsection (a) shall not be made in any case where the act giving rise to the claim for indemnification is determined by a court to have constituted willful misconduct or recklessness.

(c)  Grounds.--Indemnification pursuant to subsection (a) under any bylaw, agreement, vote of shareholders, members or directors or otherwise may be granted for any action taken and may be made whether or not the corporation would have the power to indemnify the person under any other provision of law except as provided in this section and whether or not the indemnified liability arises or arose from any threatened, pending or completed action by or in the right of the corporation. Such indemnification is declared to be consistent with the public policy of this Commonwealth.

(d)  Payment of expenses.--Expenses incurred by an officer, director, employee or agent in defending any action or proceeding against which indemnification may be made pursuant to this section may be paid by the corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of such person to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the corporation.

(e)  Rights to indemnification.--The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such person.

15c521h

 

 

SUBCHAPTER C

PROVISIONS APPLICABLE TO PARTICULAR

TYPES OF CORPORATIONS

 

Sec.

521.  Pensions and allowances.

522.  Indemnification of authorized representatives.

523.  Actions by shareholders or members to enforce a secondary right.

15c521s

§ 521.  Pensions and allowances.

A banking institution or a savings association may grant allowances or pensions to officers, directors and employees for faithful and long-continued services and, after the death of the officer, director or employee either while in the service of the corporation or after retirement, pensions or allowances may be granted or continued to their dependents. The allowances to dependents shall be reasonable in amount and paid only for a limited time and, unless part of an employee benefit plan or employment contract in effect at the time of retirement or death of the officer, director or employee, shall not exceed in total the amount of the compensation paid to the officer, director or employee during the 12 months preceding retirement or death.

15c521v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

15c522s

§ 522.  Indemnification of authorized representatives.

A banking institution or a savings association shall be governed by the provisions of Subchapter D of Chapter 17 (relating to indemnification).

15c522v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

Cross References.  Section 522 is referred to in sections 518, 523 of this title.

15c523s

§ 523.  Actions by shareholders or members to enforce a secondary right.

(a)  General rule.--In any action brought to enforce a secondary right on the part of one or more shareholders or members against any officer or director or former officer or director of a banking institution or a savings association, because the corporation refuses to enforce rights which may properly be asserted by it, the plaintiff or plaintiffs must aver and it must be made to appear that the plaintiff or each plaintiff was a shareholder or was a member of the corporation at the time of the transaction of which he complains or that his stock or membership devolved upon him by operation of law from a person who was a shareholder or member at that time.

(b)  Security for costs.--In any such action instituted or maintained by a holder or holders of less than 5% of the outstanding shares of any class of the corporation or voting trust certificates therefor, or by a member or members of a corporation organized without capital stock which has outstanding contracts or accounts with its members if the value of the contracts or accounts held or owned by the member or members instituting or maintaining the suit is less than 5% of the value of all the contracts or accounts outstanding, the corporation in whose right the action is brought shall be entitled, at any stage of the proceedings, to require the plaintiff or plaintiffs to give security for the reasonable expenses, including attorneys' fees, which may be incurred by it in connection therewith and for which it may become liable pursuant to section 522 (relating to indemnification of authorized representatives) (but only insofar as relates to mandatory indemnification in actions by or in the right of the corporation) to which security the corporation shall have recourse in such amount as the court having jurisdiction shall determine upon the termination of the action. The amount of the security may, from time to time, be increased or decreased in the discretion of the court having jurisdiction of the action upon showing that the security provided has or may become inadequate or excessive.

(c)  Definitions.--As used in this section, the following words and phrases shall have the meanings given to them in this subsection:

"Director."  Includes any individual performing the function of director, regardless of title.

"Member."  Includes depositors in a mutual banking institution.

15c523v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

1990 Amendment.  Act 198 amended subsec. (a).

15c1101h

 

 

SUBPART B

BUSINESS CORPORATIONS

 

Article

A.  Preliminary Provisions

B.  Domestic Business Corporations Generally

C.  Domestic Business Corporation Ancillaries

D.  Foreign Business Corporations

 

Special Provisions in Appendix.  See section 404(a)(8) of Act 198 of 1990 in the appendix to this title for special provisions relating to the expansion of the scope of Subpart B.

 

 

ARTICLE A

PRELIMINARY PROVISIONS

 

Chapter

11.  General Provisions

 

 

CHAPTER 11

GENERAL PROVISIONS

 

Sec.

1101.  Short titles.

1102.  Application of subpart.

1103.  Definitions.

1104.  Other general provisions (Repealed).

1105.  Restriction on equitable relief.

1106.  Uniform application of subpart.

1107.  (Reserved).

1108.  Limitation on incorporation.

1109.  Execution of documents.

1110.  Annual report information.

 

Enactment.  Chapter 11 was added December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

15c1101s

§ 1101.  Short titles.

(a)  Title of subpart.--This subpart shall be known and may be cited as the Business Corporation Law of 1988.

(b)  Prior law.--The act of May 5, 1933 (P.L.364, No.106), shall be known and may be cited as the Business Corporation Law of 1933.

15c1102s

§ 1102.  Application of subpart.

(a)  General rule.--Except as otherwise provided in this section, in the scope provisions of subsequent provisions of this subpart or where the context clearly indicates otherwise, this subpart shall apply to and the words "corporation" or "business corporation" in this subpart shall mean a domestic corporation for profit. See section 101(b) (relating to application of title).

(b)  Coordination with other laws.--Where any other provision of law contemplates notice to, the presence of or the vote, consent or other action by the shareholders, directors or officers of a business corporation, without specifying the applicable corporate standards and procedures, the standards and procedures specified by or pursuant to this subpart shall be applicable.

(c)  Exclusions.--This subpart shall not apply to any of the following corporations, whether proposed or existing, except as otherwise expressly provided in this subpart or as otherwise provided by statute applicable to the corporation:

(1)  A banking institution.

(2)  A credit union.

(3)  A savings association.

(d)  Cooperative corporations.--This subpart shall apply to a domestic corporation for profit organized on the cooperative principle only to the extent provided by Subpart D (relating to cooperative corporations).

(e)  Business corporation ancillaries.--The domestic corporation provisions of this subpart shall apply to any of the following corporations, whether proposed or existing, except as otherwise expressly provided by statute applicable to the corporation:

(1)  A business development credit corporation.

(2)  Any other domestic corporation for profit incorporated under or subject to a statute that provides that the corporate affairs of the corporation shall be governed by the laws applicable to domestic business corporations.

15c1102v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

1990 Amendment.  Act 198 amended subsec. (c).

Cross References.  Section 1102 is referred to in section 1103 of this title.

15c1103s

§ 1103.  Definitions.

(a)  General definitions.--Subject to additional definitions contained in subsequent provisions of this subpart that are applicable to specific provisions of this subpart, the following words and phrases when used in this subpart shall have the meanings given to them in this section unless the context clearly indicates otherwise:

"Act" or "action."  (Deleted by amendment).

"Amendment."  An amendment of the articles.

"Articles."  The original articles of incorporation, all amendments thereof and any other articles, statements or certificates permitted or required to be filed in the Department of State by sections 108 (relating to change in location or status of registered office provided by agent) and 138 (relating to statement of correction) or this subpart and including what have heretofore been designated by law as certificates of incorporation or charters. If an amendment of the articles or articles of merger or division made in the manner permitted by this subpart restates articles in their entirety or if there are articles of consolidation, conversion or domestication, thenceforth the "articles" shall not include any prior documents and any certificate issued by the department with respect thereto shall so state.

"Authorized shares."  The shares of all classes that the corporation is authorized to issue.

"Banking institution" or "domestic banking institution."  (Deleted by amendment).

"Board of directors" or "board."  The persons selected under section 1725 (relating to selection of directors) irrespective of the name by which the group is designated in the articles. See section 1731(c) (relating to status of committee action).

"Business corporation" or "domestic business corporation."  A domestic corporation for profit that is not excluded from the scope of this subpart by section 1102 (relating to application of subpart).

"Business development credit corporation."  A domestic corporation for profit that is a corporation as defined in the act of December 1, 1959 (P.L.1647, No.606), known as the Business Development Credit Corporation Law.

"Bylaws."  See section 1504(c) (relating to bylaw provisions in articles).

"Closely held corporation."  A business corporation that:

(1)  has not more than 30 shareholders; or

(2)  is a statutory close corporation.

Shares that are held jointly or in common or in trust by two or more persons, as fiduciaries or otherwise, or that are held by spouses shall be deemed to be held by one shareholder for the purposes of this definition.

"Corporation for profit."  (Deleted by amendment).

"Corporation not-for-profit."  (Deleted by amendment).

"Court."  (Deleted by amendment).

"Credit union."  (Deleted by amendment).

"Department."  (Deleted by amendment).

"Directors."  The term, when used in relation to any power or duty requiring collective action, shall be construed to mean "board of directors."

"Dissenters rights."  The rights and remedies provided by Subchapter D of Chapter 15 (relating to dissenters rights).

"Dissolve" or "dissolution."  The termination of corporate existence effected by:

(1)  filing of articles of dissolution in the department under this subpart by the corporation or by the office of the clerk of the court of common pleas;

(2)  expiration of the term of existence of a corporation by reason of any limitation contained in its articles;

(3)  forfeiture by proclamation of the Governor under section 1704 of the act of April 9, 1929 (P.L.343, No.176), known as The Fiscal Code, or otherwise;

(4)  filing of a certified copy of a decree of dissolution in the department under the act of April 9, 1856 (P.L.293, No.308), entitled "Supplement to the acts relating to incorporations by the Courts of Common Pleas," or otherwise; or

(5)  judgment of ouster, upon proceedings in quo warranto, under former provisions of law.

"Distribution."  A direct or indirect transfer of money or other property (except its own shares or options, rights or warrants to acquire its own shares) or incurrence of indebtedness by a corporation to or for the benefit of any or all of its shareholders in respect of any of its shares whether by dividend or by purchase, redemption or other acquisition of its shares or otherwise. Neither the making of, nor payment or performance upon, a guaranty or similar arrangement by a corporation for the benefit of any or all of its shareholders nor a direct or indirect transfer or allocation of assets or liabilities effected under Chapter 19 (relating to fundamental changes) with the approval of the shareholders shall constitute a distribution for the purposes of this subpart.

"Domestic corporation for profit."  (Deleted by amendment).

"Domestic corporation not-for-profit."  (Deleted by amendment).

"Employee."  Includes officers but not directors, as such. See section 1730 (relating to compensation of directors) as to acceptance by a director of duties that make him also an employee.

"Entitled to vote."  Those persons entitled to vote on the matter under either the bylaws of the corporation or any applicable controlling provision of law. The term includes those persons entitled at the time to vote on the matter under a plan or the terms of a fundamental transaction where dissenters rights are not available under section 1571(b)(2)(ii) (relating to exceptions).

"Exchange Act."  The Securities Exchange Act of 1934 (48 Stat. 881, 15 U.S.C. § 78a et seq.).

"Fair value."  In the case of shares, fair value as determined under the standards and procedures provided by Subchapter D of Chapter 15 (relating to dissenters rights).

"Foreign business corporation."  A foreign corporation for profit subject to Chapter 41 (relating to foreign business corporations), whether or not required to qualify thereunder.

"Foreign corporation for profit."  (Deleted by amendment).

"Foreign corporation not-for-profit."  (Deleted by amendment).

"Foreign domiciliary corporation."  A foreign business corporation defined in section 4102 (relating to foreign domiciliary corporations).

"Foreign insurance corporation."  A corporation for profit incorporated under any laws other than those of this Commonwealth that is qualified to do business in this Commonwealth under the act of May 17, 1921 (P.L.789, No.285), known as The Insurance Department Act of 1921.

"Full age."  Of the age of 18 years or older.

"Incorporator."  A signer of the original articles of incorporation.

"Insurance corporation" or "domestic insurance corporation." (Deleted by amendment).

"Internal Revenue Code of 1986."  (Deleted by amendment).

"Investment Company Act of 1940."  The Investment Company Act of 1940 (54 Stat. 789, 15 U.S.C. § 80a-1 et seq.).

"Issue."  Includes sale or other disposition of a security previously issued by the corporation and thereafter acquired by it.

"Management corporation."  A business corporation that has elected to become subject to Chapter 27 (relating to management corporations) and whose status as a management corporation has not been terminated as provided in Chapter 27.

"Mutual insurance company."  A mutual insurance company as defined in section 3102 (relating to definitions).

"Nonprofit corporation."  A domestic corporation not-for-profit defined in section 5103 (relating to definitions).

"Nonqualified foreign business corporation."  A foreign business corporation that is not a qualified foreign business corporation as defined in this section.

"Nonregistered corporation."  A corporation that is not a registered corporation.

"Nonstock corporation."  A business corporation that has elected to become subject to Chapter 21 (relating to nonstock corporations) and whose status as a nonstock corporation has not been terminated as provided in Chapter 21.

"Obligation."  (Deleted by amendment).

"Officer."  If a corporation is in the hands of a custodian, receiver, trustee or like official, the term includes that official or any person appointed by that official to act as an officer for any purpose under this subpart.

"Officially publish."  (Deleted by amendment).

"Plan."  A plan of reclassification, merger, consolidation, exchange, asset transfer, division or conversion.

"Preference."  A right in one class or series of shares that is senior to any right in a junior class or series of shares:

(1)  as to the right to payment of dividends;

(2)  as to the right to distribution of assets upon redemption of shares or upon the voluntary or involuntary liquidation of the corporation; or

(3)  as to both dividends and assets.

"Professional corporation."  A business corporation that is subject to Chapter 29 (relating to professional corporations) and whose status as a professional corporation has not been terminated as provided in Chapter 29.

"Public utility corporation."  Any domestic or foreign corporation for profit that:

(1)  is subject to regulation as a public utility by the Pennsylvania Public Utility Commission or an officer or agency of the United States; or

(2)  was subject to such regulation on December 31, 1980, or would have been so subject if it had been then existing.

"Qualified foreign business corporation."  A foreign business corporation that is:

(1)  authorized under Chapter 41 (relating to foreign business corporations) to do business in this Commonwealth; or

(2)  a foreign insurance corporation.

"Reclassification."  A change in the number, voting rights, designations, preferences, limitations, special rights or par value of shares, or a conversion or exchange of one class or series of shares into or for another class or series of shares, other securities or obligations of the same corporation, or the cancellation of shares. The term does not include a stock dividend or split effected by distribution of its own previously authorized shares pro rata to the holders of shares of the same or any other class or series pursuant to action solely of the board of directors.

"Registered corporation."  A corporation defined in section 2502 (relating to registered corporation status).

"Registered office."  That office maintained by a corporation in this Commonwealth as required by section 1507 (relating to registered office). See section 109 (relating to name of commercial registered office provider in lieu of registered address).

"Relax."  When used with respect to a provision of the articles or bylaws, means to provide lesser rights for an affected representative or shareholder.

"Representative."  (Deleted by amendment).

"Savings association" or "domestic savings association."  (Deleted by amendment).

"Securities Act of 1933."  The Securities Act of 1933 (48 Stat. 74, 15 U.S.C. § 77a et seq.).

"Share certificate."  A written instrument signed on behalf of the corporation evidencing the fact that the person therein named is the record owner of the shares therein described.

"Shareholder."  A record holder or record owner of shares of a corporation, including a subscriber to shares. The term, when used in relation to the taking of corporate action, includes the proxy of a shareholder. If and to the extent the articles confer rights of shareholders upon holders of obligations of the corporation or governmental or other entities pursuant to any provision of this subpart or other provision of law, the term shall be construed to include those holders and governmental or other entities.

"Shares."  The units into which the rights of the shareholders to participate in the control of a corporation, in its profits or in the distribution of its assets are divided.

"Special treatment."  A provision of an amendment or plan permitted by section 1906 (relating to special treatment of holders of shares of same class or series).

"Statutory close corporation."  A business corporation that has elected to become subject to Chapter 23 (relating to statutory close corporations) and whose status as a statutory close corporation has not been terminated as provided in Chapter 23.

"Subscriber."  One who subscribes for or otherwise takes shares by agreement from the issuing corporation, whether before or after incorporation.

"Subscription."  The promise to pay a consideration or the agreement fixing the amount of the consideration paid or to be paid for shares by a subscriber.

"Unless otherwise provided" or "except as otherwise provided."  When used to introduce or modify a rule, implies that the alternative provisions contemplated may either relax or restrict the stated rule.

"Unless otherwise restricted" or "except as otherwise restricted."  When used to introduce or modify a rule, implies that the alternative provisions contemplated may further restrict, but may not relax, the stated rule.

"Voting" or "casting a vote."  Includes the giving of consent in lieu of voting. The term does not include either recording the fact of abstention or failing to vote for a candidate or for approval or disapproval of a matter, whether or not the person entitled to vote characterizes the conduct as voting or casting a vote.

(b)  Index of other definitions.--The following is a nonexclusive list of words and phrases which when used in this subpart shall have the meanings given to them in section 102 (relating to definitions):

"Act" or "action."

"Banking institution" or "domestic banking institution."

"Corporation for profit."

"Corporation not-for-profit."

"Court."

"Credit union."

"Department."

"Domestic corporation for profit."

"Domestic corporation not-for-profit."

"Execute."

"Foreign corporation for profit."

"Foreign corporation not-for-profit."

"Insurance corporation" or "domestic insurance corporation."

"Internal Revenue Code of 1986."

"Obligation."

"Officially publish."

"Record form."

"Representative."

"Savings association" or "domestic savings association."

"Sign."

15c1103v

(Apr. 27, 1990, P.L.129, No.36, eff. imd.; Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; Dec. 7, 1994, P.L.703, No.106, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 added subsecs. (a) hdg. and (b) and in subsec. (a) amended the defs. of "distribution" and "voting" or "casting a vote" and deleted the defs. of "act" or "action," "banking institution" or "domestic banking institution," "corporation for profit," "corporation not-for-profit," "court," "credit union," "department," "domestic corporation for profit," "domestic corporation not-for-profit," "foreign corporation for profit," "foreign corporation not-for-profit," "insurance corporation" or "domestic insurance corporation," "Internal Revenue Code of 1986," "obligation," "officially publish," "representative" and "savings association" or "domestic savings association."

1992 Amendment.  Act 169 amended the defs. of "distribution," retroactive to October 1, 1989, "professional corporation" and "registered office" and added the def. of "dissolve" or "dissolution."

1990 Amendments.  Act 36 added the def. of "act" or "action" and Act 198 amended the defs. of "credit union," "distribution," "entitled to vote," "foreign insurance corporation," "insurance corporation" or "domestic insurance corporation," "qualified foreign business corporation" and "reclassification" and added the defs. of "Exchange Act," "Internal Revenue Code of 1986," "Investment Company Act of 1940," "mutual insurance company," "relax" and "Securities Act of 1933."

Cross References.  Section 1103 is referred to in sections 511, 1572, 1725, 1903, 2301, 5103 of this title; section 101 of Title 54 (Names).

15c1104s

§ 1104.  Other general provisions (Repealed).

15c1104v

 

2013 Repeal.  Section 1104 was repealed July 9, 2013, P.L.476, No.67, effective in 60 days.

15c1105s

§ 1105.  Restriction on equitable relief.

A shareholder of a business corporation shall not have any right to obtain, in the absence of fraud or fundamental unfairness, an injunction against any proposed plan or amendment of articles authorized under any provision of this subpart, nor any right to claim the right to valuation and payment of the fair value of his shares because of the plan or amendment, except that he may dissent and claim such payment if and to the extent provided in Subchapter D of Chapter 15 (relating to dissenters rights) where this subpart expressly provides that dissenting shareholders shall have the rights and remedies provided in that subchapter. Absent fraud or fundamental unfairness, the rights and remedies so provided shall be exclusive. Structuring a plan or transaction for the purpose or with the effect of eliminating or avoiding the application of dissenters rights is not fraud or fundamental unfairness within the meaning of this section.

15c1105v

 

Cross References.  Section 1105 is referred to in sections 1571, 1904 of this title.

15c1106s

§ 1106.  Uniform application of subpart.

(a)  General rule.--Except as provided in subsection (b), this subpart and its amendments are intended to provide uniform rules for the government and regulation of the affairs of business corporations and of their officers, directors and shareholders regardless of the date or manner of incorporation or qualification, or of the issuance of any shares thereof.

(b)  Exceptions.--

(1)  Unless expressly provided otherwise in any amendment to this subpart, the amendment shall take effect only prospectively.

(2)  An existing corporation lawfully using a name or, as part of its name, a word that could not be used as or included in the name of a corporation subsequently incorporated or qualified under this subpart may continue to use the name or word as part of its name if the use or inclusion of the word or name was lawful when first adopted by the corporation in this Commonwealth.

(3)  Subsection (a) shall not adversely affect the rights specifically provided for or saved in this subpart. See:

The provisions of section 1524(e) (relating to transitional provision).

The provisions of section 1554(c) (relating to transitional provision).

The cumulative voting rights set forth in section 1758(c)(2) (relating to cumulative voting).

The special voting requirements specified in section 1931(h) (relating to special requirements).

The provisions of section 1952(g) and (h) (relating to proposal and adoption of plan of division).

The provisions of section 2301(d) (relating to transitional provisions).

The provisions of section 2541(a)(2) and (3) and (c) (relating to application and effect of subchapter).

The provisions of section 2543(b)(1) and (2) (relating to exceptions generally).

The provisions of section 2551(b)(3)(i), (5) and (6) (relating to exceptions).

The provisions of section 2553(b)(2) (relating to exception).

(4)  Except as otherwise expressly provided in the articles, a domestic corporation for profit that, on September 30, 1989, was not subject to the Business Corporation Law of 1933 and that thereafter becomes subject to this subpart by operation of law shall be deemed to have in effect articles that provide that the following provisions of this subpart shall not be applicable to the corporation:

(i)  Section 1726(a)(1) (relating to removal by the shareholders) insofar as it provides a statutory right on the part of shareholders to remove directors from office without assigning any cause.

(ii)  Section 1755(b)(2) (relating to special meetings).

(iii)  Section 1912(a)(2) (relating to proposal of amendments).

15c1106v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; June 22, 2001, P.L.418, No.34, eff. 60 days)

 

2001 Amendment.  Act 34 amended subsec. (b)(3).

1990 Amendment.  Act 198 amended subsec. (b).

Cross References.  Section 1106 is referred to in sections 1303, 1311, 1726, 1755, 1912 of this title.

15c1107s

§ 1107.  (Reserved).

15c1107v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

1990 Amendment.  Act 198 renumbered section 1107 to section 1108 and added a new section 1107 (Reserved).

15c1108s

§ 1108.  Limitation on incorporation.

A corporation that can be incorporated under this subpart shall not be incorporated except under the provisions of this subpart.

15c1108v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

1990 Amendment.  Act 198 renumbered section 1107 to section 1108 and renumbered former section 1108 to section 1109.

15c1109s

§ 1109.  Execution of documents.

(a)  General rule.--Any document filed in the Department of State under this title by a domestic or foreign business corporation subject to this subpart may be executed on behalf of the corporation by any one duly authorized officer thereof. The corporate seal may be affixed and attested but the affixation or attestation of the corporate seal shall not be necessary for the due execution of any filing by a corporation under this title.

(b)  Cross reference.--See section 135 (relating to requirements to be met by filed documents).

15c1109v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

1990 Amendment.  Act 198 renumbered former section 1108 to present section 1109.

15c1110s

§ 1110.  Annual report information.

The Department of State shall make available as public information for inspection and copying the names of the president, vice-president, secretary and treasurer and the address of the principal office of corporations for profit as annually forwarded to the department by the Department of Revenue pursuant to section 403(a)(3) of the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

15c1110v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days)

 

Cross References.  Section 1110 is referred to in section 1732 of this title; section 503 of Title 54 (Names).

15c1301h

 

 

ARTICLE B

DOMESTIC BUSINESS CORPORATIONS GENERALLY

 

Chapter

  13.  Incorporation

  15.  Corporate Powers, Duties and Safeguards

  17.  Officers, Directors and Shareholders

  19.  Fundamental Changes

 

 

CHAPTER 13

INCORPORATION

 

Subchapter

A.  Incorporation Generally

B.  Revival

 

Enactment.  Chapter 13 was added December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

Cross References.  Chapter 13 is referred to in section 1306 of this title.

 

 

SUBCHAPTER A

INCORPORATION GENERALLY

 

Sec.

1301.  Purposes.

1302.  Number and qualifications of incorporators.

1303.  Corporate name.

1304.  Required name changes by senior corporations.

1305.  Reservation of corporate name.

1306.  Articles of incorporation.

1307.  Advertisement.

1308.  Filing of articles.

1309.  Effect of filing of articles of incorporation.

1310.  Organization meeting.

1311.  Filing of statement of summary of record by certain corporations.

15c1301s

§ 1301.  Purposes.

Corporations may be incorporated under this subpart for any lawful purpose or purposes. Unless otherwise restricted in its articles, every business corporation has as its corporate purpose the engaging in all lawful business for which corporations may be incorporated under this subpart.

15c1301v

 

Cross References.  Section 1301 is referred to in section 3311 of this title.

15c1302s

§ 1302.  Number and qualifications of incorporators.

One or more corporations for profit or not-for-profit or natural persons of full age may incorporate a business corporation under the provisions of this subpart.

15c1303s

§ 1303.  Corporate name.

(a)  General rule.--The corporate name may be in any language, but must be expressed in Roman letters or characters or Arabic or Roman numerals, and shall contain:

(1)  the word "corporation," "company," "incorporated" or "limited" or an abbreviation of any of them;

(2)  the word "association," "fund" or "syndicate"; or

(3)  words or abbreviations of like import in languages other than English.

(b)  Duplicate use of names.--The corporate name shall be distinguishable upon the records of the department from:

(1)  The name of any other domestic corporation for profit or not-for-profit which is either in existence or for which articles of incorporation have been filed but have not yet become effective, or of any foreign corporation for profit or not-for-profit which is either authorized to do business in this Commonwealth or for which an application for a certificate of authority has been filed but has not yet become effective, or the name of any association registered at any time under 54 Pa.C.S. Ch. 5 (relating to corporate and other association names), unless:

(i)  the other association:

(A)  has stated that it is about to change its name, or to cease to do business, or is being wound up, or is a foreign association about to withdraw from doing business in this Commonwealth, and the statement and a written consent to the adoption of the name is filed in the Department of State;

(B)  has filed with the Department of Revenue a certificate of out of existence, or has failed for a period of three successive years to file with the Department of Revenue a report or return required by law and the fact of such failure has been certified by the Department of Revenue to the Department of State;

(C)  has abandoned its name under the laws of its jurisdiction of incorporation, by amendment, merger, consolidation, division, expiration, dissolution or otherwise, without its name being adopted by a successor in a merger, consolidation, division or otherwise, and an official record of that fact, certified as provided by 42 Pa.C.S. § 5328 (relating to proof of official records), is presented by any person to the department; or

(D)  has had the registration of its name under 54 Pa.C.S. Ch. 5 terminated.

(ii)  (Deleted by amendment).

(2)  A name the exclusive right to which is at the time reserved by any other person whatsoever in the manner provided by statute. A name shall be rendered unavailable for corporate use by reason of the filing in the Department of State of any assumed or fictitious name required by 54 Pa.C.S. Ch. 3 (relating to fictitious names) to be filed in the department only if and to the extent expressly so provided in that chapter.

(c)  Required approvals or conditions.--

(1)  The corporate name shall not imply that the corporation is:

(i)  A governmental agency of the Commonwealth or of the United States.

(ii)  A bank, bank and trust company, savings bank, private bank or trust company, as defined in the act of November 30, 1965 (P.L.847, No.356), known as the Banking Code of 1965, unless the corporation or proposed corporation is a Pennsylvania bank holding company or is otherwise authorized by statute to use its proposed name.

(iii)  An insurance company nor contain any of the words "annuity," "assurance," "beneficial," "bond," "casualty," "endowment," "fidelity," "fraternal," "guaranty," "indemnity," "insurance," "insurer," "reassurance," "reinsurance," "surety" or "title" when used in such a way as to imply that the corporation is engaged in the business of writing insurance or reinsurance as principal or any other words of like purport unless it is duly licensed as an insurance company by its jurisdiction of incorporation or the Insurance Department certifies that it has no objection to the use by the corporation or proposed corporation of the designation. The corporate name of a domestic insurance corporation shall:

(A)  contain the word "mutual" if, and only if, it is a mutual insurance company; and

(B)  clearly designate the object and purpose of the corporation.

(iv)  A public utility corporation furnishing electric or gas service to the public, unless the corporation or proposed corporation has as an express corporate purpose the furnishing of service subject to the jurisdiction of the Pennsylvania Public Utility Commission or the Federal Energy Regulatory Commission.

(v)  A credit union. See 17 Pa.C.S. § 104 (relating to prohibition on use of words "credit union," etc.).

(2)  The corporate name shall not contain:

(i)  The word "college," "university" or "seminary" when used in such a way as to imply that it is an educational institution conforming to the standards and qualifications prescribed by the State Board of Education, unless there is submitted a certificate from the Department of Education certifying that the corporation or proposed corporation is entitled to use that designation.

(ii)  Words that constitute blasphemy, profane cursing or swearing or that profane the Lord's name.

(iii)  The words "engineer" or "engineering" or "surveyor" or "surveying" or any other word implying that any form of the practice of engineering or surveying as defined in the act of May 23, 1945 (P.L.913, No.367), known as the Professional Engineers Registration Law, is provided unless at least one of the incorporators of a proposed corporation or the directors of the existing corporation has been properly registered with the State Registration Board for Professional Engineers in the practice of engineering or surveying and there is submitted to the department a certificate from the board to that effect.

(iv)  The words "architect" or "architecture" or any other word implying that any form of the practice of architecture as defined in the act of December 14, 1982 (P.L.1227, No.281), known as the Architects Licensure Law, is provided unless at least one of the incorporators of a proposed corporation or the directors of the existing corporation has been properly registered with the Architects Licensure Board in the practice of architecture and there is submitted to the department a certificate from the board to that effect.

(v)  The word "cooperative" or an abbreviation thereof unless the corporation is a cooperative corporation.

(d)  Other rights unaffected.--This section shall not abrogate or limit the law as to unfair competition or unfair practices nor derogate from the common law, the principles of equity or the provisions of Title 54 (relating to names) with respect to the right to acquire and protect trade names. Subsection (b) shall not apply if the applicant files in the department a certified copy of a final order of a court of competent jurisdiction establishing the prior right of the applicant to the use of a name in this Commonwealth.

(e)  Remedies for violation of section.--The use of a name in violation of this section shall not vitiate or otherwise affect the corporate existence, but any court having jurisdiction may enjoin the corporation from using or continuing to use a name in violation of this section upon the application of:

(1)  the Attorney General, acting on his own motion or at the instance of any administrative department, board or commission of this Commonwealth; or

(2)  any person adversely affected.

(f)  Cross references.--See sections 135(e) (relating to distinguishable names) and 1106(b)(2) (relating to uniform application of subpart).

15c1303v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; June 22, 2000, P.L.356, No.43, eff. 60 days; June 22, 2001, P.L.418, No.34, eff. 60 days)

 

2001 Amendment.  Act 34 amended subsec. (e) and added subsec. (f).

2000 Amendment.  Act 43 amended subsec. (b) intro. par., (1) intro. par., (i) intro. par., (A) and (D) and deleted subsec. (b)(1)(ii) and last par.

1990 Amendment.  Act 198 amended subsecs. (b)(1) and (c)(1)(iii) and added subsec. (c)(1)(v).

References in Text.  The name of the Professional Engineers Registration Law was changed to the Engineer, Land Surveyor and Geologist Registration Law. The name of the State Registration Board for Professional Engineers and Professional Land Surveyors was changed to the State Registration Board for Professional Engineers, Land Surveyors and Geologists.

Cross References.  Section 1303 is referred to in sections 161, 1304, 2121, 2921, 4123, 4161, 8203, 8505, 8905 of this title.

15c1304s

§ 1304.  Required name changes by senior corporations.

(a)  Adoption of new name upon reactivation.--Where a corporate name is made available on the basis that the corporation or other association that formerly registered the name has failed to file in the Department of Revenue a report or a return required by law or where the corporation or other association has filed in the Department of Revenue a certificate of out of existence, the corporation or other association shall cease to have by virtue of its prior registration any right to the use of the name. The corporation or other association, upon withdrawal of the certificate of out of existence or upon the removal of its delinquency in the filing of the required reports or returns, shall make inquiry with the Department of State with regard to the availability of its name and, if the name has been made available to another domestic or foreign corporation for profit or not-for-profit or other association by virtue of these conditions, shall adopt a new name in accordance with law before resuming its activities.

(b)  Enforcement of undertaking to release name.--If a corporation has used a name that is not distinguishable upon the records of the Department of State from the name of another corporation or other association as permitted by section 1303(b)(1) (relating to duplicate use of names) and the other corporation or other association continues to use its name in this Commonwealth and does not change its name, cease to do business, be wound up or withdraw as it proposed to do in its consent or change its name as required by subsection (a), any court having jurisdiction may enjoin the other corporation or other association from continuing to use its name or a name that is not distinguishable therefrom upon the application of:

(1)  the Attorney General, acting on his own motion or at the instance of any administrative department, board or commission of this Commonwealth; or

(2)  any person adversely affected.

15c1304v

(Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; June 22, 2000, P.L.356, No.43, eff. 60 days; June 22, 2001, P.L.418, No.34, eff. 60 days)

 

2001 Amendment.  Act 34 amended subsec. (b).

1992 Amendment.  Act 169 amended subsec. (a).

Cross References.  Section 1304 is referred to in section 1341 of this title.

15c1305s

§ 1305.  Reservation of corporate name.

(a)  General rule.--The exclusive right to the use of a corporate name may be reserved by any person. The reservation shall be made by delivering to the Department of State an application to reserve a specified corporate name, executed by the applicant. If the department finds that the name is available for corporate use, it shall reserve the name for the exclusive use of the applicant for a period of 120 days.

(b)  Transfer of reservation.--The right to exclusive use of a specified corporate name reserved under subsection (a) may be transferred to any other person by delivering to the department a notice of the transfer, executed by the person who reserved the name, and specifying the name and address of the transferee.

(c)  Cross references.--See sections 134 (relating to docketing statement) and 4131 (relating to registration of name).

15c1305v

 

Cross References.  Section 1305 is referred to in sections 8203, 8505, 8905 of this title; section 503 of Title 54 (Names).

15c1306s

§ 1306.  Articles of incorporation.

(a)  General rule.--Articles of incorporation shall be signed by each of the incorporators and shall set forth in the English language:

(1)  The name of the corporation, unless the name is in a foreign language in which case it shall be set forth in Roman letters or characters or Arabic or Roman numerals.

(2)  Subject to section 109 (relating to name of commercial registered office provider in lieu of registered address), the address, including street and number, if any, of its initial registered office in this Commonwealth.

(3)  A statement that the corporation is incorporated under the provisions of the Business Corporation Law of 1988.

(4)  A statement that the corporation is to be organized upon a nonstock basis, or if it is to be organized on a stock share basis:

(i)  The aggregate number of shares that the corporation shall have authority to issue. It shall not be necessary to set forth in the articles the designations of the classes of shares of the corporation, or the maximum number of shares of each class that may be issued.

(ii)  A statement of the voting rights, designations, preferences, limitations and special rights in respect of the shares of any class or any series of any class, to the extent that they have been determined.

(iii)  A statement of any authority vested in the board of directors to divide the authorized and unissued shares into classes or series, or both, and to determine for any such class or series its voting rights, designations, preferences, limitations and special rights.

(5)  The name and address, including street and number, if any, of each of the incorporators.

(6)  The term for which the corporation is to exist, if not perpetual.

(7)  If the articles are to be effective on a specified date, the hour, if any, and the month, day and year of the effective date.

(8)  Any other provisions that the incorporators may choose to insert if:

(i)  any provision of this subpart authorizes or requires provisions pertaining to the subject matter thereof to be set forth in the articles or bylaws of a business corporation or in an agreement or other instrument; or

(ii)  the provisions, whether or not specifically authorized by this subpart, relate to the purpose or purposes of the corporation, the management of its business or affairs or the rights, powers or duties of its securityholders, directors or officers.

(b)  Other provisions authorized.--A provision of the original articles or a provision of the articles approved by the shareholders, in either case adopted under subsection (a)(8)(ii), may relax or be inconsistent with and supersede any provision of Chapter 13 (relating to incorporation), 15 (relating to corporate powers, duties and safeguards), 17 (relating to officers, directors and shareholders) or 19 (relating to fundamental changes) concerning the subjects specified in subsection (a)(8)(ii), except where a provision of those chapters expressly provides that the articles shall not relax or be inconsistent with any provision on a specified subject. Notwithstanding the foregoing, the articles may provide greater rights for shareholders than are authorized by any provision of those chapters that otherwise provides that the articles shall not relax or be inconsistent with any provision on a specified subject.

(c)  Par value.--The articles may, but need not, set forth a par value for any authorized shares or class or series of shares.

(d)  Written consent to naming directors.--The naming of directors in articles of incorporation shall constitute an affirmation that the directors have consented in writing to serve as such.

(e)  Reference to external facts.--Except for the provisions required by subsection (a)(1), (2), (3), (4)(i), (5) and (7), any provision of the articles of incorporation may be made dependent upon facts ascertainable outside of the articles if the manner in which the facts will operate upon the provision is set forth in the articles. The facts may include actions or events within the control of or determinations made by the corporation or a representative of the corporation.

15c1306v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 added subsec. (e).

1992 Amendment.  Act 169 amended subsec. (b).

1990 Amendment.  Act 198 amended subsec. (a)(8), relettered subsec. (b) to subsec. (d) and added new subsecs. (b) and (c).

Cross References.  Section 1306 is referred to in sections 1504, 1718, 3304 of this title.

15c1307s

§ 1307.  Advertisement.

The incorporators or the corporation shall officially publish a notice of intention to file or of the filing of articles of incorporation. The notice may appear prior to or after the day the articles of incorporation are filed in the Department of State and shall set forth briefly:

(1)  The name of the proposed corporation.

(2)  A statement that the corporation is to be or has been incorporated under the provisions of the Business Corporation Law of 1988.

15c1308s

§ 1308.  Filing of articles.

(a)  General rule.--The articles of incorporation shall be filed in the Department of State.

(b)  Cross reference.--See section 134 (relating to docketing statement).

15c1309s

§ 1309.  Effect of filing of articles of incorporation.

(a)  Corporate existence.--Upon the filing of the articles of incorporation in the Department of State or upon the effective date specified in the articles of incorporation, whichever is later, the corporate existence shall begin.

(b)  Evidence of incorporation.--Subject to the provisions of section 503 (relating to actions to revoke corporate franchises), the articles of incorporation filed in the department, or recorded in the office of the recorder of deeds under the former provisions of law, shall be conclusive evidence of the fact that the corporation has been incorporated.

15c1310s

§ 1310.  Organization meeting.

(a)  General rule.--After the corporate existence begins, an organization meeting of the initial directors or, if directors are not named in the articles, of the incorporator or incorporators shall be held, within or without this Commonwealth, for the purpose of adopting bylaws which they shall have authority to do at the meeting, of electing directors, if directors are not named in the articles, and the transaction of such other business as may come before the meeting. A bylaw adopted at the organization meeting of directors or incorporators shall be deemed to be a bylaw adopted by the shareholders for the purposes of this subpart and of any other provision of law.

(b)  Call of and action at meeting.--The meeting may be held at the call of any director or, if directors are not named in the articles, of any incorporator, who shall give at least five days' written notice thereof to each other director or incorporator, which notice shall set forth the time and place of the meeting. For the purposes of this section, any incorporator may act in person, by written consent or by proxy signed by him or his attorney-in-fact.

(c)  Death or incapacity of directors or incorporators.--If a designated director or an incorporator dies or is for any reason unable to act at the meeting, the other or others may act. If there is no other designated director or incorporator able to act, any person for whom an incorporator was acting as agent may act or appoint another to act in his stead.

15c1310v

 

Cross References.  Section 1310 is referred to in section 1504 of this title.

15c1311s

§ 1311.  Filing of statement of summary of record by certain corporations.

(a)  General rule.--Where any of the charter documents of a business corporation are not on file in the Department of State or there is an error in any such document as transferred to the department pursuant to section 140 (relating to custody and management of orphan corporate and business records), and the corporation desires to file any document in the department under any other provision of this subpart or the corporation desires to secure from the department any certificate to the effect that the corporation is a corporation duly incorporated and existing under the laws of this Commonwealth or a certified copy of the articles of the corporation or the corporation desires to correct the text of its charter documents as on file in the department, the corporation shall file in the department a statement of summary of record which shall be executed by the corporation and shall set forth:

(1)  The name of the corporation and, subject to section 109 (relating to name of commercial registered office provider in lieu of registered address), the location, including street and number, if any, of its registered office.

(2)  The statute by or under which the corporation was incorporated.

(3)  The name under which, the manner in which and the date on which the corporation was originally incorporated, including the date when and the place where the original articles were recorded.

(4)  The place or places, including volume and page numbers or their equivalent, where the documents that are not on file in the department or that require correction in the records of the department were originally filed or recorded, the date or dates of each filing or recording and the correct text of the documents. The information specified in this paragraph may be omitted in a statement of summary of record that is delivered to the department contemporaneously with amended and restated articles of the corporation filed under this subpart.

(5)  (Deleted by amendment).

(6)  (Deleted by amendment).

(b)  Validation of prior defects in incorporation.--Upon the filing of a statement by a corporation under this section or the transfer to the department of the records relating to a corporation pursuant to section 140, the corporation shall be deemed to be a validly subsisting corporation to the same extent as if it had been duly incorporated and was existing under this subpart and the department shall so certify regardless of any absence of or defect in the prior proceedings relating to incorporation.

(c)  Cross references.--See sections 134 (relating to docketing statement), 135 (relating to requirements to be met by filed documents) and 1106(b)(2) (relating to uniform application of subpart).

15c1311v

(June 22, 2001, P.L.418, No.34, eff. 60 days)

 

Cross References.  Section 1311 is referred to in section 9305 of this title.

15c1341h

 

 

SUBCHAPTER B

REVIVAL

 

Sec.

1341.  Statement of revival.

15c1341s

§ 1341.  Statement of revival.

(a)  General rule.--Any business corporation whose charter or articles have been forfeited by proclamation of the Governor pursuant to section 1704 of the act of April 9, 1929 (P.L.343, No.176), known as The Fiscal Code, or otherwise, or whose corporate existence has expired by reason of any limitation contained in its charter or articles and the failure to effect a timely renewal or extension of its corporate existence, may at any time by filing a statement of revival procure a revival of its charter or articles, together with all the rights, franchises, privileges and immunities and subject to all of its duties, debts and liabilities that had been vested in and imposed upon the corporation by its charter or articles as last in effect.

(b)  Contents of statement.--The statement of revival shall be executed in the name of the forfeited or expired corporation and shall, subject to section 109 (relating to name of commercial registered office provider in lieu of registered address), set forth:

(1)  The name of the corporation at the time its charter or articles were forfeited or expired and the address, including street and number, if any, of its last registered office.

(2)  The statute by or under which the corporation was incorporated and the date of incorporation.

(3)  The name that the corporation adopts as its new name if the adoption of a new name is required by section 1304 (relating to required name changes by senior corporations).

(4)  The address, including street and number, if any, of its registered office in this Commonwealth.

(5)  A reference to the proclamation or other action by which its charter or articles were forfeited or a reference to the limitation contained in its expired charter or articles.

(6)  A statement that the corporate existence of the corporation shall be revived.

(7)  A statement that the filing of the statement of revival has been authorized by the corporation. Every forfeited or expired corporation may act by its last directors or may elect directors and officers in the manner provided by this subpart for the limited purpose of effecting a filing under this section.

(c)  Filing and effect.--The statement of revival and, in the case of a forfeited corporation, the clearance certificates required by section 139 (relating to tax clearance of certain fundamental transactions) shall be filed in the Department of State. Upon the filing of the statement of revival, the corporation shall be revived with the same effect as if its charter or articles had not been forfeited or expired by limitation. The revival shall validate all contracts and other transactions made and effected within the scope of the articles of the corporation by its representatives during the time when its charter or articles were forfeited or expired to the same effect as if its charter or articles had not been forfeited or expired.

(d)  Cross reference.--See section 134 (relating to docketing statement).

15c1501h

 

 

CHAPTER 15

CORPORATE POWERS, DUTIES AND SAFEGUARDS

 

Subchapter

A.  General Provisions

B.  Shares and Other Securities

C.  Corporate Finance

D.  Dissenters Rights

 

Enactment.  Chapter 15 was added December 21, 1988, P.L.1444, No.177, effective October 1, 1989.

Cross References.  Chapter 15 is referred to in section 1306 of this title.

 

 

SUBCHAPTER A

GENERAL PROVISIONS

 

Sec.

1501.  Corporate capacity.

1502.  General powers.

1503.  Defense of ultra vires.

1504.  Adoption, amendment and contents of bylaws.

1505.  Persons bound by bylaws.

1506.  Form of execution of instruments.

1507.  Registered office.

1508.  Corporate records; inspection by shareholders.

1509.  Bylaws and other powers in emergency.

1510.  Certain specifically authorized debt terms.

1511.  Additional powers of certain public utility corporations.

1512.  Informational rights of a director.

15c1501s

§ 1501.  Corporate capacity.

Except as provided in section 103 (relating to subordination of title to regulatory laws), a business corporation shall have the legal capacity of natural persons to act.

15c1502s

§ 1502.  General powers.

(a)  General rule.--Subject to the limitations and restrictions imposed by statute or contained in its articles, every business corporation shall have power:

(1)  To have perpetual succession by its corporate name unless a limited period of duration is specified in its articles, subject to the power of the Attorney General under section 503 (relating to actions to revoke corporate franchises) and to the power of the General Assembly under the Constitution of Pennsylvania.

(2)  To sue and be sued, complain and defend and participate as a party or otherwise in any judicial, administrative, arbitrative or other proceeding in its corporate name.

(3)  To have a corporate seal, which may be altered at pleasure, and to use the seal by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.

(4)  To acquire, own and utilize any real or personal property, or any interest therein, wherever situated.

(5)  To sell, convey, mortgage, pledge, lease, exchange or otherwise dispose of all or any part of its property and assets, or any interest therein, wherever situated.

(6)  To guarantee, become surety for, acquire, own and dispose of obligations, capital stock and other securities.

(7)  To borrow money, issue or incur its obligations and secure any of its obligations by mortgage on or pledge of or security interest in all or any part of its property and assets, wherever situated, franchises or income, or any interest therein.

(8)  To invest its funds, lend money and take and hold real and personal property as security for the repayment of funds so invested or loaned.

(9)  To make contributions and donations.

(10)  To use abbreviations, words, logos or symbols upon the records of the corporation, and in connection with the registration of, and inscription of ownership or entitlement on, certificates evidencing shares in or other securities or obligations of the corporation, or upon any notice such as the notice provided by section 1528(f) (relating to uncertificated shares), and upon checks, proxies, notices and other instruments and documents relating to the foregoing, which abbreviations, words, logos or symbols shall have the same force and effect as though the respective words and phrases for which they stand were set forth in full for the purposes of all statutes of this Commonwealth and all other purposes.

(11)  To be a promoter, partner, member, associate or manager of any partnership, enterprise or venture or in any transaction, undertaking or arrangement that the corporation would have power to conduct itself, whether or not its participation involves sharing or delegation of control with or to others.

(12)  To transact any lawful business that the board of directors finds will aid governmental policy.

(13)  To continue the salaries of such of its employees as may be serving in the active or reserve armed forces of the United States, or in the National Guard or in any other organization established for the protection of the lives and property of citizens of this Commonwealth or the United States, during the term of that service or during such part thereof as the employees, by reason of that service, may be unable to perform their duties as employees of the corporation.

(14)  To pay pensions and establish pension plans, pension trusts, profit sharing plans, share bonus plans, share option plans, incentive and deferred compensation plans and other plans or trusts for any or all of its present or former representatives and, after their death, to grant allowances or pensions to their dependents or beneficiaries, whether or not the grant was made during their lifetime.

(15)  To conduct its business, carry on its operations, have offices and exercise the powers granted by this subpart or any other provision of law in any jurisdiction within or without the United States.

(16)  To elect or appoint and remove officers, employees and agents of the corporation, define their duties, fix their compensation and the compensation of directors, to lend any of the foregoing money and credit and to pay bonuses or other additional compensation to any of the foregoing for past services.

(17)  To enter into any obligation appropriate for the transaction of its affairs, including contracts or other agreements with its shareholders.

(18)  To accept, reject, respond to or take no action in respect of an actual or proposed acquisition, divestiture, tender offer, takeover or other fundamental change under Chapter 19 (relating to fundamental changes) or otherwise.

(19)  To have and exercise all of the powers and means appropriate to effect the purpose or purposes for which the corporation is incorporated.

(20)  To have and exercise all other powers enumerated elsewhere in this subpart or otherwise vested by law in the corporation.

(b)  Enumeration unnecessary.--It shall not be necessary to set forth in the articles of the corporation the powers enumerated in subsection (a).

(c)  Board to exercise.--See section 1721 (relating to board of directors).

15c1502v

 

Cross References.  Section 1502 is referred to in sections 1715, 1721, 7521 of this title.

15c1503s

§ 1503.  Defense of ultra vires.

(a)  General rule.--A limitation upon the business, purposes or powers of a business corporation, expressed or implied in its articles or bylaws or implied by law, shall not be asserted in order to defend any action at law or in equity between the corporation and a third person, or between a shareholder and a third person, involving any contract to which the corporation is a party or any right of property or any alleged liability of whatever nature, but the limitation may be asserted:

(1)  In an action by a shareholder against the corporation to enjoin the doing of unauthorized acts or the transaction or continuation of unauthorized business. If the unauthorized acts or business sought to be enjoined are being transacted pursuant to any contract to which the corporation is a party, the court may, if all of the parties to the contract are parties to the action and if it deems the result to be equitable, set aside and enjoin the performance of the contract, and in so doing shall allow to the corporation, or to the other parties to the contract, as the case may be, such compensation as may be appropriate for the loss or damage sustained by any of them from the action of the court in setting aside and enjoining the performance of the contract, but anticipated profits to be derived from the performance of the contract shall not be awarded by the court as a loss or damage sustained.

(2)  In any action by or in the right of the corporation to procure a judgment in its favor against an incumbent or former officer or director of the corporation for loss or damage due to his unauthorized acts.

(3)  In a proceeding by the Commonwealth under section 503 (relating to actions to revoke corporate franchises) or in a proceeding by the Commonwealth to enjoin the corporation from the doing of unauthorized or unlawful business.

(b)  Conveyances of property by or to a corporation.--A conveyance or transfer by or to a business corporation of property, real or personal, of any kind or description, shall not be invalid or fail because in making the conveyance or transfer, or in acquiring the property, real or personal, any representative of the corporation acting within the scope of the actual or apparent authority given to him by the corporation has exceeded any of the purposes or powers of the corporation.

(c)  Cross reference.--See section 4146 (relating to provisions applicable to all foreign corporations).

15c1503v

 

Cross References.  Section 1503 is referred to in section 4146 of this title.

15c1504s

§ 1504.  Adoption, amendment and contents of bylaws.

(a)  General rule.--Except as otherwise provided in this subpart, the shareholders entitled to vote shall have the power to adopt, amend and repeal the bylaws of a business corporation. Except as provided in subsection (b), the authority to adopt, amend and repeal bylaws may be expressly vested by the bylaws in the board of directors, subject to the power of the shareholders to change such action. The bylaws may contain any provisions for managing the business and regulating the affairs of the corporation not inconsistent with law or the articles. In the case of a meeting of shareholders, written notice shall be given to each shareholder that the purpose, or one of the purposes, of a meeting is to consider the adoption, amendment or repeal of the bylaws. There shall be included in, or enclosed with, the notice a copy of the proposed amendment or a summary of the changes to be effected thereby. Any change in the bylaws shall take effect when adopted unless otherwise provided in the resolution effecting the change.

(b)  Exception.--Except as otherwise provided in section 1310(a) (relating to organization meeting), or in the articles to the extent authorized by section 1306(b) (relating to other provisions authorized), the board of directors shall not have the authority to adopt or change a bylaw on any subject that is committed expressly to the shareholders by any of the provisions of this subpart. See:

Subsection (d) (relating to amendment of voting provisions).

Section 1521 (relating to authorized shares).

Section 1713 (relating to personal liability of directors).

Section 1721 (relating to board of directors).

Section 1725 (relating to selection of directors).

Section 1726 (relating to removal of directors).

Section 1729 (relating to voting rights of directors).

Section 1756 (relating to quorum).

Section 1757 (relating to action by shareholders).

Section 1765 (relating to judges of election).

Section 2105 (relating to termination of nonstock corporation status).

Section 2122 (relating to classes of membership).

Section 2124 (relating to voting rights of members).

Section 2302 (relating to definition of minimum vote).

Section 2321 (relating to shares).

Section 2322 (relating to share transfer restrictions).

Section 2325 (relating to sale option of estate of shareholder).

Section 2332 (relating to management by shareholders).

Section 2334 (relating to appointment of provisional director in certain cases).

Section 2337 (relating to option of shareholder to dissolve corporation).

Section 2923 (relating to issuance and retention of shares).

(c)  Bylaw provisions in articles.--Where any provision of this subpart or any other provision of law refers to a rule as set forth in the bylaws of a corporation or in a bylaw adopted by the shareholders, the reference shall be construed to include and be satisfied by any rule on the same subject as set forth in the articles of the corporation.

(d)  Amendment of voting provisions.--

(1)  Unless otherwise provided in a bylaw adopted by the shareholders, whenever the bylaws require for the taking of any action by the shareholders or a class of shareholders a specific number or percentage of votes, the provision of the bylaws setting forth that requirement shall not be amended or repealed by any lesser number or percentage of votes of the shareholders or of the class of shareholders.

(2)  Paragraph (1) shall not apply to a bylaw setting forth the right of shareholders to act by unanimous written consent as provided in section 1766(a) (relating to unanimous consent).

15c1504v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992, P.L.1333, No.169, eff. 60 days; July 9, 2013, P.L.476, No.67, eff. 60 days)

 

2013 Amendment.  Act 67 amended subsec. (c).

1992 Amendment.  Act 169 amended subsecs. (b) and (d), retroactive to October 1, 1989, as to subsec. (d).

Cross References.  Section 1504 is referred to in sections 1103, 1757, 2332, 3121 of this title.

15c1505s

§ 1505.  Persons bound by bylaws.

Except as otherwise provided by section 1713 (relating to personal liability of directors) or any similar provision of law, the bylaws of a business corporation shall operate only as regulations among the shareholders, directors and officers of the corporation and shall not affect contracts or other dealings with other persons unless those persons have actual knowledge of the bylaws.

15c1505v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; June 22, 2001, P.L.418, No.34, eff. 60 days)

15c1506s

§ 1506.  Form of execution of instruments.

(a)  General rule.--Any form of execution provided in the articles or bylaws to the contrary notwithstanding, any note, mortgage, evidence of indebtedness, contract or other document, or any assignment or endorsement thereof, executed or entered into between any business corporation and any other person, when signed by one or more officers or agents having actual or apparent authority to sign it, or by the president or vice president and secretary or assistant secretary or treasurer or assistant treasurer of the corporation, shall be held to have been properly executed for and in behalf of the corporation.

(b)  Seal unnecessary.--The affixation of the corporate seal shall not be necessary to the valid execution, assignment or endorsement by a corporation of any instrument or other document.

(c)  Cross reference.--See section 4146 (relating to provisions applicable to all foreign corporations).

15c1506v

 

Cross References.  Section 1506 is referred to in section 4146 of this title.

15c1507s

§ 1507.  Registered office.

(a)  General rule.--Every business corporation shall have and continuously maintain in this Commonwealth a registered office which may, but need not, be the same as its place of business.

(b)  Statement of change of registered office.--After incorporation, a change of the location of the registered office may be authorized at any time by the board of directors. Before the change of location becomes effective, the corporation either shall amend its articles under the provisions of this subpart to reflect the change in location or shall file in the Department of State a statement of change of registered office executed by the corporation setting forth:

(1)  The name of the corporation.

(2)  The address, including street and number, if any, of its then registered office.

(3)  The address, including street and number, if any, to which the registered office is to be changed.

(4)  A statement that the change was authorized by the board of directors.

(c)  Alternative procedure.--A corporation may satisfy the requirements of this subpart concerning the maintenance of a registered office in this Commonwealth by setting forth in any document filed in the department under any provision of this subpart that permits or requires the statement of the address of its then registered office, in lieu of that address, the statement authorized by section 109(a) (relating to name of commercial registered office provider in lieu of registered address).

(d)  Cross reference.--See section 134 (relating to docketing statement).

15c1507v

 

Cross References.  Section 1507 is referred to in sections 1103, 4144 of this title.

15c1508s

§ 1508.  Corporate records; inspection by shareholders.

(a)  Required records.--Every business corporation shall keep complete and accurate books and records of account, minutes of the proceedings of the incorporators, shareholders and directors and a share register giving the names and addresses of all shareholders and the number and class of shares held by each. The share register shall be kept at any of the following locations:

(1)  the registered office of the corporation in this Commonwealth;

(2)  the principal place of business of the corporation wherever situated;

(3)  any actual business office of the corporation; or

(4)  the office of the registrar or transfer agent of the corporation.

(b)  Right of inspection by a shareholder.--Every shareholder shall, upon written verified demand stating the purpose thereof, have a right to examine, in person or by agent or attorney, during the usual hours for business for any proper purpose, the share register, books and records of account, and records of the proceedings of the incorporators, shareholders and directors and to make copies or extracts therefrom. A proper purpose shall mean a purpose reasonably related to the interest of the person as a shareholder. In every instance where an attorney or other agent is the person who seeks the right of inspection, the demand shall be accompanied by a verified power of attorney or other writing that authorizes the attorney or other agent to so act on behalf of the shareholder. The demand shall be directed to the corporation:

(1)  at its registered office in this Commonwealth;

(2)  at its principal place of business wherever situated; or

(3)  in care of the person in charge of an actual business office of the corporation.

(c)  Proceedings for the enforcement of inspection by a shareholder.--If the corporation, or an officer or agent thereof, refuses to permit an inspection sought by a shareholder or attorney or other agent acting for the shareholder pursuant to subsection (b) or does not reply to the demand within five business days after the demand has been made, the shareholder may apply to the court for an order to compel the inspection. The court shall determine whether or not the person seeking inspection is entitled to the inspection sought. The court may summarily order the corporation to permit the shareholder to inspect the share register and the other books and records of the corporation and to make copies or extracts therefrom, or the court may order the corporation to furnish to the shareholder a list of its shareholders as of a specific date on condition that the shareholder first pay to the corporation the reasonable cost of obtaining and furnishing the list and on such other conditions as the court deems appropriate. Where the shareholder seeks to inspect the books and records of the corporation, other than its share register or list of shareholders, he shall first establish:

(1)  That he has complied with the provisions of this section respecting the form and manner of making demand for inspection of the document.

(2)  That the inspection he seeks is for a proper purpose.

Where the shareholder seeks to inspect the share register or list of shareholders of the corporation and he has complied with the provisions of this section respecting the form and manner of making demand for inspection of the documents, the burden of proof shall be upon the corporation to establish that the inspection he seeks is for an improper purpose. The court may, in its discretion, prescribe any limitations or conditions with reference to the inspection or award such other or further relief as the court deems just and proper. The court may order books, documents and records, pertinent extracts therefrom, or duly authenticated copies thereof, to be brought into this Commonwealth and kept in this Commonwealth upon such terms and conditions as the order may prescribe.

(d)  Certain provisions of articles ineffective.--This section may not be relaxed by any provision of the articles.

(e)  Cross references.--See sections 107 (relating to form of records), 1512 (relating to informational rights of a director) and 1763(c) (relating to certification by nominee).

15c1508v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.; June 22, 2001, P.L.418, No.34, eff. 60 days)

 

Cross References.  Section 1508 is referred to in section 1512 of this title.

15c1509s

§ 1509.  Bylaws and other powers in emergency.

(a)  General rule.--Except as otherwise restricted in the bylaws, the board of directors of any business corporation may adopt emergency bylaws, subject to repeal or change by action of the shareholders, which shall, notwithstanding any different provisions of law or of the articles or bylaws, be effective during any emergency resulting from an attack on the United States, a nuclear disaster or another catastrophe as a result of which a quorum of the board cannot readily be assembled. The emergency bylaws may make any provision that may be appropriate for the circumstances of the emergency, including:

(1)  Procedures for calling meetings of the board.

(2)  Quorum requirements for meetings.

(3)  Procedures for designating additional or substitute directors.

(b)  Lines of succession; head office.--The board of directors, either before or during any emergency, may provide, and from time to time modify, lines of succession in the event that during the emergency any or all officers or agents of the corporation shall for any reason be rendered incapable of discharging their duties and may, effective in the emergency, change the head offices or designate several alternative head offices or regional offices of the corporation or authorize the officers to do so.

(c)  Personnel not liable.--A representative of the corporation:

(1)  Acting in accordance with any emergency bylaws shall not be liable except for willful misconduct.

(2)  Shall not be liable for any action taken by him in good faith in an emergency in furtherance of the ordinary business affairs of the corporation even though not authorized by the emergency or other bylaws then in effect.

(d)  Effect on regular bylaws.--To the extent not inconsistent with any emergency bylaws so adopted, the bylaws of the corporation shall remain in effect during any emergency and, upon its termination, the emergency bylaws shall cease to be effective.

(e)  Procedure in absence of emergency bylaws.--Unless otherwise provided in emergency bylaws, notice of any meeting of the board of directors during an emergency shall be given only to those directors it is feasible to reach at the time and by such means as are feasible at the time, including publication, radio or television. To the extent required to constitute a quorum at any meeting of the board of directors during any emergency, the officers of the corporation who are present shall, unless otherwise provided in emergency bylaws, be deemed, in order of rank and within the same rank in order of seniority, directors for the meeting.

15c1510s

§ 1510.  Certain specifically authorized debt terms.

(a)  Interest rates.--A business corporation shall not plead or set up usury, or the taking of more than the lawful rate of interest, or the taking of any finance, service or default charge in excess of any maximum rate therefor provided or prescribed by law, as a defense to any action or proceeding brought against it to recover damages on, or to enforce payment of, or to enforce any other remedy on, any obligation executed or effected by the corporation.

(b)  Yield maintenance premiums.--A prepayment premium determined by reference to the approximate spread between the yield at issuance, or at the date of amendment of any of the terms, of an obligation of a corporation and the yield at or about such date of an interest rate index of independent significance and contingent upon a change in the ownership of the shares of or a default by or other change in the condition or prospects of the issuer or any affiliate of the issuer shall be deemed liquidated damages and shall not constitute a penalty.

(c)  Definitions.--As used in this section, the following words shall have the meanings given to them in this subsection:

"Affiliate."  An affiliate or associate as defined in section 2552 (relating to definitions).

"Obligation."  Includes an installment sale contract.

(d)  Cross reference.--See section 4146 (relating to provisions applicable to all foreign corporations).

15c1510v

(Dec. 19, 1990, P.L.834, No.198, eff. imd.)

 

Cross References.  Section 1510 is referred to in sections 4146, 8926, 8981, 9506, 9507 of this title.

15c1511s

§ 1511.  Additional powers of certain public utility corporations.

(a)  General rule.--A public utility corporation shall, in addition to any other power of eminent domain conferred by any other statute, have the right to take, occupy and condemn property for one or more of the following principal purposes and ancillary purposes reasonably necessary or appropriate for the accomplishment of the principal purposes:

(1)  The transportation of passengers or property or both as a common carrier by means of elevated street railway, ferry, inclined plane railway, railroad, street railway or underground street railway, trackless-trolley omnibus or by any combination of such means.

(2)  The transportation of artificial or natural gas, electricity, petroleum or petroleum products or water or any combination of such substances for the public.

(3)  The production, generation, manufacture, transmission, storage, distribution or furnishing of natural or artificial gas, electricity, steam, air conditioning or refrigerating service or any combination thereof to or for the public.

(4)  The diverting, developing, pumping, impounding, distributing or furnishing of water from either surface or subsurface sources to or for the public.

(5)  The collection, treatment or disposal of sewage for the public.

(6)  The conveyance or transmission of messages or communications by telephone or telegraph for the public.

(7)  The diverting, pumping or impounding of water for the development or furnishing of hydroelectric power to or for the public.

(8)  The transportation of oxygen or nitrogen, or both, by pipeline or conduit for the public.

(b)  Restrictions.--The powers conferred by subsection (a) shall not be exercised:

(1)  To condemn for the purpose of constructing any street railway, trackless-trolley omnibus, petroleum or petroleum products transportation or aerial electric transmission, aerial telephone or aerial telegraph lines:

(i)  Any dwelling house or, except in the case of any condemnation for petroleum or petroleum products transportation lines, any part of the reasonable curtilage of a dwelling house within 100 meters therefrom and not within the limits of any street, highway, water or other public way or place.

(ii)  Any place of public worship or burying ground.

(2)  To condemn any place of public worship or burying ground for the purpose of constructing any elevated street railway, sewer or underground street railway line.

(c)  Public Utility Commission approval.--The powers conferred by subsection (a) may be exercised to condemn property outside the limits of any street, highway, water or other public way or place for the purpose of erecting poles or running wires or other aerial electric, intrastate aerial telephone or intrastate aerial telegraph facilities only after the Pennsylvania Public Utility Commission, upon application of the public utility corporation, has found and determined, after notice and opportunity for hearing, that the service to be furnished by the corporation through the exercise of those powers is necessary or proper for the service, accommodation, convenience or safety of the public. The power of the public utility corporation to condemn the subject property or the procedure followed by it shall not be an issue in the commission proceedings held under this subsection, and no court shall entertain any proceeding questioning the jurisdiction of the commission under this subsection. A final order of the commission approving or denying an application under this subsection, including an order involving a question of jurisdiction under this subsection, may be made the subject of any appeal in the manner provided or prescribed by law.

(d)  Estate in property condemned.--The estate in property condemned and taken by a public utility corporation shall be in fee simple absolute unless the resolution of condemnation specifies a lesser estate. Whenever it is necessary for any public utility corporation to condemn by authority of subsection (a) the freehold in the surface of any tract of property or the right to the exclusive possession for any indefinite period of the surface of any tract of property, the public utility corporation shall condemn a fee simple absolute and no less estate in the tract or the surface thereof.

(e)  Streets and other public places.--A public utility corporation shall have the right to enter upon and occupy streets, highways, waters and other public ways and places for one or more of the principal purposes specified in subsection (a) and ancillary purposes reasonably necessary or appropriate for the accomplishment of the principal purposes, including the placement, maintenance and removal of aerial, surface and subsurface public utility facilities thereon or therein. Before entering upon any street, highway or other public way, the public utility corporation shall obtain such permits as may be required by law and shall comply with the lawful and reasonable regulations of the governmental authority having responsibility for the maintenance thereof.

(f)  Effect on other statutes.--Subsections (a) through (e) shall not be construed to eliminate the exemption by statute of certain agricultural or historical lands from liability to condemnation or entry nor to affect or modify any of the provisions of the act of December 19, 1984 (P.L.1140, No.223), known as the Oil and Gas Act, or of 66 Pa.C.S. § 1104 (relating to certain appropriations by the right of eminent domain prohibited) or 2702 (relating to construction, relocation, suspension and abolition of crossings), nor to permit the acquisition of water rights, water or land underlying them by any public utility corporation that has not received from the Department of Environmental Resources a limited power permit, limited water supply permit, order of confirmation, permit for acquisition of water rights or gubernatorial easement, right-of-way, license or lease authorizing the acquisition or occupancy.

(g)  Procedure.--

(1)  The act of June 22, 1964 (Sp.Sess., P.L.84, No.6), known as the Eminent Domain Code, shall be applicable to proceedings for the condemnation and taking of property conducted pursuant to this section.

(2)  Notwithstanding paragraph (1), a corporation having the power of eminent domain that condemns for occupation by electric, underground telephone or telegraph, gas, oil or petroleum products lines used directly or indirectly in furnishing service to the public an interest (other than a fee) for right-of-way purposes or an easement for such purposes may elect to proceed as follows in lieu of the procedures specified in sections 402, 403, 405 and 406 of the Eminent Domain Code:

(i)  If the corporation and any interested party cannot agree on the amount of damages sustained, or if any interested party is an unincorporated association, or is absent, unknown, not of full age or otherwise incompetent or unavailable to contract with the corporation, or in the case of disputed, doubtful or defective title, the corporation may make a verified application to the appropriate court for an order directing the filing of a bond to the Commonwealth, in an amount and with security to be approved by the court, for the use of the person or persons who may be found to be entitled to the damages sustained. The application shall be accompanied by the bond and a certified copy of the resolution of condemnation. The resolution shall describe the nature and extent of the taking.

(ii)  If the address of such interested party is known to the corporation, written notice of the filing of the application under subparagraph (i) shall be sent to such party by mail, or otherwise, at least ten days prior to the consideration thereof by the court. Otherwise the corporation shall officially publish such notice in the county or counties where the property is situated twice a week for two weeks prior to consideration by the court and shall give such supplemental or alternative notice as the court may direct.

(iii)  Upon entry by the court of an order approving the bond and directing that it be filed, the title that the corporation acquires in the right-of-way or easement described in the resolution of condemnation shall pass to the corporation and the corporation shall be entitled to possession.

(iv)  The papers filed by the corporation with the court under this paragraph shall constitute the declaration of taking for the purposes of sections 404, 408 and 409 and Articles V through VIII of the Eminent Domain Code.

15c1511v

 

Saved from Repeal.  Subsec. (g)(2) is saved from repeal by section 5(4) of the act of May 4, 2006, P.L.112, No.34, which put into effect the provisions of Title 26 (Eminent Domain).

References in Text.  The Department of Environmental Resources, referred to in subsec. (f), was abolished by Act 18 of 1995. Its functions were transferred to the Department of Conservation and Natural Resources and the Department of Environmental Protection.

Cross References.  Section 1511 is referred to in section 8102 of this title.

15c1512s

§ 1512.  Informational rights of a director.

(a)  General rule.--To the extent reasonably related to the performance of the duties of the director, including those arising from service as a member of a committee of the board of directors, a director of a business corporation is entitled:

(1)  in person or by any attorney or other agent, at any reasonable time, to inspect and copy corporate books, records and documents and, in addition, to inspect and receive information regarding the assets, liabilities and operations of the corporation and any subsidiaries of the corporation incorporated or otherwise organized or created under the laws of this Commonwealth that are controlled directly or indirectly by the corporation; and

(2)  to demand that the corporation exercise whatever rights it may have to obtain information regarding any other subsidiaries of the corporation.