PRIOR PRINTER'S NOS. 3516, 3694 | PRINTER'S NO. 3746 |
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. | 2234 | Session of 2014 |
INTRODUCED BY TURZAI, DERMODY, KOTIK, MACKENZIE, MARSHALL, MILLARD, GREINER, PAINTER, KILLION, READSHAW, DAVIS, EVERETT, BOBACK, THOMAS, TRUITT, ROZZI, MUSTIO, BARBIN, AUMENT, BAKER, COHEN, MILNE, DENLINGER, MICOZZIE, OBERLANDER, GROVE, SWANGER, BROWNLEE, MENTZER, CUTLER, FEE, WATSON, McNEILL, MURT, COX, BLOOM, METCALFE, FRANKEL, HICKERNELL, LAWRENCE, SAYLOR, GABLER, HARHART, CARROLL, LONGIETTI, KORTZ, CAUSER, GRELL, DeLUCA, D. COSTA, GOODMAN, CLYMER, MULLERY, BRADFORD, GILLEN, HANNA, SANTARSIERO, F. KELLER, ROCK, KAMPF, GINGRICH, PICKETT, KNOWLES, GODSHALL, KRIEGER, DONATUCCI, BROOKS, FLECK, ENGLISH AND SABATINA, MAY 5, 2014
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES, JUNE 16, 2014
AN ACT
1Amending Titles 15 (Corporations and Unincorporated
2Associations) and 54 (Names) of the Pennsylvania Consolidated
3Statutes, modernizing the law on corporations and
4unincorporated associations by doing the following:
5Adding provisions applicable to associations generally on
6names, mergers, interest exchanges, conversions, divisions,
7domestications and registration of foreign associations to do
8business.
9Extensively revising preliminary provisions on general
10provisions, entities generally, entity transactions and
11foreign associations.
12As to business corporations, extensively revising:
13preliminary provisions on definitions, equitable
14relief and applicability;
15general incorporation provisions on names, articles
16of incorporation, applicability and notice to demand
17payment;
18management and ownership provisions on shareholder
19action;
20fundamental change provisions on omissions,
21termination, de facto transaction, proposals, special
1treatment of shares, submission of matters to
2shareholders, liabilities, merger, share exchange, sale
3of assets, division, conversion, voluntary dissolution
4and winding up;
5nonstock corporation provisions on application;
6statutory close corporation provisions on
7application;
8registered corporation provisions on call of special
9meetings of shareholders, shareholder transactions and
10management adoption of merger plans;
11management corporation provisions on application and
12bylaw and fundamental change procedures;
13professional corporation provisions on application
14and corporate name;
15insurance corporation provisions on application;
16benefit corporation provisions on applicability and
17election of status; and
18foreign business corporation provisions on admission,
19excluded activities, names, commencing business,
20certificates of authority, termination, address change
21after withdrawal, name registration, penalties, powers
22and duties, registered offices and domestication.
23As to nonprofit corporations, extensively revising:
24general provisions on definitions and applicability;
25incorporation provisions on corporate name, changes
26and reservation;
27management and ownership provisions on action;
28fundamental change provisions on filed plans,
29statement of termination, proposal of fundamental
30transactions, authorization, plans, notice, procedure,
31foreign corporations, articles, filing, effectiveness,
32resulting effect, merger, voluntary transfer of assets,
33division and conversion; and
34foreign nonprofit corporate provisions on admission,
35excluded activities, names, commencing business,
36certificates of authority, organic change, termination,
37address change after withdrawal, name registration,
38penalties, powers and duties, registered offices and
39domestication.
40As to cooperative corporations, extensively revising
41workers cooperative corporation provisions on definitions,
42nature and articles and terminating provisions on generation
43choices for customers of electric cooperatives.
44As to partnerships and limited liability companies,
45extensively revising:
46registered limited liability partnership provisions
47on name and foreign partnerships;
48limited partnership provisions on definitions, name,
49cancellation of certificate, merger and consolidation,
50nonjudicial dissolution, division and foreign limited
51partnerships; and
1limited liability company provisions on definitions,
2name, election, merger and consolidation, division and
3foreign companies.
4As to unincorporated associations, extensively revising:
5preliminary provisions on definitions; and
6professional associations provisions on
7applicability.
8As to business trusts, extensively revising provisions on
9creation, status and termination, on documentation and on
10foreign business trusts.
11In names:
12as to fictitious names, further providing for scope
13and registration; and
14as to corporate and associational names, further
15providing for a register and for decennial filings.
16Making editorial changes.
17The General Assembly of the Commonwealth of Pennsylvania
18hereby enacts as follows:
19Section 1. This act shall be known and may be cited as the
20Association Transactions Act.
21Section 1.1. The General Assembly finds and declares as
22follows:
23(1) It is necessary to modernize the law of this
24Commonwealth on the organization and governance of
25corporations and other associations in order to make the
26Commonwealth competitive with other states in attracting
27business organizations.
28(2) This act is designed to amend 15 Pa.C.S. Pt. I to
29integrate the law on corporations and other associations by
30enacting provisions applicable to all forms of associations
31and authorizing transactions involving any form of
32association.
33(3) It is also necessary to modernize the law on those
34subjects in order to improve the functioning of the Bureau of
35Corporations and Charitable Organizations, which administers
36that law.
1(4) This act is designed to amend 15 Pa.C.S. Pt. I to
2integrate the law on entity names, entity transactions and
3registration of foreign entities into a single coherent body
4of law that can be efficiently administered by the Bureau of
5Corporations and Charitable Organizations and easily used and
6understood by the citizens of the Commonwealth.
7Section 1.2. The introductory paragraph, the definitions of
8"association," "cooperative corporation," "corporation for
9profit," and "corporation not-for-profit," paragraph (2) of the
10definition of "court" and the definitions of "domestic savings
11association" and "savings association" in section 102 of Title
1215 of the Pennsylvania Consolidated Statutes are amended and the
13section is amended by adding definitions and a subsection to
14read:
15§ 102. Definitions.
16(a) Defined terms.--Subject to additional or inconsistent
17definitions contained in subsequent provisions of this title
18that are applicable to specific provisions of this title, the
19following words and phrases when used in this title shall have,
20unless the context clearly indicates otherwise, the meanings
21given to them in this section:
22* * *
23"Association." A corporation for profit or not-for-profit, a
24partnership, a limited liability company, a business or
25statutory trust, an entity or two or more persons associated in
26a common enterprise or undertaking. The term does not include:
27(1) a testamentary trust or an inter vivos trust as
28defined in 20 Pa.C.S. § 711(3) (relating to mandatory
29exercise of jurisdiction through orphans' court division in
30general)[.];
1(2) an association or relationship that:
2(i) is not a person that has:
3(A) a legal existence separate from any interest
4holder of the person; or
5(B) the power to acquire an interest in real
6property in its own name; and
7(ii) is not a partnership under the rules stated in
8section 8312 (relating to rules for determining the
9existence of a partnership) or a similar provision of the
10law of another jurisdiction;
11(3) a decedent's estate; or
12(4) a government or a governmental subdivision, agency
13or instrumentality.
14* * *
15"Business corporation." A domestic or foreign business
16corporation as defined in section 1103 (relating to
17definitions), whether or not it is a cooperative corporation.
18* * *
19"Cooperative corporation." A domestic corporation that is
20subject to Subpart D of Part II (relating to cooperative
21corporations), or a foreign corporation that is subject to a
22similar law of a foreign jurisdiction.
23"Corporation for profit." A domestic or foreign corporation
24incorporated for a purpose or purposes involving pecuniary
25profit, incidental or otherwise, to its shareholders or members,
26whether or not it is a cooperative corporation.
27"Corporation not-for-profit." A domestic or foreign
28corporation not incorporated for a purpose or purposes involving
29pecuniary profit, incidental or otherwise, whether or not it is
30a cooperative corporation.
1"Court." Subject to any inconsistent general rule prescribed
2by the Supreme Court of Pennsylvania:
3* * *
4(2) where an association results from a merger,
5[consolidation,] division or other transaction without
6establishing a registered office in this Commonwealth or
7withdraws as a foreign corporation or association, the court
8of common pleas in which venue would have been laid
9immediately prior to the transaction or withdrawal.
10* * *
11"Dissenters rights." The rights and remedies provided by
12Subchapter D of Chapter 15 (relating to dissenters rights).
13"Distributional interest." The right under the organic law
14of an entity that is not a corporation for profit or not-for-
15profit, or under the organic rules of such an entity, to receive
16distributions from the entity.
17"Domestic association." An association, the internal affairs
18of which are governed by the law of this Commonwealth.
19* * *
20"Domestic entity." An entity, the internal affairs of which
21are governed by the law of this Commonwealth.
22"Domestic filing association." A domestic association, the
23formation of which requires the filing of a public organic
24record. The term does not include a general partnership that is
25also:
26(1) a limited liability partnership; or
27(2) an electing partnership.
28"Domestic filing entity." A domestic entity, the formation
29of which requires the filing of a public organic record. The
30term does not include a general partnership that is also:
1(1) a limited liability partnership; or
2(2) an electing partnership.
3* * *
4["Domestic savings association." A domestic corporation for
5profit which is an association as defined in section 102(3) of
6the former act of December 14, 1967 (P.L.746, No.345), known as
7the Savings Association Code of 1967.]
8* * *
9"Electronic." Relating to technology having electrical,
10digital, magnetic, wireless, optical, electromagnetic or similar
11capabilities.
12"Entity." A domestic or foreign:
13(1) business corporation;
14(2) nonprofit corporation;
15(3) general partnership;
16(4) limited partnership;
17(5) limited liability company;
18(6) unincorporated nonprofit association;
19(7) professional association; or
20(8) business trust, common law business trust or
21statutory trust.
22* * *
23"Filing association." A domestic or foreign association, the
24formation of which requires the filing of a public organic
25record. The term does not include a general partnership that is
26also:
27(1) a limited liability partnership; or
28(2) an electing partnership.
29"Filing entity." A domestic or foreign entity, the formation
30of which requires the filing of a public organic record. The
1term does not include a general partnership that is also:
2(1) a limited liability partnership; or
3(2) an electing partnership.
4"Foreign association." An association that is not a domestic
5association.
6* * *
7"Foreign entity." An entity that is not a domestic entity.
8"Foreign filing association." A foreign association, the
9formation of which requires the filing of a public organic
10record.
11"Fraternal benefit society." A fraternal benefit society as
12defined in section 2403 of the act of May 17, 1921 (P.L.682,
13No.284), known as The Insurance Company Law of 1921.
14"General partnership." A domestic or foreign partnership as
15defined in section 8311 (relating to partnership defined),
16whether or not it is a limited liability partnership or electing
17partnership.
18"Governance interest." A right under the organic law or
19organic rules of an association that is not a corporation for
20profit or not-for-profit, other than as a governor, agent,
21assignee or proxy, to:
22(1) receive or demand access to information concerning,
23or the books and records of, the association;
24(2) vote for the election of the governors of the
25association; or
26(3) receive notice of or vote on an issue involving the
27internal affairs of the association.
28"Governor." A person by or under whose authority the powers
29of an association are exercised and under whose direction the
30activities and affairs of the association are managed pursuant
1to the organic law and organic rules of the association. The
2term includes:
3(1) A director of a corporation for profit or a
4shareholder of a statutory close corporation that is deemed
5to be a director under section 2332(a) (relating to
6management by shareholders).
7(2) A director or member of an other body of a
8corporation not-for-profit.
9(3) A partner of a general partnership.
10(4) A general partner of a limited partnership.
11(5) A general partner of an electing partnership.
12(6) A manager of a manager-managed limited liability
13company or a member that has the right to participate
14materially in the management of a member-managed limited
15liability company.
16(7) A manager of an unincorporated nonprofit
17association.
18(8) A member of the board of governors of a professional
19association.
20(9) A trustee of a business trust, common law business
21trust or statutory trust.
22"Health maintenance organization." An entity that is subject
23to the act of December 29, 1972 (P.L.1701, No.364), known as the
24Health Maintenance Organization Act.
25"Hospital plan corporation." A hospital plan corporation as
26defined in 40 Pa.C.S. § 6101 (relating to definitions).
27* * *
28"Interest." A share in a corporation for profit, a
29membership or share in a corporation not-for-profit, a
30governance interest or a distributional interest. The term
1includes the following:
2(1) A governance interest or transferable interest in a
3general partnership.
4(2) A governance interest or transferable interest in a
5limited partnership.
6(3) A governance interest or transferable interest in a
7limited liability company.
8(4) A membership in an unincorporated nonprofit
9association.
10(5) An ownership interest in a professional association.
11(6) A beneficial interest in a business trust, common-
12law business trust or statutory trust.
13"Interest holder." A direct or record holder of an interest.
14The term includes the following:
15(1) A shareholder of a corporation for profit.
16(2) A member or shareholder of a corporation not-for-
17profit.
18(3) A partner or transferee in a general partnership.
19(4) A general or limited partner or transferee in a
20limited partnership.
21(5) A member or transferee in a limited liability
22company.
23(6) A member of an unincorporated nonprofit association.
24(7) An associate in a professional association.
25(8) A beneficiary or beneficial owner of record of a
26business trust, common-law business trust or statutory trust.
27* * *
28"Jurisdiction." When used to refer to a political entity,
29the United States, a state, a foreign country or a political
30subdivision of a foreign country.
1"Jurisdiction of formation." The jurisdiction whose law
2includes the organic law of an association.
3* * *
4"Limited liability limited partnership." A domestic or
5foreign limited partnership for which there is in effect:
6(1) a statement of registration under Chapter 82
7(relating to registered limited liability partnerships);
8(2) a provision of its certificate of limited
9partnership electing to be subject to Chapter 82; or
10(3) a similar filing or provision under the organic law
11of a foreign partnership.
12"Limited liability partnership." A domestic or foreign
13general partnership for which there is in effect:
14(1) a statement of registration under Chapter 82
15(relating to registered limited liability partnerships); or
16(2) a similar filing under the organic law of a foreign
17general partnership.
18"Limited partnership." A domestic or foreign limited
19partnership as defined in section 8503 (relating to definitions
20and index of definitions), whether or not it is a limited
21liability limited partnership or electing partnership.
22"Nonfiling association." An association that is not a filing
23association.
24"Nonprofit corporation." A domestic or foreign nonprofit
25corporation as defined in section 5103 (relating to
26definitions), whether or not it is a cooperative corporation.
27"Nonregistered foreign association." A foreign association
28that is not registered to do business in this Commonwealth
29pursuant to a filing with the department.
30* * *
1"Organic law." The law of the jurisdiction of formation of
2an association governing its internal affairs.
3"Organic rules." The public organic record and private
4organic rules of an association.
5"Principal office." The principal executive office of an
6association, whether or not the office is located in this
7Commonwealth.
8"Private organic rules." The rules that govern the internal
9affairs of an association, are binding on all its interest
10holders and are not part of its public organic record, if any.
11The term includes the following:
12(1) The bylaws of a corporation for profit.
13(2) The bylaws of a corporation not-for-profit.
14(3) The partnership agreement of a general partnership.
15(4) The partnership agreement of a limited partnership.
16(5) The operating agreement of a limited liability
17company.
18(6) The governing principles of an unincorporated
19nonprofit association.
20(7) The bylaws of a professional association.
21(8) The bylaws or similar rules, by whatever name they
22may be referred to, of a business trust, common-law business
23trust or statutory trust.
24* * *
25"Professional association." An association as defined in
26section 9302 (relating to application of chapter).
27"Professional health service corporation." A professional
28health service corporation as defined in 40 Pa.C.S. § 6302
29(relating to definitions).
30* * *
1"Property." All property, whether real, personal or mixed,
2or tangible or intangible, or any right or interest therein,
3including rights under contracts and other binding agreements.
4"Public organic record." The document the public filing of
5which by the department or a similar agency in another
6jurisdiction is required to form an association. The term
7includes any amendment or restatement of the document and
8includes the following:
9(1) The articles of incorporation of a corporation for
10profit.
11(2) The articles of incorporation of a corporation not-
12for-profit.
13(3) The certificate of limited partnership of a limited
14partnership.
15(4) The certificate of organization of a limited
16liability company.
17(5) The articles of association of a professional
18association.
19(6) The declaration of trust or other instrument of a
20business trust or statutory trust which has been filed by the
21department or a similar agency in another jurisdiction.
22"Receipt." Actual coming into possession.
23"Receive." To actually come into possession.
24* * *
25"Registered corporation." A corporation defined in section
262502 (relating to registered corporation status).
27"Registered foreign association." A foreign association that
28is registered to do business in this Commonwealth pursuant to a
29filing in the department.
30* * *
1["Savings association." An association as defined in section
2102(3) of the former act of December 14, 1967 (P.L.746, No.345),
3known as the Savings Association Code of 1967.]
4* * *
5"Transfer." Includes:
6(1) an assignment;
7(2) a conveyance;
8(3) a sale;
9(4) a lease;
10(5) an encumbrance, including a mortgage or security
11interest;
12(6) a gift; and
13(7) a transfer by operation of law.
14"Type." When used with respect to an association, a generic
15form:
16(1) recognized at common law; or
17(2) organized under an organic law, whether or not some
18associations organized under that organic law are subject to
19provisions of that law which create different categories of
20the form of association.
21"Unincorporated nonprofit association." A nonprofit
22association as defined in section 9112 (relating to
23definitions).
24* * *
25(b) Application of definitions.--The words and phrases
26defined in subsection (a) shall have the same meanings when used
27in 54 Pa.C.S. (relating to names) except to the extent those
28meanings are inconsistent with the provisions of that title.
29Section 1.3. Section 109(b) of Title 15 is amended to read:
30§ 109. Name of commercial registered office provider in lieu of
1registered address.
2* * *
3(b) Statement of address of commercial registered office.--A
4domestic [business corporation or qualified foreign business
5corporation, partnership or other] or registered foreign
6association engaged in the business of maintaining registered
7offices in this Commonwealth for corporations or other
8associations may file in the department a statement of address
9of commercial registered office executed by the representing
10association or a division thereof and setting forth:
11(1) The name of the representing association.
12(2) The form of organization of the representing
13association.
14(3) A statement that it is in the business of
15maintaining registered offices in this Commonwealth for
16corporations or other associations.
17(4) The address, including street and number, if any, of
18a place of business of the representing association in this
19Commonwealth to which communications and other matters
20directed to each person represented by it may be delivered.
21* * *
22Section 2. Title 15 is amended by adding sections to read:
23§ 112. Receipt of electronic communications.
24(a) Requirements.--Unless otherwise provided in the organic
25rules of an entity or otherwise agreed between the sender and
26the recipient, an electronic communication is received when it:
27(1) enters an information processing system that the
28recipient has designated or uses for the purpose of receiving
29electronic records or information of the type sent and from
30which the recipient is able to retrieve the electronic
1record; and
2(2) is in a form capable of being processed by that
3system.
4(b) Awareness not required.--An electronic communication is
5received under subsection (a) even if no individual is aware of
6its receipt.
7(c) Presumption.--Receipt of an electronic acknowledgment
8from an information processing system described in subsection
9(a) establishes that a communication was received but, by
10itself, does not establish that the content sent corresponds to
11the content received.
12§ 113. Delivery of document.
13(a) Permissible means.--Permissible means of delivery of a
14document in record form include:
15(1) personal delivery;
16(2) mail;
17(3) conventional commercial practice; and
18(4) electronic transmission.
19(b) Delivery to department.--Delivery to the department of a
20document in record form is effective only on receipt by the
21department.
22(c) Delivery by department.--Except as provided by law other
23than this title, the department may deliver a document in record
24form to a person by delivering it:
25(1) in person to the person that submitted it for
26filing;
27(2) to the address of the person's registered office;
28(3) to the principal office address of the person; or
29(4) to another address the person provides to the
30department for delivery.
1Section 2.1. Section 133(a)(3) of Title 15 is amended by
2adding a subparagraph to read:
3§ 133. Powers of Department of State.
4(a) General rule.--The department has the power and
5authority reasonably necessary to enable it to administer this
6subchapter efficiently and to perform the functions specified in
7section 132 (relating to functions of Department of State), in
813 Pa.C.S. (relating to commercial code) and in 17 Pa.C.S.
9(relating to credit unions). The following shall not be agency
10regulations for the purposes of section 612 of the act of April
119, 1929 (P.L.177, No.175), known as The Administrative Code of
121929, the act of October 15, 1980 (P.L.950, No.164), known as
13the Commonwealth Attorneys Act, the act of June 25, 1982
14(P.L.633, No.181), known as the Regulatory Review Act, or any
15similar provision of law, but shall be subject to the
16opportunity of public comment requirement under section 201 of
17the act of July 31, 1968 (P.L.769, No.240), referred to as the
18Commonwealth Documents Law:
19* * *
20(3) Regulations, which the department is hereby
21authorized to promulgate, that:
22* * *
23(vi) Specify the symbols or characters which:
24(A) do not make a name distinguishable on the
25records of the department; or
26(B) may be used in the name of an entity.
27* * *
28Section 2.2. Section 135(e)(1) of Title 15 is amended to
29read:
30§ 135. Requirements to be met by filed documents.
1* * *
2(e) Distinguishable names.--A name shall not be considered
3distinguishable upon the records of the department from another
4name for purposes of this title and 54 Pa.C.S. (relating to
5names) solely because the names differ from each other in any or
6all of the following respects:
7(1) Use of punctuation marks and of symbols or
8characters specified by regulation of the department under
9section 133(a)(3)(vi) (relating to powers of department of
10State).
11* * *
12Section 3. Section 136(c) of Title 15 is amended and the
13section is amended by adding a subsection to read:
14§ 136. Processing of documents by Department of State.
15* * *
16(c) Effective date and time.--Except as otherwise provided
17in this title and subject to sections 138 (relating to statement
18of correction) and 141 (relating to <-withdrawal <-abandonment of
19filing before effectiveness), a document [shall become] filed by
20the department under a provision of this title is effective
21[upon the filing thereof in the department.]:
22(1) on the date and at the time of its delivery to the
23department;
24(2) on the date of delivery and at the time specified in
25the document as its effective time, if the time specified is
26later than the time under paragraph (1); or
27(3) at a specified delayed effective date and:
28(i) at a specified time; or
29(ii) if no time is specified, at 12:01 a.m. on the
30date specified.
1* * *
2(e) Redaction of information.--If law other than this title
3prohibits the disclosure by the department of information
4contained in a document in record form delivered to the
5department for filing, the department shall accept the document
6if it otherwise complies with this title but may redact the
7information.
8Section 3.1. Section 138 of Title 15 is amended to read:
9§ 138. Statement of correction.
10(a) Filing of statement.--Whenever any document authorized
11or required to be [filed in the Department of State] delivered
12to the department for filing by any provision of this title has
13been so filed and is an inaccurate record of the [corporate or
14other] action therein referred to or was defectively or
15erroneously executed, the document may be corrected by [filing
16in the department] delivering to the department for filing a
17statement of correction [of the document]. The statement of
18correction, except as provided in subsection (c), shall be
19[executed] signed by the association or other person that
20[effected the] delivered the inaccurate, defective or erroneous
21document for filing and shall set forth:
22(1) The name of the association or other person and,
23subject to section 109 (relating to name of commercial
24registered office provider in lieu of registered address),
25the location, including street and number, if any, of its
26registered or other office.
27(2) The statute by or under which the [corporation was
28incorporated] association was formed, or the preceding filing
29was made, in the case of a filing that does not constitute a
30part of the [articles of incorporation of a corporation]
1public organic record of an association.
2(3) The inaccuracy or defect to be corrected.
3(4) The portion of the document requiring correction in
4corrected form or, if the document was erroneously executed,
5a statement that the original document shall be deemed
6reexecuted or stricken from the records of the department, as
7the case may be.
8(b) Effect of filing.--
9(1) The corrected document shall be effective:
10(i) Upon filing in the department, as to those
11persons who are substantially and adversely affected by
12the correction.
13(ii) As of the date the original document was
14effective, as to all other persons.
15(2) A filing under this section shall not have the
16effect of causing [original articles of incorporation of a
17corporation or a similar type of document creating any other
18form of association] the original public organic record of an
19association to be stricken from the records of the department
20but the [articles or other document] public organic record
21may be corrected under this section.
22(c) Filing pursuant to court order.--If the association or
23other person refuses to [file] deliver to the department for
24filing an appropriate statement of correction under this section
25within ten business days after any person adversely affected has
26made a [written demand therefor] demand in record form for the
27correction, the affected person may apply to the court for an
28order to compel the filing. If the court finds that a document
29on file in the department is inaccurate [or defective],
30defective or erroneous, it may direct the association or other
1person who effected the inaccurate, defective or erroneous
2filing to [file] deliver to the department for filing an
3appropriate statement of correction [in the department], or it
4may order the clerk to execute the statement under the seal of
5the court and cause the statement to be [filed in the
6department] delivered to the department for filing. In the
7absence of fraud, an application may not be made to a court
8under this subsection with respect to a document more than one
9year after the date on which it was originally filed in the
10department.
11(d) Cross reference.--See section 135 (relating to
12requirements to be met by filed documents).
13Section 4. Section 139(a) of Title 15 is amended and the
14section is amended by adding a subsection to read:
15§ 139. Tax clearance of certain fundamental transactions.
16(a) [General rule] Requirement.--Except as provided in
17subsection (c) or (d), [a domestic association shall not file
18articles or a certificate of merger or consolidation effecting a
19merger or consolidation into a nonqualified foreign association
20or articles or a certificate of dissolution or a statement of
21revival, a qualified foreign association shall not file an
22application for termination of authority or similar document in
23the Department of State and a domestic association shall not
24file articles or a certificate of division dividing solely into
25nonqualified foreign associations unless the articles,
26certificate, application or other document are accompanied by]
27clearance certificates from the Department of Revenue and the
28[Office of Employment Security of the] Department of Labor and
29Industry, evidencing the payment by the association of all taxes
30and charges due the Commonwealth required by law[.] must be
1delivered to the department for filing when any of the following
2is delivered to the department for filing:
3(1) Articles or a statement or certificate of merger
4merging a domestic association into a nonregistered foreign
5association.
6(2) Articles or a statement or certificate of conversion
7or domestication effecting a conversion or domestication of a
8domestic association into a nonregistered foreign
9association.
10(3) Articles or a certificate of dissolution or a
11statement of revival of a domestic association.
12(4) An application for termination of registration<-,
13statement of withdrawal or similar document by a registered
14foreign association.
15(5) Articles or a statement or certificate of division
16dividing a domestic association solely into foreign
17associations.
18* * *
19(d) Registration of foreign associations.--It shall not be
20necessary to deliver clearance certificates under subsection (a)
21if, simultaneously with the delivery of the articles, statement
22or certificate of merger, conversion, division or domestication:
23(1) the foreign association that is the surviving,
24converted or domesticated association registers to do
25business in this Commonwealth; or
26(2) at least one of the new foreign associations
27resulting from the division registers to do business in this
28Commonwealth.
29Section 5. Title 15 is amended by adding sections to read:
30§ 141. <-Withdrawal <-Abandonment of filing before effectiveness.
1(a) General rule.--A document in record form delivered to
2the department for filing may be <-withdrawn <-abandoned before it
3takes effect by delivering to the department for filing a
4statement of <-withdrawal, except that a document that may be
5abandoned under any of the following sections may not be
6withdrawn under this section:
7Section 334 (relating to amendment or abandonment of plan
8of merger).
9Section 344 (relating to amendment or abandonment of plan
10of interest exchange).
11Section 354 (relating to amendment or abandonment of plan
12of conversion).
13Section 365 (relating to amendment or abandonment of plan
14of division).
15Section 374 (relating to amendment or abandonment of plan
16of domestication). <-abandonment.
17(b) Requirements for statement of <-withdrawal <-abandonment.--A
18statement of withdrawal <-abandonment must:
19(1) be signed by a person with the authority to sign the
20statement; <-and
21(2) identify the document to be <-withdrawn <-abandoned; and
22(3) state that abandonment of the document has been
23validly approved.
24(c) Effect of statement of <-withdrawal abandonment.--Upon
25filing by the department of a statement of <-withdrawal
<-26abandonment, the action or transaction evidenced by the original
27document shall not take effect.
28§ 142. Effect of signing filings.
29(a) Affirmation of truth.--Signing a document delivered to
30the department for filing is an affirmation under the penalties
1provided in 18 Pa.C.S. § 4904 (relating to unsworn falsification
2to authorities) that the facts stated in the document are true
3in all material respects.
4(b) Signature by agent or legal representative.--A document
5filed under this title may be signed by an agent. If this title
6requires a particular individual to sign a document and the
7individual is deceased or incompetent, the document may be
8signed by a legal representative of the individual on behalf of
9the individual.
10(c) Affirmation of authority.--A person that signs a
11document delivered to the department for filing affirms as a
12fact that the person is authorized to sign the document.
13§ 143. Liability for inaccurate information in filing.
14If a document that is delivered to the department for filing
15under this title and filed by the department contains inaccurate
16information at the time of delivery to the department, a person
17that suffers a loss by reliance on the information may recover
18damages for the loss from a person that signed the document or
19caused another to sign it on behalf of the person and knew at
20the time the document was delivered that the information was
21inaccurate.
22§ 144. Signing and filing pursuant to judicial order.
23(a) Petition.--If a person required by this title to sign a
24document or deliver a document to the department for filing
25under this title does not do so, another person that is
26aggrieved may petition the court to order:
27(1) the person to sign the document;
28(2) the person to deliver the document to the department
29for filing; or
30(3) the department to file the document unsigned.
1(b) Association.--If a petitioner under subsection (a) is
2not the association to which the document pertains, the
3petitioner shall make the association a party to the action.
4(c) Effect.--A record filed under subsection (a)(3) is
5effective without being signed.
6§ 145. Subsistence certificate.
7(a) General rule.--On request of a person, the department
8shall issue:
9(1) a subsistence certificate for a domestic filing
10entity or domestic limited liability partnership; or
11(2) a certificate of registration for a registered
12foreign association.
13(b) Contents of certificate.--A certificate under subsection
14(a) must state:
15(1) the name of the domestic filing entity or domestic
16limited liability partnership or the name under which the
17registered foreign association is registered in this
18Commonwealth.
19(2) in the case of a domestic filing entity or domestic
20limited liability partnership, that the entity is currently
21subsisting on the records of the department; and
22(3) in the case of a registered foreign association,
23that it is registered to do business in this Commonwealth.
24(c) Effect of certificate.--Subject to any qualification
25stated in the certificate, a certificate issued by the
26department under subsection (a) may be relied on as conclusive
27evidence of the facts stated in the certificate.
28Section 5.1. Paragraph (6) of the definition of "ancillary
29transaction" in section 152 of Title 15 is amended and the
30definition is amended by adding a paragraph to read:
1§ 152. Definitions.
2The following words and phrases when used in this subchapter
3shall have the meanings given to them in this section unless the
4context clearly indicates otherwise:
5"Ancillary transaction." Includes:
6* * *
7(6) any transaction similar to any item listed in
8paragraphs (1) through (5); [or]
9(6.1) withdrawal, abandonment or termination of a
10document which has been delivered to the department for
11filing but has not yet become effective; or
12* * *
13Section 6. Section 153(a) of Title 15 is amended to read:
14§ 153. Fee schedule.
15(a) General rule.--The nonrefundable fees of the bureau,
16including fees for the public acts and transactions of the
17Secretary of the Commonwealth administered through the bureau,
18shall be as follows:
19[(1) Domestic corporations: |
| |||||
20(i) Articles of incorporation, letters |
$125 | |||||
23(ii) Articles or agreement or similar |
70 | |||||
25(iii) Additional fee for each association |
40 | |||||
27(iv) Additional fee for each new association |
125 | |||||
29(v) Articles of conversion or a similar |
70 | |||||
1(vi) Each ancillary transaction............. | 70 | |||||
2(2) Foreign corporations: |
| |||||
3(i) Certificates of authority or similar |
250 |
5(ii) Amended certificate of authority or |
250 |
7(iii) Domestication......................... | 125 |
8(iv) Statement of merger or consolidation or |
70 |
12(v) Additional fee for each qualified |
40 |
15(vi) Each ancillary transaction............. | 70 |
16(3) Partnerships and limited liability companies: |
|
17(i) Certificate of limited partnership or |
125 |
22(ii) Certificate of merger, consolidation or |
70 |
24(iii) Additional fee for each association |
40 |
26(iv) Additional fee for each new association |
125 |
28(v) Application for registration of foreign |
250 |
30(vi) Certificate of amendment of
1registration of foreign limited partnership or |
250 |
3(vii) Statement of registration of |
125 |
6(viii) Domestication of foreign limited |
125 |
8(ix) Each ancillary transaction............. | 70 |
9(4) Unincorporated nonprofit associations: |
|
10(i) Statement appointing an agent to receive |
70 |
12(ii) Resignation of appointed agent.......... | 40 |
13(iii) Amendment or cancellation of statement |
70 |
15(5) Business trusts: |
|
16(i) Deed of trust or other initial |
125 |
19(ii) Each ancillary transaction.............. | 70 |
20(6) Fictitious names: |
|
21(i) Registration............................ | 70 |
22(ii) Each ancillary transaction............. | 70 |
23(7) Service of process: |
|
24(i) Each defendant named or served.......... | 70 |
25(ii) (Reserved)............................. |
|
26(8) Trademarks, emblems, union labels, |
|
28(i) Trademark registration.................. | 50 |
29(ii) Each ancillary trademark transaction... | 50 |
30(iii) Any other registration under this
1paragraph........................................ |
70 |
2(iv) Any other ancillary transaction under |
70 |
4(9) Uniform Commercial Code: As provided in 13 |
|
6(10) Copy fees, including copies furnished under |
|
8(i) Each page of photocopy furnished........ | 3 |
9(ii) (Reserved)............................. |
|
10(11) Certification fees: |
|
11(i) For certifying copies of any document or |
40 |
14(ii) (Reserved)............................. |
|
15(iii) For issuing any other certificate of |
40 |
18(12) Report of record search other than a search 19under paragraph (9): |
|
20(i) For preparing and providing a report of |
15 |
23(ii) (Reserved)............................. |
|
24(13) Reservation and registration of names: |
|
25(i) Reservation of association name......... | 70 |
26(ii) Registration of foreign or other |
70 |
28(14) Change of registered office or address: |
|
29(i) Each statement of change of registered |
5 | |||||
1(ii) Each statement or certificate of change |
5 | |||||
3(iii) Each statement of change of address... | 5 | |||||
4(15) Contingent domestication: |
|
5(i) Statement of contingent domestication... | 125 |
6(ii) Each year, or portion of a year, during |
1,500 |
9(16) Expedited service: |
|
10(i) For the processing of any filing under |
1,000 |
15(ii) For the processing of any filing under 20................................................. |
300 |
21(iii) For processing of any filing under |
100] |
25(1) Domestic corporations: |
|
26(i) Articles of incorporation, letters patent |
$125 |
28(ii) Each ancillary transaction.............. | 70 |
29(2) Foreign associations: |
|
30(i) Registration statement or similar
1qualifications to do business..................... |
250 |
2(ii) Amendment of registration statement or |
250 |
4(iii) Domestication of alien association |
250 |
7(iv) Statement of merger, division or |
70 |
11(v) Additional fee for each qualified foreign |
40 |
14(vi) Each ancillary transaction.............. | 70 |
15(3) Partnerships and limited liability companies: |
|
16(i) Certificate of limited partnership or |
125 |
19(ii) Statement of registration of registered |
125 |
22(iii) Each ancillary transaction............. | 70 |
23(4) Unincorporated nonprofit associations: |
|
24(i) Statement appointing an agent to receive |
70 |
26(ii) Resignation of appointed agent.......... | 40 |
27(iii) Amendment or cancellation of statement |
70 |
29(5) Business trusts: |
|
30(i) Declaration of trust or other initial
1instrument for a business trust................... |
125 |
2(ii) Each ancillary transaction.............. | 70 |
3(6) Fictitious names: |
|
4(i) Registration............................. | 70 |
5(ii) Each ancillary transaction.............. | 70 |
6(7) Service of process: |
|
7(i) Each defendant named or served........... | 70 |
8(ii) (Reserved). |
|
9(8) Trademarks, emblems, union labels, |
|
11(i) Trademark registration................... | 50 |
12(ii) Each ancillary trademark transaction.... | 50 |
13(iii) Another registration under this |
70 |
15(iv) Another ancillary transaction under this |
70 |
17(9) Uniform Commercial Code: |
|
| |
20(ii) (Reserved). |
|
21(10) Copy fees, including copies furnished under |
|
23(i) Each page furnished......... | 3 |
24(ii) (Reserved). |
|
25(11) Certification fees: |
|
26(i) For certifying copies of a document or |
40 |
29(ii) (Reserved). |
|
30(iii) For issuing any other certificate of
1the Secretary of the Commonwealth or the |
40 |
3(iv) For preparing and issuing an engrossed |
125 |
5(12) Report of record search other than a search |
|
7(i) For preparing and providing a report of a |
15 |
10(ii) (Reserved). |
|
11(13) Reservation and registration of names: |
|
12(i) Reservation of association name.......... | 70 |
13(ii) Registration of foreign association name | 70 |
14(14) Change of registered office or address: |
|
15(i) Each statement of change of registered |
5 |
17(ii) Each statement or certificate of change |
5 |
19(iii) Each statement of change of address.... | 5 |
20(15) Expedited service: |
|
21(i) For the processing of a filing under this |
1,000 |
26(ii) For the processing of a filing under |
300 |
30(iii) For processing of a filing under this
1title or 13 Pa.C.S. which is received by the |
100 |
4(16) Entity transactions: |
|
5(i) Statement of merger, interest exchange, |
70 |
7(ii) Additional fee for each association that |
40 |
9(iii) Additional fee for each new association |
125 |
11(iv) Each ancillary transaction.............. | 70 |
12(17) Special processing fees: |
|
13(i) Request that multiple documents delivered |
70 |
16(ii) (Reserved). |
|
17* * *
18Section 7. Subchapter D heading of Chapter 1 of Title 15 is
19amended to read:
20SUBCHAPTER D
21[DEFINITIVE AND CONTINGENT] DOMESTICATION
22OF CERTAIN ALIEN ASSOCIATIONS
23Section 8. Section 161(b) introductory paragraph, (1) and
24(5), (e) and (f) of Title 15 are amended to read:
25§ 161. Domestication of certain alien associations.
26* * *
27(b) Statement of domestication.--The statement of
28domestication shall be [executed] signed by the association and
29shall set forth in the English language:
30(1) The name of the association. If the name is in a
1foreign language, it shall be set forth in Roman letters or
2characters or Arabic or Roman numerals. If the name is one
3that is rendered unavailable for use by a [corporation by any
4provision of section 1303(b) or (c) (relating to corporate
5name)] domestic entity by section 202(b) or (c) (relating to
6requirements for names generally), the association shall
7adopt a new name, in accordance with any procedures for
8changing the name of the association that are applicable
9prior to the domestication of the association, and shall set
10forth the new name in the statement.
11* * *
12(5) A statement that the filing of the statement of
13domestication and, if desired, the renunciation of the prior
14domicile has been authorized (unless its [charter or other
15organic documents] organic rules require a greater vote) by a
16majority in interest of the [shareholders, members or other
17proprietors] interest holders of the association.
18* * *
19(e) Exclusion.--An association that can be domesticated
20under [any of the following sections shall not be domesticated
21under this section:
22Section 4161 (relating to domestication).
23Section 6161 (relating to domestication).
24Section 8590 (relating to domestication).
25Section 8982 (relating to domestication).
26Section 9501(a)(1)(ii) (relating to application and effect of
27chapter)] Subchapter G of Chapter 3 (relating to domestication)
28shall not be domesticated under this section.
29(f) Definition.--As used in this section, the term
30"association," except as restricted by subsection (e), includes
1any [alien] incorporated organization, private law corporation
2(whether or not organized for business purposes), public law
3corporation, partnership, proprietorship, joint venture,
4foundation, trust, association or similar organization or entity
5existing under the laws of any jurisdiction other than this
6Commonwealth.
7* * *
8Section 8.1. Section 162 of Title 15 is repealed:
9[§ 162. Contingent domestication of certain alien associations.
10(a) General rule.--Any association as defined in subsection
11(i) may become a contingent domestic association by filing in
12the Department of State a statement of contingent domestication.
13The statement of contingent domestication and all papers and
14information relating thereto shall remain confidential and shall
15not be available for public inspection until and unless the
16association files a statement of consummation of domestication
17as provided in subsection (c).
18(b) Statement of contingent domestication.--The statement of
19contingent domestication shall be executed by the association
20and shall set forth in the English language:
21(1) In the case of:
22(i) a corporation subject to section 4161 (relating
23to domestication), the statements required to be set
24forth in articles of domestication (except the statement
25required by section 4161(b)(6));
26(ii) a corporation subject to section 6161 (relating
27to domestication), the statements required to be set
28forth in articles of domestication (except the statement
29required by section 6161(b)(6));
30(iii) a limited partnership subject to section 8590
1(relating to domestication), the statements required to
2be set forth in a certificate of domestication (except
3the statement required by section 8590(b)(5));
4(iv) a limited liability company subject to section
58982 (relating to domestication), the statements required
6to be set forth in a certificate of domestication (except
7the statement required by section 8982(b)(5));or
8(v) any other association, the statements required
9by section 161(b) (relating to statement of
10domestication) to be set forth in a statement of
11domestication (except the statement required by section
12161(b)(5)).
13(2) A statement that the effectiveness of the statement
14is contingent upon the subsequent filing of a statement of
15consummation of domestication.
16(3) A statement that the filing of the statement of
17contingent domestication and the delegation of authority to
18file a statement of consummation of domestication has been
19authorized (unless its charter or other organic documents
20require a greater vote):
21(i) by a majority vote of the votes cast by all
22shareholders entitled to vote thereon and, if any class
23of shares is entitled to vote thereon as a class, a
24majority of the votes cast in each class vote, in the
25case of a corporation subject to section 4161;
26(ii) by a majority vote of the votes cast by all
27members, if any, entitled to vote thereon and, if any
28class of members is entitled to vote thereon as a class,
29a majority of the votes cast in each class vote, in the
30case of a corporation subject to section 6161;
1(iii) by a majority vote of the votes cast by all
2partners entitled to vote thereon and, if any class of
3partners is entitled to vote thereon as a class, a
4majority of the votes cast in each class vote, in the
5case of a limited partnership subject to section 8590;
6(iv) by a majority vote of the votes cast by all
7members entitled to vote thereon and, if any class of
8members is entitled to vote thereon as a class, a
9majority of the votes cast in each class vote, in the
10case of a limited liability company subject to section
118982; or
12(v) by a majority in interest of the shareholders,
13members or other proprietors of the association in any
14other case.
15(c) Statement of consummation of domestication.--At any time
16after the filing of a statement of contingent domestication, the
17association may file in the department a statement of
18consummation of domestication which shall be executed by the
19association and shall set forth:
20(1) The name of the association as set forth in its
21statement of contingent domestication.
22(2) A statement that either:
23(i) an emergency condition exists in the
24jurisdiction the law of which governs the internal
25affairs of the association and that in the judgment of
26the management of the association a temporary transfer of
27the domicile of the association to this Commonwealth is
28warranted by the circumstances; or
29(ii) an event has occurred that, under the law of
30the jurisdiction governing the internal affairs of the
1association, permits the association to transfer its
2domicile.
3(d) Statement of termination of domestication.--At any time
4after the filing of a statement of consummation of
5domestication, the association may file in the department a
6statement of termination of domestication which shall be
7executed by the association and shall set forth:
8(1) The name of the association in the form set forth in
9the prior filings under this section.
10(2) If a statement of consummation of domestication has
11theretofore been filed and is then in effect, a statement
12that the association elects to terminate its domicile in this
13Commonwealth.
14(3) A statement that either:
15(i) the statement of contingent domestication is
16reinstated pending the filing in the department of a new
17statement of consummation of domestication; or
18(ii) the statement of contingent domestication is
19withdrawn.
20(e) Execution of filings.--All documents filed under this
21section shall be signed on behalf of the association by any
22authorized person.
23(f) Effect of filing statement of consummation of
24domestication.--Upon the filing of a statement of consummation
25of domestication, and until the filing of a statement of
26termination of domestication, the association shall have the
27status under the law of this Commonwealth of:
28(1) a business corporation domesticated under section
294161, in the case of a corporation subject to that section;
30(2) a nonprofit corporation domesticated under section
16161, in the case of a corporation subject to that section;
2(3) a limited partnership domesticated under section
38590, in the case of a limited partnership subject to that
4section;
5(4) a limited liability company domesticated under
6section 8982, in the case of a limited liability company
7subject to that section; or
8(5) an association domesticated under section 161, in
9any other case.
10(g) Effect of filing a statement of termination of
11domestication.--Upon the filing of a statement of termination of
12domestication, the association shall under the law of this
13Commonwealth revert to the status it held prior to the filing
14of:
15(1) the statement of consummation of domestication, if
16the statement of termination of domestication states that the
17statement of contingent domestication is reinstated; or
18(2) the statement of contingent domestication, if the
19statement of termination of domestication states that the
20statement of contingent domestication is withdrawn.
21(h) Annual renewal.--A renewal application may be filed
22between October 1 and December 31 in each year and shall extend
23the applicability of this section for the following calendar
24year. Otherwise the association shall not be entitled to any of
25the benefits of this section. See section 153(a)(14) (relating
26to contingent domestication).
27(i) Definition.--As used in this section, the term
28"association" includes any incorporated organization, private
29law corporation (whether or not organized for business
30purposes), public law corporation, partnership, proprietorship,
1joint venture, foundation, trust, association or similar
2organization or entity if such association or entity immediately
3prior to effecting an initial filing under this section is an
4association or entity governed by the law of any jurisdiction
5other than the United States or any state, Puerto Rico or any
6possession or territory of the United States.
7(j) Cross references.--See sections 134 (relating to
8docketing statement) and 135 (relating to requirements to be met
9by filed documents).]
10Section 9. Title 15 is amended by adding chapters to read:
11CHAPTER 2
12ENTITIES GENERALLY
13Subchapter
14A. Names
15B. (Reserved)
16SUBCHAPTER A
17NAMES
18Sec.
19201. Definitions.
20202. Requirements for names generally.
21203. Corporation names.
22204. Partnership and limited liability company names.
23205. Business trust names.
24206. Requirements for foreign association names.
25207. Required name changes by senior associations.
26208. Reservation of name.
27209. Registration of name of nonregistered foreign association.
28§ 201. Definitions.
29The following words and phrases when used in this subchapter
30shall have the meanings given to them in this section unless the
1context clearly indicates otherwise:
2"Covered association." Any of the following:
3(1) a domestic filing entity;
4(2) a domestic limited liability partnership;
5(3) an electing partnership; or
6(4) a registered foreign association.
7"Proper name." The name set forth in:
8(1) the public organic record of a domestic filing
9association;
10(2) the statement of registration of a limited liability
11partnership;
12(3) the statement of election of an electing
13partnership; or
14(4) the statement of registration of a registered
15foreign association under section 412(a)(1)(i) (relating to
16foreign registration statement) or, if that name does not
17comply with this section, the name set forth in the statement
18under section 412(a)(1)(ii).
19§ 202. Requirements for names generally.
20(a) General rule.--The proper name of a covered association
21may be in any language, but it must be expressed in Roman
22letters or characters, Arabic or Roman numerals or symbols or
23characters specified by regulation of the department under
24section 133(a)(3)(vi) (relating to powers of Department of
25State).
26(b) Duplicate use of names.--Except as provided in
27subsection (f), the proper name of a covered association must be
28distinguishable on the records of the department from the
29following:
30(1) The proper name of another covered association or
1the name of an association registered at any time under 54
2Pa.C.S. Ch. 5 (relating to corporate and other association
3names), unless the covered association or other association
4has:
5(i) stated that it is about to change its name, is
6about to cease to do business, is being wound up or is a
7foreign association about to withdraw from doing business
8in this Commonwealth, and the statement and a consent to
9the adoption of the name are delivered to the department
10for filing;
11(ii) filed a tax return or certificate with the
12Department of Revenue indicating that the covered
13association or other association is out of existence or
14has failed for a period of three successive years to file
15with the Department of Revenue a report or return
16required by law and the fact of the failure has been
17certified by the Department of Revenue to the Department
18of State;
19(iii) abandoned its name under the laws of its
20jurisdiction of formation, by amendment, merger,
21consolidation, division, expiration, dissolution or
22otherwise, without its name being adopted by a successor,
23and an official record of that fact, certified as
24provided under 42 Pa.C.S. § 5328 (relating to proof of
25official records), is presented by a person to the
26department; or
27(iv) had the registration of its name under 54
28Pa.C.S. Ch. 5 terminated.
29(2) A name that has been reserved or registered pursuant
30to section 208 (relating to reservation of name) or 209
1(relating to registration of name of nonregistered foreign
2association). A name shall be rendered unavailable for use
3under this subchapter by reason of the filing by the
4department of an assumed or fictitious name registration
5under 54 Pa.C.S. Ch. 3 (relating to fictitious names) only to
6the extent expressly provided in 54 Pa.C.S. Ch. 3.
7(c) Required approvals or conditions.--
8(1) The proper name of a covered association shall not
9imply that the association is:
10(i) A governmental agency of the Commonwealth or of
11the United States.
12(ii) A bank, bank and trust company, savings bank,
13private bank or trust company, as defined in the act of
14November 30, 1965 (P.L.847, No.356), known as the Banking
15Code of 1965, unless:
16(A) The association is a Pennsylvania bank
17holding company or is otherwise authorized by statute
18to use its name.
19(B) The association is a nonprofit corporation
20holding property in trust under section 5547
21(relating to authority to take and hold trust
22property) and has been converted from a trust company
23under Subchapter E of Chapter 3 (relating to
24conversion). The preceding sentence controls over
25section 805(b) of the Banking Code of 1965.
26(iii) An insurance company, nor contain any of the
27words "annuity," "assurance," "beneficial," "bond,"
28"casualty," "endowment," "fidelity," "fraternal,"
29"guaranty," "indemnity," "insurance," "insurer,"
30"reassurance," "reinsurance," "surety" or "title" when
1used in a manner as to imply that the association is
2engaged in the business of writing insurance or
3reinsurance as principal or any other words of like
4purport unless it is duly licensed as an insurance
5company by its jurisdiction of formation or the Insurance
6Department certifies that it has no objection to the use
7by the association or proposed association of the
8designation. The proper name of a domestic insurance
9company shall:
10(A) contain the word "mutual" only if it is a
11mutual insurance company; and
12(B) clearly designate the object and purpose of
13the association.
14(iv) A public utility furnishing electric or gas
15service to the public, unless the association or proposed
16association has as an express purpose the furnishing of
17service subject to the jurisdiction of the Pennsylvania
18Public Utility Commission or the Federal Energy
19Regulatory Commission.
20(v) A credit union. See 17 Pa.C.S. § 104 (relating
21to prohibition on use of words "credit union").
22(2) The proper name of a covered association shall not
23contain:
24(i) The word "college," "university" or "seminary"
25when used in a manner as to imply that it is an
26educational institution conforming to the standards and
27qualifications prescribed by the State Board of
28Education, unless there is submitted a certificate from
29the Department of Education certifying that the
30association or proposed association is entitled to use
1that designation.
2(ii) Words that constitute blasphemy, profane
3cursing or swearing or that profane the Lord's name.
4(iii) The words "engineer" or "engineering,"
5"surveyor" or "surveying" or any other word implying that
6any form of the practice of engineering or surveying as
7defined in the act of May 23, 1945 (P.L.913, No.367),
8known as the Engineer, Land Surveyor and Geologist
9Registration Law, is provided unless at least one of the
10individuals signing the initial public organic record of
11the association or one of the governors of the existing
12association has been properly registered with the State
13Registration Board for Professional Engineers in the
14practice of engineering or surveying and there is
15submitted to the department a certificate from the board
16to that effect.
17(iv) The words "architect" or "architecture" or any
18other word implying that any form of the practice of
19architecture as defined in the act of December 14, 1982
20(P.L.1227, No.281), known as the Architects Licensure
21Law, is provided unless at least one of the individuals
22signing the initial public organic record of the
23association or one of the governors of the existing
24association has been properly registered with the
25Architects Licensure Board in the practice of
26architecture and there is submitted to the department a
27certificate from the board to that effect.
28(v) The word "cooperative" or an abbreviation
29thereof unless the corporation is a cooperative
30corporation.
1(vi) Any other words prohibited by law. See section
2103 (relating to subordination of title to regulatory
3laws).
4(d) Other rights unaffected.--This section shall not
5abrogate or limit the law as to unfair competition or unfair
6practices nor derogate from the common law, the principles of
7equity or the provisions of 54 Pa.C.S. (relating to names) with
8respect to the right to acquire and protect trade names.
9(e) Remedies for violation of section.--The use of a name in
10violation of this section shall not vitiate or otherwise affect
11the existence or any acts of an association, but a court having
12jurisdiction may enjoin the association from using or continuing
13to use a name in violation of this section on the application
14of:
15(1) the Attorney General, acting on his or her own
16motion or at the instance of an administrative department,
17board or commission of this Commonwealth; or
18(2) a person adversely affected.
19(f) Court-ordered use of name.--Subsection (b) shall not
20apply if an association delivers to the department for filing a
21certified copy of a final judgment of a court of competent
22jurisdiction establishing the right of the association to use a
23name in this Commonwealth.
24§ 203. Corporation names.
25(a) Business corporations.--The proper name of a domestic or
26registered foreign business corporation must contain:
27(1) the word "corporation," "company," "incorporated" or
28"limited" or an abbreviation of any of the terms;
29(2) the word "association," "fund" or "syndicate"; or
30(3) words or abbreviations of like import used in a
1jurisdiction other than this Commonwealth.
2(b) Nonprofit corporations.--The proper name of a domestic
3nonprofit corporation or registered foreign corporation not-for-
4profit shall not be required to contain one of the words or
5abbreviations described under subsection (a).
6§ 204. Partnership and limited liability company names.
7(a) Limited liability partnerships.--The proper name of a
8domestic limited liability partnership or registered foreign
9limited liability partnership must contain the term "company,"
10"limited" or "limited liability partnership," or an abbreviation
11of one of those terms, or words or abbreviations of like import
12used in a jurisdiction other than this Commonwealth.
13(b) Limited partnerships.--The proper name of a domestic or
14registered foreign limited partnership:
15(1) shall not be required to contain a word or
16abbreviation indicating that it is a limited partnership;
17(2) if it is a limited liability limited partnership,
18must contain:
19(i) the term "company," "limited" or "limited
20liability limited partnership" or a term of like import;
21or
22(ii) an abbreviation of a term under subparagraph
23(i); and
24(3) may contain the name of a partner.
25(c) Limited liability companies.--The proper name of a
26domestic limited liability company or registered foreign limited
27liability company must contain the term "company," "limited" or
28"limited liability company," or an abbreviation of one of those
29terms, or words or abbreviations of like import used in a
30jurisdiction other than this Commonwealth.
1§ 205. Business trust names.
2The proper name of a domestic business trust or registered
3foreign business trust shall not be required to contain a word
4or abbreviation indicating that it is a business trust.
5§ 206. Requirements for foreign association names.
6(a) General rule.--The department shall not file a
7registration statement pursuant to section 412 (relating to
8foreign registration statement) for a foreign association that,
9except as provided under subsection (b), has a name that is
10rendered unavailable for use by a covered association under
11section 202(a), (b) or (c)(1)(i), (iii), (iv) or (v) or (2)
12(relating to requirements for names generally).
13(b) Exception.--The provisions of section 202(b) and (c)
14shall not prevent the filing of a registration statement of a
15foreign association setting forth a name that is prohibited by
16section 202(b) and (c) if the foreign association delivers to
17the department for filing a resolution of its governors adopting
18a name for use in registering to do business in this
19Commonwealth that is available for use by a covered association.
20§ 207. Required name changes by senior associations.
21(a) Loss of rights to name.--A covered association shall
22cease to have the exclusive right to its proper name if the
23association:
24(1) has failed to file in the Department of Revenue a
25report or a return required by law;
26(2) has filed in the Department of Revenue a tax return
27or certificate indicating that it is out of existence; or
28(3) has failed to file the most recent required
29decennial filing under 54 Pa.C.S. § 503 (relating to
30decennial filings required).
1(b) Adoption of new name on reactivation.--Upon the removal
2of the reason why a covered association has lost the exclusive
3right to its proper name under subsection (a), the association
4shall make inquiry with the Department of State with regard to
5the availability of its name and, if the name has been
6appropriated by another person, the covered association shall
7adopt a new name in accordance with law before resuming its
8activities.
9(c) Enforcement of undertaking to release name.--If a
10covered association has used a name that is not distinguishable
11on the records of the Department of State from the name of
12another association as permitted by section 202(b)(1) (relating
13to requirements for names generally) and the other association
14continues to use its name in this Commonwealth and does not
15change its name, cease to do business, be wound up or withdraw
16as it proposed to do in its consent or change its name as
17required by subsection (a), any court having jurisdiction may
18enjoin the other association from continuing to use its name or
19a name that is not distinguishable therefrom on the application
20of:
21(1) the Attorney General, acting on his or her own
22motion or at the instance of an administrative department,
23board or commission of this Commonwealth; or
24(2) any person adversely affected.
25§ 208. Reservation of name.
26(a) General rule.--The exclusive right to the use of a name
27may be reserved by any person. The reservation shall be made by
28delivering to the department an application to reserve a
29specified name, signed by the applicant. If the department finds
30that the name is available for use, it shall reserve the name
1for the exclusive use of the applicant for a period of 120 days.
2(b) Transfer of reservation.--The right to exclusive use of
3a name reserved pursuant to subsection (a) may be transferred to
4any other person by delivering to the department a notice in
5record form of the transfer, signed by the person who reserved
6the name, and specifying the name and address of the other
7person.
8(c) Cross references.--See:
9Section 134 (relating to docketing statement).
10Section 135 (relating to requirements to be met by filed
11documents).
12Section 209 (relating to registration of name of
13nonregistered foreign association).
14§ 209. Registration of name of nonregistered foreign
15association.
16(a) General rule.--A nonregistered foreign association may
17register its name under 54 Pa.C.S. Ch. 5 (relating to corporate
18and other association names) if the name is available for use by
19a registered foreign association pursuant to section 206
20(relating to requirements for foreign association names) by
21delivering to the department for filing an application for
22registration of name, signed by the association, setting forth:
23(1) The name of the association.
24(2) The address, including street and number, if any, of
25the principal office of the association.
26(b) Annual renewal.--An association that has in effect a
27registration of its name may renew the registration from year to
28year by annually delivering to the department for filing an
29application for renewal setting forth the facts required to be
30set forth in an original application for registration. A renewal
1application may be filed between October 1 and December 31 in
2each year and shall extend the registration for the following
3calendar year.
4(c) Use of registered name.--A foreign association whose
5name registration is effective may register as a foreign
6association under the registered name or consent in record form
7to the use of that name by another association.
8(d) Cross references.--See sections 134 (relating to
9docketing statement) and 135 (relating to requirements to be met
10by filed documents).
11SUBCHAPTER B
12(RESERVED)
13CHAPTER 3
14ENTITY TRANSACTIONS
15Subchapter
16A. Preliminary Provisions
17B. Approval of Entity Transactions
18C. Merger
19D. Interest Exchange
20E. Conversion
21F. Division
22G. Domestication
23SUBCHAPTER A
24PRELIMINARY PROVISIONS
25Sec.
26311. Short title of chapter.
27312. Definitions.
28313. Relationship of chapter to other provisions of law.
29314. Regulatory conditions and required notices and approvals.
30315. Nature of transactions.
1316. Contents of plan.
2317. Contractual dissenters rights in entity transactions.
3318. Excluded entities and transactions.
4319. Party to plan or transaction.
5320. Submission of matters to interest holders.
6§ 311. Short title of chapter.
7This chapter shall be known and may be cited as the Entity
8Transactions Law.
9§ 312. Definitions.
10(a) Definitions.--The following words and phrases when used
11in this chapter shall have the meanings given to them in this
12subsection unless the context clearly indicates otherwise:
13"Acquired association." The domestic entity or foreign
14association, all of one or more classes or series of interests
15in which are acquired in an interest exchange.
16"Acquiring association." The domestic entity or foreign
17association that acquires all of one or more classes or series
18of interests of the acquired association in an interest
19exchange.
20"Conversion." A transaction authorized by Subchapter E
21(relating to conversion).
22"Converted association." The converting association as it
23continues in existence after a conversion.
24"Converting association." The domestic entity or domestic
25banking institution that approves a plan of conversion pursuant
26to section 353 (relating to approval of conversion) or the
27foreign association that approves a conversion pursuant to the
28law of its jurisdiction of formation.
29"Dividing association." The domestic entity that approves a
30plan of division pursuant to section 363 (relating to approval
1of division) or 364 (relating to division without interest
2holder approval) or the foreign association that approves a
3division pursuant to the law of its jurisdiction of formation.
4"Division." A transaction authorized by Subchapter F
5(relating to division).
6"Domesticated entity." The domesticating entity as it
7continues in existence after a domestication.
8"Domesticating entity." The domestic entity that approves a
9plan of domestication pursuant to section 373(a) (relating to
10approval of domestication) or the foreign entity that approves a
11domestication pursuant to section 373(b).
12"Domestication." A transaction authorized by Subchapter G
13(relating to domestication).
14"Interest exchange." A transaction authorized by Subchapter
15D (relating to interest exchange).
16"Interest holder liability." Either of the following:
17(1) Personal liability for a liability of an association
18that is imposed on a person either:
19(i) Solely by reason of the status of the person as
20an interest holder.
21(ii) By the organic rules of the association that
22make one or more specified interest holders or categories
23of interest holders liable in their capacity as interest
24holders for all or specified liabilities of the entity.
25(2) An obligation of an interest holder under the
26organic rules of an association to contribute to the
27association.
28"Merger." A transaction in which two or more merging
29associations are combined into a surviving association pursuant
30to a document filed by the department or similar office in
1another jurisdiction.
2"Merging association." A domestic entity, domestic banking
3institution or foreign association that is a party to a merger
4under Subchapter C (relating to merger) and exists immediately
5before the merger becomes effective.
6"New association." An association that is created by a
7division.
8"Plan." A plan of merger, plan of interest exchange, plan of
9conversion, plan of division or plan of domestication, as
10applicable.
11"Protected agreement." Either of the following:
12(1) A record evidencing indebtedness and any related
13agreement in effect on July 1, 2015.
14(2) A protected governance agreement.
15"Protected governance agreement." Either of the following:
16(1) The organic rules of a domestic entity or foreign
17association in effect on {the Legislative Reference Bureau
18shall insert here on the effective date of this chapter}.
19(2) An agreement that is binding on any of the governors
20or interest holders of a domestic entity or foreign
21association on July 1, 2015.
22"Registered office." In the case of a domestic banking
23institution that is a corporation, the principal place of
24business of the corporation set forth in its articles of
25incorporation as required by section 1004 of the act of November
2630, 1965 (P.L.847, No.356), known as the Banking Code of 1965.
27"Resulting association." A dividing association, if it
28survives the division, or a new association.
29"Special treatment." A provision of a plan permitted by
30section 329 (relating to special treatment of interest holders).
1"Surviving association." The domestic entity, domestic
2banking institution or foreign association that continues in
3existence after or is created by a merger under Subchapter C
4(relating to merger).
5(b) Index of definitions.--Following is a nonexclusive list
6of definitions in section 102 (relating to definitions) that
7apply to this chapter:
8"Act" or "action."
9"Banking institution."
10"Department."
11"Dissenters rights."
12"Domestic entity."
13"Entity."
14"Filing entity."
15"Foreign entity."
16"Governor."
17"Interest."
18"Interest holder."
19"Obligation."
20"Organic law."
21"Organic rules."
22"Private organic rules."
23"Property."
24"Public organic record."
25"Record form."
26"Registered foreign association."
27"Representative."
28"Sign."
29"Transfer."
30"Type."
1§ 313. Relationship of chapter to other provisions of law.
2(a) Antitakeover provisions.--A transaction under this
3chapter to which a registered corporation is a party may not
4impair any right or obligation that a person has under, and may
5not make applicable to the corporation, any provision of section
62538 (relating to approval of transactions with interested
7shareholders) or Subchapters E (relating to control
8transactions), F (relating to business combinations), G
9(relating to control-share acquisitions), H (relating to
10disgorgement by certain controlling shareholders following
11attempts to acquire control), I (relating to severance
12compensation for employees terminated following certain control-
13share acquisitions) and J (relating to business combination
14transactions-labor contracts) of Chapter 25, nor shall it change
15the standard of care applicable to the directors under
16Subchapter B of Chapter 17 (relating to fiduciary duty) unless:
17(1) If the corporation does not survive the transaction,
18the transaction satisfies any requirements of the provision.
19(2) If the corporation survives the transaction, the
20approval of the transaction is by a vote of the shareholders
21or directors which would be sufficient to impair the right or
22obligation under, or make the corporation subject to, the
23provision.
24(b) Transitional provision.--
25(1) This subsection applies to a transaction of a type
26authorized by this chapter if:
27(i) prior to July 1, 2015, a step has been taken to
28effectuate the transaction; but
29(ii) the transaction does not take effect by July 1,
302015.
1(2) Except as set forth in paragraph (3), the
2transaction shall remain subject to the former provisions of
3law supplied by this chapter until the transaction:
4(i) is abandoned; or
5(ii) takes effect.
6(3) Notwithstanding paragraph (2), if the plan provides
7that this chapter applies to the transaction, this chapter
8shall apply to the transaction after June 30, 2015.
9§ 314. Regulatory conditions and required notices and
10approvals.
11(a) Regulatory approvals.--If law of this Commonwealth other
12than this chapter requires notice to, or the approval of, a
13governmental agency or officer of this Commonwealth in
14connection with the participation under an organic law that is
15not part of this title by a domestic or foreign association in a
16transaction which is a form of transaction authorized by this
17chapter, the notice must be given or the approval obtained by
18the association before it may participate in any form of
19transaction under this chapter.
20(b) Certain regulated businesses.---A domestic converted
21association, domestic domesticated entity, domestic new
22association, domestic resulting association or domestic
23surviving association may not acquire as a result of a
24transaction under this chapter the power to engage in the
25business of banking, insurance or acting as a trust company
26unless an association of that type is authorized to have and
27exercise that power under the law of this Commonwealth.
28(c) Charitable assets.--Property held for a charitable
29purpose under the law of this Commonwealth by a domestic or
30foreign association immediately before a transaction under this
1chapter becomes effective may not, as a result of the
2transaction, be diverted from the objects for which it was
3donated, granted, devised or otherwise transferred unless, to
4the extent required by or pursuant to the law of this
5Commonwealth concerning cy pres or other law dealing with
6nondiversion of charitable assets, the domestic or foreign
7association obtains an appropriate order of a court of competent
8jurisdiction specifying the disposition of the property.
9(d) Preservation of transfers.--A bequest, devise, gift,
10grant or promise contained in a will or other instrument of
11donation, subscription or conveyance that is made to a merging
12association that is not the surviving association and that takes
13effect or remains payable after the merger inures to the
14surviving association. A trust obligation that would govern
15property if transferred to a merging association that is not the
16surviving association applies to property that is transferred to
17the surviving association.
18(e) Cross reference.--See section 318 (relating to excluded
19entities and transactions).
20§ 315. Nature of transactions.
21The fact that a sale or conversion of the interests in or
22assets of an association or a transaction under a particular
23subchapter produces a result that could be accomplished in any
24other manner permitted by a different subchapter or other law
25shall not be a basis for recharacterizing the sale, conversion
26or transaction as a different form of sale, conversion or
27transaction under any other subchapter or other law.
28§ 316. Contents of plan.
29(a) Omission of certain provisions.--A plan as delivered to
30the department for filing under any provision of this chapter in
1lieu of a statement of merger, statement of interest exchange,
2statement of conversion, statement of division or statement of
3domestication may omit all provisions of the plan except
4provisions, if any, that:
5(1) are intended to amend or constitute the operative
6provisions of the public organic record of a domestic
7association as in effect subsequent to the effectiveness of
8the plan;
9(2) are required by this chapter in the statement in
10lieu of which the plan is being delivered to the department
11for filing; or
12(3) allocate or specify the respective property and
13liabilities of the resulting associations, in the case of a
14plan of division.
15(b) Availability of full plan.--If any of the provisions of
16a plan are omitted from the plan as delivered to the department
17as permitted under subsection (a), the plan must state that the
18full text of the plan is on file at the principal office of the
19surviving, acquiring, converted, new or resulting association or
20domesticated entity and the address thereof. An association that
21takes advantage of this section shall furnish a copy of the full
22text of the plan, on request and without cost, to any interest
23holder of any domestic or foreign association that was a party
24to the plan.
25(c) Reference to external facts.--A plan may refer to facts
26ascertainable outside of the plan if the manner in which the
27facts will operate on the plan is specified in the plan. The
28facts may include the occurrence of an event or a determination
29or action by a person, whether or not the event, determination
30or action is within the control of a party to the transaction.
1§ 317. Contractual dissenters rights in entity transactions.
2(a) General rule.--An interest holder of a domestic entity
3other than a nonprofit corporation or unincorporated nonprofit
4association shall be entitled to contractual dissenters rights
5in connection with a transaction under this chapter, even though
6the interest holder would not otherwise be entitled to
7dissenters rights under this title to the extent provided:
8(1) in the entity's organic rules; or
9(2) in the plan.
10(b) Procedures for contractual dissenters rights.--If an
11interest holder is entitled to contractual dissenters rights
12pursuant to subsection (a), Subchapter D of Chapter 15 (relating
13to dissenters rights) applies to the extent practicable except
14as otherwise provided in the organic rules of the domestic
15entity or the plan.
16(c) Cross references.--See sections 329 (relating to special
17treatment of interest holders) and 1571(c) (relating to
18application and effect of subchapter).
19§ 318. Excluded entities and transactions.
20(a) Excluded entities.--The following entities may not
21participate in a transaction under this chapter:
22(1) A cooperative corporation subject to Chapter 73
23(relating to electric cooperative corporations).
24(2) A beneficial, benevolent, fraternal or fraternal
25benefit society:
26(i) having a lodge system and a representative form
27of government; or
28(ii) transacting any type of insurance.
29(b) Excluded transactions involving certain nonprofit
30corporations.--The following apply to nonprofit corporations:
1(1) Except as provided in paragraph (2), this chapter
2may not be used to accomplish a transaction that has the
3effect of converting a domestic nonprofit corporation that is
4subject to the supervision of the Department of Banking and
5Securities, the Insurance Department or the Pennsylvania
6Public Utility Commission to a different type of entity.
7(2) Paragraph (1) does not apply to a transaction under
8this chapter in which a health maintenance organization is
9converted to a different type of entity if the transaction
10has received the prior approval of the Insurance Department.
11(c) Cross references.--See sections 103 (relating to
12subordination of title to regulatory laws) and 314 (relating to
13regulatory conditions and required notices and approvals).
14§ 319. Party to plan or transaction.
15An association that approves a plan in its capacity as an
16interest holder or creditor of a domestic or foreign association
17that is a party to the transaction under the plan, or that
18furnishes all or a part of the consideration contemplated by a
19plan, does not thereby become a party to the plan or the
20transaction under the plan for purposes of this chapter.
21§ 320. Submission of matters to interest holders.
22(a) General rule.--A domestic association may agree, in
23record form, to submit a plan to its interest holders whether or
24not the governors determine, at any time after approving the
25plan, that the plan is no longer advisable and recommend that
26the interest holders reject or vote against it, regardless of
27whether the governors change their recommendation. If an
28association so agrees to submit a plan to its interest holders,
29the plan is deemed to have been validly adopted by the
30association when it has been approved by the interest holders.
1(b) Cross references.--See sections 321(c) (relating to
2approval by business corporation) and 325(c)(2) (relating to
3approval by limited liability company).
4SUBCHAPTER B
5APPROVAL OF ENTITY TRANSACTIONS
6Sec.
7321. Approval by business corporation.
8322. Approval by nonprofit corporation.
9323. Approval by general partnership.
10324. Approval by limited partnership.
11325. Approval by limited liability company.
12326. Approval by professional association.
13327. Approval by business trust.
14328. Approval by unincorporated nonprofit association.
15329. Special treatment of interest holders.
16330. Alternative means of approval of transactions.
17§ 321. Approval by business corporation.
18(a) Proposal of plan.--Except where the approval of the
19board of directors is unnecessary pursuant to section 330
20(relating to alternative means of approval of transactions), a
21plan shall be proposed in the case of a domestic business
22corporation by the adoption by the board of directors of a
23resolution approving the plan. Except where the approval of the
24shareholders is unnecessary under this chapter, the board of
25directors shall direct that the plan be submitted to a vote of
26the shareholders entitled to vote thereon at a regular or
27special meeting of the shareholders.
28(b) Notice of meeting of shareholders.--Notice in record
29form of the meeting of shareholders that will act on the
30proposed plan must be given to each shareholder of record,
1whether or not entitled to vote thereon, of each domestic
2business corporation that is a party to the transaction under
3the plan. There shall be included in or enclosed with the notice
4a copy of the proposed plan or a summary thereof and any notice
5required by section 329 (relating to special treatment of
6interest holders). If the holders of shares of any class or
7series of shares are entitled to assert dissenters rights, the
8notice must include or be accompanied by the text of the
9provision of this chapter granting dissenters rights and the
10text of Chapter 15 Subch. D (relating to dissenters rights). The
11notice must state that a copy of the organic rules of the
12surviving, acquired, converted, new or resulting association or
13domesticated entity as they will be in effect immediately
14following the transaction will be furnished to any shareholder
15of the corporation giving the notice on request and without
16cost.
17(c) Shareholder vote required.--Except as provided in
18section 1757 (relating to action by shareholders) or subsection
19(d), a plan shall be adopted by a domestic business corporation
20that is a party to the transaction under the plan upon receiving
21the affirmative vote of a majority of the votes cast by all
22shareholders entitled to vote on the plan and, if any class or
23series of shares is entitled to vote thereon as a class, the
24affirmative vote of a majority of the votes cast in each class
25vote. The holders of any class or series of shares of a domestic
26business corporation that is a party to a transaction under a
27plan that would effect any change in the articles of the
28corporation shall be entitled to vote as a class on the plan if
29they would have been entitled to a class vote under the
30provisions of section 1914 (relating to adoption of amendments)
1had the change been accomplished under Subchapter B of Chapter
219 (relating to amendment of articles). Except as provided in
3section 330, a proposed plan shall not be deemed to have been
4adopted by a domestic business corporation unless it has also
5been approved by the board of directors, regardless of the fact
6that the board has directed or suffered the submission of the
7plan to the shareholders for action.
8(d) Adoption of plan of merger without shareholder vote.--
9(1) Unless otherwise required by the organic rules, a
10plan of merger shall not require the approval of the
11shareholders of a domestic business corporation that is a
12merging association if:
13(i) whether or not the corporation is the surviving
14association:
15(A) the surviving association is a domestic
16business corporation and its articles are identical
17to the articles of the corporation for which
18shareholder approval is not required, except for
19changes that could be made without shareholder
20approval pursuant to section 1914(c);
21(B) each share of the corporation outstanding
22immediately prior to the effectiveness of the merger
23is to continue as or be converted into, except as may
24be otherwise agreed by the holder thereof, an
25identical share of the surviving association; and
26(C) the plan provides that the shareholders of
27the corporation are to hold in the aggregate shares
28of the surviving association to be outstanding
29immediately after the effectiveness of the merger
30entitled to cast at least a majority of the votes
1entitled to be cast generally for the election of
2directors;
3(ii) immediately prior to the adoption of the plan
4and at all times thereafter prior to the effectiveness of
5the merger, another association owns directly or
6indirectly 80% or more of the outstanding shares of each
7class of the corporation; or
8(iii) no shares of the corporation have been issued
9prior to the adoption of the plan by the board of
10directors pursuant to subsection (a).
11(2) If a merger is effected pursuant to paragraph (1)(i)
12or (iii), the plan shall be deemed adopted by the
13corporation when it has been adopted by the board of
14directors pursuant to subsection (a).
15(3) If a merger of a subsidiary corporation is effected
16pursuant to paragraph (1)(ii), the plan shall be deemed
17adopted by the subsidiary corporation when it has been
18adopted by the governors of the parent association and
19neither approval of the plan by the board of directors of the
20subsidiary corporation nor signing of the statement of merger
21by the subsidiary corporation shall be necessary.
22(4) Unless otherwise required by the organic rules, a
23plan of merger providing for the merger of a domestic
24business corporation (referred to in this paragraph as a
25"constituent corporation") with or into a single indirect
26wholly owned subsidiary (referred to in this paragraph as the
27"subsidiary corporation") of the constituent corporation
28shall not require the approval of the shareholders of either
29the constituent corporation or the subsidiary corporation if
30all of the following provisions are satisfied.
1(i) A merger under this paragraph must satisfy the
2following conditions:
3(A) The constituent corporation and the
4subsidiary corporation are the only parties to the
5merger, other than a surviving association that is a
6corporation created in the merger.
7(B) Each share or fraction of a share of the
8capital stock of the constituent corporation
9outstanding immediately prior to the effectiveness of
10the merger is converted in the merger into a share or
11equal fraction of a share of capital stock of a
12holding company having the same designations, rights,
13powers and preferences and the qualifications,
14limitations and restrictions as the share of capital
15stock of the constituent corporation being converted
16in the merger.
17(C) The holding company and the surviving
18association are each domestic business corporations.
19(D) Immediately following the effectiveness of
20the merger, the articles of incorporation and bylaws
21of the holding company are identical to the articles
22of incorporation and bylaws of the constituent
23corporation immediately before the effectiveness of
24the merger, except for changes that could be made
25without shareholder approval pursuant to section
261914(c).
27(E) Immediately following the effectiveness of
28the merger, the surviving association is a direct or
29indirect wholly owned subsidiary of the holding
30company.
1(F) The directors of the constituent corporation
2become or remain the directors of the holding company
3on the effectiveness of the merger.
4(G) The board of directors of the constituent
5corporation has made a good faith determination that
6the shareholders of the constituent corporation will
7not recognize gain or loss for United States Federal
8income tax purposes.
9(ii) If the holding company is a registered
10corporation, the shares of the holding company issued in
11connection with the merger shall be deemed to have been
12acquired at the time that the shares of the constituent
13corporation converted in the merger were acquired.
14(iii) As used in this paragraph only, the term
15"holding company" means a corporation that, from its
16incorporation until consummation of the merger governed
17by this paragraph, was at all times a direct wholly owned
18subsidiary of the constituent corporation and whose
19capital stock is issued in the merger.
20(e) Approval of division by preferred shares.--If a dividing
21association that is a business corporation has outstanding any
22shares of a preferred or special class or series of shares,
23regardless of a limitation stated in the articles or bylaws on
24the voting rights of the class or series of shares, the holders
25of outstanding shares of the class or series shall be entitled
26to vote as a class on a plan of division which:
27(1) provides that the dividing association will not
28survive the division; or
29(2) amends the articles or bylaws of the surviving
30corporation in a manner that would entitle the holders of the
1preferred or special shares to a class vote on the amendment
2under the articles, the bylaws or section 1914(b).
3(f) Cross references.--See:
4Subchapter A of Chapter 17 (relating to notice and
5meetings generally).
6Section 2512 (relating to dissenters rights procedure).
7Section 2539 (relating to adoption of plan of merger by
8board of directors).
9Section 3304(b) (relating to election of benefit
10corporation status).
11Section 3305(b) (relating to termination of benefit
12corporation status).
13§ 322. Approval by nonprofit corporation.
14(a) Proposal of plan.--A plan shall be proposed in the case
15of a domestic nonprofit corporation as follows:
16(1) by the adoption by the board of directors or other
17body of a resolution approving the plan;
18(2) unless otherwise provided in the articles, by
19petition of members entitled to cast at least 10% of the
20votes that all members are entitled to cast thereon, setting
21forth the proposed plan, which petition shall be directed to
22the board of directors and filed with the secretary of the
23corporation; or
24(3) by such other method as may be provided in the
25bylaws.
26(b) Submission to members.--Except where the domestic
27nonprofit corporation has no members entitled to vote thereon,
28the board of directors or other body shall direct that the plan
29be submitted to a vote of the members entitled to vote thereon
30at a regular or special meeting of the members.
1(c) Notice of meeting of members.--Notice in record form of
2the meeting of members that will act on the proposed plan shall
3be given to each member of record, whether or not entitled to
4vote thereon, of each domestic nonprofit corporation that is a
5party to the transaction under the plan. A copy of the proposed
6plan or a summary thereof shall be included in or enclosed with
7the notice. The notice shall state that a copy of the organic
8rules of the surviving, acquired, converted, new or resulting
9association or domesticated entity as they will be in effect
10immediately following the transaction will be furnished to any
11member of the corporation giving the notice on request and
12without cost.
13(d) Member vote required.--Except as provided in section
145757 (relating to action by members), a plan shall be adopted
15upon receiving the affirmative vote of at least a majority of
16the votes that all members present are entitled to cast thereon
17of each domestic nonprofit corporation that is a party to the
18transaction under the plan. If any class of members is entitled
19to vote on the plan as a class, the plan must be adopted by the
20affirmative vote of at least a majority of the votes that all
21members present of such class are entitled to cast thereon.
22(e) Adoption in absence of voting members.--If a domestic
23nonprofit corporation has no members entitled to vote thereon, a
24plan shall be deemed adopted by the corporation when it has been
25adopted by the board of directors or other body pursuant to
26subsection (a).
27(f) Cross references.--See Subchapter A of Chapter 57
28(relating to notice and meetings generally) and section 3304(b)
29(relating to election of benefit corporation status).
30§ 323. Approval by general partnership.
1(a) General rule.--A plan shall be approved in the case of a
2domestic general partnership as follows:
3(1) in the manner provided in its organic rules for the
4type of plan involved;
5(2) if its organic rules do not provide for approval of
6the type of plan involved, in the manner provided in its
7organic rules for approval of a plan of merger; or
8(3) if its organic rules do not provide for approval of
9the type of plan involved or a plan of merger, the plan shall
10be approved by all of the partners.
11(b) Cross reference.--See section 3304(b) (relating to
12election of benefit corporation status).
13§ 324. Approval by limited partnership.
14(a) Proposal of plan.--A plan shall be proposed in the case
15of a domestic limited partnership by the adoption by a unanimous
16vote of the general partners of a resolution approving the plan.
17Except where the approval of the limited partners is unnecessary
18under this chapter or the organic rules, the general partners
19shall submit the plan to a vote of the limited partners entitled
20to vote thereon at a regular or special meeting of the limited
21partners.
22(b) Notice of meeting of limited partners.--Notwithstanding
23any other provision of the organic rules, notice in record form
24of the meeting of limited partners called for the purpose of
25considering the proposed plan shall be given to each limited
26partner, whether or not entitled to vote thereon, of each
27domestic limited partnership that is a party to the transaction
28under the plan. A copy of the proposed plan or a summary thereof
29shall be included in or enclosed with the notice. The notice
30shall state that a copy of the organic rules of the surviving,
1acquired, converted, new or resulting association or
2domesticated entity as they will be in effect immediately
3following the transaction will be furnished to any limited
4partner of the limited partnership giving the notice on request
5and without cost.
6(c) Required vote by limited partners.--The plan shall be
7adopted upon receiving a majority of the votes cast by all
8limited partners, if any, entitled to vote thereon of each
9domestic limited partnership that is a party to the proposed
10transaction under the plan and, if any class of limited partners
11is entitled to vote thereon as a class, a majority of the votes
12cast in each class vote. A proposed plan may not be deemed to
13have been adopted by the limited partnership unless it has also
14been approved by the general partners, regardless of the fact
15that the general partners have directed or suffered the
16submission of the plan to the limited partners for action.
17(d) Merger by action of general partners only.--Except as
18provided in the organic rules, a plan of merger shall not
19require the approval of the limited partners of a domestic
20limited partnership that is a merging association and shall be
21deemed adopted by the limited partnership when it has been
22adopted by the general partners pursuant to subsection (a) if:
23(1) whether or not the limited partnership is the
24surviving association, the surviving association is a
25domestic limited partnership and its organic rules are
26identical to the organic rules of the merging limited
27partnership, except for changes that could be made without
28action by the limited partners; and
29(2) each partnership interest outstanding immediately
30before the effectiveness of the merger is to continue as or
1to be converted into, except as may be otherwise agreed by
2the holder thereof, an identical partnership interest in the
3surviving limited partnership after the effectiveness of the
4merger.
5(e) Cross reference.--See section 3304(b) (relating to
6election of benefit corporation status).
7§ 325. Approval by limited liability company.
8(a) Proposal of plan in manager-managed company.--Except as
9provided in the organic rules or where the approval of the
10managers is unnecessary under section 330 (relating to
11alternative means of approval of transactions), a plan shall be
12proposed, in the case of a manager-managed, domestic limited
13liability company, by the adoption by the managers of a
14resolution approving the plan. Except where the approval of the
15members of a manager-managed, domestic limited liability company
16is unnecessary under this chapter or the organic rules, the plan
17shall be submitted to a vote of the members entitled to vote
18thereon at a regular or special meeting of the members.
19(b) Notice of meeting of members.--Except as provided in the
20organic rules:
21(1) Notice in record form of the meeting of members of a
22domestic limited liability company that will act on the
23proposed plan shall be given to each member of record,
24whether or not entitled to vote thereon, of each domestic
25limited liability company that is a party to the transaction
26under the plan.
27(2) There shall be included in or enclosed with the
28notice a copy of the proposed plan or a summary thereof.
29(3) The notice shall state that a copy of the organic
30rules of the surviving, acquired, converted, new or resulting
1association or domesticated entity as they will be in effect
2immediately following the transaction will be furnished to
3any member of the company giving the notice on request and
4without cost.
5(c) Adoption of plan by members.--A plan:
6(1) Except as provided in the organic rules, shall be
7adopted upon receiving a majority of the votes cast by all
8members, if any, entitled to vote thereon of each of the
9domestic limited liability companies that is a party to the
10transaction under the plan and, if any class of members is
11entitled to vote thereon as a class, a majority of the votes
12cast in each class vote.
13(2) Except as provided in the organic rules or section
14330, shall not be deemed to have been adopted by a manager-
15managed company unless it has also been approved by the
16managers, regardless of the fact that the managers have
17directed or suffered the submission of the plan to the
18members for action.
19(d) Merger by action of managers only.--Unless otherwise
20required by a provision of the organic rules in record form, a
21plan of merger shall not require the approval of the members of
22a manager-managed, domestic limited liability company and shall
23be deemed adopted by the company when a resolution approving the
24plan has been adopted by the managers pursuant to subsection (a)
25if:
26(1) Whether the company is the surviving association:
27(i) the surviving association is a domestic limited
28liability company and its organic rules are identical to
29the organic rules of the limited liability company that
30is party to the merger, except for changes that could be
1made without action by the members; and
2(ii) each membership interest outstanding
3immediately prior to the effectiveness of the merger is
4to continue as or to be converted into, except as may be
5otherwise agreed by the holder thereof, an identical
6membership interest in the surviving association after
7the effectiveness of the merger.
8(2) The plan of merger provides for the merger of the
9company, referred to in this paragraph as the "constituent
10company," with or into a single indirect wholly owned
11subsidiary, referred to in this paragraph as the "subsidiary
12company," of the constituent company if all of the following
13provisions are satisfied:
14(i) The constituent company and the subsidiary
15company are the only parties to the merger, other than a
16surviving association that is created in the merger.
17(ii) Each interest of the constituent company
18outstanding immediately prior to the effectiveness of the
19merger is converted in the merger into an interest of a
20holding company having the same designations, rights,
21powers and preferences and the qualifications,
22limitations and restrictions as the interest of the
23constituent company being converted in the merger.
24(iii) The holding company and the surviving
25association are each domestic limited liability
26companies.
27(iv) Immediately following the effectiveness of the
28merger, the certificate of organization and operating
29agreement of the holding company are identical to the
30certificate of organization and operating agreement of
1the constituent company immediately before the
2effectiveness of the merger, except for changes that
3could be made without member approval pursuant to Chapter
489 (relating to limited liability companies).
5(v) Immediately following the effectiveness of the
6merger, the surviving association is a direct or indirect
7wholly owned subsidiary of the holding company.
8(vi) The managers of the constituent company become
9or remain the managers of the holding company on the
10effectiveness of the merger.
11(vii) The managers of the constituent company have
12made a good faith determination that the members of the
13constituent company will not recognize gain or loss for
14United States Federal income tax purposes.
15(viii) As used in this paragraph only, the term
16"holding company" means a limited liability company that,
17from its formation until consummation of the merger
18governed by this paragraph, was at all times a direct
19wholly owned subsidiary of the constituent company and
20interests in which are issued in the merger.
21(e) Cross reference.--See section 3304(b) (relating to
22election of benefit corporation status).
23§ 326. Approval by professional association.
24(a) General rule.--A plan shall be approved in the case of a
25domestic professional association by vote of a majority, or such
26higher percentage as may be provided in the organic rules, of
27the associates, voting according to their proportionate shares
28of ownership.
29(b) Cross reference.--See section 3304(b) (relating to
30election of benefit corporation status).
1§ 327. Approval by business trust.
2(a) General rule.--Except as provided in subsection (b), a
3plan shall be approved in the case of a domestic business trust
4as follows:
5(1) in the manner provided in its organic rules for the
6type of plan involved;
7(2) if its organic rules do not provide for approval of
8the type of plan involved, in the manner provided in its
9organic rules for approval of a plan of merger; or
10(3) if its organic rules do not provide for approval of
11the type of plan involved or a plan of merger, the plan
12shall be approved by all of the beneficial owners.
13(b) Adoption of plan of merger without beneficiary vote.--
14Unless otherwise required by the organic rules, a plan of merger
15providing for the merger of a domestic business trust, referred
16to in this paragraph as the "constituent trust," with or into a
17single indirect wholly owned subsidiary, referred to in this
18paragraph as the "subsidiary trust," of the constituent trust
19shall not require the approval of the beneficiaries of the
20constituent trust if all of the following provisions are
21satisfied:
22(1) The constituent trust and the subsidiary trust are
23the only parties to the merger, other than a surviving
24association created in the merger.
25(2) Each interest in the constituent trust outstanding
26immediately prior to the effectiveness of the merger is
27converted in the merger into an interest in the holding trust
28having the same designations, rights, powers and preferences
29and the qualifications, limitations and restrictions as the
30interests in the constituent trust being converted in the
1merger.
2(3) The holding trust and the surviving association are
3each domestic business trusts.
4(4) Immediately following the effectiveness of the
5merger, the instrument and organic rules of the holding trust
6are identical to the instrument and organic rules of the
7constituent trust immediately before the effectiveness of the
8merger, except for changes that could be made without
9beneficiary approval under Chapter 95 (relating to business
10trusts).
11(5) Immediately following the effectiveness of the
12merger, the surviving association is a direct or indirect
13wholly owned subsidiary of the holding trust.
14(6) The trustees of the constituent trust become or
15remain the trustees of the holding trust on the effectiveness
16of the merger.
17(7) The trustees of the constituent trust have made a
18good faith determination that the beneficiaries of the
19constituent trust will not recognize gain or loss for United
20States Federal income tax purposes.
21(8) As used in this subsection only, the term "holding
22trust" means a business trust that, from its formation until
23consummation of the merger governed by this subsection, was
24at all times a direct wholly owned subsidiary of the
25constituent trust and the interests in which are issued in
26the merger.
27(c) Cross reference.--See section 3304(b) (relating to
28election of benefit corporation status).
29§ 328. Approval by unincorporated nonprofit association.
30(a) General rule.--Except as provided in the governing
1principles, a plan shall be approved in the case of a domestic
2unincorporated nonprofit association by the affirmative vote of
3at least a majority of the votes cast at a meeting of the
4members.
5(b) Cross reference.--See section 3304(b) (relating to
6election of benefit corporation status).
7§ 329. Special treatment of interest holders.
8(a) General rule.--Except as otherwise restricted in the
9organic rules, a plan may contain a provision classifying the
10interest holders of a class or series of interests into one or
11more separate groups by reference to any facts or circumstances
12that are not manifestly unreasonable and providing mandatory
13treatment for interests of the class or series held by
14particular interest holders or groups of interest holders that
15differs materially from the treatment accorded other interest
16holders or groups of interest holders that hold interests of the
17same class or series, including a provision modifying or
18rescinding rights previously created under this section if
19either of the following applies:
20(1) The plan:
21(i) is approved by a majority of the votes cast by
22the holders of any class or series of interests any of
23the interests of which are so classified into groups,
24whether or not such class or series would otherwise be
25entitled to vote on the plan; and
26(ii) specifically enumerates the type and extent of
27the special treatment authorized.
28(2) Under all the facts and circumstances, a court of
29competent jurisdiction finds such special treatment is
30undertaken in good faith, after reasonable deliberation and
1is in the best interest of the association.
2(b) Statutory voting rights on special treatment.--Except as
3provided in subsection (d), if a plan contains a provision for
4special treatment, each group of holders of any outstanding
5interests of a class or series who are to receive the same
6special treatment under the plan shall be entitled to vote as a
7special class in respect to the plan regardless of any
8limitations stated in the organic rules on the voting rights of
9any class or series.
10(c) Determination of groups.--For purposes of applying
11subsections (a)(1) and (b), the determination of which interest
12holders are part of each group receiving special treatment shall
13be made as of the record date for interest holder action on the
14plan.
15(d) Dissenters rights on special treatment.--If a plan
16contains a provision for special treatment without requiring for
17the adoption of the plan the statutory class vote required under
18subsection (b), the holder of any outstanding interests the
19statutory class voting rights of which are so denied shall be
20entitled to assert dissenters rights with respect to those
21interests. A shareholder of a business corporation who wishes to
22assert dissenters rights shall comply with Subchapter D of
23Chapter 15 (relating to dissenters rights). An interest holder
24in any other type of domestic entity shall comply with
25Subchapter D of Chapter 15 to the extent practicable.
26(e) Notice to interest holders.--Any notice to interest
27holders of a meeting called to act on a plan that provides for
28special treatment shall state that the plan provides for special
29treatment. The notice shall identify the interest holders
30receiving special treatment unless the notice is accompanied by
1either a summary of the plan that includes that information or
2the full text of the plan.
3(f) Exceptions.--This section shall not apply to any of the
4following:
5(1) A provision of a plan that offers to all holders of
6interests of a class or series the same option to elect
7certain treatment.
8(2) A plan involving any type of domestic entity that
9contains an express provision that this section does not
10apply or that fails to contain an express provision that this
11section shall apply.
12(3) A provision of a plan that treats all of the holders
13of a particular class or series of interests of any type of
14domestic entity differently from the holders of another class
15or series. A provision of a plan that treats the holders of a
16class or series of shares of a domestic business corporation
17differently from the holders of another class or series of
18shares shall not constitute a violation of section 1521(d)
19(relating to authorized shares).
20§ 330. Alternative means of approval of transactions.
21(a) General rule.--Except as provided in subsection (b) or
22the organic rules of a domestic entity, approval of a
23transaction under this chapter by the unanimous vote or consent
24of its interest holders satisfies the requirements of this
25chapter for approval of the transaction.
26(b) Exception.--Subsection (a) shall not apply to a
27nonprofit corporation.
28SUBCHAPTER C
29MERGER
30Sec.
1331. Merger authorized.
2332. Plan of merger.
3333. Approval of merger.
4334. Amendment or abandonment of plan of merger.
5335. Statement of merger; effectiveness.
6336. Effect of merger.
7§ 331. Merger authorized.
8(a) General rule.--Except as provided in section 318
9(relating to excluded entities and transactions) or this
10section, by complying with this chapter:
11(1) One or more domestic entities may merge with one or
12more domestic entities or foreign associations into a
13surviving association.
14(2) Two or more foreign associations may merge into a
15surviving association that is a domestic entity.
16(3) A domestic banking institution may be a merging
17association or surviving association in a merger with one or
18more domestic or foreign associations if the surviving
19association or at least one of the merging associations is a
20domestic entity.
21(b) Foreign law authorization required.--By complying with
22the applicable provisions of this subchapter, a foreign
23association may be a party to a merger under this subchapter or
24may be the surviving association in such a merger if the merger
25is authorized by the law of the jurisdiction of formation of the
26foreign association.
27(c) Banking institutions.--Subsection (a)(3) controls over
28any inconsistent provision of the organic law of a domestic
29banking institution that is a merging association.
30(d) Exception.--A health maintenance organization may be a
1merging association only if the surviving association is a
2health maintenance organization.
3(e) Cross reference.--See section 314 (relating to
4regulatory conditions and required notices and approvals).
5§ 332. Plan of merger.
6(a) General rule.--A domestic entity may become a party to a
7merger by approving a plan of merger. The plan shall be in
8record form and contain all of the following:
9(1) As to each merging association, its name,
10jurisdiction of formation and type.
11(2) If the surviving association is to be created in the
12merger, a statement to that effect and the association's
13name, jurisdiction of formation and type.
14(3) The manner, if any, of:
15(i) converting some or all of the interests in a
16merging association into interests, securities,
17obligations, money, other property, rights to acquire
18interests or securities, or any combination of the
19foregoing; or
20(ii) canceling some or all of the interests in a
21merging association.
22(4) If the surviving association exists before the
23merger, any proposed amendments to:
24(i) its public organic record, if any; or
25(ii) its private organic rules that are or are
26proposed to be in record form.
27(5) If the surviving association is to be created in the
28merger:
29(i) its proposed public organic record, if any; and
30(ii) the full text of its private organic rules that
1are proposed to be in record form.
2(6) Provisions, if any, providing special treatment of
3interests in a merging association held by any interest
4holder or group of interest holders as authorized by, and
5subject to, section 329 (relating to special treatment of
6interest holders).
7(7) The other terms and conditions of the merger.
8(8) Any other provision required by:
9(i) the law of this Commonwealth;
10(ii) the law of the jurisdiction of formation of a
11foreign merging or surviving association; or
12(iii) the organic rules of a merging association.
13(b) Optional contents.--In addition to the requirements of
14subsection (a), a plan of merger may contain any other provision
15not prohibited by law.
16(c) Cross reference.--See section 316 (relating to contents
17of plan).
18§ 333. Approval of merger.
19(a) Approval by domestic entities.--A plan of merger shall
20not be effective unless it has been approved in both of the
21following ways:
22(1) The plan is approved by a domestic entity that is a
23merging association in accordance with the applicable
24provisions of Subchapter B (relating to approval of entity
25transactions).
26(2) The plan is approved in record form by each interest
27holder, if any, of a domestic entity that is a merging
28association that will have interest holder liability for
29debts, obligations and other liabilities that arise after the
30merger becomes effective, unless, as to an interest holder
1that does not approve the plan, both of the following apply:
2(i) The organic rules of the domestic entity provide
3in record form for the approval of a merger in which some
4or all of its interest holders become subject to interest
5holder liability by the vote or consent of fewer than all
6the interest holders.
7(ii) The interest holder consented in record form to
8or voted for that provision of the organic rules or
9became an interest holder after the adoption of that
10provision.
11(b) Approval by foreign associations.--A merger under this
12subchapter in which a foreign association is a merging
13association is not effective unless the merger is approved by
14the foreign association in accordance with the law of its
15jurisdiction of formation.
16(c) Approval by domestic banking institutions.--A merger
17under this subchapter in which a domestic banking institution
18that is not a domestic entity is a merging association is not
19effective unless the merger is approved by the domestic banking
20institution in accordance with the requirements in its organic
21law and organic rules for approval of a merger.
22(d) Dissenters rights.--
23(1) Except as provided in paragraph (2), if a
24shareholder of a domestic business corporation that is to be
25a merging association objects to the plan of merger and
26complies with Subchapter D of Chapter 15 (relating to
27dissenters rights), the shareholder shall be entitled to
28dissenters rights to the extent provided in that subchapter.
29(2) Except as provided under section 317 (relating to
30contractual dissenters rights in entity transactions),
1dissenters rights shall not be available to shareholders of a
2domestic business corporation that is a merging association
3in a merger described in section 321(d)(1)(i) or (4)
4(relating to approval by business corporation).
5(3) If a shareholder of a domestic banking institution
6that is to be a merging association objects to the plan of
7merger and complies with section 1222 of the act of November
830, 1965 (P.L.847, No.356), known as the Banking Code of
91965, the shareholder shall be entitled to the rights
10provided in that section.
11(4) See section 329 (relating to special treatment of
12interest holders).
13§ 334. Amendment or abandonment of plan of merger.
14(a) General rule.--A plan of merger may be amended or
15abandoned only with the consent of each party to the plan,
16except as otherwise provided in the plan.
17(b) Approval of amendment.--A domestic entity that is a
18merging association may approve an amendment of a plan of merger
19in one of the following ways:
20(1) In the same manner as the plan was approved, if the
21plan does not provide for the manner in which it may be
22amended.
23(2) By its governors or interest holders in the manner
24provided in the plan, but an interest holder that was
25entitled to vote on or consent to approval of the plan is
26entitled to vote on or consent to any amendment of the plan
27that will change any of the following:
28(i) The amount or kind of interests, securities,
29obligations, money, other property, rights to acquire
30interests or securities, or any combination of the
1foregoing, to be received by the interest holders of any
2party to the plan.
3(ii) The public organic record, if any, or private
4organic rules of the surviving association that will be
5in effect immediately after the merger becomes effective,
6except for changes that do not require approval of the
7interest holders of the surviving association under its
8organic law or organic rules.
9(iii) Any other terms or conditions of the plan, if
10the change would:
11(A) increase the interest holder liability to
12which the interest holder will be subject; or
13(B) otherwise adversely affect the interest
14holder in any material respect.
15(c) Approval of abandonment.--After a plan of merger has
16been approved by a domestic entity that is a merging association
17and before a statement of merger becomes effective, the plan may
18be abandoned as provided in the plan. Unless prohibited by the
19plan, a domestic entity that is a merging association may
20abandon the plan in the same manner as the plan was approved.
21(d) Statement of abandonment.--If a plan of merger is
22abandoned after a statement of merger has been delivered to the
23department for filing and before the statement becomes
24effective, a statement of abandonment <-under section 141
25(relating to abandonment of filing before effectiveness), signed
26by a party to the plan, must be delivered to the department for
27filing before the statement of merger becomes effective. <-The
28statement of abandonment shall take effect on filing, and the
29merger shall be abandoned and shall not become effective. The
30statement of abandonment shall contain all of the following:
1(1) The name of each party to the plan of merger.
2(2) The date on which the statement of merger was filed
3by the department.
4(3) A statement that the merger has been abandoned in
5accordance with this section.
6(e) Cross references.--See sections 134 (relating to
7docketing statement) and 135 (relating to requirements to be met
8by filed documents).
9§ 335. Statement of merger; effectiveness.
10(a) General rule.--A statement of merger shall be signed by
11each merging association and delivered to the department for
12filing along with the certificates, if any, required by section
13139 (relating to tax clearance of certain fundamental
14transactions).
15(b) Contents.--A statement of merger shall contain all of
16the following:
17(1) With respect to each merging association that is not
18the surviving association:
19(i) its name;
20(ii) its jurisdiction of formation;
21(iii) its type;
22(iv) if it is a domestic filing association,
23domestic limited liability partnership or registered
24foreign association, the address of its registered
25office, including street and number, if any, in this
26Commonwealth, subject to section 109 (relating to name of
27commercial registered office provider in lieu of
28registered address);
29(v) if it is a domestic association that is not a
30domestic filing association or limited liability
1partnership, the address, including street and number, if
2any, of its principal office; and
3(vi) if it is a nonregistered foreign association,
4the address, including street and number, if any, of:
5(A) its registered or similar office, if any,
6required to be maintained by the law of its
7jurisdiction of formation; or
8(B) if it is not required to maintain a
9registered or similar office, its principal office.
10(2) With respect to the surviving association:
11(i) its name;
12(ii) its jurisdiction of formation;
13(iii) its type;
14(iv) if it is a domestic filing association,
15domestic limited liability partnership or registered
16foreign association, the address of its registered
17office, including street and number, if any, in this
18Commonwealth, subject to section 109;
19(v) if it is a domestic association that is not a
20domestic filing association or limited liability
21partnership, the address, including street and number, if
22any, of its principal office; and
23(vi) if it is a nonregistered foreign association,
24the address, including street and number, if any, of:
25(A) its registered or similar office, if any,
26required to be maintained by the law of its
27jurisdiction of formation; or
28(B) if it is not required to maintain a
29registered or similar office, its principal office.
30(3) If the statement of merger is not to be effective on
1filing, the later date or date and time on which it will
2become effective.
3(4) A statement that the merger was approved in the
4following ways as applicable:
5(i) By a domestic entity that is a merging
6association, in accordance with this chapter.
7(ii) By a foreign merging association, in accordance
8with the law of its jurisdiction of formation.
9(iii) By a domestic merging association that is not
10a domestic entity, in the same manner required by its
11organic law for approving a merger that requires the
12approval of its interest holders.
13(5) If the surviving association exists before the
14merger and is a domestic filing entity, any amendment to its
15public organic record approved as part of the plan of merger.
16(6) If the surviving association is created by the
17merger and is a domestic filing entity, its public organic
18record, as an attachment. The public organic record does not
19need to state the name or address of an incorporator of a
20corporation, organizer of a limited liability company or
21similar person with respect to any other type of entity.
22(7) If the surviving association is created by the
23merger and is a nonregistered foreign association, one of the
24following:
25(i) The street and mailing addresses of its
26registered agent and registered office in its
27jurisdiction of formation if it is a filing entity.
28(ii) The street and mailing address of its principal
29office if it is not a filing entity.
30(8) If the surviving association is created by the
1merger and is a domestic limited liability partnership or a
2domestic limited liability limited partnership that is not
3using the alternative procedure in section 8201(f) (relating
4to scope), its statement of registration, as an attachment.
5(9) If the surviving association is created by the
6merger and is a domestic electing partnership, its statement
7of election.
8(c) Other provisions.--In addition to the requirements of
9subsection (b), a statement of merger may contain any other
10provision not prohibited by law.
11(d) Domestic surviving association.--If the surviving
12association is a domestic entity, its public organic record, if
13any, shall satisfy the requirements of the law of this
14Commonwealth, except that the public organic record does not
15need to be signed and may omit any provision that is not
16required to be included in a restatement of the public organic
17record.
18(e) Filing of plan.--A plan of merger that is signed by all
19of the merging associations and meets all of the requirements of
20subsection (b) may be delivered to the department for filing
21instead of a statement of merger and on filing has the same
22effect. If a plan of merger is filed as provided in this
23subsection, references in this chapter to a statement of merger
24refer to the plan of merger filed under this subsection.
25(f) Effectiveness of statement of merger.--A statement of
26merger is effective as provided in section 136(c) (relating to
27processing of documents by Department of State).
28(g) Effectiveness of merger.--If the surviving association
29is a domestic association, the merger is effective when the
30statement of merger is effective. If the surviving association
1is a foreign association, the merger is effective on the later
2of:
3(1) the date and time provided by the organic law of the
4surviving association; or
5(2) when the statement of merger is effective.
6(h) Cross references.--See sections 134 (relating to
7docketing statement), 135 (relating to requirements to be met by
8filed documents) and 316 (relating to contents of plan).
9§ 336. Effect of merger.
10(a) General rule.--When a merger under this subchapter
11becomes effective, all of the following apply:
12(1) The surviving association continues or comes into
13existence.
14(2) Each merging association that is not the surviving
15association ceases to exist.
16(3) All property of each merging association vests in
17the surviving association without reversion or impairment,
18and the merger shall not constitute a transfer of any of that
19property.
20(4) All debts, obligations and other liabilities of each
21merging association are debts, obligations and other
22liabilities of the surviving association.
23(5) Except as otherwise provided by law <-or the plan of
24merger, all the rights, privileges, immunities<-, <-and powers
<-25and purposes of each merging association vest in the
26surviving association.
27(6) If the surviving association exists before the
28merger, all of the following apply:
29(i) All of its property continues to be vested in it
30without transfer, reversion or impairment.
1(ii) It remains subject to all its debts,
2obligations and other liabilities.
3(iii) All its rights, privileges, immunities<-, <-and
4powers <-and purposes continue to be vested <-without change
5in it.
6(iv) Its public organic record, if any, is amended
7to the extent provided in the statement of merger.
8(v) Its private organic rules that are to be in
9record form, if any, are amended to the extent provided
10in the plan of merger.
<-11(7) The name of the surviving association may be
12substituted for the name of any merging association that is a
13party to any pending action or proceeding.
<-14(7) Liens on the property of the merging association
15shall not be impaired by the merger.
16(8) A claim existing or an action or a proceeding
17pending by or against any of the merging associations may be
18prosecuted to judgment as if the merger had not taken place,
19or the surviving association may be proceeded against or
20substituted in place of the appropriate merging association.
21(8) <-(9) If the surviving association is created by the
22merger, its private organic rules are effective and the
23following apply:
24(i) If it is a filing entity, its public organic
25record is effective.
26(ii) If it is a limited liability partnership or a
27limited liability limited partnership that is not using
28the alternative procedure under section 8201(f) (relating
29to scope), its statement of registration is effective.
30(iii) If it is an electing partnership, its
1statement of election is effective.
<-2(9) <-(10) The interests in each merging association that
3are to be converted or canceled as provided in the plan of
4merger are converted or canceled, and the interest holders of
5those interests are entitled only to the rights provided to
6them under the plan and to any dissenters rights they have
7pursuant to section 317 (relating to contractual dissenters
8rights in entity transactions) or 333(d) (relating to
9approval of merger).
10(b) No dissolution rights.--Except as provided in the
11organic law or organic rules of a merging association, a merger
12under this subchapter does not give rise to any rights that an
13interest holder, governor or third party would have on a
14dissolution, liquidation or winding up of the merging
15association.
16(c) New interest holder liability.--When a merger under this
17subchapter becomes effective, a person that becomes subject to
18interest holder liability with respect to an association as a
19result of the merger has interest holder liability only to the
20extent provided by the organic law of that association and only
21for those debts, obligations and other liabilities that arise
22after the merger becomes effective.
23(d) Prior interest holder liability.--When a merger under
24this subchapter becomes effective, the interest holder liability
25of a person that ceases to hold an interest in a domestic entity
26that is a merging association with respect to which the person
27had interest holder liability shall be as follows:
28(1) The merger does not discharge any interest holder
29liability under the organic law of the domestic entity to the
30extent the interest holder liability arose before the merger
1became effective.
2(2) The person does not have interest holder liability
3under the organic law of the domestic entity for any debt,
4obligation or other liability that arises after the merger
5becomes effective.
6(3) The organic law of the domestic entity continues to
7apply to the release, collection or discharge of any interest
8holder liability preserved under paragraph (1) as if the
9merger had not occurred.
10(4) The person has whatever rights of contribution from
11any other person as are provided by law other than this
12chapter or the organic rules of the domestic entity with
13respect to any interest holder liability preserved under
14paragraph (1) as if the merger had not occurred.
15(e) Foreign surviving association.--When a merger under this
16subchapter becomes effective, a foreign association that is the
17surviving association may be served with process in this
18Commonwealth for the collection and enforcement of any debts,
19obligations or other liabilities of a domestic entity that is a
20merging association in accordance with applicable law.
21(f) Registration of foreign association.--When a merger
22under this subchapter becomes effective, the registration to do
23business in this Commonwealth of a registered foreign
24association that is a merging association and is not the
25surviving association is canceled.
26(g) Taxes.--Any taxes, interest, penalties and public
27accounts of the Commonwealth claimed against any of the merging
28associations that are settled, assessed or determined prior to
29or after the merger shall be the liability of the surviving
30association <-and, together with interest thereon, shall be a lien
1against the franchises and property of the surviving
2association.
3SUBCHAPTER D
4INTEREST EXCHANGE
5Sec.
6341. Interest exchange authorized.
7342. Plan of interest exchange.
8343. Approval of interest exchange.
9344. Amendment or abandonment of plan of interest exchange.
10345. Statement of interest exchange; effectiveness.
11346. Effect of interest exchange.
12§ 341. Interest exchange authorized.
13(a) General rule.--Except as provided in section 318
14(relating to excluded entities and transactions) or this
15section, by complying with this subchapter:
16(1) A domestic or foreign association may acquire all of
17one or more classes or series of interests of a domestic
18entity in exchange for interests, securities, obligations,
19money, other property, rights to acquire interests or
20securities or any combination of the foregoing.
21(2) A domestic entity may acquire all of one or more
22classes or series of interests of a foreign association in
23exchange for interests, securities, obligations, money, other
24property, rights to acquire interests or securities or any
25combination of the foregoing.
26(b) Foreign associations.--By complying with the applicable
27provisions of this subchapter:
28(1) A foreign association may be the acquiring
29association in an interest exchange under this subchapter
30regardless of whether the law of its jurisdiction of
1formation authorizes an interest exchange.
2(2) A foreign association may be the acquired
3association in an interest exchange under this subchapter
4only if the interest exchange is authorized by the law of its
5jurisdiction of formation.
6(c) Protected agreements.--If a protected agreement of a
7domestic entity other than a business corporation contains a
8provision that applies to a merger of the entity but does not
9refer to an interest exchange, the provision shall apply to an
10interest exchange in which the domestic entity is the acquired
11association as if the interest exchange were a merger until the
12provision is amended after July 1, 2015.
13(d) Excluded entities.--The following domestic entities
14shall not be the acquired association in an interest exchange:
15(1) a health maintenance organization;
16(2) a hospital plan corporation; or
17(3) a professional health service organization.
18(e) Transitional provision.--A reference to a share exchange
19in a provision of the organic rules of a domestic business
20corporation which took effect before July 1, 2015, shall be
21deemed to include an interest exchange.
22(f) Cross reference.--See section 314 (relating to
23regulatory conditions and required notices and approvals).
24§ 342. Plan of interest exchange.
25(a) General rule.--A domestic entity may be the acquired
26association in an interest exchange under this chapter by
27approving a plan of interest exchange. The plan shall be in
28record form and contain all of the following:
29(1) The name and type of the acquired association.
30(2) The name, jurisdiction of formation and type of the
1acquiring association.
2(3) The manner of:
3(i) exchanging the interests in the acquired
4association to be acquired in the interest exchange into
5interests, securities, obligations, money, other
6property, rights to acquire interests or securities, or
7any combination of the foregoing; and
8(ii) canceling, if desired, some or all other
9interests in the acquired association.
10(4) Any proposed amendments to:
11(i) the public organic record, if any, of the
12acquired association; and
13(ii) the private organic rules of the acquired
14association that are or are proposed to be in record
15form.
16(5) Provisions, if any, providing special treatment of
17interests in the acquired association held by any interest
18holder or group of interest holders as authorized by, and
19subject to, section 329 (relating to special treatment of
20interest holders).
21(6) The other terms and conditions of the interest
22exchange.
23(7) Any other provision required by:
24(i) the law of this Commonwealth; or
25(ii) the organic rules of the acquired association.
26(b) Optional contents.--In addition to the requirements of
27subsection (a), a plan of interest exchange may contain any
28other provision not prohibited by law.
29(c) Cross reference.--See section 316(c) (relating to
30contents of plan).
1§ 343. Approval of interest exchange.
2(a) Approval by domestic entities.--A plan of interest
3exchange in which the acquired association is a domestic entity
4shall not be effective unless it has been approved in the
5following ways:
6(1) By the acquired domestic entity in accordance with
7the applicable provisions of Subchapter B (relating to
8approval of entity transactions).
9(2) In record form, by each interest holder of the
10acquired domestic entity that will have interest holder
11liability for debts, obligations and other liabilities that
12arise after the interest exchange becomes effective, unless,
13as to an interest holder that does not approve the plan, both
14of the following apply:
15(i) The organic rules of the entity provide in
16record form for the approval of an interest exchange or a
17merger in which some or all of its interest holders
18become subject to interest holder liability by the vote
19or consent of fewer than all the interest holders.
20(ii) The interest holder voted for or consented in
21record form to that provision of the organic rules or
22became an interest holder after the adoption of that
23provision.
24(3) Except as provided in the organic rules of the
25domestic entity, by the following class votes:
26(i) the holders of any class or series of interests
27of the acquired association to be exchanged or canceled
28shall be entitled to vote as a class on the plan; and
29(ii) the holders of any class or series of interests
30of the acquired association shall be entitled to vote as
1a class on the plan if the plan effects any change in the
2organic rules and those holders would have been entitled
3to vote as a class if the change had been made in any
4other manner.
5(b) Approval by foreign associations.--An interest exchange
6in which the acquired association is a foreign association is
7not effective unless it is approved by the foreign association
8in accordance with the law of its jurisdiction of formation.
9(c) Acquiring association.--Except as provided in its
10organic law or organic rules, the interest holders of the
11acquiring association are not required to approve the interest
12exchange.
13(d) Dissenters rights.--If a shareholder of a domestic
14business corporation that is to be the acquired association in
15an interest exchange objects to the plan of exchange and
16complies with Subchapter D of Chapter 15 (relating to dissenters
17rights), the shareholder shall be entitled to dissenters rights
18to the extent provided in that subchapter.
19(e) Cross references.--See sections 317 (relating to
20contractual dissenters rights in entity transactions) and 329(c)
21(relating to special treatment of interest holders).
22§ 344. Amendment or abandonment of plan of interest exchange.
23(a) General rule.--A plan of interest exchange may be
24amended or abandoned only with the consent of each party to the
25plan, except as otherwise provided in the plan.
26(b) Approval of amendment.--A domestic entity that is the
27acquired association may approve an amendment of a plan of
28interest exchange in one of the following ways:
29(1) In the same manner as the plan was approved, if the
30plan does not provide for the manner in which it may be
1amended.
2(2) By its governors or interest holders in the manner
3provided in the plan, but an interest holder that was
4entitled to vote on or consent to approval of the plan is
5entitled to vote on or consent to any amendment of the plan
6that will change any of the following:
7(i) The amount or kind of interests, securities,
8obligations, money, other property, rights to acquire
9interests or securities, or any combination of the
10foregoing, to be received by any of the interest holders
11of the entity under the plan.
12(ii) The public organic record, if any, or private
13organic rules of the entity that will be in effect
14immediately after the interest exchange becomes
15effective, except for changes that do not require
16approval of the interest holders of the entity under its
17organic law or organic rules.
18(iii) Any other terms or conditions of the plan, if
19the change would:
20(A) increase the interest holder liability to
21which the interest holder will be subject; or
22(B) otherwise adversely affect the interest
23holder in any material respect.
24(c) Approval of abandonment.--After a plan of interest
25exchange has been approved by a domestic entity that is the
26acquired entity and before a statement of interest exchange
27becomes effective, the plan may be abandoned as provided in the
28plan. Unless prohibited by the plan, a domestic entity that is
29the acquired association may abandon the plan in the same manner
30as the plan was approved.
1(d) Statement of abandonment.--If a plan of interest
2exchange is abandoned after a statement of interest exchange has
3been delivered to the department for filing and before the
4statement becomes effective, a statement of abandonment <-under
5section 141 (relating to abandonment of filing before
6effectiveness), signed by the acquired association, must be
7delivered to the department for filing before the time the
8statement of interest exchange becomes effective. <-The statement
9of abandonment shall take effect on filing, and the interest
10exchange shall be abandoned and shall not become effective. The
11statement of abandonment shall contain all of the following:
12(1) The name of the acquired association.
13(2) The date on which the statement of interest exchange
14was filed by the department.
15(3) A statement that the interest exchange has been
16abandoned in accordance with this section.
17(e) Cross references.--See sections 134 (relating to
18docketing statement) and 135 (relating to requirements to be met
19by filed documents).
20§ 345. Statement of interest exchange; effectiveness.
21(a) General rule.--If the acquired association is a domestic
22entity, a statement of interest exchange shall be signed by that
23entity and delivered to the department for filing.
24(b) Contents.--A statement of interest exchange shall
25contain all of the following:
26(1) With respect to the acquired association:
27(i) its name;
28(ii) its jurisdiction of formation;
29(iii) its type;
30(iv) if it is a domestic filing association or
1domestic limited liability partnership, the address of
2its registered office, including street and number, if
3any, in this Commonwealth, subject to section 109
4(relating to name of commercial registered office
5provider in lieu of registered address); and
6(v) if it is a domestic association that is not a
7domestic filing association or limited liability
8partnership, the address, including street and number, if
9any, of its principal office.
10(2) With respect to the acquiring association:
11(i) its name;
12(ii) its jurisdiction of formation;
13(iii) its type;
14(iv) if it is a domestic filing association,
15domestic limited liability partnership or registered
16foreign association, the address of its registered
17office, including street and number, if any, in this
18Commonwealth, subject to section 109;
19(v) if it is a domestic association that is not a
20domestic filing association or limited liability
21partnership, the address, including street and number, if
22any, of its principal office; and
23(vi) if it is a nonregistered foreign association,
24the address, including street and number, if any, of:
25(A) its registered or similar office, if any,
26required to be maintained by the law of its
27jurisdiction of formation; or
28(B) if it is not required to maintain a
29registered or similar office, its principal office.
30(3) If the statement of interest exchange is not to be
1effective on filing, the later date or date and time on which
2it will become effective.
3(4) A statement that the plan of interest exchange was
4approved by the acquired association in accordance with this
5chapter.
6(5) Any amendments to the public organic record of the
7acquired association approved as part of the plan of interest
8exchange.
9(c) Other provisions.--In addition to the requirements of
10subsection (b), a statement of interest exchange may contain any
11other provision not prohibited by law.
12(d) Filing of plan.--A plan of interest exchange that is
13signed by the domestic entity that is the acquired association
14and that meets all of the requirements of subsection (b) may be
15delivered to the department for filing instead of a statement of
16interest exchange and on filing shall have the same effect. If a
17plan of interest exchange is delivered to the department for
18filing as provided in this subsection, references in this
19chapter to a statement of interest exchange shall refer to the
20plan of interest exchange filed under this subsection.
21(e) Effectiveness.--An interest exchange in which the
22acquired association is a domestic entity is effective when the
23statement of interest exchange is effective as provided in
24section 136(c) (relating to processing of documents by
25Department of State).
26(f) Cross references.--See sections 134 (relating to
27docketing statement) and 135 (relating to requirements to be met
28by filed documents).
29§ 346. Effect of interest exchange.
30(a) General rule.--When an interest exchange in which the
1acquired association is a domestic entity becomes effective, all
2of the following apply:
3(1) Interests in the acquired association are exchanged
4or canceled as provided in the plan of exchange, and the
5interest holders of those interests are entitled only to the
6rights provided to them under the plan and to any dissenters
7rights they have pursuant to section 317 (relating to
8contractual dissenters rights in entity transactions) or
9343(d) (relating to approval of interest exchange).
10(2) The acquiring association becomes the interest
11holder of the interests in the acquired association stated in
12the plan of interest exchange to be acquired by the acquiring
13entity.
14(3) The public organic record, if any, of the acquired
15association is amended to the extent provided in the
16statement of interest exchange.
17(4) The private organic rules of the acquired
18association that are to be in record form, if any, are
19amended to the extent provided in the plan of interest
20exchange.
21(b) No dissolution rights.--Except as provided in the
22organic rules of the acquired association, the interest exchange
23shall not give rise to any rights that an interest holder,
24governor or third party would have upon a dissolution,
25liquidation or winding up of the acquired association.
26(c) New interest holder liability.--When an interest
27exchange becomes effective, a person that becomes subject to
28interest holder liability with respect to an association as a
29result of the interest exchange has interest holder liability
30only to the extent provided by the organic law of the
1association and only for those debts, obligations and other
2liabilities that arise after the interest exchange becomes
3effective.
4(d) Prior interest holder liability.--When an interest
5exchange becomes effective, the interest holder liability of a
6person that ceases to hold an interest in a domestic acquired
7association with respect to which the person had interest holder
8liability is as follows:
9(1) The interest exchange does not discharge any
10interest holder liability under the organic law of the
11domestic acquired association to the extent the interest
12holder liability arose before the interest exchange became
13effective.
14(2) The person does not have interest holder liability
15under the organic law of the domestic acquired association
16for any debt, obligation or other liability that arises after
17the interest exchange becomes effective.
18(3) The organic law of the domestic acquired association
19continues to apply to the release, collection or discharge of
20any interest holder liability preserved under paragraph (1)
21as if the interest exchange had not occurred.
22(4) The person has whatever rights of contribution from
23any other person as are provided by law other than this title
24or the organic law or organic rules of the domestic acquired
25association with respect to any interest holder liability
26preserved under paragraph (1) as if the interest exchange had
27not occurred.
28SUBCHAPTER E
29CONVERSION
30Sec.
1351. Conversion authorized.
2352. Plan of conversion.
3353. Approval of conversion.
4354. Amendment or abandonment of plan of conversion.
5355. Statement of conversion; effectiveness.
6356. Effect of conversion.
7§ 351. Conversion authorized.
8(a) Domestic converting associations.--Except as provided in
9section 318 (relating to excluded entities and transactions) or
10this section, by complying with this chapter:
11(1) A domestic entity may become a domestic entity of a
12different type or a domestic banking institution.
13(2) A domestic banking institution may become a domestic
14association of a different type.
15(3) A domestic entity may become a foreign association
16of a different type, if the conversion is authorized by the
17law of the foreign jurisdiction.
18(b) Foreign converting associations.--By complying with the
19applicable provisions of this subchapter, a foreign association
20may become a domestic entity of a different type if the
21conversion is authorized by the law of the jurisdiction of
22formation of the foreign association.
23(c) Protected governance agreements.--If a protected
24governance agreement that is binding on a domestic entity
25immediately before the effectiveness of a transaction under this
26chapter contains a provision that applies to a merger of the
27entity but does not refer to a conversion, the provision shall
28apply to a conversion of the entity as if the conversion were a
29merger until the provision is amended after July 1, 2015.
30(d) Exceptions.--This subchapter may not be used to
1accomplish a transaction that has the same effect as a
2transaction under any of the following provisions:
3(1) Section 7104 (relating to election of an existing
4business corporation to become a cooperative corporation).
5(2) Section 7105 (relating to termination of status as a
6cooperative corporation for profit).
7(3) Section 7106 (relating to election of an existing
8nonprofit corporation to become a cooperative corporation).
9(4) Section 7107 (relating to termination of nonprofit
10cooperative corporation status).
11(e) Cross reference.--See section 314 (relating to
12regulatory conditions and required notices and approvals).
13§ 352. Plan of conversion.
14(a) General rule.--A domestic entity or domestic banking
15institution may be a party to a conversion by approving a plan
16of conversion. The plan shall be in record form and contain all
17of the following:
18(1) The name and type of the converting association.
19(2) The name, jurisdiction of formation and type of
20converted association.
21(3) The manner of:
22(i) canceling, if desired, some, but less than all,
23of the interests in the converting association;
24(ii) converting at least some of the interests in
25the converting association into interests in the
26converted association; and
27(iii) converting the interests in the converting
28association not canceled under subparagraph (i) or
29converted under subparagraph (ii) into interests,
30securities, obligations, money, other property, rights to
1acquire interests or securities or any combination of the
2foregoing.
3(4) The proposed public organic record of the converted
4association if it will be a filing entity.
5(5) The full text of the private organic rules of the
6converted association that are proposed to be in record form.
7(6) Provisions, if any, providing special treatment of
8interests in the converting association held by any interest
9holder or group of interest holders as authorized by and
10subject to section 329 (relating to special treatment of
11interest holders).
12(7) The other terms and conditions of the conversion.
13(8) Any other provision required by:
14(i) the law of this Commonwealth;
15(ii) the law of the jurisdiction of formation of the
16converted association if it is to be a foreign
17association; or
18(iii) the organic rules of the converting
19association.
20(b) Optional contents.--In addition to the requirements of
21subsection (a), a plan of conversion may contain any other
22provision not prohibited by law.
23(c) Terms of interests.--The ownership, voting and other
24rights of the interest holders in the converted association
25shall be substantially the same as they were in the converting
26association except:
27(1) as provided in the plan of conversion pursuant to
28section 329;
29(2) as provided in the express terms of the organic
30rules of the converted association that are in record form;
1or
2(3) to the extent a difference in those rights is
3required by a provision of the organic law of the converted
4association that cannot be varied in its organic rules.
5(d) Cross reference.--See section 316(c) (relating to
6contents of plan).
7§ 353. Approval of conversion.
8(a) Approval by domestic associations.--A plan of conversion
9in which the converting association is a domestic entity or
10domestic banking institution shall not be effective unless it
11has been approved in the following ways:
12(1) In the case of a domestic entity, in accordance with
13the applicable provisions of Subchapter B (relating to
14approval of entity transactions).
15(2) In the case of a domestic banking institution that
16is a corporation, by at least:
17(i) In the case of a mutual savings bank:
18(A) two-thirds of the trustees present at a
19meeting at which the plan is proposed; and
20(B) two-thirds of all the trustees at a
21subsequent meeting held upon not less than ten days'
22notice to all the trustees.
23(ii) In the case of any other institution:
24(A) a majority of the directors; and
25(B) the shareholders entitled to cast at least
26two-thirds of the votes which all shareholders are
27entitled to cast thereon, and, if any class of shares
28is entitled to vote thereon as a class, the holders
29of at least two-thirds of the outstanding shares of
30such class, at a meeting held upon not less than ten
1days' notice to all shareholders.
2(3) In record form, by each interest holder, if any, of
3the converting association that will have interest holder
4liability for debts, obligations and other liabilities that
5arise after the conversion becomes effective, unless, as to
6an interest holder that does not approve the plan, both of
7the following apply:
8(i) The organic rules of the converting association
9provide in record form for the approval of a conversion
10or a merger in which some or all of its interest holders
11become subject to interest holder liability by the vote
12or consent of fewer than all of the interest holders.
13(ii) The interest holder voted for or consented in
14record form to that provision of the organic rules or
15became an interest holder after the adoption of that
16provision.
17(b) Approval by foreign associations.--A conversion in which
18the converting association is a foreign association shall not be
19effective unless it is approved by the foreign association in
20accordance with the law of its jurisdiction of formation.
21(c) Dissenters rights.--The following apply with respect to
22the rights of an interest holder of the converting association:
23(1) A shareholder of a domestic business corporation
24that is to be a converting association shall be entitled to
25dissenters rights if:
26(i) the shareholder objects to the plan of
27conversion and complies with Subchapter D of Chapter 15
28(relating to dissenters rights); and
29(ii) the conversion involves a change in the rights
30of the shareholder pursuant to section 352(c)(1) or (2)
1(relating to plan of conversion).
2(2) A shareholder of a domestic banking institution that
3is to be a converting association shall be entitled to the
4rights provided in section 1222 of the act of November 30,
51965 (P.L.847, No.356), known as the Banking Code of 1965,
6if:
7(i) the shareholder objects to the plan of
8conversion and complies with section 1222 of the Banking
9Code of 1965; and
10(ii) the conversion involves a change in the rights
11of the shareholder pursuant to section 352(c)(1) or (2).
12(3) See sections 317 (relating to contractual dissenters
13rights in entity transactions) and 329 (relating to special
14treatment of interest holders).
15§ 354. Amendment or abandonment of plan of conversion.
16(a) Approval of amendment.--A plan of conversion in which
17the converting association is a domestic association may be
18amended in one of the following ways:
19(1) In the same manner as the plan was approved, if the
20plan does not provide for the manner in which it may be
21amended.
22(2) By its governors or interest holders in the manner
23provided in the plan, but an interest holder that was
24entitled to vote on or consent to approval of the plan is
25entitled to vote on or consent to any amendment of the plan
26that will change any of the following:
27(i) The amount or kind of interests, securities,
28obligations, money, other property, rights to acquire
29interests or securities, or any combination of the
30foregoing, to be received by any of the interest holders
1of the converting association under the plan.
2(ii) The public organic record, if any, or private
3organic rules of the converted association that will be
4in effect immediately after the conversion becomes
5effective, except for changes that do not require
6approval of the interest holders of the converted
7association under its organic law or organic rules.
8(iii) Any other terms or conditions of the plan, if
9the change would:
10(A) increase the interest holder liability to
11which the interest holder will be subject; or
12(B) otherwise adversely affect the interest
13holder in any material respect.
14(b) Approval of abandonment.--After a plan of conversion has
15been approved by a converting association that is a domestic
16association and before a statement of conversion becomes
17effective, the plan may be abandoned as provided in the plan.
18Unless prohibited by the plan, a domestic converting association
19may abandon the plan in the same manner as the plan was
20approved.
21(c) Statement of abandonment.--If a plan of conversion is
22abandoned after a statement of conversion has been delivered to
23the department for filing and before the statement of conversion
24becomes effective, a statement of abandonment <-under section 141
25(relating to abandonment of filing before effectiveness), signed
26by the converting association, must be delivered to the
27department for filing before the statement of conversion becomes
28effective. <-The statement of abandonment shall take effect on
29filing, and the conversion shall be abandoned and shall not
30become effective. The statement of abandonment shall contain all
1of the following:
2(1) The name of the converting association.
3(2) The date on which the statement of conversion was
4delivered to the department for filing.
5(3) A statement that the conversion has been abandoned
6in accordance with this section.
7(d) Cross references.--See sections 134 (relating to
8docketing statement) and 135 (relating to requirements to be met
9by filed documents).
10§ 355. Statement of conversion; effectiveness.
11(a) General rule.--A statement of conversion shall be signed
12by the converting association and delivered to the department
13for filing along with the certificates, if any, required by
14section 139 (relating to tax clearance of certain fundamental
15transactions).
16(b) Contents.--A statement of conversion shall contain all
17of the following:
18(1) With respect to the converting association:
19(i) its name;
20(ii) its jurisdiction of formation;
21(iii) its type;
22(iv) the date on which it was first created,
23incorporated, formed or otherwise came into existence;
24(v) if it is a domestic filing association, the
25statute under which it was first created, incorporated,
26formed or otherwise came into existence;
27(vi) if it is a domestic filing association,
28domestic limited liability partnership or registered
29foreign association:
30(A) the address of its registered office,
1including street and number, if any, in this
2Commonwealth, subject to section 109 (relating to
3name of commercial registered office provider in lieu
4of registered address); or
5(B) if it is not required to maintain a
6registered office in this Commonwealth, the address,
7including street and number, if any, of its principal
8office;
9(vii) if it is a domestic association that is not a
10domestic filing association or limited liability
11partnership, the address, including street and number, if
12any, of its principal office; and
13(viii) if it is a nonregistered foreign association,
14the address, including street and number, if any, of:
15(A) its registered or similar office, if any,
16required to be maintained by the law of its
17jurisdiction of formation; or
18(B) if it is not required to maintain a
19registered or similar office, its principal office.
20(2) With respect to the converted association:
21(i) its name;
22(ii) its jurisdiction of formation;
23(iii) its type;
24(iv) if it is a domestic filing association,
25domestic limited liability partnership or registered
26foreign association:
27(A) the address of its registered office,
28including street and number, if any, in this
29Commonwealth, subject to section 109; or
30(B) if it is not required to maintain a
1registered office in this Commonwealth, the address,
2including street and number, if any, of its principal
3office;
4(v) if it is a domestic association that is not a
5domestic filing association or limited liability
6partnership, the address, including street and number, if
7any, of its principal office; and
8(vi) if it is a nonregistered foreign association,
9the address, including street and number, if any, of:
10(A) its registered or similar office, if any,
11required to be maintained by the law of its
12jurisdiction of formation; or
13(B) if it is not required to maintain a
14registered or similar office, its principal office.
15(3) If the statement of conversion is not to be
16effective on filing, the later date or date and time on which
17it will become effective.
18(4) If the converting association is a domestic
19association, a statement that the plan of conversion was
20approved in accordance with this chapter or, if the
21converting association is a foreign association, a statement
22that the conversion was approved by the foreign association
23in accordance with the law of its jurisdiction of formation.
24(5) If the converted association is a domestic filing
25entity or domestic banking institution, its public organic
26record as an attachment. The public organic record does not
27need to state the name or address of an incorporator of a
28corporation, organizer of a limited liability company or
29similar person with respect to any other type of entity.
30(6) If the converted association is a domestic limited
1liability partnership or a domestic limited liability limited
2partnership that is not using the alternative procedure in
3section 8201(f) (relating to scope), its statement of
4registration as an attachment.
5(7) If the converted association is a domestic electing
6partnership, its statement of election as an attachment.
7(8) If the converted association is a nonregistered
8foreign association, one of the following:
9(i) The street and mailing addresses of its
10registered agent and registered office in its
11jurisdiction of formation if it is a filing entity.
12(ii) The street and mailing address of its principal
13office if it is not a filing entity.
14(c) Other provisions.--In addition to the requirements of
15subsection (b), a statement of conversion may contain any other
16provision not prohibited by law.
17(d) Domestic converted association.--If the converted
18association is a domestic association, its public organic
19record, if any, must satisfy the requirements of the law of this
20Commonwealth, except that the public organic record does not
21need to be signed and may omit any provision that is not
22required to be included in a restatement of the public organic
23record.
24(e) Filing of plan.--A plan of conversion that is signed by
25the converting association and meets all the requirements of
26subsection (b) may be delivered to the department for filing
27instead of a statement of conversion and on filing has the same
28effect. If a plan of conversion is filed as provided in this
29subsection, references in this chapter to a statement of
30conversion refer to the plan of conversion filed under this
1subsection.
2(f) Effectiveness of statement of conversion.--A statement
3of conversion is effective as provided in section 136(c)
4(relating to processing of documents by Department of State).
5(g) Effectiveness of conversion.--If the converted
6association is a domestic association, the conversion is
7effective when the statement of conversion is effective. If the
8converted association is a foreign association, the conversion
9is effective on the later of:
10(1) the date and time provided by the organic law of the
11converted association; or
12(2) when the statement of conversion is effective.
13(h) Cross references.--See sections 134 (relating to
14docketing statement) and 135 (relating to requirements to be met
15by filed documents).
16§ 356. Effect of conversion.
17(a) General rule.--When a conversion becomes effective, all
18of the following apply:
19(1) The converted association is:
20(i) Organized under and subject to the organic law
21of the converted association.
22(ii) The same association without interruption as
23the converting association.
24(iii) Deemed to have commenced its existence on the
25date the converting association commenced its existence
26in the jurisdiction in which the converting association
27was first created, incorporated, formed or otherwise came
28into existence, except for purposes of determining how
29the converted association is taxed.
30(2) All property of the converting association continues
1to be vested in the converted association without reversion
2or impairment, and the conversion shall not constitute a
3transfer of any of that property.
4(3) All debts, obligations and other liabilities of the
5converting association continue as debts, obligations and
6other liabilities of the converted association.
7(4) Except as provided by law <-or the plan of conversion,
8all of the rights, privileges, immunities<-, and powers <-and
9purposes of the converting association continue to be vested
10without change in the converted association.
11(5) <-The <-Liens on the property of the converting
12association shall not be impaired by the conversion.
13(6) A claim existing or an action or a proceeding
14pending by or against the converting association may be
15prosecuted to judgment as if the conversion had not taken
16place, and the name of the converted association may be
17substituted for the name of the converting association in any
18pending action or proceeding.
<-19(6) <-(7) If a converted association is a filing
20association, its public organic record is effective.
<-21(7) <-(8) If the converted association is a limited
22liability partnership or a limited liability limited
23partnership that is not using the alternative procedure in
24section 8201(f) (relating to scope), its statement of
25registration is effective.
<-26(8) <-(9) If the converted association is an electing
27partnership, its statement of election is effective.
<-28(9) <-(10) Any private organic rules of the converted
29association that are to be in record form and were approved
30as part of the plan of conversion are effective.
<-1(10) <-(11) The interests in the converting association
2are converted or canceled in accordance with and as provided
3in the plan of conversion, and the interest holders of the
4converting association are entitled only to the rights
5provided to them under the plan and to any dissenters rights
6they have pursuant to section 317 (relating to contractual
7dissenters rights in entity transactions) or 353(c) (relating
8to approval of conversion).
<-9(11) <-(12) Except as otherwise provided in the plan of
10conversion or organic rules pursuant to section 352(c)
11(relating to plan of conversion), the conversion does not
12constitute and shall not be deemed to result in a change of
13control of the converting association and the converted
14association shall remain under the control of the same
15persons that controlled the converting association
16immediately before the conversion.
17(b) No other rights.--The conversion does not give rise to
18any rights:
19(1) that a third party would have upon a transfer of
20assets, merger, dissolution, liquidation or winding up of the
21converting association, except as provided in subsection(a)
22(11); or
23(2) that an interest holder or governor would have upon
24a dissolution, liquidation or winding up of the converting
25association, except as provided in the organic law or organic
26rules of the converting association.
27(c) New interest holder liability.--When a conversion
28becomes effective, a person that becomes subject to interest
29holder liability with respect to a domestic association as a
30result of the conversion has interest holder liability only to
1the extent provided by the organic law of the association and
2only for those debts, obligations and other liabilities that
3arise after the conversion becomes effective.
4(d) Prior interest holder liability.--When a conversion
5becomes effective, the interest holder liability of a person
6that ceases to hold an interest in a domestic converting
7association with respect to which the person had interest holder
8liability is as follows:
9(1) The conversion does not discharge any interest
10holder liability under the organic law of the domestic
11converting association to the extent the interest holder
12liability arose before the conversion became effective.
13(2) The person does not have interest holder liability
14under the organic law of the domestic converting association
15for any debt, obligation or other liability that arises after
16the conversion becomes effective.
17(3) The organic law of the domestic converting
18association continues to apply to the release, collection or
19discharge of any interest holder liability preserved under
20paragraph (1) as if the conversion had not occurred.
21(4) The person has whatever rights of contribution from
22any other person as are provided by other law or the organic
23law or organic rules of the domestic converting association
24with respect to any interest holder liability preserved under
25paragraph (1) as if the conversion had not occurred.
26(e) Foreign converted association.--When a conversion
27becomes effective, a foreign association that is the converted
28association may be served with process in this Commonwealth for
29the collection and enforcement of any of its debts, obligations
30and other liabilities in accordance with applicable law.
1(f) Association not dissolved.--A conversion does not
2require a domestic converting association to liquidate, dissolve
3or wind up its affairs and does not constitute or cause the
4liquidation or dissolution of the association.
5(g) Taxes.--Any taxes, interest, penalties and public
6accounts of the Commonwealth claimed against the converting
7association that are settled, assessed or determined prior to or
8after the conversion shall be the liability of the converted
9association <-and, together with interest thereon, shall be a lien
10against the franchises and property of the converted
11association.
12(h) Cross references.--See sections 416 (relating to
13withdrawal deemed on certain transactions) and 417 (relating to
14required withdrawal on certain transactions).
15SUBCHAPTER F
16DIVISION
17Sec.
18361. Division authorized.
19362. Plan of division.
20363. Approval of division.
21364. Division without interest holder approval.
22365. Amendment or abandonment of plan of division.
23366. Statement of division; effectiveness.
24367. Effect of division.
25368. Allocation of liabilities in division.
26§ 361. Division authorized.
27(a) Domestic entities.--Except as provided in section 318
28(relating to excluded entities and transactions) or this
29section, by complying with this subchapter, a domestic entity
30may divide into:
1(1) the dividing association and one or more new
2associations that are either domestic entities or foreign
3associations; or
4(2) two or more new associations that are either
5domestic entities or foreign associations.
6(b) Foreign associations.--
7(1) A foreign association may be created by the division
8of a domestic entity only if the division is authorized by
9the law of the jurisdiction of formation of the foreign
10association.
11(2) If the division is authorized by the law of the
12jurisdiction of formation of the foreign association, one or
13more of the resulting associations created in a division of a
14foreign association may be a domestic entity.
15(c) Exception.--A domestic banking institution that is a
16domestic entity may be a dividing association only if all of the
17resulting associations are domestic banking institutions.
18(d) Cross reference.--See section 314 (relating to
19regulatory conditions and required notices and approvals).
20§ 362. Plan of division.
21(a) General rule.--A domestic entity may become a dividing
22association under this chapter by approving a plan of division.
23The plan shall be in record form and contain all of the
24following:
25(1) The name and type of the dividing association.
26(2) A statement as to whether the dividing association
27will survive the division.
28(3) The name, jurisdiction of formation and type of each
29new association.
30(4) The manner of:
1(i) If the dividing association survives the
2division and it is desired:
3(A) Canceling some, but less than all, of the
4interests in the dividing association.
5(B) Converting some, but less than all, of the
6interests in the dividing association into interests,
7securities, obligations, money, other property,
8rights to acquire interests or securities, or any
9combination of the foregoing.
10(ii) If the dividing association does not survive
11the division, canceling or converting the interests in
12the dividing association into interests, securities,
13obligations, money, other property, rights to acquire
14interests or securities, or any combination of the
15foregoing.
16(iii) Allocating between or among the resulting
17associations the property of the dividing association
18that will not be owned by all of the resulting
19associations as tenants in common pursuant to section
20367(a)(4) (relating to effect of division) and those
21liabilities of the dividing association as to which not
22all of the resulting associations will be liable jointly
23and severally pursuant to section 368(a)(3) (relating to
24allocation of liabilities in division).
25(iv) Distributing the interests of the new
26associations.
27(5) For each new association:
28(i) its proposed public organic record if it will be
29a filing association; and
30(ii) the full text of its private organic rules that
1will be in record form.
2(6) If the dividing association will survive the
3division, any proposed amendments to its public organic
4record or private organic rules that are or will be in record
5form.
6(7) Provisions, if any, providing special treatment of
7interests in the dividing association held by any interest
8holder or group of interest holders as authorized by and
9subject to section 329 (relating to special treatment of
10interest holders).
11(8) The other terms and conditions of the division.
12(9) Any other provision required by:
13(i) the law of this Commonwealth;
14(ii) the law of the jurisdiction of formation of any
15of the resulting associations; or
16(iii) the organic rules of the dividing association.
17(b) Optional contents.--In addition to the requirements of
18subsection (a), a plan of division may contain any other
19provision not prohibited by law.
20(c) Description of property and liabilities.--It shall not
21be necessary for a plan of division to list each individual
22liability or item of property of the dividing association to be
23allocated to a resulting association so long as the liabilities
24and property are described in a reasonable manner.
25(d) Cross reference.--See section 316(c) (relating to
26contents of plan).
27§ 363. Approval of division.
28(a) Approval by domestic entities.--Except as provided in
29section 364 (relating to division without interest holder
30approval) or subsection (d), a plan of division in which the
1dividing association is a domestic entity is not effective
2unless it has been approved in both of the following ways:
3(1) The plan is approved by the domestic entity in
4accordance with the applicable provisions of Subchapter B
5(relating to approval of entity transactions).
6(2) The plan is approved in record form by each interest
7holder, if any, of the domestic entity that will have
8interest holder liability for debts, obligations and other
9liabilities that arise after the division becomes effective,
10unless, as to an interest holder that does not approve the
11plan, both of the following apply:
12(i) The organic rules of the domestic entity provide
13in record form for the approval of a division in which
14some or all of its interest holders become subject to
15interest holder liability by the vote or consent of fewer
16than all of the interest holders.
17(ii) The interest holder voted for or consented in
18record form to that provision of the organic rules or
19became an interest holder after the adoption of the
20provision.
21(b) Approval by foreign associations.--A division of a
22foreign association in which one or more of the resulting
23associations is a domestic entity is not effective unless it is
24approved by the foreign association in accordance with the law
25of its jurisdiction of formation.
26(c) Dissenters rights.--If a shareholder of a domestic
27business corporation that is to be a dividing association
28objects to the plan of division and complies with Subchapter D
29of Chapter 15 (relating to dissenters rights), the shareholder
30shall be entitled to dissenters rights to the extent provided in
1that subchapter. See sections 317 (relating to contractual
2dissenters rights in entity transactions) and 329 (relating to
3special treatment of interest holders).
4(d) Transitional approval requirements.--
5(1) If a provision of the organic rules of a dividing
6association that is a domestic entity of the type described
7was adopted before the date indicated and requires for the
8proposal or adoption of a plan of merger a specific number or
9percentage of votes of governors or interest holders or other
10special procedures, a plan of division shall not be proposed
11or adopted by the governors or interest holders without that
12number or percentage of votes or compliance with the other
13special procedures:
14(i) For a dividing association that is a domestic
15business corporation, before October 1, 1989.
16(ii) For a dividing association that is a general
17partnership, before July 1, 2015.
18(iii) For a dividing association that is a limited
19partnership, before February 5, 1995.
20(iv) For a dividing association that is an
21unincorporated nonprofit association, before July 1,
222015.
23(2) If a provision of any debt securities, notes or
24similar evidences of indebtedness for money borrowed, whether
25secured or unsecured, indentures or other contracts that were
26issued, incurred or executed by a dividing association that
27is a domestic entity of the type described before the date
28indicated, and the provision requires the consent of the
29obligee to a merger of the dividing association or treats
30such a merger as a default, the provision shall apply to a
1division of the dividing association as if it were a merger:
2(i) For a dividing association that is a domestic
3business corporation, before August 21, 2001.
4(ii) For a dividing association that is a general
5partnership, before July 1, 2015.
6(iii) For a dividing association that is a limited
7partnership, before July 1, 2015.
8(iv) For a dividing association that is an
9unincorporated nonprofit association, before July 1,
102015.
11(3) When a provision described in paragraph (1) or (2)
12has been amended after the applicable date, the provision
13shall cease to be subject to the respective paragraph and
14shall thereafter apply only in accordance with its express
15terms.
16§ 364. Division without interest holder approval.
17(a) General rule.--Unless otherwise restricted by its
18organic rules, a plan of division of a domestic dividing
19association shall not require the approval of the interest
20holders of the dividing association if:
21(1) The plan does not do any of the following:
22(i) alter the jurisdiction of formation of the
23dividing association;
24(ii) provide for special treatment; or
25(iii) amend in any respect the provisions of the
26public organic record of the dividing association, except
27amendments which may be made without the approval of the
28interest holders.
29(2) Either:
30(i) the dividing association survives the division
1and all the interests and other securities and
2obligations, if any, of all of the new associations are
3owned solely by the dividing association; or
4(ii) the interests in each new association are
5distributed as provided in subsection (b).
6(b) Distribution of interests.--The requirements for
7distributing interests in each new association referred to in
8subsection (a)(2)(ii) are as follows:
9(1) if the dividing association is not a limited
10partnership, the dividing association has only one class of
11interests outstanding and the interests and other securities
12and obligations, if any, of each new association are
13distributed pro rata to the interest holders of the dividing
14association; or
15(2) if the dividing association is a limited
16partnership:
17(i) it has only one class of general partners and
18one class of limited partners;
19(ii) each new association is a limited partnership;
20and
21(iii) all of the following apply:
22(A) the general partner interests in each new
23association are distributed pro rata to the general
24partners of the dividing limited partnership;
25(B) the limited partner interests in each new
26association are distributed pro rata to the limited
27partners of the dividing limited partnership; and
28(C) no securities of obligations of any of the
29new associations are distributed to any of the
30interest holders of the dividing limited partnership.
1§ 365. Amendment or abandonment of plan of division.
2(a) Approval of amendment.--A plan of division in which the
3dividing association is a domestic entity may be amended in one
4of the following ways:
5(1) In the same manner as the plan was approved, if the
6plan does not provide for the manner in which it may be
7amended.
8(2) By its governors or interest holders in the manner
9provided in the plan, but an interest holder that was
10entitled to vote on or consent to approval of the plan is
11entitled to vote on or consent to any amendment of the plan
12that will change any of the following:
13(i) The amount or kind of interests, securities,
14obligations, money, other property, rights to acquire
15interests or securities, or any combination of the
16foregoing, to be received by any of the interest holders
17of the dividing association under the plan.
18(ii) The public organic record, if any, or private
19organic rules of any of the resulting associations that
20will be in effect immediately after the division becomes
21effective, except for changes that do not require
22approval of the interest holders of the resulting
23association under its organic law or organic rules.
24(iii) Any other terms or conditions of the plan, if
25the change would:
26(A) increase the interest holder liability to
27which the interest holder will be subject; or
28(B) otherwise adversely affect the interest
29holder in any material respect.
30(b) Approval of abandonment.--After a plan of division has
1been approved by a domestic entity that is the dividing
2association and before a statement of division becomes
3effective, the plan may be abandoned as provided in the plan.
4Unless prohibited by the plan, a domestic entity that is the
5dividing association may abandon the plan in the same manner as
6the plan was approved.
7(c) Statement of abandonment.--If a plan of division is
8abandoned after a statement of division has been delivered to
9the department for filing and before the statement becomes
10effective, a statement of abandonment <-under section 141
11(relating to abandonment of filing before effectiveness), signed
12by the dividing association, must be delivered to the department
13for filing before the time the statement of division becomes
14effective. The statement of abandonment shall take effect on
15filing, and the division shall be abandoned and shall not become
16effective. <-The statement of abandonment shall contain all of the
17following:
18(1) The name of the dividing association.
19(2) The date on which the statement of division was
20filed by the department.
21(3) A statement that the division has been abandoned in
22accordance with this section.
23(d) Cross references.--See sections 134 (relating to
24docketing statement) and 135 (relating to requirements to be met
25by filed documents).
26§ 366. Statement of division; effectiveness.
27(a) General rule.--A statement of division shall be signed
28by the dividing association and delivered to the department for
29filing along with the certificates, if any, required by section
30139 (relating to tax clearance of certain fundamental
1transactions).
2(b) Contents.--A statement of division shall contain all of
3the following:
4(1) With respect to the dividing association:
5(i) its name;
6(ii) its jurisdiction of formation;
7(iii) its type;
8(iv) if it is a domestic filing association,
9domestic limited liability partnership or registered
10foreign association, the address of its registered
11office, including street and number, if any, in this
12Commonwealth, subject to section 109 (relating to name of
13commercial registered office provider in lieu of
14registered address);
15(v) if it is a domestic association that is not a
16domestic filing association or limited liability
17partnership, the address, including street and number, if
18any, of its principal office; and
19(vi) if it is a nonregistered foreign association,
20the address, including street and number, if any, of:
21(A) its registered or similar office, if any,
22required to be maintained by the law of its
23jurisdiction of formation; or
24(B) if it is not required to maintain a
25registered or similar office, its principal office.
26(2) A statement as to whether the dividing association
27will survive the division.
28(3) With respect to each resulting association created
29by the division:
30(i) its name;
1(ii) its jurisdiction of formation;
2(iii) its type;
3(iv) if it is a domestic filing association,
4domestic limited liability partnership or registered
5foreign association, the address of its registered
6office, including street and number, if any, in this
7Commonwealth, subject to section 109;
8(v) if it is a domestic association that is not a
9domestic filing association or limited liability
10partnership, the address, including street and number, if
11any, of its principal office; and
12(vi) if it is a nonregistered foreign association,
13the address, including street and number, if any, of:
14(A) its registered or similar office, if any,
15required to be maintained by the law of its
16jurisdiction of formation; or
17(B) if it is not required to maintain a
18registered or similar office, its principal office.
19(4) If the statement of division is not to be effective
20on filing, the later date or date and time on which it will
21become effective.
22(5) A statement that the division was approved in the
23following ways:
24(i) By a dividing association that is a domestic
25entity, in accordance with this chapter.
26(ii) By a dividing association that is a foreign
27association, in accordance with the law of its
28jurisdiction of formation.
29(6) If the dividing association is a domestic filing
30entity and survives the division, any amendment to its public
1organic record approved as part of the plan of division.
2(7) For each resulting association created by the
3division that is a domestic entity, its public organic
4record, if any, as an attachment. The public organic record
5does not need to state the name or address of an incorporator
6of a corporation, organizer of a limited liability company or
7similar person with respect to any other type of entity.
8(8) For each new association that is a domestic limited
9liability partnership or a domestic limited liability limited
10partnership that is not using the alternative procedure in
11section 8201(f) (relating to scope), its statement of
12registration as an attachment.
13(9) For each new association that is an electing
14partnership, its statement of election as an attachment.
15(10) The property and liabilities of the dividing
16association that are to be allocated to each resulting
17association, but it shall not be necessary to list in the
18statement of division each individual liability or item of
19property of the dividing association to be allocated to a
20resulting association so long as the liabilities and property
21are described in a reasonable manner.
22(c) Other provisions.--In addition to the requirements of
23subsection (b), a statement of division may contain any other
24provision not prohibited by law.
25(d) New domestic entity.--If a new association is a domestic
26entity, its public organic record, if any, must satisfy the
27requirements of the law of this Commonwealth, except that it
28does not need to be signed and may omit any provision that is
29not required to be included in a restatement of the public
30organic record.
1(e) Filing of plan.--A plan of division that is signed by
2the dividing association and meets all of the requirements of
3subsection (b) may be delivered to the department for filing
4instead of a statement of division and on filing has the same
5effect. If a plan of division is filed as provided in this
6subsection, references in this chapter to a statement of
7division refer to the plan of division filed under this
8subsection.
9(f) Effectiveness of statement of division.--A statement of
10division is effective as provided in section 136(c) (relating to
11processing of documents by Department of State).
12(g) Effectiveness of division.--A division takes effect as
13follows:
14(1) If the division is one in which all of the resulting
15associations are domestic associations, the division is
16effective when the statement of division is effective.
17(2) If the division is one in which one or more of the
18resulting associations is a foreign association, the division
19is effective on the later of:
20(i) the effectiveness of the statement of division;
21or
22(ii) when the division is effective under the law of
23each of the jurisdictions of formation of the foreign
24resulting associations.
25(h) Cross references.--See sections 134 (relating to
26docketing statement) and 135 (relating to requirements to be met
27by filed documents).
28§ 367. Effect of division.
29(a) General rule.--When a division becomes effective, all of
30the following apply:
1(1) If the dividing association is to survive the
2division:
3(i) It continues to exist.
4(ii) Its public organic record, if any, is amended
5as provided in the statement of division.
6(iii) Its private organic rules that are to be in
7record form, if any, are amended to the extent provided
8in the plan of division.
9(2) If the dividing association is not to survive the
10division, the dividing association ceases to exist.
11(3) With respect to each new association, all of the
12following apply:
13(i) It comes into existence.
14(ii) It holds any property allocated to it as the
15successor to the dividing association, and not by
16transfer, whether directly or indirectly, or by operation
17of law.
18(iii) Its public organic record, if any, and private
19organic rules are effective.
20(iv) If it is a limited liability partnership, its
21statement of registration is effective.
22(v) If it is a limited liability limited partnership
23and is not using the alternative procedure in section
248201(f) (relating to scope), its statement of
25registration is effective.
26(vi) If it is an electing partnership, its statement
27of election is effective.
28(4) Property of the dividing association:
29(i) That is allocated by the plan of division
30either:
1(A) vests in the new associations as provided in
2the plan of division; or
3(B) remains vested in the dividing association.
4(ii) That is not allocated by the plan of division:
5(A) remains vested in the dividing association,
6if the dividing association survives the division; or
7(B) is allocated to and vests equally in the
8resulting associations as tenants in common, if the
9dividing association does not survive the division.
10(iii) Vests as provided in this paragraph without
11transfer, reversion or impairment.
12(5) A resulting association to which a cause of action
13is allocated as provided in paragraph (4) may be substituted
14or added in any pending action or proceeding to which the
15dividing association is a party at the effective time of the
16division.
17(6) The liabilities of the dividing association are
18allocated between or among the resulting associations as
19provided in section 368 (relating to allocation of
20liabilities in division).
21(7) The interests in the dividing association that are
22to be converted or canceled in the division are converted or
23canceled, and the interest holders of those interests are
24entitled only to the rights provided to them under the plan
25of division and to any dissenters rights they may have
26pursuant to section 317 (relating to contractual dissenters
27rights in entity transactions) or 363(c) (relating to
28approval of division).
29(b) Dividing association not dissolved.--Except as provided
30in the organic law or organic rules of the dividing association,
1the division does not give rise to any rights that an interest
2holder, governor or third party would have upon a dissolution,
3liquidation or winding up of the dividing association.
4(c) New interest holder liability.--When a division becomes
5effective, a person that did not have interest holder liability
6with respect to the dividing association and that becomes
7subject to interest holder liability with respect to an
8association as a result of the division has interest holder
9liability only to the extent provided by the organic law of the
10association and only for those liabilities that arise after the
11division becomes effective.
12(d) Prior interest holder liability.--When a division
13becomes effective, the interest holder liability of a person
14that ceases to hold an interest in the dividing association that
15is a domestic entity with respect to which the person had
16interest holder liability is as follows:
17(1) The division does not discharge any interest holder
18liability under the organic law of the domestic entity to the
19extent the interest holder liability arose before the
20division became effective.
21(2) The person does not have interest holder liability
22under the organic law of the domestic entity for any debt,
23obligation or other liability that arises after the division
24becomes effective.
25(3) The organic law of the domestic entity continues to
26apply to the release, collection or discharge of any interest
27holder liability preserved under paragraph (1) as if the
28division had not occurred.
29(4) The person has whatever rights of contribution from
30any other person as are provided by other law or the organic
1law or organic rules of the domestic entity with respect to
2any interest holder liability preserved by paragraph (1) as
3if the division had not occurred.
4(e) Registration of registered foreign association.--When a
5division of a registered foreign association in which at least
6one of the resulting associations is a domestic entity becomes
7effective, the registration to do business of the dividing
8association is canceled if it does not survive the division.
9(f) Real property.--Except with regard to the real property
10of a dividing association that is a domestic nonprofit
11corporation, the allocation of any fee or freehold interest or
12leasehold having a remaining term of 30 years or more in any
13tract or parcel of real property situate in this Commonwealth
14owned by a dividing association, including property owned by a
15foreign association dividing solely under the law of another
16jurisdiction, to a new association is not effective until one of
17the following documents is filed in the office for the recording
18of deeds of the county, or each of them, in which the tract or
19parcel is situated:
20(1) A deed, lease or other instrument of confirmation
21describing the tract or parcel.
22(2) A duly executed duplicate original copy of the
23statement of division.
24(3) A copy of the statement of division certified by the
25department.
26(4) A declaration of acquisition stating the value of
27real estate holdings in the county of the new association as
28an acquired association.
29(g) Secured collateral.--The allocation to a new association
30of property that is collateral covered by an effective financing
1statement shall not be effective until a new financing statement
2naming the new association as a debtor is effective under
3Article 9 of the Uniform Commercial Code as enacted in the
4relevant jurisdiction.
5(h) Vehicles.--The provisions of 75 Pa.C.S. § 1114 (relating
6to transfer of vehicle by operation of law) shall not be
7applicable to an allocation of ownership of any motor vehicle,
8trailer or semitrailer to a new association under this section
9or under a similar law of any other jurisdiction, but any such
10allocation shall be effective only upon compliance with the
11requirements of 75 Pa.C.S. § 1116 (relating to issuance of new
12certificate following transfer), unless the dividing association
13is a domestic nonprofit corporation.
14(i) Disposition of interests.--Unless otherwise provided in
15the plan of division, the interests and any securities or
16obligations of each new association shall be distributed to:
17(1) the dividing association, if it survives the
18division; or
19(2) the holders of the common or other residuary
20interest of the dividing association that do not assert
21dissenters rights, pro rata, if the dividing association does
22not survive the division.
23§ 368. Allocation of liabilities in division.
24(a) General rule.--Except as provided in this section, when
25a division becomes effective, a resulting association is
26responsible:
27(1) Individually for the liabilities the resulting
28association undertakes or incurs in its own name after the
29division.
30(2) Individually for the liabilities of the dividing
1association that are allocated to or remain the liability of
2that resulting association to the extent specified in the
3plan of division.
4(3) Jointly and severally with the other resulting
5associations for the liabilities of the dividing association
6that are not allocated by the plan of division.
7(b) Joint and several liability.--If an allocation of
8property or liabilities in a division is ineffective or voidable
9pursuant to fraudulent transfer or similar law, both of the
10following apply:
11(1) The allocations of liabilities in the plan of
12division are ineffective and the liabilities of the dividing
13association become liabilities of all of the resulting
14associations, jointly and severally.
15(2) The validity and effectiveness of the division are
16not affected thereby.
17(c) Breach of obligation.--If a division breaches an
18obligation of the dividing association, all of the resulting
19associations are liable, jointly and severally, for the breach,
20but the validity and effectiveness of the division are not
21affected thereby.
22(d) Application of fraudulent transfer law.--In applying the
23law governing fraudulent transfers to a division:
24(1) The law applies to the dividing association as
25follows:
26(i) If it does not survive the division, it is not
27subject to that law.
28(ii) If it survives the division, it is subject to
29that law only in its capacity as a resulting association.
30(2) The law applies to each resulting association as
1follows:
2(i) The association is treated as a debtor.
3(ii) The liabilities allocated to the association
4are treated as an obligation incurred by the debtor.
5(iii) The association is treated as not having
6received a reasonably equivalent value in exchange for
7incurring the obligation.
8(iv) The property allocated to the association is
9treated as remaining property.
10(e) Distribution tests not applicable.--A direct or indirect
11allocation of property or liabilities in a division is not a
12distribution for purposes of the organic law of the dividing
13association or any of the resulting associations.
14(f) Liens and other charges.--Liens, security interests and
15other charges on the property of the dividing association are
16not impaired by the division, notwithstanding any otherwise
17enforceable allocation of liabilities of the dividing
18association.
19(g) Security agreements.--If the dividing association is
20bound by a security agreement governed by Article 9 of the
21Uniform Commercial Code as enacted in any jurisdiction and the
22security agreement provides that the security interest attaches
23to after-acquired collateral, each resulting association is
24bound by the security agreement.
25(h) Creditors and guarantors.--An allocation of a liability
26does not:
27(1) Affect the rights under other law of a creditor owed
28payment of the liability or performance of the obligation
29that creates the liability, except that those rights are
30available only against an association responsible for the
1liability or obligation under this section.
2(2) Release or reduce the obligation of a surety or
3guarantor of the liability or obligation.
4(i) Regulatory approvals.--The conditions in this section
5for freeing one or more of the resulting associations from the
6liabilities of the dividing association and for allocating some
7or all of the liabilities of the dividing association shall be
8conclusively deemed to have been satisfied if the plan of
9division has been approved by the Department of Banking and
10Securities, the Insurance Department or the Pennsylvania Public
11Utility Commission in a final order issued after August 21,
122001, that is not subject to further appeal.
13(j) Taxes.--Any taxes, interest, penalties and public
14accounts of the Commonwealth claimed against the dividing
15association that are settled, assessed or determined prior to or
16after the division shall be the liability of all of the
17resulting associations <-and, together with interest thereon,
18shall be a lien against the franchises and property of each
19resulting association. Upon the application of the dividing
20association, the Department of Revenue, with the concurrence of
21the Department of Labor and Industry, shall release one or more,
22but less than all, of the resulting associations from liability
23and liens for all taxes, interest, penalties and public accounts
24of the dividing association due the Commonwealth for periods
25prior to the effective date of the division if those departments
26are satisfied that the public revenues will be adequately
27secured.
28SUBCHAPTER G
29DOMESTICATION
30Sec.
1371. Domestication authorized.
2372. Plan of domestication.
3373. Approval of domestication.
4374. Amendment or abandonment of plan of domestication.
5375. Statement of domestication; effectiveness.
6376. Effect of domestication.
7§ 371. Domestication authorized.
8(a) Domestic entities.--Except as provided in section 318
9(relating to excluded entities and transactions), by complying
10with this chapter, a domestic entity may become a domestic
11entity of the same type in a foreign jurisdiction if the
12domestication is authorized by the law of the foreign
13jurisdiction.
14(b) Foreign entities.--By complying with the applicable
15provisions of this subchapter, a foreign entity may become a
16domestic entity of the same type in this Commonwealth if this
17title provides for the formation of that type of entity.
18(c) Cross reference.--See section 314 (relating to
19regulatory conditions and required notices and approvals).
20§ 372. Plan of domestication.
21(a) General rule.--A domestic entity may become a foreign
22entity of the same type by approving a plan of domestication.
23The plan shall be in record form and contain all of the
24following:
25(1) The name and type of the domesticating entity.
26(2) The name and jurisdiction of formation of the
27domesticated entity.
28(3) The manner, if any, of canceling or converting those
29interests in the domesticating entity, if any, that are to
30receive special treatment as authorized by and subject to
1section 329 (relating to special treatment of interest
2holders).
3(4) The proposed public organic record of the
4domesticated entity if it is a filing entity.
5(5) The full text of the private organic rules of the
6domesticated entity that are proposed to be in record form.
7(6) The other terms and conditions of the domestication.
8(7) Any other provision required by:
9(i) law of this Commonwealth;
10(ii) the law of the jurisdiction of formation of the
11foreign domesticated entity; or
12(iii) the organic rules of the domesticating entity.
13(b) Optional contents.--In addition to the requirements of
14subsection (a), a plan of domestication may contain any other
15provision not prohibited by law.
16(c) Terms of interests.--Except as provided in the plan of
17domestication pursuant to section 329, the terms of the
18interests in the domesticated entity and the rights of the
19interest holders in the domesticated entity shall be
20substantially the same as the terms of the interests and the
21rights of the interest holders in the domesticating entity,
22except to the extent a different term or right is required by a
23provision of the organic law of the domesticated entity that
24cannot be varied in its organic rules.
25(d) Cross reference.--See section 316(c) (relating to
26contents of plan).
27§ 373. Approval of domestication.
28(a) Approval by domestic entities.--A plan of domestication
29in which the domesticating entity is a domestic entity is not
30effective unless it has been approved by the domestic entity in
1accordance with the applicable provisions of Subchapter B
2(relating to approval of entity transactions).
3(b) Approval by foreign entities.--A plan of domestication
4in which the domesticating entity is a foreign entity is not
5effective unless it has been approved in one of the following
6ways:
7(1) In accordance with the law of the jurisdiction of
8formation of the foreign entity.
9(2) By at least a majority of the votes cast with
10respect to approval of the domestication by all interest
11holders of the foreign entity entitled to vote generally on a
12merger to which the foreign entity is a party if the law of
13the foreign entity's jurisdiction of formation does not
14provide for a domestication of the foreign entity.
15(c) Cross references.--See sections 317 (relating to
16contractual dissenters rights in entity transactions) and 329
17(relating to special treatment of interest holders).
18§ 374. Amendment or abandonment of plan of domestication.
19(a) Approval of amendment.--A plan of domestication in which
20the domesticating entity is a domestic entity may be amended in
21one of the following ways:
22(1) In the same manner as the plan was approved, if the
23plan does not provide for the manner in which it may be
24amended.
25(2) By the governors or interest holders of the domestic
26entity in the manner provided in the plan, but an interest
27holder that was entitled to vote on or consent to approval of
28the plan is entitled to vote on or consent to any amendment
29of the plan that will change any of the following:
30(i) The amount or kind of interests, securities,
1obligations, money, other property, rights to acquire
2interests or securities, or any combination of the
3foregoing, to be received by any of the interest holders
4of the domesticating entity under the plan.
5(ii) The public organic record, if any, or private
6organic rules of the domesticated entity that will be in
7effect immediately after the domestication becomes
8effective, except for changes that do not require
9approval of the interest holders of the domesticated
10entity under its organic law or organic rules.
11(iii) Any other terms or conditions of the plan, if
12the change would adversely affect the interest holder in
13any material respect.
14(b) Approval of abandonment.--After a plan of domestication
15has been approved by a domestic entity that is the domesticating
16entity and before a statement of domestication becomes
17effective, the plan may be abandoned as provided in the plan.
18Unless prohibited by the plan, a domestic entity that is the
19domesticating entity may abandon the plan in the same manner as
20the plan was approved.
21(c) Statement of abandonment.--If a plan of domestication is
22abandoned after a statement of domestication has been delivered
23to the department for filing and before the statement becomes
24effective, a statement of abandonment <-under section 141
25(relating to abandonment of filing before effectiveness), signed
26by the domesticating entity, must be delivered to the department
27for filing before the time the statement of domestication
28becomes effective. <-The statement of abandonment shall take
29effect on filing, and the domestication shall be abandoned and
30shall not become effective. The statement of abandonment shall
1contain all of the following:
2(1) The name of the domesticating entity.
3(2) The date on which the statement of domestication was
4delivered to the department for filing.
5(3) A statement that the domestication has been
6abandoned in accordance with this section.
7(d) Cross references.--See sections 134 (relating to
8docketing statement) and 135 (relating to requirements to be met
9by filed documents).
10§ 375. Statement of domestication; effectiveness.
11(a) General rule.--A statement of domestication shall be
12signed by the domesticating entity and delivered to the
13department for filing along with the certificates, if any,
14required by section 139 (relating to tax clearance of certain
15fundamental transactions).
16(b) Contents.--A statement of domestication shall contain
17all of the following:
18(1) With respect to the domesticating entity:
19(i) its name;
20(ii) its jurisdiction of formation;
21(iii) its type;
22(iv) the date on which it was first created,
23incorporated, formed or otherwise came into existence;
24(v) if it is a domestic filing entity, domestic
25limited liability partnership or registered foreign
26association, the address of its registered office,
27including street and number, if any, in this
28Commonwealth, subject to section 109 (relating to name of
29commercial registered office provider in lieu of
30registered address);
1(vi) if it is a domestic entity that is not a
2domestic filing entity or limited liability partnership,
3the address, including street and number, if any, of its
4principal office; and
5(vii) if it is a nonregistered foreign association,
6the address, including street and number, if any, of:
7(A) its registered or similar office, if any,
8required to be maintained by the law of its
9jurisdiction of formation; or
10(B) if it is not required to maintain a
11registered or similar office, its principal office.
12(2) With respect to the domesticated entity:
13(i) its name;
14(ii) its jurisdiction of formation;
15(iii) its type;
16(iv) if it is a domestic filing entity, domestic
17limited liability partnership or registered foreign
18association, the address of its registered office,
19including street and number, if any, in this
20Commonwealth, subject to section 109;
21(v) if it is a domestic entity that is not a
22domestic filing entity or limited liability partnership,
23the address, including street and number, if any, of its
24principal office; and
25(vi) if it is a nonregistered foreign association,
26the address, including street and number, if any, of:
27(A) its registered or similar office, if any,
28required to be maintained by the law of its
29jurisdiction of formation; or
30(B) if it is not required to maintain a
1registered or similar office, its principal office.
2(3) If the statement of domestication is not to be
3effective on filing, the later date or date and time on which
4it will become effective.
5(4) If the domesticating entity is a domestic entity, a
6statement that the plan of domestication was approved in
7accordance with Subchapter B (relating to approval of entity
8transactions) or, if the domesticating entity is a foreign
9entity, a statement that the domestication was approved in
10accordance with section 373(b) (relating to approval of
11domestication).
12(5) If the domesticated entity is a domestic filing
13entity, its public organic record as an attachment. The
14public organic record does not need to state the name or
15address of an incorporator of a corporation, organizer of a
16limited liability company or similar person with respect to
17any other type of entity.
18(6) If the domesticated entity is a domestic limited
19liability partnership or a domestic limited liability limited
20partnership that is not using the alternative procedure in
21section 8201(f) (relating to scope), its statement of
22registration as an attachment.
23(7) If the domesticated entity is an electing
24partnership, its statement of election as an attachment.
25(8) If the domesticating entity is to be a domestic
26entity in both this Commonwealth and the foreign
27jurisdiction, a statement to that effect.
28(c) Other provisions.--In addition to the requirements of
29subsection (b), a statement of domestication may contain any
30other provision not prohibited by law.
1(d) Public organic record of new domestic entity.--If the
2domesticated entity is a domestic entity, its public organic
3record, if any, must satisfy the requirements of the law of this
4Commonwealth, except that it does not need to be signed and may
5omit any provision that is not required to be included in a
6restatement of the public organic record.
7(e) Filing of plan.--A plan of domestication that is signed
8by a domesticating entity that is a domestic entity and meets
9all of the requirements of subsection (b) may be delivered to
10the department for filing instead of a statement of
11domestication and on filing has the same effect. If a plan of
12domestication is filed as provided in this subsection,
13references in this chapter to a statement of domestication refer
14to the plan of domestication filed under this subsection.
15(f) Effectiveness of domestication.--A domestication in
16which the domesticated entity is a domestic entity is effective
17when the statement of domestication is effective under section
18136(c) (relating to processing of documents by Department of
19State). A domestication in which the domesticated entity is a
20foreign entity becomes effective on the later of:
21(1) the date and time provided by the organic law of the
22domesticated entity; or
23(2) when the statement of domestication is effective.
24(g) Cross references.--See sections 134 (relating to
25docketing statement) and 135 (relating to requirements to be met
26by filed documents).
27§ 376. Effect of domestication.
28(a) General rule.--When a domestication becomes effective,
29all of the following apply:
30(1) The domesticated entity is:
1(i) organized under and subject to the organic law
2of the domesticated entity;
3(ii) the same entity without interruption as the
4domesticating entity;
5(iii) deemed to have commenced its existence on the
6date the domesticating entity commenced its existence in
7the jurisdiction in which the domesticating entity was
8first created, formed, incorporated or otherwise came
9into existence; and
10(iv) also organized under and subject to the organic
11law of the domesticating entity if the statement of
12domestication includes the statement provided for in
13section 375(b)(8) (relating to statement of
14domestication; effectiveness).
15(2) All property of the domesticating entity continues
16to be vested in the domesticated entity without transfer,
17reversion or impairment.
18(3) All debts, obligations and other liabilities of the
19domesticating entity continue as debts, obligations and other
20liabilities of the domesticated entity.
21(4) Except as provided by law <-or the plan of
22domestication, all of the rights, privileges, immunities<-, <-and
23powers<- and purposes of the domesticating entity <-remain
<-24continue to be vested without change in the domesticated
25entity.
26(5) The name of the domesticated entity may be
27substituted for the name of the domesticating entity in any
28pending action or proceeding.
29(6) If the domesticated entity is a filing entity, its
30public organic record is effective and is binding on its
1interest holders.
2(7) If the domesticated entity is a domestic limited
3liability partnership or a limited liability limited
4partnership that is not using the alternative procedure in
5section 8201(f) (relating to scope), its statement of
6registration is effective.
7(8) If the domesticated entity is an electing
8partnership, its statement of election is effective.
9(9) The private organic rules of the domesticated entity
10that are to be in record form, if any, approved as part of
11the plan of domestication are effective.
12(10) The interest holders in the domesticating entity
13are interest holders in the domesticated entity except to the
14extent that an interest holder does not receive interests in
15the domesticated entity pursuant to a provision in the plan
16of domestication for special treatment pursuant to section
17329 (relating to special treatment of interest holders).
18(b) No dissolution rights.--Except as otherwise provided in
19the organic law or organic rules of a domestic domesticating
20entity, the domestication does not give rise to any rights that
21an interest holder, governor or third party would have upon a
22dissolution, liquidation or winding up of the domesticating
23entity.
24(c) Collection of liabilities.--When a domestication becomes
25effective, a foreign domesticated entity may be served with
26process in this Commonwealth for the collection and enforcement
27of any of its debts, obligations and other liabilities in
28accordance with applicable law.
29(d) New interest holder liability.--When a domestication
30becomes effective, a person that becomes subject to interest
1holder liability with respect to a domestic association as a
2result of the domestication has interest holder liability only
3to the extent provided by the organic law of the association and
4only for those debts, obligations and other liabilities that
5arise after the domestication is effective.
6(e) Prior interest holder liability.--When a domestication
7becomes effective, the following rules apply:
8(1) The domestication does not discharge any interest
9holder liability under the organic law of a domesticating
10domestic entity to the extent the interest holder liability
11arose before the domestication became effective.
12(2) A person does not have interest holder liability
13under the organic law of a domestic domesticating entity for
14any debt, obligation or other liability that arises after the
15domestication becomes effective.
16(3) The organic law of a domestic domesticating entity
17continues to apply to the release, collection or discharge of
18any interest holder liability preserved under paragraph (1)
19as if the domestication had not occurred.
20(4) A person has whatever rights of contribution from
21any other person as are provided by other law or the organic
22rules of a domestic domesticating entity with respect to any
23interest holder liability preserved under paragraph (1) as if
24the domestication had not occurred.
25(f) Service of process.--When a domestication becomes
26effective, a foreign domesticated entity may be served with
27process in this Commonwealth for the collection and enforcement
28of any of its debts, obligations and other liabilities in
29accordance with applicable law.
30(g) No dissolution.--A domestication does not require a
1domestic domesticating entity to liquidate, dissolve or wind up
2its affairs and does not constitute or cause the liquidation or
3dissolution of the entity.
4(h) Taxes.--Any taxes, interest, penalties and public
5accounts of the Commonwealth claimed against the domesticating
6entity that are settled, assessed or determined prior to or
7after the domestication shall be the liability of the
8domesticated entity <-and, together with interest thereon, shall
9be a lien against the franchises and property of the
10domesticated entity.
11(i) Cross references.--See sections 416 (relating to
12withdrawal deemed on certain transactions) and 417 (relating to
13required withdrawal on certain transactions).
14CHAPTER 4
15FOREIGN ASSOCIATIONS
16Subchapter
17A. General Provisions
18B. Registration
19SUBCHAPTER A
20GENERAL PROVISIONS
21Sec.
22401. Application of chapter.
23402. Governing law.
24403. Activities not constituting doing business.
25§ 401. Application of chapter.
26(a) General rule.--Except as otherwise provided in this
27section or in subsequent provisions of this chapter, this
28chapter shall apply to all foreign associations.
29(b) Application to foreign banking institutions.--The words
30"foreign filing association" or "foreign association" in this
1chapter include an association that, if a domestic association,
2would be a banking institution or credit union. The term does
3not include an interstate bank as defined in section 102 of the
4act of November 30, 1965 (P.L.847, No.356), known as the Banking
5Code of 1965.
6(c) Domestic Federal financial association exclusion.--
7Except as permitted by act of Congress, this chapter shall not
8apply to:
9(1) Any of the following institutions or similar
10federally chartered institutions engaged in this Commonwealth
11in activities similar to those conducted by banking
12institutions or credit unions:
13(i) National banking associations organized under
14The National Bank Act (13 Stat. 99, 12 U.S.C. § 1 et
15seq.).
16(ii) Federal savings and loan associations and
17Federal mutual savings banks organized under the Home
18Owners' Loan Act (48 Stat. 128, 12 U.S.C. § 1461 et
19seq.).
20(iii) Federal credit unions organized under the
21Federal Credit Union Act (48 Stat. 1216, 12 U.S.C. § 1751
22et seq.).
23(2) Any other Federal association intended by the
24Congress to be treated for State law purposes as a domestic
25association of this Commonwealth.
26(d) Foreign insurance corporations.--A foreign insurance
27corporation shall be subject to this chapter, except as provided
28in section 402(e) (relating to governing law) or 411(g)
29(relating to registration to do business in this Commonwealth).
30(e) Government entities.--This chapter shall apply to and
1the words "association" and "foreign association" shall include
2a government or other sovereign, other than the Commonwealth or
3any of its political subdivisions, and any governmental
4corporation, agency or other entity thereof.
5(f) Admitted foreign fraternal benefit society exclusion.--
6This chapter shall not apply to any foreign corporation not-for-
7profit licensed to transact business in this Commonwealth under
8section 2455 of the act of May 17, 1921 (P.L.682, No.284), known
9as The Insurance Company Law of 1921.
10§ 402. Governing law.
11(a) General rule.--The law of the jurisdiction of formation
12of a foreign association governs the following:
13(1) The internal affairs of the association.
14(2) The liability that a person has as an interest
15holder or governor for a debt, obligation or other liability
16of the association.
17(3) The liability of a series or protected cell of a
18foreign association.
19(b) Effect of differences in law.--A foreign association is
20not precluded from registering to do business in this
21Commonwealth because of any difference between the law of the
22jurisdiction of formation of the foreign association and the law
23of this Commonwealth.
24(c) Limitations on domestic associations applicable.--
25Registration of a foreign association to do business in this
26Commonwealth does not authorize the foreign association to
27engage in any activities and affairs or exercise any power that
28a domestic association of the same type may not engage in or
29exercise in this Commonwealth.
30(d) Equal rights and privileges of registered foreign
1associations.--Except as otherwise provided by law, a registered
2foreign association, so long as its registration to do business
3is not terminated or canceled, shall enjoy the same rights and
4privileges as a domestic entity and shall be subject to the same
5liabilities, restrictions, duties and penalties now in force or
6hereafter imposed on domestic entities, to the same extent as if
7it had been formed under this title. A foreign insurance
8corporation shall be deemed a registered foreign association
9except as provided in subsection (e).
10(e) Foreign insurance corporations.--A foreign insurance
11corporation shall, insofar as it is engaged in the business of
12writing insurance or reinsurance as principal, be subject to the
13law of this Commonwealth regulating the conduct of the business
14of insurance by a foreign insurance corporation in lieu of the
15provisions of subsection (d) regarding its rights, privileges,
16liabilities, restrictions and duties and the penalties to which
17it may be subject.
18(f) Agricultural lands.--Interests in agricultural land
19shall be subject to the restrictions of, and escheatable as
20provided by, the act of April 6, 1980 (P.L.102, No.39), referred
21to as the Agricultural Land Acquisition by Aliens Law.
22§ 403. Activities not constituting doing business.
23(a) General rule.--Activities of a foreign filing
24association or foreign limited liability partnership that do not
25constitute doing business in this Commonwealth under this
26chapter shall include the following:
27(1) Maintaining, defending, mediating, arbitrating or
28settling an action or proceeding.
29(2) Carrying on any activity concerning its internal
30affairs, including holding meetings of its interest holders
1or governors.
2(3) Maintaining accounts in financial institutions.
3(4) Maintaining offices or agencies for the transfer,
4exchange and registration of securities of the association or
5maintaining trustees or depositories with respect to the
6securities.
7(5) Selling through independent contractors.
8(6) Soliciting or obtaining orders by any means if the
9orders require acceptance outside of this Commonwealth before
10the orders become contracts.
11(7) Creating or acquiring indebtedness, mortgages or
12security interests in property.
13(8) Securing or collecting debts or enforcing mortgages
14or security interests in property securing the debts and
15holding, protecting or maintaining property so acquired.
16(9) Conducting an isolated transaction that is not in
17the course of similar transactions.
18(10) Owning, without more, property.
19(11) Doing business in interstate or foreign commerce.
20(b) Participation in other associations.--Being an interest
21holder or governor of a foreign association that does business
22in this Commonwealth shall not by itself constitute doing
23business in this Commonwealth.
24(c) Applicability.--This section shall not apply in
25determining the contacts or activities that may subject a
26foreign filing association or foreign limited liability
27partnership to service of process, taxation or regulation under
28law of this Commonwealth other than this title.
29SUBCHAPTER B
30REGISTRATION
1Sec.
2411. Registration to do business in this Commonwealth.
3412. Foreign registration statement.
4413. Amendment of foreign registration statement.
5414. Noncomplying name of foreign association.
6415. Voluntary withdrawal of registration.
7416. Withdrawal deemed on certain transactions.
8417. Required withdrawal on certain transactions.
9418. Transfer of registration.
10419. Termination of registration.
11§ 411. Registration to do business in this Commonwealth.
12(a) Registration required.--Except as provided in section
13401 (relating to application of chapter) or subsection (g), a
14foreign filing association or foreign limited liability
15partnership may not do business in this Commonwealth until it
16registers with the department under this chapter.
17(b) Penalty for failure to register.--A foreign filing
18association or foreign limited liability partnership doing
19business in this Commonwealth may not maintain an action or
20proceeding in this Commonwealth unless it is registered to do
21business under this chapter.
22(c) Contracts and acts not impaired by failure to
23register.--The failure of a foreign filing association or
24foreign limited liability partnership to register to do business
25in this Commonwealth does not impair the validity of a contract
26or act of the foreign filing association or foreign limited
27liability partnership or preclude it from defending an action or
28proceeding in this Commonwealth.
29(d) Limitations on liability preserved.--A limitation on the
30liability of an interest holder or governor of a foreign filing
1association or of a partner of a foreign limited liability
2partnership is not waived solely because the foreign filing
3association or foreign limited liability partnership does
4business in this Commonwealth without registering.
5(e) Governing law not affected.--Section 402 (relating to
6governing law) applies even if a foreign association fails to
7register under this chapter.
8(f) Registered office.--Subject to section 109 (relating to
9name of commercial registered office provider in lieu of
10registered address), every registered foreign association shall
11have, and continuously maintain, in this Commonwealth a
12registered office, which may but need not be the same as its
13place of business in this Commonwealth.
14(g) Foreign insurance corporations.--A foreign insurance
15corporation is not required to register under this chapter.
16§ 412. Foreign registration statement.
17(a) General rule.--To register to do business in this
18Commonwealth, a foreign filing association or foreign limited
19liability partnership must deliver a foreign registration
20statement to the department for filing. The statement must be
21signed by the association and state all of the following:
22(1) Both:
23(i) The name of the foreign filing association or
24foreign limited liability partnership.
25(ii) If the name does not comply with section 202
26(relating to requirements for names generally), an
27alternate name adopted pursuant to section 414(a)
28(relating to noncomplying name of foreign association).
29(2) The type of association and, if it is a foreign
30limited partnership, whether it is a foreign limited
1liability limited partnership.
2(3) The association's jurisdiction of formation.
3(4) The street and mailing addresses of the
4association's principal office and, if the law of the
5association's jurisdiction of formation requires the
6association to maintain an office in that jurisdiction, the
7street and mailing addresses of the office.
8(5) Subject to section 109 (relating to name of
9commercial registered office provider in lieu of registered
10address), the address, including street and number, if any,
11of its registered office in this Commonwealth.
12(6) If the association may have one or more series, a
13statement to that effect.
14(b) Qualification or registration under former statutes.--
15The effect of a foreign association qualifying or registering to
16do business under prior provisions of law shall be as follows:
17(1) With respect to corporations for profit, the
18following apply:
19(i) If a foreign corporation for profit was admitted
20to do business in this Commonwealth by the filing of a
21power of attorney and statement under the former act of
22June 8, 1911 (P.L.710, No.283), entitled "An act to
23regulate the doing of business in this Commonwealth by
24foreign corporations; the registration thereof and
25service of process thereon; and providing punishment and
26penalties for the violation of its provisions; and
27repealing previous legislation on the subject," on July
281, 2015, the power of attorney and statement shall be
29deemed a filed registration statement under this chapter.
30The corporation shall include in its first amended
1registration statement under this chapter the information
2required by this chapter to be set forth in a
3registration statement.
4(ii) A certificate of authority issued under the
5former provisions of the act of May 5, 1933 (P.L.364,
6No.106), known as the Business Corporation Law of 1933,
7or Subpart B of Part II (relating to business
8corporations) that is in effect on July 1, 2015, shall be
9deemed to be a registration statement under this chapter
10and shall be deemed not to contain any reference to the
11kind of business that the corporation proposes to do in
12this Commonwealth.
13(iii) A certificate of authority issued under the
14former provisions of Subchapter B of Chapter 41 (relating
15to qualification) that is in effect on July 1, 2015,
16shall be deemed to be a registration statement under this
17chapter.
18(2) With respect to corporations not-for-profit, the
19following apply:
20(i) If a foreign corporation not-for-profit was
21admitted to do business in this Commonwealth by the
22filing of a power of attorney and statement under the
23former act of June 8, 1911 (P.L.710, No.283), on July 1,
242015, the power of attorney and statement shall be deemed
25a filed registration statement under this chapter. The
26corporation shall include in its first amended
27registration statement under this chapter the information
28required by this chapter to be set forth in a
29registration statement.
30(ii) A certificate of authority issued under the
1former provisions of the act of May 5, 1933 (P.L.289,
2No.105), known as the Nonprofit Corporation Law of 1933,
3or the former provisions of Article B of Part III known
4as the Nonprofit Corporation Law of 1972, as added by the
5act of November 15, 1972 (P.L.1063, No.271), that is in
6effect on July 1, 2015, shall be deemed to be a
7registration statement under this chapter and shall be
8deemed not to contain any reference to the kind of
9business that the corporation proposes to do in this
10Commonwealth.
11(iii) A certificate of authority issued under the
12former provisions of Subchapter B of Chapter 61 (relating
13to qualification) that is in effect on July 1, 2015,
14shall be deemed to be a registration statement under this
15chapter.
16(3) With respect to limited partnerships, the following
17apply:
18(i) An application for registration filed under the
19former provisions of 59 Pa.C.S. § 563 (relating to
20registration) that is in effect on July 1, 2015, shall be
21deemed to be a registration statement under this chapter
22and shall be deemed not to contain any reference to:
23(A) the general character of the business the
24limited partnership proposes to transact in this
25Commonwealth; or
26(B) the names and addresses of the limited
27partners.
28(ii) An application for registration filed under the
29former provisions of section 8582 (relating to
30registration) that is in effect on July 1, 2015, shall be
1deemed to be a registration statement under this chapter
2and shall be deemed not to contain:
3(A) any reference to the address of the office
4at which is kept a list of the names and addresses of
5the limited partners and their capital contributions;
6or
7(B) an undertaking to keep those records until
8the registration of the limited partnership in this
9Commonwealth is canceled or withdrawn.
10(4) An application for registration filed by a limited
11liability company under the former provisions of section 8981
12(relating to foreign limited liability companies) that is in
13effect on July 1, 2015, shall be deemed to be a registration
14statement under this chapter.
15(5) A certificate of authority issued to a business
16trust under the former provisions of section 9507 (relating
17to foreign business trusts) that is in effect on July 1,
182015, shall be deemed to be a registration statement under
19this chapter.
20(c) Cross references.--See:
21Section 134 (relating to docketing statement).
22Section 135 (relating to requirements to be met by filed
23documents).
24Section 4124 (relating to advertisement of registration
25to do business).
26Section 6124 (relating to advertisement of registration
27to do business).
28§ 413. Amendment of foreign registration statement.
29(a) General rule.--A registered foreign association shall
30deliver to the department for filing an amendment to its foreign
1registration statement if there is a change in any of the
2following:
3(1) The name of the association.
4(2) The type of association, including, if it is a
5foreign limited partnership, whether the association became
6or ceased to be a foreign limited liability limited
7partnership.
8(3) The association's jurisdiction of formation.
9(4) An address required by section 412(a)(4) (relating
10to foreign registration statement).
11(5) Its registered office.
12(6) The authority of the association to have one or more
13series.
14(b) Contents of amendment.--An amendment of a foreign
15registration statement shall be signed by the registered foreign
16association and state all of the following:
17(1) The name under which the registered foreign
18association is registered to do business in this
19Commonwealth.
20(2) Subject to section 109 (relating to name of
21commercial registered office provider in lieu of registered
22address), the address, including street and number, if any,
23of its registered office in this Commonwealth.
24(3) If the amendment is not to be effective on filing,
25the later date or date and time on which it will become
26effective.
27(4) The information that is to be changed.
28(c) Cross references.--See sections 134 (relating to
29docketing statement) and 135 (relating to requirements to be met
30by filed documents).
1§ 414. Noncomplying name of foreign association.
2(a) General rule.--A foreign filing association or foreign
3limited liability partnership whose name does not comply with
4Subchapter A of Chapter 2 (relating to names) may not register
5to do business in this Commonwealth until it adopts, for the
6purpose of doing business in this Commonwealth, an alternate
7name that complies with Subchapter A of Chapter 2. A foreign
8association that registers under an alternate name under this
9subsection is not required to comply with 54 Pa.C.S. Ch. 3
10(relating to fictitious names) with respect to the alternate
11name. After registering to do business in this Commonwealth
12under an alternate name, a foreign association shall do business
13in this Commonwealth under any of the following:
14(1) The alternate name.
15(2) Its proper name under the law of its jurisdiction of
16formation, with the addition of the name of its jurisdiction
17of formation.
18(3) A name the foreign association is authorized to use
19under 54 Pa.C.S. Ch. 3.
20(b) Change of name.--If a registered foreign association
21changes its name to one that does not comply with Subchapter A
22of Chapter 2, it may not do business in this Commonwealth until
23it complies with subsection (a) by amending its registration to
24adopt an alternate name that complies with Subchapter A of
25Chapter 2.
26(c) Filed documents.--If a registered foreign association
27adopts an alternate name under subsection (a), the association
28shall use the alternate name in response to a requirement in
29this title that a document delivered to the department for
30filing state the name of the association.
1§ 415. Voluntary withdrawal of registration.
2(a) General rule.--A registered foreign association may
3withdraw its registration by delivering a statement of
4withdrawal to the department for filing. The statement of
5withdrawal shall be signed by the association and state all of
6the following:
7(1) The name of the association and its jurisdiction of
8formation.
9(2) Subject to section 109 (relating to name of
10commercial registered office provider in lieu of registered
11address), the address, including street and number, if any,
12of its registered office in this Commonwealth.
13(3) That the association is not doing business in this
14Commonwealth.
15(4) That the association withdraws its registration to
16do business in this Commonwealth.
17(b) Filing.--The statement of withdrawal and the
18certificates required by section 139 (relating to tax clearance
19of certain fundamental transactions) shall be delivered to the
20department for filing and shall take effect on filing.
21(c) Cross references.--See sections 134 (relating to
22docketing statement) and 135 (relating to requirements to be met
23by filed documents).
24§ 416. Withdrawal deemed on certain transactions.
25(a) Merger.--A registered foreign association that merges
26into a domestic filing entity or domestic limited liability
27partnership shall be deemed to have withdrawn its registration
28on the effective date of the merger.
29(b) Conversion.--A registered foreign association that
30converts to any type of domestic filing entity or to a domestic
1limited liability partnership shall be deemed to have withdrawn
2its registration on the effective date of the conversion.
3(c) Domestication.--A registered foreign association that
4domesticates in this Commonwealth as a domestic filing entity or
5a domestic limited liability partnership shall be deemed to have
6withdrawn its registration on the effective date of the
7domestication.
8§ 417. Required withdrawal on certain transactions.
9(a) Application of section.--This section shall apply to a
10registered foreign association that has been:
11(1) a nonsurviving party to a merger in which the
12survivor is a nonregistered foreign association;
13(2) a dividing association which did not survive the
14division;
15(3) dissolved and completed winding up;
16(4) converted to a domestic or foreign nonfiling
17association other than a limited liability partnership; or
18(5) the domesticating entity in a domestication in which
19the domesticated entity is a domestic or foreign nonfiling
20association other than a limited liability partnership.
21(b) Statement of withdrawal.--A registered foreign
22association described in subsection (a) shall deliver a
23statement of withdrawal and the certificates required by section
24139 (relating to tax clearance of certain fundamental
25transactions) to the department for filing. The statement shall
26be signed by the dissolved or converted association and state as
27follows:
28(1) In the case of a foreign association that has
29completed winding up, all of the following:
30(i) The name under which the association is
1registered to do business in this Commonwealth and its
2jurisdiction of formation.
3(ii) That the association withdraws its registration
4to do business in this Commonwealth.
5(2) In the case of a foreign association that has
6converted to a domestic or foreign nonfiling association
7other than a limited liability partnership, all of the
8following:
9(i) The name under which the association is
10registered to do business in this Commonwealth and its
11jurisdiction of formation.
12(ii) The type of nonfiling association to which the
13association has converted and its jurisdiction of
14formation.
15(iii) That the association withdraws its
16registration to do business in this Commonwealth.
17(3) In the case of a foreign association that has
18domesticated as a domestic or foreign nonfiling association
19other than a limited liability partnership in a jurisdiction
20other than this Commonwealth, all of the following:
21(i) The name under which the association is
22registered to do business in this Commonwealth and its
23jurisdiction of formation.
24(ii) The jurisdiction of formation of the
25domesticated association.
26(iii) That the association withdraws its
27registration to do business in this Commonwealth.
28(c) Cross references.--See sections 134 (relating to
29docketing statement) and 135 (relating to requirements to be met
30by filed documents).
1§ 418. Transfer of registration.
2(a) General rule.--If a registered foreign association
3merges into a nonregistered foreign association or converts to a
4foreign association required to register with the department to
5do business in this Commonwealth, the association shall deliver
6to the department for filing an application for transfer of
7registration. The application shall be signed by the surviving
8or converted association and state all of the following:
9(1) The name of the association before the merger or
10conversion.
11(2) The type of association it was before the merger or
12conversion.
13(3) The name of the applicant association and, if the
14name does not comply with section 202 (relating to
15requirements for names generally), an alternate name adopted
16in accordance with section 414(a) (relating to noncomplying
17name of foreign association).
18(4) The type of association of the applicant association
19and its jurisdiction of formation.
20(5) If different than the information for the foreign
21association before the merger or conversion, all of the
22following information regarding the applicant association:
23(i) The street and mailing addresses of the
24principal office of the association and, if the law of
25the association's jurisdiction of formation requires it
26to maintain an office in that jurisdiction, the street
27and mailing addresses of that office.
28(ii) Subject to section 109 (relating to name of
29commercial registered office provider in lieu of
30registered address), the address of its registered office
1in this Commonwealth.
2(b) Effect of application.--When an application for transfer
3of registration takes effect, the registration of the registered
4foreign association to do business in this Commonwealth is
5transferred without interruption to the association into which
6it has merged or to which it has been converted.
7(c) Cross references.--See sections 134 (relating to
8docketing statement) and 135 (relating to requirements to be met
9by filed documents).
10§ 419. Termination of registration.
11(a) General rule.--The department may terminate the
12registration of a registered foreign association in the manner
13provided in subsections (b) and (c) if the department finds that
14the association:
15(1) has not amended its registration when required by
16section 413 (relating to amendment of foreign registration
17statement); or
18(2) has been administratively, voluntarily or
19involuntarily dissolved under the law of its jurisdiction of
20formation.
21(b) Notice by department.--The department may terminate the
22registration of a registered foreign association by taking both
23of the following actions:
24(1) Filing a notice of termination or noting the
25termination in the records of the department.
26(2) Delivering a copy of the notice or the information
27in the notation to the association's registered office or, if
28the association does not have a registered office, to the
29association's principal office.
30(c) Contents.--The notice shall state, or the information in
1the notation under subsection (b) shall include, both of the
2following:
3(1) The effective date of the termination, which shall
4be no less than 60 days after the date the department
5delivers the copy.
6(2) The grounds for termination under subsection (a).
7(d) Effectiveness or cure.--The registration of a registered
8foreign association to do business in this Commonwealth shall
9cease on the effective date of the notice of termination or
10notation under subsection (b), unless before that date the
11association cures each ground for termination stated in the
12notice or notation. If the association cures each ground, the
13department shall file a record stating as such.
14Section 10. Section 1103(a) introductory paragraph and the
15definitions of "articles," "dissenters rights," "distribution,"
16"foreign business corporation," "nonqualified foreign business
17corporation," "plan," "qualified foreign business corporation"
18and "registered corporation" of Title 15 are amended to read:
19§ 1103. Definitions.
20(a) General definitions.--Subject to additional definitions
21contained in subsequent provisions of this subpart that are
22applicable to specific provisions of this subpart, the following
23words and phrases when used in Part I (relating to preliminary
24provisions) or in this subpart shall have the meanings given to
25them in this section unless the context clearly indicates
26otherwise:
27* * *
28"Articles." The original articles of incorporation, all
29amendments thereof and any other articles, statements or
30certificates permitted or required to be filed in the Department
1of State by sections 108 (relating to change in location or
2status of registered office provided by agent) and 138 (relating
3to statement of correction), Chapter 3 (relating to entity
4transactions) or this subpart and including what have heretofore
5been designated by law as certificates of incorporation or
6charters. If an amendment of the articles or [articles of merger
7or division made in the manner permitted by this subpart] a
8statement filed under Chapter 3 restates articles in their
9entirety [or if there are articles of consolidation, conversion
10or domestication], thenceforth the "articles" shall not include
11any prior documents and any certificate issued by the department
12with respect thereto shall so state.
13* * *
14["Dissenters rights." The rights and remedies provided by
15Subchapter D of Chapter 15 (relating to dissenters rights).]
16* * *
17"Distribution." Â A direct or indirect transfer of money or
18other property (except its own shares or options, rights or
19warrants to acquire its own shares) or incurrence of
20indebtedness by a corporation to or for the benefit of any or
21all of its shareholders in respect of any of its shares whether
22by dividend or by purchase, redemption or other acquisition of
23its shares or otherwise. Neither the making of, nor payment or
24performance upon, a guaranty or similar arrangement by a
25corporation for the benefit of any or all of its shareholders
26nor a direct or indirect transfer or allocation of assets or
27liabilities effected under Chapter 3 (relating to entity
28transactions) or 19 (relating to fundamental changes) with the
29approval of the shareholders shall constitute a distribution for
30the purposes of this subpart.
1* * *
2"Foreign business corporation." A foreign corporation for
3profit subject to Chapter [41] 4 (relating to foreign [business
4corporations] associations), whether or not required to qualify
5thereunder.
6* * *
7["Nonqualified foreign business corporation." A foreign
8business corporation that is not a qualified foreign business
9corporation as defined in this section.]
10* * *
11["Plan." A plan of reclassification, merger, consolidation,
12exchange, asset transfer, division or conversion.]
13* * *
14["Qualified foreign business corporation." A foreign
15business corporation that is:
16(1) authorized under Chapter 41 (relating to foreign
17business corporations) to do business in this Commonwealth;
18or
19(2) a foreign insurance corporation.]
20* * *
21["Registered corporation." A corporation defined in section
222502 (relating to registered corporation status).]
23* * *
24Section 11. Sections 1105 and 1106 of Title 15 are amended
25to read:
26§ 1105. Restriction on equitable relief.
27A shareholder of a business corporation shall not have any
28right to obtain, in the absence of fraud or fundamental
29unfairness, an injunction against any proposed plan or amendment
30of articles authorized under any provision of this [subpart]
1title, nor any right to claim the right to valuation and payment
2of the fair value of his shares because of the plan or
3amendment, except that he may dissent and claim such payment if
4and to the extent provided in Subchapter D of Chapter 15
5(relating to dissenters rights) where this [subpart] title
6expressly provides that dissenting shareholders shall have the
7rights and remedies provided in that subchapter. Absent fraud or
8fundamental unfairness, the rights and remedies so provided
9shall be exclusive. Structuring a plan or transaction for the
10purpose or with the effect of eliminating or avoiding the
11application of dissenters rights is not fraud or fundamental
12unfairness within the meaning of this section.
13§ 1106. Uniform application of subpart.
14(a) General rule.--Except as provided in subsection (b),
15Part I (relating to preliminary provisions) and this subpart
16[and its amendments] are intended to provide uniform rules for
17the government and regulation of the affairs of business
18corporations and of their officers, directors and shareholders
19regardless of the date or manner of incorporation or
20qualification, or of the issuance of any shares thereof.
21(b) Exceptions.--
22(1) Unless expressly provided otherwise in any amendment
23to this subpart, the amendment shall take effect only
24prospectively.
25(2) An existing corporation lawfully using a name or, as
26part of its name, a word that could not be used as or
27included in the name of a corporation subsequently
28incorporated or qualified under this subpart may continue to
29use the name or word as part of its name if the use or
30inclusion of the word or name was lawful when first adopted
1by the corporation in this Commonwealth.
2(3) Subsection (a) shall not adversely affect the rights
3specifically provided for or saved in this [subpart] title.
4See:
5The provisions of section 341(c) (relating to interest
6exchange authorized).
7The provisions of section 351(c) (relating to conversion
8authorized).
9The transitional approval requirements set forth in
10section 363(d) (relating to approval of division).
11The provisions of section 1524(e) (relating to
12transitional provision).
13The provisions of section 1554(c) (relating to
14transitional provision).
15The cumulative voting rights set forth in section 1758(c)
16(2) (relating to cumulative voting).
17[The special voting requirements specified in section
181931(h) (relating to special requirements).
19The provisions of section 1952(g) and (h) (relating to
20proposal and adoption of plan of division).]
21The provisions of section 2301(d) (relating to
22transitional provisions).
23The provisions of section 2541(a)(2) and (3) and (c)
24(relating to application and effect of subchapter).
25The provisions of section 2543(b)(1) and (2) (relating to
26exceptions generally).
27The provisions of section 2551(b)(3)(i), (5) and (6)
28(relating to exceptions).
29The provisions of section 2553(b)(2) (relating to
30exception).
1(4) Except as otherwise expressly provided in the
2articles, a domestic corporation for profit that, on
3September 30, 1989, was not subject to the Business
4Corporation Law of 1933 and that thereafter becomes subject
5to this subpart by operation of law shall be deemed to have
6in effect articles that provide that the following provisions
7of this subpart shall not be applicable to the corporation:
8(i) Section 1726(a)(1) (relating to removal by the
9shareholders) insofar as it provides a statutory right on
10the part of shareholders to remove directors from office
11without assigning any cause.
12(ii) Section 1755(b)(2) (relating to special
13meetings).
14(iii) Section 1912(a)(2) (relating to proposal of
15amendments).
16Section 12. Sections 1303, 1304 and 1305 of Title 15 are
17repealed:
18[§ 1303. Corporate name.
19(a) General rule.--The corporate name may be in any
20language, but must be expressed in Roman letters or characters
21or Arabic or Roman numerals, and shall contain:
22(1) the word "corporation," "company," "incorporated" or
23"limited" or an abbreviation of any of them;
24(2) the word "association," "fund" or "syndicate"; or
25(3) words or abbreviations of like import in languages
26other than English.
27(b) Duplicate use of names.--The corporate name shall be
28distinguishable upon the records of the department from:
29(1) The name of any other domestic corporation for
30profit or not-for-profit which is either in existence or for
1which articles of incorporation have been filed but have not
2yet become effective, or of any foreign corporation for
3profit or not-for-profit which is either authorized to do
4business in this Commonwealth or for which an application for
5a certificate of authority has been filed but has not yet
6become effective, or the name of any association registered
7at any time under 54 Pa.C.S. Ch. 5 (relating to corporate and
8other association names), unless:
9(i) the other association:
10(A) has stated that it is about to change its
11name, or to cease to do business, or is being wound
12up, or is a foreign association about to withdraw
13from doing business in this Commonwealth, and the
14statement and a written consent to the adoption of
15the name is filed in the Department of State;
16(B) has filed with the Department of Revenue a
17certificate of out of existence, or has failed for a
18period of three successive years to file with the
19Department of Revenue a report or return required by
20law and the fact of such failure has been certified
21by the Department of Revenue to the Department of
22State;
23(C) has abandoned its name under the laws of its
24jurisdiction of incorporation, by amendment, merger,
25consolidation, division, expiration, dissolution or
26otherwise, without its name being adopted by a
27successor in a merger, consolidation, division or
28otherwise, and an official record of that fact,
29certified as provided by 42 Pa.C.S. § 5328 (relating
30to proof of official records), is presented by any
1person to the department; or
2(D) has had the registration of its name under
354 Pa.C.S. Ch. 5 terminated.
4(2) A name the exclusive right to which is at the
5time reserved by any other person whatsoever in the
6manner provided by statute. A name shall be rendered
7unavailable for corporate use by reason of the filing in
8the Department of State of any assumed or fictitious name
9required by 54 Pa.C.S. Ch. 3 (relating to fictitious
10names) to be filed in the department only if and to the
11extent expressly so provided in that chapter.
12(c) Required approvals or conditions.--
13(1) The corporate name shall not imply that the
14corporation is:
15(i) A governmental agency of the Commonwealth or of
16the United States.
17(ii) A bank, bank and trust company, savings bank,
18private bank or trust company, as defined in the act of
19November 30, 1965 (P.L.847, No.356), known as the Banking
20Code of 1965, unless the corporation or proposed
21corporation is a Pennsylvania bank holding company or is
22otherwise authorized by statute to use its proposed name.
23(iii) An insurance company nor contain any of the
24words "annuity," "assurance," "beneficial," "bond,"
25"casualty," "endowment," "fidelity," "fraternal,"
26"guaranty," "indemnity," "insurance," "insurer,"
27"reassurance," "reinsurance," "surety" or "title" when
28used in such a way as to imply that the corporation is
29engaged in the business of writing insurance or
30reinsurance as principal or any other words of like
1purport unless it is duly licensed as an insurance
2company by its jurisdiction of incorporation or the
3Insurance Department certifies that it has no objection
4to the use by the corporation or proposed corporation of
5the designation. The corporate name of a domestic
6insurance corporation shall:
7(A) contain the word "mutual" if, and only if,
8it is a mutual insurance company; and
9(B) clearly designate the object and purpose of
10the corporation.
11(iv) A public utility corporation furnishing
12electric or gas service to the public, unless the
13corporation or proposed corporation has as an express
14corporate purpose the furnishing of service subject to
15the jurisdiction of the Pennsylvania Public Utility
16Commission or the Federal Energy Regulatory Commission.
17(v) A credit union. See 17 Pa.C.S. § 104 (relating
18to prohibition on use of words "credit union," etc.).
19(2) The corporate name shall not contain:
20(i) The word "college," "university" or "seminary"
21when used in such a way as to imply that it is an
22educational institution conforming to the standards and
23qualifications prescribed by the State Board of
24Education, unless there is submitted a certificate from
25the Department of Education certifying that the
26corporation or proposed corporation is entitled to use
27that designation.
28(ii) Words that constitute blasphemy, profane
29cursing or swearing or that profane the Lord's name.
30(iii) The words "engineer" or "engineering" or
1"surveyor" or "surveying" or any other word implying that
2any form of the practice of engineering or surveying as
3defined in the act of May 23, 1945 (P.L.913, No.367),
4known as the Professional Engineers Registration Law, is
5provided unless at least one of the incorporators of a
6proposed corporation or the directors of the existing
7corporation has been properly registered with the State
8Registration Board for Professional Engineers in the
9practice of engineering or surveying and there is
10submitted to the department a certificate from the board
11to that effect.
12(iv) The words "architect" or "architecture" or any
13other word implying that any form of the practice of
14architecture as defined in the act of December 14, 1982
15(P.L.1227, No.281), known as the Architects Licensure
16Law, is provided unless at least one of the incorporators
17of a proposed corporation or the directors of the
18existing corporation has been properly registered with
19the Architects Licensure Board in the practice of
20architecture and there is submitted to the department a
21certificate from the board to that effect.
22(v) The word "cooperative" or an abbreviation
23thereof unless the corporation is a cooperative
24corporation.
25(d) Other rights unaffected.--This section shall not
26abrogate or limit the law as to unfair competition or unfair
27practices nor derogate from the common law, the principles of
28equity or the provisions of Title 54 (relating to names) with
29respect to the right to acquire and protect trade names.
30Subsection (b) shall not apply if the applicant files in the
1department a certified copy of a final order of a court of
2competent jurisdiction establishing the prior right of the
3applicant to the use of a name in this Commonwealth.
4(e) Remedies for violation of section.--The use of a name in
5violation of this section shall not vitiate or otherwise affect
6the corporate existence, but any court having jurisdiction may
7enjoin the corporation from using or continuing to use a name in
8violation of this section upon the application of:
9(1) the Attorney General, acting on his own motion or at
10the instance of any administrative department, board or
11commission of this Commonwealth; or
12(2) any person adversely affected.
13(f) Cross references.--See sections 135(e) (relating to
14distinguishable names) and 1106(b)(2) (relating to uniform
15application of subpart).
16§ 1304. Required name changes by senior corporations.
17(a) Adoption of new name upon reactivation.--Where a
18corporate name is made available on the basis that the
19corporation or other association that formerly registered the
20name has failed to file in the Department of Revenue a report or
21a return required by law or where the corporation or other
22association has filed in the Department of Revenue a certificate
23of out of existence, the corporation or other association shall
24cease to have by virtue of its prior registration any right to
25the use of the name. The corporation or other association, upon
26withdrawal of the certificate of out of existence or upon the
27removal of its delinquency in the filing of the required reports
28or returns, shall make inquiry with the Department of State with
29regard to the availability of its name and, if the name has been
30made available to another domestic or foreign corporation for
1profit or not-for-profit or other association by virtue of these
2conditions, shall adopt a new name in accordance with law before
3resuming its activities.
4(b) Enforcement of undertaking to release name.--If a
5corporation has used a name that is not distinguishable upon the
6records of the Department of State from the name of another
7corporation or other association as permitted by section 1303(b)
8(1) (relating to duplicate use of names) and the other
9corporation or other association continues to use its name in
10this Commonwealth and does not change its name, cease to do
11business, be wound up or withdraw as it proposed to do in its
12consent or change its name as required by subsection (a), any
13court having jurisdiction may enjoin the other corporation or
14other association from continuing to use its name or a name that
15is not distinguishable therefrom upon the application of:
16(1) the Attorney General, acting on his own motion or at
17the instance of any administrative department, board or
18commission of this Commonwealth; or
19(2) any person adversely affected.
20§ 1305. Reservation of corporate name.
21(a) General rule.--The exclusive right to the use of a
22corporate name may be reserved by any person. The reservation
23shall be made by delivering to the Department of State an
24application to reserve a specified corporate name, executed by
25the applicant. If the department finds that the name is
26available for corporate use, it shall reserve the name for the
27exclusive use of the applicant for a period of 120 days.
28(b) Transfer of reservation.--The right to exclusive use of
29a specified corporate name reserved under subsection (a) may be
30transferred to any other person by delivering to the department
1a notice of the transfer, executed by the person who reserved
2the name, and specifying the name and address of the transferee.
3(c) Cross references.--See sections 134 (relating to
4docketing statement) and 4131 (relating to registration of
5name).]
6Section 13. Sections 1306(b), 1341(b)(3) and (d), 1571(a),
7(b), (c) and (h), 1575(a) introductory paragraph and (b) and
81704(b)(1) of Title 15 are amended to read:
9§ 1306. Articles of incorporation.
10* * *
11(b) Other provisions authorized.--A provision of the
12original articles or a provision of the articles approved by the
13shareholders, in either case adopted under subsection (a)(8)
14(ii), may relax or be inconsistent with and supersede any
15provision of Chapter 3 (relating to entity transactions), 13
16(relating to incorporation), 15 (relating to corporate powers,
17duties and safeguards), 17 (relating to officers, directors and
18shareholders) or 19 (relating to fundamental changes) concerning
19the subjects specified in subsection (a)(8)(ii), except where a
20provision of those chapters expressly provides that the articles
21shall not relax or be inconsistent with any provision on a
22specified subject. Notwithstanding the foregoing, the articles
23may provide greater rights for shareholders than are authorized
24by any provision of those chapters that otherwise provides that
25the articles shall not relax or be inconsistent with any
26provision on a specified subject.
27* * *
28§ 1341. Statement of revival.
29* * *
30(b) Contents of statement.--The statement of revival shall
1be executed in the name of the forfeited or expired corporation
2and shall, subject to section 109 (relating to name of
3commercial registered office provider in lieu of registered
4address), set forth:
5* * *
6(3) The name that the corporation adopts as its new name
7if the adoption of a new name is required by section [1304]
8207 (relating to required name changes by senior
9[corporations] associations).
10* * *
11(d) Cross [reference.--See section 134 (relating to
12docketing statement).] references.--See sections 134 (relating
13to docketing statement) and 135 (relating to requirements to be
14met by filed documents).
15§ 1571. Application and effect of subchapter.
16(a) General rule.--Except as otherwise provided in
17subsection (b), any shareholder (as defined in section 1572
18(relating to definitions)) of a business corporation shall have
19the [right to dissent from, and to obtain payment of the fair
20value of his shares in the event of, any corporate action, or to
21otherwise obtain fair value for his shares,] rights and remedies
22provided in this subchapter in connection with a transaction
23under this title only where this [part] title expressly provides
24that a shareholder shall have the rights and remedies provided
25in this subchapter. See:
26Section 329(c) (relating to special treatment of interest
27holders).
28Section 333 (relating to approval of merger).
29Section 343 (relating to approval of interest exchange).
30Section 353 (relating to approval of conversion).
1Section 363 (relating to approval of division).
2Section 1906(c) (relating to dissenters rights upon special
3treatment).
4[Section 1930 (relating to dissenters rights).
5Section 1931(d) (relating to dissenters rights in share
6exchanges).]
7Section 1932(c) (relating to dissenters rights in asset
8transfers).
9[Section 1952(d) (relating to dissenters rights in division).
10Section 1962(c) (relating to dissenters rights in
11conversion).]
12Section 2104(b) (relating to procedure).
13Section 2324 (relating to corporation option where a
14restriction on transfer of a security is held invalid).
15Section 2325(b) (relating to minimum vote requirement).
16Section 2704(c) (relating to dissenters rights upon
17election).
18Section 2705(d) (relating to dissenters rights upon renewal
19of election).
20Section 2904(b) (relating to procedure).
21Section 2907(a) (relating to proceedings to terminate breach
22of qualifying conditions).
23Section 7104(b)(3) (relating to procedure).
24(b) Exceptions.--
25(1) Except as otherwise provided in paragraph (2), the
26holders of the shares of any class or series of shares shall
27not have the right to dissent and obtain payment of the fair
28value of the shares under this subchapter if, on the record
29date fixed to determine the shareholders entitled to notice
30of and to vote at the meeting at which a plan specified in
1any of section [1930, 1931(d),] 333, 343, 353, 363 or 1932(c)
2[or 1952(d)] is to be voted on or on the date of the first
3public announcement that such a plan has been approved by the
4shareholders by consent without a meeting, the shares are
5either:
6(i) listed on a national securities exchange [or
7designated as a national market system security on an
8interdealer quotation system by the National Association
9of Securities Dealers, Inc.] registered under section 6
10of the Exchange Act; or
11(ii) held beneficially or of record by more than
122,000 persons.
13(2) Paragraph (1) shall not apply to and dissenters
14rights shall be available without regard to the exception
15provided in that paragraph in the case of:
16(ii) Shares of any preferred or special class or
17series unless the articles, the plan or the terms of the
18transaction entitle all shareholders of the class or
19series to vote thereon and require for the adoption of
20the plan or the effectuation of the transaction the
21affirmative vote of a majority of the votes cast by all
22shareholders of the class or series.
23(iii) Shares entitled to dissenters rights under
24section 329(d) or 1906(c) (relating to dissenters rights
25upon special treatment).
26(3) The shareholders of a corporation that acquires by
27purchase, lease, exchange or other disposition all or
28substantially all of the shares, property or assets of
29another corporation by the issuance of shares, obligations or
30otherwise, with or without assuming the liabilities of the
1other corporation and with or without the intervention of
2another corporation or other person, shall not be entitled to
3the rights and remedies of dissenting shareholders provided
4in this subchapter regardless of the fact, if it be the case,
5that the acquisition was accomplished by the issuance of
6voting shares of the corporation to be outstanding
7immediately after the acquisition sufficient to elect a
8majority or more of the directors of the corporation.
9(c) Grant of optional dissenters rights.--The bylaws or a
10resolution of the board of directors may direct that all or a
11part of the shareholders shall have dissenters rights in
12connection with any corporate action or other transaction that
13would otherwise not entitle such shareholders to dissenters
14rights. See section 317 (relating to contractual dissenters
15rights in entity transactions).
16* * *
17(h) Cross references.--[See sections 1105 (relating to
18restriction on equitable relief), 1904 (relating to de facto
19transaction doctrine abolished), 1763(c) (relating to
20determination of shareholders of record) and 2512 (relating to
21dissenters rights procedure).] See:
22Section 315 (relating to nature of transactions).
23Section 1105 (relating to restriction on equitable
24relief).
25Section 1763(c) (relating to determination of
26shareholders of record).
27Section 2512 (relating to dissenters rights procedure).
28§ 1575. Notice to demand payment.
29(a) General rule.--If the proposed corporate action is
30approved by the required vote at a meeting of shareholders of a
1business corporation, the corporation shall [mail] deliver a
2further notice to all dissenters who gave due notice of
3intention to demand payment of the fair value of their shares
4and who refrained from voting in favor of the proposed action.
5If the proposed corporate action is approved by the shareholders
6by less than unanimous consent without a meeting or is taken
7without the need for approval by the shareholders, the
8corporation shall [send] deliver to all shareholders who are
9entitled to dissent and demand payment of the fair value of
10their shares a notice of the adoption of the plan or other
11corporate action. In either case, the notice shall:
12* * *
13(b) Time for receipt of demand for payment.--The time set
14for receipt of the demand and deposit of certificated shares
15shall be not less than 30 days from the [mailing] delivery of
16the notice.
17§ 1704. Place and notice of meetings of shareholders.
18* * *
19(b) Notice.--Notice in record form of every meeting of the
20shareholders shall be given by, or at the direction of, the
21secretary or other authorized person to each shareholder of
22record entitled to vote at the meeting at least:
23(1) ten days prior to the day named for a meeting that
24will consider a transaction under Chapter 3 (relating to
25entity transactions) or a fundamental change under Chapter 19
26(relating to fundamental changes); or
27* * *
28Section 14. Section 1757(a) and (b) of Title 15 are amended
29and the section is amended by adding a subsection to read:
30§ 1757. Action by shareholders.
1(a) General rule.--Except as otherwise provided in this
2[subpart] title or in a bylaw adopted by the shareholders,
3whenever any corporate action is to be taken by vote of the
4shareholders of a business corporation, it shall be authorized
5upon receiving the affirmative vote of a majority of the votes
6cast by all shareholders entitled to vote thereon and, if any
7shareholders are entitled to vote thereon as a class, upon
8receiving the affirmative vote of a majority of the votes cast
9by the shareholders entitled to vote as a class.
10(b) Changes in required vote.--Whenever a provision of this
11[subpart] title requires a specified number or percentage of
12votes of shareholders or of a class of shareholders for the
13taking of any action, a business corporation may prescribe in a
14bylaw adopted by the shareholders that a higher number or
15percentage of votes shall be required for the action. See
16sections 1504(d) (relating to amendment of voting provisions)
17and 1914(e) (relating to amendment of voting provisions).
18* * *
19(d) Cross reference.--See section 321 (relating to approval
20by business corporation).
21Section 15. Section 1766(c) of Title 15 is amended to read:
22§ 1766. Consent of shareholders in lieu of meeting.
23* * *
24(c) Effectiveness of action by partial consent.--An action
25taken pursuant to subsection (b) to approve a transaction under
26Chapter 3 (relating to entity transactions) shall not become
27effective until after at least ten days' notice of the action
28has been given to each shareholder entitled to vote thereon who
29has not consented thereto. Any other action may become effective
30immediately, but prompt notice that the action has been taken
1shall be given to each shareholder entitled to vote thereon that
2has not consented. This subsection may not be relaxed by any
3provision of the articles.
4* * *
5Section 16. Sections 1901, 1902(a) and 1904 of Title 15 are
6amended to read:
7[§ 1901. Omission of certain provisions from filed plans.
8(a) General rule.--A plan as filed in the Department of
9State under any provision of this chapter may omit all
10provisions of the plan except provisions, if any:
11(1) that are intended to amend or constitute the
12operative provisions of the articles of a corporation as in
13effect subsequent to the effective date of the plan; or
14(2) that allocate or specify the respective assets and
15liabilities of the resulting corporations, in the case of a
16plan of division.
17(b) Availability of full plan.--If any of the provisions of
18a plan are omitted from the plan as filed in the department, the
19articles of amendment, merger, consolidation, exchange, division
20or conversion shall state that the full text of the plan is on
21file at the principal place of business of the reclassifying,
22surviving or new or a resulting corporation and shall state the
23address thereof. A corporation that takes advantage of this
24section shall furnish a copy of the full text of the plan, on
25request and without cost, to any shareholder of any corporation
26that was a party to the plan and, unless all parties to the plan
27were closely held corporations, on request and at cost to any
28other person.]
29§ 1902. Statement of termination.
30(a) General rule.--If [a statement with respect to shares,]
1articles of amendment [or articles of merger, consolidation,
2exchange, division or conversion of a business corporation or to
3which it is a party] have been filed in the [Department of
4State] department prior to the termination of the amendment [or
5plan] pursuant to provisions therefor set forth in the
6resolution or petition relating to the amendment [or in the
7plan], the termination shall not be effective unless the
8corporation shall, prior to the time the amendment [or plan] is
9to become effective, file in the department a statement of
10termination. The statement of termination shall be [executed]
11signed by the corporation that filed the amendment [or by each
12corporation that is a party to the plan, unless the plan permits
13termination by less than all of the corporations, in which case
14the statement shall be executed on behalf of the corporation or
15corporations exercising the right to terminate,] and shall set
16forth:
17(1) A copy of the [statement with respect to shares,]
18articles of amendment [or articles of merger, consolidation,
19exchange, division or conversion relating to the amendment or
20plan that is terminated].
21(2) A statement that the amendment [or plan] has been
22terminated in accordance with the provisions therefor set
23forth therein.
24* * *
25§ 1904. De facto transaction doctrine abolished.
26The doctrine of de facto mergers, consolidations and other
27fundamental transactions is abolished and the rules laid down by
28Bloch v. Baldwin Locomotive Works, 75 Pa. D. & C. 24 (C.P. Del.
29Cty. 1950), and Marks v. The Autocar Co., 153 F.Supp. 768 (E.D.
30Pa. 1954), and similar cases are overruled. A transaction that
1in form satisfies the requirements of this [subpart] title may
2be challenged by reason of its substance only to the extent
3permitted by section 1105 (relating to restriction on equitable
4relief).
5Section 17. Section 1905 of Title 15 is amended to read:
6§ 1905. Proposal of fundamental transactions.
7Where any provision of this chapter requires that an
8amendment of the articles[, a plan] or the dissolution of a
9business corporation be proposed or approved by action of the
10board of directors, that requirement shall be construed to
11authorize and be satisfied by the written agreement or consent
12of all of the shareholders of the corporation entitled to vote
13thereon.
14Section 18. Section 1906(a), (d)(1) and (e) of Title 15 are
15amended and the section is amended by adding a subsection to
16read:
17§ 1906. Special treatment of holders of shares of same class or
18series.
19(a) General rule.--Except as otherwise restricted in the
20articles, a plan may contain a provision classifying the holders
21of shares of a class or series into one or more separate groups
22by reference to any facts or circumstances that are not
23manifestly unreasonable and providing mandatory treatment for
24shares of the class or series held by particular shareholders or
25groups of shareholders that differs materially from the
26treatment accorded other shareholders or groups of shareholders
27holding shares of the same class or series (including a
28provision modifying or rescinding rights previously created
29under this section) if:
30(1) (i) [such provision is specifically authorized by a
1majority of the votes cast by all shareholders entitled
2to vote on the plan, as well as] the plan is approved by
3a majority of the votes cast by any class or series of
4shares any of the shares of which are so classified into
5groups, whether or not such class or series would
6otherwise be entitled to vote on the plan; and
7(ii) the provision voted on specifically enumerates
8the type and extent of the special treatment authorized;
9or
10(2) under all the facts and circumstances, a court of
11competent jurisdiction finds such special treatment is
12undertaken in good faith, after reasonable deliberation and
13is in the best interest of the corporation.
14* * *
15(c.2) Notice to shareholders.--A notice to shareholders of a
16meeting called to act on a plan that provides for special
17treatment must state that the plan provides for special
18treatment. The notice must identify the shareholders receiving
19special treatment unless the notice is accompanied by either a
20summary of the plan that includes that information or the full
21text of the plan.
22(d) Exceptions.--This section shall not apply to:
23(1) [The creation or issuance of securities, contracts,
24warrants or other instruments evidencing any shares, option
25rights, securities having conversion or option rights or
26obligations authorized by section 2513 (relating to disparate
27treatment of certain persons).] (Reserved).
28* * *
29(e) Definition.--As used in this section, the term "plan"
30[includes] means:
1(1) an amendment of the articles that effects a
2reclassification of shares, whether or not the amendment is
3accompanied by a separate plan of reclassification; [and]
4(1.1) a plan of asset transfer adopted under section
51932(b) (relating to voluntary transfer of corporate assets);
6or
7(2) a resolution recommending that the corporation
8dissolve voluntarily adopted under section 1972(a) (relating
9to proposal of voluntary dissolution).
10Section 19. Section 1908 of Title 15 is amended to read:
11§ 1908. Submission of matters to shareholders.
12A business corporation may agree, in record form, to submit
13an amendment [or plan] or other matter to its shareholders
14whether or not the board of directors determines, at any time
15after approving the matter, that the matter is no longer
16advisable and recommends that the shareholders reject or vote
17against it, regardless of whether the board of directors changes
18its recommendation. If a corporation so agrees to submit a
19matter to its shareholders, the matter is deemed to have been
20validly adopted by the corporation when it has been approved by
21the shareholders.
22Section 20. Subchapter C heading of Chapter 19 of Title 15
23is amended to read:
24SUBCHAPTER C
25MERGER [,CONSOLIDATION, SHARE EXCHANGES] LIABILITIES AND
26SALE OF ASSETS
27Section 21. Sections 1921, 1922, 1923, 1924, 1925, 1926,
281927, 1928, 1929, 1930 and 1931 of Title 15 are repealed:
29[§ 1921. Merger and consolidation authorized.
30(a) Domestic surviving or new corporation.--Any two or more
1domestic business corporations, or any two or more foreign
2business corporations, or any one or more domestic business
3corporations and any one or more foreign business corporations,
4may, in the manner provided in this subchapter, be merged into
5one of the domestic business corporations, designated in this
6subchapter as the surviving corporation, or consolidated into a
7new corporation to be formed under this subpart, if the foreign
8business corporations are authorized by the laws of the
9jurisdiction under which they are incorporated to effect a
10merger or consolidation with a corporation of another
11jurisdiction.
12(b) Foreign surviving or new corporation.--Any one or more
13domestic business corporations, and any one or more foreign
14business corporations, may, in the manner provided in this
15subchapter, be merged into one of the foreign business
16corporations, designated in this subchapter as the surviving
17corporation, or consolidated into a new corporation to be
18incorporated under the laws of the jurisdiction under which one
19of the foreign business corporations is incorporated, if the
20laws of that jurisdiction authorize a merger with or
21consolidation into a corporation of another jurisdiction.
22(c) Business trusts, partnerships and other associations.--
23The provisions of this subchapter applicable to domestic and
24foreign business corporations shall also be applicable to a
25merger, consolidation or share exchange to which a domestic
26business corporation is a party or in which such a corporation
27is the resulting entity with, into or involving a domestic or
28foreign partnership, business trust or other association. The
29surviving, resulting or exchanging entity in such a merger,
30consolidation or share exchange may be a corporation,
1partnership, business trust or other association. Subject to the
2provisions of Subchapter F of Chapter 85 (relating to merger and
3consolidation), the powers and duties vested in and imposed upon
4the board of directors and shareholders in this subchapter shall
5be exercised and performed by the group of persons under the
6direction of whom the business and affairs of the partnership,
7business trust or other association are managed and the holders
8or owners of beneficial or other interests in the partnership,
9business trust or other association, respectively, irrespective
10of the names by which the managing group and the holders or
11owners of beneficial or other interests are designated. The
12units into which the beneficial or other interests in the
13partnership, business trust or other association are divided
14shall be deemed to be shares for the purposes of applying the
15provisions of this subchapter to a merger, consolidation or
16share exchange involving the partnership, business trust or
17other association. Dissenters rights shall be available to a
18holder of beneficial or other interests only to the extent, if
19any, provided by the law under which the partnership, business
20trust or other association is organized.
21§ 1922. Plan of merger or consolidation.
22(a) Preparation of plan.--A plan of merger or consolidation,
23as the case may be, shall be prepared, setting forth:
24(1) The terms and conditions of the merger or
25consolidation.
26(2) If the surviving or new corporation is or is to be a
27domestic business corporation:
28(i) any changes desired to be made in the articles,
29which may include a restatement of the articles in the
30case of a merger; or
1(ii) in the case of a consolidation, all of the
2statements required by this subpart to be set forth in
3restated articles.
4(3) The manner and basis of converting the shares of
5each corporation into shares or other securities or
6obligations of the surviving or new corporation, or of
7canceling some or all of the shares of a corporation, as the
8case may be, and, if any of the shares of any of the
9corporations that are parties to the merger or consolidation
10are not to be canceled or converted solely into shares or
11other securities or obligations of the surviving or new
12corporation, the shares or other securities or obligations of
13any other person or cash, property or rights that the holders
14of such shares are to receive in exchange for, or upon
15conversion of, such shares, and the surrender of any
16certificates evidencing them, which securities or
17obligations, if any, of any other person or cash, property or
18rights may be in addition to or in lieu of the shares or
19other securities or obligations of the surviving or new
20corporation.
21(4) Any provisions desired providing special treatment
22of shares held by any shareholder or group of shareholders as
23authorized by, and subject to the provisions of, section 1906
24(relating to special treatment of holders of shares of same
25class or series).
26(5) Such other provisions as are deemed desirable.
27(b) Post-adoption amendment.--A plan of merger or
28consolidation may contain a provision that the boards of
29directors of the constituent corporations may amend the plan at
30any time prior to its effective date, except that an amendment
1made subsequent to the adoption of the plan by the shareholders
2of any constituent domestic business corporation shall not
3change:
4(1) The amount or kind of shares, obligations, cash,
5property or rights to be received in exchange for or on
6conversion of all or any of the shares of the constituent
7domestic business corporation adversely to the holders of
8those shares.
9(2) Any provision of the articles of the surviving or
10new corporation as it is to be in effect immediately
11following consummation of the merger or consolidation except
12provisions that may be amended without the approval of the
13shareholders under section 1914(c)(2) (relating to adoption
14of amendments).
15(3) Any of the other terms and conditions of the plan if
16the change would adversely affect the holders of any shares
17of the constituent domestic business corporation.
18(c) Proposal.--Except where the approval of the board of
19directors is unnecessary under this subchapter, every merger or
20consolidation shall be proposed in the case of each domestic
21business corporation by the adoption by the board of directors
22of a resolution approving the plan of merger or consolidation.
23Except where the approval of the shareholders is unnecessary
24under this subchapter, the board of directors shall direct that
25the plan be submitted to a vote of the shareholders entitled to
26vote thereon at a regular or special meeting of the
27shareholders.
28(d) Party to plan or transaction.--A corporation,
29partnership, business trust or other association that approves a
30plan in its capacity as a shareholder or creditor of a merging
1or consolidating corporation, or that furnishes all or a part of
2the consideration contemplated by a plan, does not thereby
3become a party to the plan or the merger or consolidation for
4the purposes of this subchapter.
5(e) Reference to outside facts.--Any of the terms of a plan
6of merger or consolidation may be made dependent upon facts
7ascertainable outside of the plan if the manner in which the
8facts will operate upon the terms of the plan is set forth in
9the plan. Such facts may include, without limitation, actions or
10events within the control of or determinations made by a party
11to the plan or a representative of a party to the plan.
12§ 1923. Notice of meeting of shareholders.
13(a) General rule.--Notice in record form of the meeting of
14shareholders that will act on the proposed plan must be given to
15each shareholder of record, whether or not entitled to vote
16thereon, of each domestic business corporation that is a party
17to the merger or consolidation. The notice must include or be
18accompanied by the proposed plan or a summary thereof. If
19Subchapter D of Chapter 15 (relating to dissenters rights) is
20applicable to the holders of shares of any class or series, the
21text of that subchapter and of section 1930 (relating to
22dissenters rights) must be furnished to the holders of shares of
23that class or series. If the surviving or new corporation will
24be a nonregistered corporation, the notice must state that a
25copy of its bylaws as they will be in effect immediately
26following the merger or consolidation will be furnished to any
27shareholder on request and without cost.
28(b) Cross references.--See Subchapter A of Chapter 17
29(relating to notice and meetings generally) and sections 2512
30(relating to dissenters rights procedure) and 2528 (relating to
1notice of shareholder meetings).
2§ 1924. Adoption of plan.
3(a) General rule.--The plan of merger or consolidation shall
4be adopted upon receiving the affirmative vote of a majority of
5the votes cast by all shareholders entitled to vote thereon of
6each of the domestic business corporations that is a party to
7the merger or consolidation and, if any class or series of
8shares is entitled to vote thereon as a class, the affirmative
9vote of a majority of the votes cast in each class vote. The
10holders of any class or series of shares of a domestic
11corporation that is a party to a merger or consolidation that
12effects any change in the articles of the corporation shall be
13entitled to vote as a class on the plan if they would have been
14entitled to a class vote under the provisions of section 1914
15(relating to adoption of amendments) had the change been
16accomplished under Subchapter B (relating to amendment of
17articles). A proposed plan of merger or consolidation shall not
18be deemed to have been adopted by the corporation unless it has
19also been approved by the board of directors, regardless of the
20fact that the board has directed or suffered the submission of
21the plan to the shareholders for action.
22(b) Adoption by board of directors.--
23(1) Unless otherwise required by its bylaws, a plan of
24merger or consolidation shall not require the approval of the
25shareholders of a constituent domestic business corporation
26if:
27(i) whether or not the constituent corporation is
28the surviving corporation:
29(A) the surviving or new corporation is a
30domestic business corporation and the articles of the
1surviving or new corporation are identical to the
2articles of the constituent corporation, except
3changes that under section 1914(c) (relating to
4adoption by board of directors) may be made without
5shareholder action;
6(B) each share of the constituent corporation
7outstanding immediately prior to the effective date
8of the merger or consolidation is to continue as or
9to be converted into, except as may be otherwise
10agreed by the holder thereof, an identical share of
11the surviving or new corporation after the effective
12date of the merger or consolidation; and
13(C) the plan provides that the shareholders of
14the constituent corporation are to hold in the
15aggregate shares of the surviving or new corporation
16to be outstanding immediately after the effectiveness
17of the plan entitled to cast at least a majority of
18the votes entitled to be cast generally for the
19election of directors;
20(ii) immediately prior to the adoption of the plan
21and at all times thereafter prior to its effective date,
22another corporation that is a party to the plan owns
23directly or indirectly 80% or more of the outstanding
24shares of each class of the constituent corporation; or
25(iii) no shares of the constituent corporation have
26been issued prior to the adoption of the plan of merger
27or consolidation by the board of directors pursuant to
28section 1922 (relating to plan of merger or
29consolidation).
30(2) If a merger or consolidation is effected pursuant to
1paragraph (1)(i) or (iii), the plan of merger or
2consolidation shall be deemed adopted by the constituent
3corporation when it has been adopted by the board of
4directors pursuant to section 1922.
5(3) If a merger or consolidation of a subsidiary
6corporation with a parent corporation is effected pursuant to
7paragraph (1)(ii), the plan of merger or consolidation shall
8be deemed adopted by the subsidiary corporation when it has
9been adopted by the board of the parent corporation and
10neither approval of the plan by the board of directors of the
11subsidiary corporation nor execution of articles of merger or
12consolidation by the subsidiary corporation shall be
13necessary.
14(4) (i) Unless otherwise required by its bylaws, a plan
15of merger or consolidation providing for the merger or
16consolidation of a domestic business corporation
17(referred to in this paragraph as the "constituent
18corporation") with or into a single indirect wholly owned
19subsidiary (referred to in this paragraph as the
20"subsidiary corporation") of the constituent corporation
21shall not require the approval of the shareholders of
22either the constituent corporation or the subsidiary
23corporation if all of the provisions of this paragraph
24are satisfied.
25(ii) A merger or consolidation under this paragraph
26shall satisfy the following conditions:
27(A) The constituent corporation and the
28subsidiary corporation are the only parties to the
29merger or consolidation, other than the resulting
30corporation, if any, in a consolidation (the
1corporation that survives or results from the merger
2or consolidation is referred to in this paragraph as
3the "resulting subsidiary").
4(B) Each share or fraction of a share of the
5capital stock of the constituent corporation
6outstanding immediately prior to the effective time
7of the merger or consolidation is converted in the
8merger or consolidation into a share or equal
9fraction of a share of capital stock of a holding
10company having the same designations, rights, powers
11and preferences and the qualifications, limitations
12and restrictions as the share of stock of the
13constituent corporation being converted in the merger
14or consolidation.
15(C) The holding company and the resulting
16subsidiary are each domestic business corporations.
17(D) Immediately following the effective time of
18the merger or consolidation, the articles of
19incorporation and bylaws of the holding company are
20identical to the articles of incorporation and bylaws
21of the constituent corporation immediately before the
22effective time of the merger or consolidation except
23for changes that could be made without shareholder
24approval under section 1914(c) (relating to adoption
25by board of directors).
26(E) Immediately following the effective time of
27the merger or consolidation, the resulting subsidiary
28is a direct or indirect wholly owned subsidiary of
29the holding company.
30(F) The directors of the constituent corporation
1become or remain the directors of the holding company
2upon the effective time of the merger or
3consolidation.
4(G) The board of directors of the constituent
5corporation has made a good faith determination that
6the shareholders of the constituent corporation will
7not recognize gain or loss for United States Federal
8Income Tax purposes.
9(iii) As used in this paragraph only, the term
10"holding company" means a corporation that, from its
11incorporation until consummation of the merger or
12consolidation governed by this paragraph, was at all
13times a direct wholly owned subsidiary of the constituent
14corporation and whose capital stock is issued in the
15merger or consolidation.
16(iv) If the holding company is a registered
17corporation, the shares of the holding company issued in
18connection with the merger or consolidation shall be
19deemed to have been acquired at the time that the shares
20of the constituent corporation converted in the merger or
21consolidation were acquired.
22(5) A plan of merger or consolidation adopted by the
23board of directors under this subsection without the approval
24of the shareholders shall not, by itself, create or impair
25any rights or obligations on the part of any person under
26section 2538 (relating to approval of transactions with
27interested shareholders) or under Subchapters E (relating to
28control transactions), F (relating to business combinations),
29G (relating to control-share acquisitions), H (relating to
30disgorgement by certain controlling shareholders following
1attempts to acquire control), I (relating to severance
2compensation for employees terminated following certain
3control-share acquisitions) and J (relating to business
4combination transactions - labor contracts) of Chapter 25,
5nor shall it change the standard of care applicable to the
6directors under Subchapter B of Chapter 17 (relating to
7fiduciary duty).
8(c) Termination of plan.--Prior to the time when a merger or
9consolidation becomes effective, the merger or consolidation may
10be terminated pursuant to provisions therefor, if any, set forth
11in the plan. If articles of merger or consolidation have been
12filed in the Department of State prior to the termination, a
13statement under section 1902 (relating to statement of
14termination) shall be filed in the department.
15(d) Cross reference.--See section 2539 (relating to adoption
16of plan of merger by board of directors).
17§ 1925. Authorization by foreign corporations.
18The plan of merger or consolidation shall be authorized,
19adopted or approved by each foreign business corporation that
20desires to merge or consolidate in accordance with the laws of
21the jurisdiction in which it is incorporated.
22§ 1926. Articles of merger or consolidation.
23Upon the adoption of the plan of merger or consolidation by
24the corporations desiring to merge or consolidate, as provided
25in this subchapter, articles of merger or articles of
26consolidation, as the case may be, shall, except as provided by
27section 1924(b)(3) (relating to adoption by board of directors),
28be executed by each corporation and shall, subject to section
29109 (relating to name of commercial registered office provider
30in lieu of registered address), set forth:
1(1) The name and the location of the registered office,
2including street and number, if any, of the domestic
3surviving or new corporation or, in the case of a foreign
4surviving or new corporation, the name of the corporation and
5its jurisdiction of incorporation, together with either:
6(i) If a qualified foreign business corporation, the
7address, including street and number, if any, of its
8registered office in this Commonwealth.
9(ii) If a nonqualified foreign business corporation,
10the address, including street and number, if any, of its
11principal office under the laws of the jurisdiction in
12which it is incorporated.
13(2) The name and address, including street and number,
14if any, of the registered office of each other domestic
15business corporation and qualified foreign business
16corporation that is a party to the merger or consolidation.
17(3) If the plan is to be effective on a specified date,
18the hour, if any, and the month, day and year of the
19effective date.
20(4) The manner in which the plan was adopted by each
21domestic corporation and, if one or more foreign corporations
22are parties to the merger or consolidation, the fact that the
23plan was authorized, adopted or approved, as the case may be,
24by each of the foreign corporations in accordance with the
25laws of the jurisdiction in which it is incorporated.
26(5) Except as provided in section 1901 (relating to
27omission of certain provisions from filed plans), the plan of
28merger or consolidation.
29§ 1927. Filing of articles of merger or consolidation.
30(a) General rule.--The articles of merger or articles of
1consolidation, as the case may be, and the certificates or
2statement, if any, required by section 139 (relating to tax
3clearance of certain fundamental transactions) shall be filed in
4the Department of State.
5(b) Cross reference.--See section 134 (relating to docketing
6statement).
7§ 1928. Effective date of merger or consolidation.
8Upon the filing of the articles of merger or the articles of
9consolidation in the Department of State or upon the effective
10date specified in the plan of merger or consolidation, whichever
11is later, the merger or consolidation shall be effective. The
12merger or consolidation of one or more domestic business
13corporations into a foreign business corporation shall be
14effective according to the provisions of law of the jurisdiction
15in which the foreign corporation is incorporated, but not until
16articles of merger or articles of consolidation have been
17adopted and filed, as provided in this subchapter.
18§ 1929. Effect of merger or consolidation.
19(a) Single surviving or new corporation.--Upon the merger or
20consolidation becoming effective, the several corporations
21parties to the merger or consolidation shall be a single
22corporation which, in the case of a merger, shall be the
23corporation designated in the plan of merger as the surviving
24corporation and, in the case of a consolidation, shall be the
25new corporation provided for in the plan of consolidation. The
26separate existence of all corporations parties to the merger or
27consolidation shall cease, except that of the surviving
28corporation, in the case of a merger. The surviving or new
29corporation, as the case may be, if it is a domestic business
30corporation, shall not thereby acquire authority to engage in
1any business or exercise any right that a corporation may not be
2incorporated under this subpart to engage in or exercise.
3(b) Property rights.--All the property, real, personal and
4mixed, and franchises of each of the corporations parties to the
5merger or consolidation, and all debts due on whatever account
6to any of them, including subscriptions for shares and other
7choses in action belonging to any of them, shall be deemed to be
8vested in and shall belong to the surviving or new corporation,
9as the case may be, without further action, and the title to any
10real estate, or any interest therein, vested in any of the
11corporations shall not revert or be in any way impaired by
12reason of the merger or consolidation. The surviving or new
13corporation shall thenceforth be responsible for all the
14liabilities of each of the corporations so merged or
15consolidated. Liens upon the property of the merging or
16consolidating corporations shall not be impaired by the merger
17or consolidation and any claim existing or action or proceeding
18pending by or against any of the corporations may be prosecuted
19to judgment as if the merger or consolidation had not taken
20place or the surviving or new corporation may be proceeded
21against or substituted in its place.
22(c) Taxes.--Any taxes, interest, penalties and public
23accounts of the Commonwealth claimed against any of the merging
24or consolidating corporations that are settled, assessed or
25determined prior to or after the merger or consolidation shall
26be the liability of the surviving or new corporation and,
27together with interest thereon, shall be a lien against the
28franchises and property, both real and personal, of the
29surviving or new corporation.
30(d) Articles of incorporation.--In the case of a merger, the
1articles of incorporation of the surviving domestic business
2corporation, if any, shall be deemed to be amended to the
3extent, if any, that changes in its articles are stated in the
4plan of merger. In the case of a consolidation into a domestic
5business corporation, the statements that are set forth in the
6plan of consolidation, or articles of incorporation set forth
7therein, shall be deemed to be the articles of incorporation of
8the new corporation.
9§ 1930. Dissenters rights.
10(a) General rule.--If any shareholder of a domestic business
11corporation that is to be a party to a merger or consolidation
12pursuant to a plan of merger or consolidation objects to the
13plan of merger or consolidation and complies with the provisions
14of Subchapter D of Chapter 15 (relating to dissenters rights),
15the shareholder shall be entitled to the rights and remedies of
16dissenting shareholders therein provided, if any. See also
17section 1906(c) (relating to dissenters rights upon special
18treatment).
19(b) Plans adopted by directors only.--Except as otherwise
20provided pursuant to section 1571(c) (relating to grant of
21optional dissenters rights), Subchapter D of Chapter 15 shall
22not apply to any of the shares of a corporation that is a party
23to a merger or consolidation pursuant to section 1924(b)(1)(i)
24or (4) (relating to adoption by board of directors).
25(c) Cross references.--See sections 1571(b) (relating to
26exceptions) and 1904 (relating to de facto transaction doctrine
27abolished).
28§ 1931. Share exchanges.
29(a) General rule.--All the outstanding shares of one or more
30classes or series of a domestic business corporation, designated
1in this section as the exchanging corporation, may, in the
2manner provided in this section, be acquired by any person,
3designated in this section as the acquiring person, through an
4exchange of all the shares pursuant to a plan of exchange. The
5plan of exchange may also provide for the shares of any other
6class or series of the exchanging corporation to be canceled or
7converted into shares, other securities or obligations of any
8person or cash, property or rights. The procedure authorized by
9this section shall not be deemed to limit the power of any
10person to acquire all or part of the shares or other securities
11of any class or series of a corporation through a voluntary
12exchange or otherwise by agreement with the holders of the
13shares or other securities.
14(b) Plan of exchange.--A plan of exchange shall be prepared,
15setting forth:
16(1) The terms and conditions of the exchange.
17(2) The manner and basis of canceling the shares of the
18exchanging corporation or exchanging or converting the shares
19of the exchanging corporation into shares or other securities
20or obligations of the acquiring person, and, if any of the
21shares of the exchanging corporation are not to be exchanged
22or converted solely into shares or other securities or
23obligations of the acquiring person, the shares or other
24securities or obligations of any other person or cash,
25property or rights that the holders of the shares of the
26exchanging corporation are to receive in exchange for, or
27upon conversion of, the shares and the surrender of any
28certificates evidencing them, which securities or
29obligations, if any, of any other person or cash, property
30and rights may be in addition to or in lieu of the shares or
1other securities or obligations of the acquiring person.
2(3) Any changes desired to be made in the articles of
3the exchanging corporation, which may include a restatement
4of the articles.
5(4) Any provisions desired providing special treatment
6of shares held by any shareholder or group of shareholders as
7authorized by, and subject to the provisions of, section 1906
8(relating to special treatment of holders of shares of same
9class or series). Notwithstanding subsection (a), a plan that
10provides special treatment may affect less than all of the
11outstanding shares of a class or series.
12(5) Such other provisions as are deemed desirable.
13(c) Proposal and adoption.--The plan of exchange shall be
14proposed and adopted and may be amended after its adoption and
15terminated by the exchanging corporation in the manner provided
16by this subchapter for the proposal, adoption, amendment and
17termination of a plan of merger except section 1924(b) (relating
18to adoption by board of directors). There shall be included in,
19or enclosed with, the notice of the meeting of shareholders to
20act on the plan a copy or a summary of the plan and, if
21Subchapter D of Chapter 15 (relating to dissenters rights) is
22applicable, a copy of the subchapter and of subsection (d). The
23holders of any class of shares to be exchanged or converted
24pursuant to the plan of exchange shall be entitled to vote as a
25class on the plan if they would have been entitled to vote on a
26plan of merger that affects the class in substantially the same
27manner as the plan of exchange.
28(d) Dissenters rights in share exchanges.--Any holder of
29shares that are to be canceled, exchanged or converted pursuant
30to a plan of exchange who objects to the plan and complies with
1the provisions of Subchapter D of Chapter 15 shall be entitled
2to the rights and remedies of dissenting shareholders therein
3provided, if any. See section 1906(c) (relating to dissenters
4rights upon special treatment).
5(e) Articles of exchange.--Upon adoption of a plan of
6exchange, as provided in this section, articles of exchange
7shall be executed by the exchanging corporation and shall set
8forth:
9(1) The name and, subject to section 109 (relating to
10name of commercial registered office provider in lieu of
11registered address), the location of the registered office,
12including street and number, if any, of the exchanging
13corporation.
14(2) If the plan is to be effective on a specified date,
15the hour, if any, and the month, day and year of the
16effective date.
17(3) The manner in which the plan was adopted by the
18exchanging corporation.
19(4) Except as provided in section 1901 (relating to
20omission of certain provisions from filed plans), the plan of
21exchange.
22The articles of exchange shall be filed in the Department of
23State. See sections 134 (relating to docketing statement) and
24135 (relating to requirements to be met by filed documents).
25(f) Effective date.--Upon the filing of articles of exchange
26in the department or upon the effective date specified in the
27plan of exchange, whichever is later, the plan shall become
28effective.
29(g) Effect of plan.--Upon the plan of exchange becoming
30effective, the shares of the exchanging corporation that are,
1under the terms of the plan, to be canceled, converted or
2exchanged shall cease to exist or shall be converted or
3exchanged. The former holders of the shares shall thereafter be
4entitled only to the shares, other securities or obligations or
5cash, property or rights into which they have been converted or
6for which they have been exchanged in accordance with the plan,
7and the acquiring person shall be the holder of the shares of
8the exchanging corporation stated in the plan to be acquired by
9such person. The articles of incorporation of the exchanging
10corporation shall be deemed to be amended to the extent, if any,
11that changes in its articles are stated in the plan of exchange.
12(h) Special requirements.--If any provision of the articles
13or bylaws of an exchanging domestic business corporation adopted
14before October 1, 1989, requires for the proposal or adoption of
15a plan of merger, consolidation or asset transfer a specific
16number or percentage of votes of directors or shareholders or
17other special procedures, the plan of exchange shall not be
18proposed by the directors or adopted by the shareholders without
19that number or percentage of votes or compliance with the other
20special procedures.
21(i) Reference to outside facts.--Any of the terms of a plan
22of exchange may be made dependent upon facts ascertainable
23outside of the plan if the manner in which the facts will
24operate upon the terms of the plan is set forth in the plan.
25Such facts may include, without limitation, actions or events
26within the control of or determinations made by a party to the
27plan or a representative of a party to the plan.]
28Section 22. Section 1932(b)(1), (2) and (4) of Title 15 are
29amended to read:
30§ 1932. Voluntary transfer of corporate assets.
1* * *
2(b) Shareholder approval required.--
3(1) A sale, lease, exchange or other disposition of all,
4or substantially all, the property and assets, with or
5without the goodwill, of a business corporation, if not made
6pursuant to subsection (a) or (d) or to section 1551
7(relating to distributions to shareholders) or Subchapter [D]
8F of Chapter 3 (relating to division), may be made only
9pursuant to a plan of asset transfer in the manner provided
10in this subsection. A corporation selling, leasing or
11otherwise disposing of all, or substantially all, its
12property and assets is referred to in this subsection and in
13subsection (c) as the "transferring corporation."
14(2) The property or assets of a direct or indirect
15subsidiary corporation that is controlled by a parent
16corporation shall also be deemed the property or assets of
17the parent corporation for the purposes of this subsection
18and of subsection (c). A merger [or consolidation] to which
19such a subsidiary corporation is a party and in which a third
20party acquires direct or indirect ownership of the property
21or assets of the subsidiary corporation constitutes an "other
22disposition" of the property or assets of the parent
23corporation within the meaning of that term as used in this
24section.
25* * *
26(4) The plan of asset transfer shall be proposed and
27adopted, and may be amended after its adoption and
28terminated, by the transferring corporation in the manner
29provided in [this subchapter] Chapter 3 (relating to entity
30transactions) for the proposal, adoption, amendment and
1termination of a plan of merger, except section [1924(b)
2(relating to adoption by board of directors)] 321(d)
3(relating to approval by business corporation). The
4procedures of [this subchapter] Chapter 3 shall not be
5applicable to the person acquiring the property or assets of
6the transferring corporation. There shall be included in, or
7enclosed with, the notice of the meeting of the shareholders
8of the transferring corporation to act on the plan a copy or
9a summary of the plan and, if Subchapter D of Chapter 15
10(relating to dissenters rights) is applicable, a copy of the
11subchapter and of subsection (c).
12* * *
13Section 23. Subchapter D heading and sections 1951, 1952,
141953, 1954, 1955, 1956, 1957, Subchapter E and section 1980 of
15Chapter 19 of Title 15 are repealed:
16[SUBCHAPTER D
17DIVISION
18§ 1951. Division authorized.
19(a) Division of domestic corporation.--Any domestic business
20corporation may, in the manner provided in this subchapter, be
21divided into two or more domestic business corporations
22incorporated or to be incorporated under this article, or into
23one or more domestic business corporations and one or more
24foreign business corporations to be incorporated under the laws
25of another jurisdiction or jurisdictions, or into two or more
26foreign business corporations, if the laws of the other
27jurisdictions authorize the division.
28(b) Division of foreign corporation.--Any foreign business
29corporation may, in the manner provided in this subchapter, be
30divided into one or more domestic business corporations to be
1incorporated under this subpart and one or more foreign business
2corporations incorporated or to be incorporated under the laws
3of another jurisdiction or jurisdictions, or into two or more
4domestic business corporations, if the foreign business
5corporation is authorized under the laws of the jurisdiction
6under which it is incorporated to effect a division.
7(c) Surviving and new corporations.--The corporation
8effecting a division, if it survives the division, is designated
9in this subchapter as the surviving corporation. All
10corporations originally incorporated by a division are
11designated in this subchapter as new corporations. The surviving
12corporation, if any, and the new corporation or corporations are
13collectively designated in this subchapter as the resulting
14corporations.
15§ 1952. Proposal and adoption of plan of division.
16(a) Preparation of plan.--A plan of division shall be
17prepared, setting forth:
18(1) The terms and conditions of the division, including
19the manner and basis of:
20(i) The reclassification of the shares of the
21surviving corporation, if there be one, and, if any of
22the shares of the dividing corporation are not to be
23converted solely into shares or other securities or
24obligations of one or more of the resulting corporations,
25the shares or other securities or obligations of any
26other person, or cash, property or rights that the
27holders of such shares are to receive in exchange for or
28upon conversion of such shares, and the surrender of any
29certificates evidencing them, which securities or
30obligations, if any, of any other person or cash,
1property or rights may be in addition to or in lieu of
2shares or other securities or obligations of one or more
3of the resulting corporations.
4(ii) The disposition of the shares and other
5securities or obligations, if any, of the new corporation
6or corporations resulting from the division.
7(2) A statement that the dividing corporation will, or
8will not, survive the division.
9(3) Any changes desired to be made in the articles of
10the surviving corporation, if there be one, including a
11restatement of the articles.
12(4) The articles of incorporation required by subsection
13(b).
14(5) Any provisions desired providing special treatment
15of shares held by any shareholder or group of shareholders as
16authorized by, and subject to the provisions of, section 1906
17(relating to special treatment of holders of shares of same
18class or series).
19(6) Such other provisions as are deemed desirable.
20(b) Articles of new corporations.--There shall be included
21in or annexed to the plan of division:
22(1) Articles of incorporation, which shall contain all
23of the statements required by this subpart to be set forth in
24restated articles, for each of the new domestic business
25corporations, if any, resulting from the division.
26(2) Articles of incorporation, certificates of
27incorporation or other charter documents for each of the new
28foreign business corporations, if any, resulting from the
29division.
30(c) Proposal and adoption.--Except as otherwise provided in
1section 1953 (relating to division without shareholder
2approval), the plan of division shall be proposed and adopted,
3and may be amended after its adoption and terminated, by a
4domestic business corporation in the manner provided for the
5proposal, adoption, amendment and termination of a plan of
6merger in Subchapter C (relating to merger, consolidation, share
7exchanges and sale of assets), except section 1924(b) (relating
8to adoption by board of directors), or, if the dividing
9corporation is a foreign business corporation, in accordance
10with the laws of the jurisdiction in which it is incorporated.
11There shall be included in, or enclosed with, the notice of the
12meeting of shareholders to act on the plan a copy or a summary
13of the plan and, if Subchapter D of Chapter 15 (relating to
14dissenters rights) is applicable, a copy of the subchapter and
15of subsection (d).
16(d) Dissenters rights in division.--
17(1) Except as otherwise provided in paragraph (2), any
18shareholder of a business corporation that adopts a plan of
19division who objects to the plan and complies with the
20provisions of Subchapter D of Chapter 15 shall be entitled to
21the rights and remedies of dissenting shareholders therein
22provided, if any. See section 1906(c) (relating to dissenters
23rights upon special treatment).
24(2) Except as otherwise provided pursuant to section
251571(c) (relating to grant of optional dissenters rights),
26Subchapter D of Chapter 15 shall not apply to any of the
27shares of a corporation that is a party to a plan of division
28pursuant to section 1953 (relating to division without
29shareholder approval).
30(f) Action by holders of preferred or special shares.--If
1the dividing corporation has outstanding any shares of any
2preferred or special class or series, the holders of the
3outstanding shares of the class or series shall be entitled to
4vote as a class on the plan regardless of any limitations stated
5in the articles or bylaws on the voting rights of the class or
6series if the plan of division:
7(1) provides that the dividing corporation will not
8survive the division; or
9(2) amends the articles or bylaws of the surviving
10corporation in a manner that would entitle the holders of
11such preferred or special shares to a class vote thereon
12under the articles, bylaws or section 1914(b) (relating to
13statutory voting rights).
14(g) Rights of holders of indebtedness.--If any debt
15securities, notes or similar evidences of indebtedness for money
16borrowed, whether secured or unsecured, indentures or other
17contracts were issued, incurred or executed by the dividing
18corporation before August 21, 2001, and have not been amended
19subsequent to that date, the liability of the dividing
20corporation thereunder shall not be affected by the division nor
21shall the rights of the obligees thereunder be impaired by the
22division, and each of the resulting corporations may be
23proceeded against or substituted in place of the dividing
24corporation as joint and several obligors on such liability,
25regardless of any provision of the plan of division apportioning
26the liabilities of the dividing corporation.
27(h) Special requirements.--If any provision of the articles
28or bylaws of a dividing domestic business corporation adopted
29before October 1, 1989, requires for the proposal or adoption of
30a plan of merger, consolidation or asset transfer a specific
1number or percentage of votes of directors or shareholders or
2other special procedures, the plan of division shall not be
3proposed or adopted by the directors or (if adoption by the
4shareholders is otherwise required by this subchapter) adopted
5by the shareholders without that number or percentage of votes
6or compliance with the other special procedures.
7(i) Reference to outside facts.--Any of the terms of a plan
8of division may be made dependent upon facts ascertainable
9outside of the plan if the manner in which the facts will
10operate upon the terms of the plan is set forth in the plan.
11Such facts may include, without limitation, actions or events
12within the control of or determinations made by the dividing
13corporation or a representative of the dividing corporation.
14§ 1953. Division without shareholder approval.
15(a) General rule.--Unless otherwise restricted by its bylaws
16or required by section 1952(f) (relating to action by holders of
17preferred or special shares), a plan of division that does not
18alter the state of incorporation of a business corporation,
19provide for special treatment nor amend in any respect the
20provisions of its articles (except amendments which under
21section 1914(c) (relating to adoption by board of directors) may
22be made without shareholder action) shall not require the
23approval of the shareholders of the corporation if:
24(1) the dividing corporation has only one class of
25shares outstanding and the shares and other securities, if
26any, of each corporation resulting from the plan are
27distributed pro rata to the shareholders of the dividing
28corporation;
29(2) the dividing corporation survives the division and
30all the shares and other securities and obligations, if any,
1of all new corporations resulting from the plan are owned
2solely by the surviving corporation; or
3(3) the allocation of assets among the resulting
4corporations effected by the division, if effected by means
5of a sale, lease, exchange or other disposition, would not
6require the approval of shareholders under section 1932(b)
7(relating to shareholder approval required).
8(b) Limitation.--A plan of division adopted by the board of
9directors under this section without the approval of the
10shareholders shall not, by itself, create or impair any rights
11or obligations on the part of any person under section 2538
12(relating to approval of transactions with interested
13shareholders) or under Subchapters E (relating to control
14transactions), F (relating to business combinations), G
15(relating to control-share acquisitions), H (relating to
16disgorgement by certain controlling shareholders following
17attempts to acquire control), I (relating to severance
18compensation for employees terminated following certain control-
19share acquisitions) and J (relating to business combination
20transactions - labor contracts) of Chapter 25, nor shall it
21change the standard of care applicable to the directors under
22Subchapter B of Chapter 17 (relating to fiduciary duty).
23§ 1954. Articles of division.
24Upon the adoption of a plan of division by the corporation
25desiring to divide, as provided in this subchapter, articles of
26division shall be executed by the corporation and shall, subject
27to section 109 (relating to name of commercial registered office
28provider in lieu of registered address), set forth:
29(1) The name and the location of the registered office,
30including street and number, if any, of the dividing domestic
1business corporation or, in the case of a dividing foreign
2business corporation, the name of the corporation and the
3jurisdiction in which it is incorporated, together with
4either:
5(i) If a qualified foreign business corporation, the
6address, including street and number, if any, of its
7registered office in this Commonwealth.
8(ii) If a nonqualified foreign business corporation,
9the address, including street and number, if any, of its
10principal office under the laws of that jurisdiction.
11(2) The statute under which the dividing corporation was
12incorporated and the date of incorporation.
13(3) A statement that the dividing corporation will, or
14will not, survive the division.
15(4) The name and the address, including street and
16number, if any, of the registered office of each new domestic
17business corporation or qualified foreign business
18corporation resulting from the division.
19(5) If the plan is to be effective on a specific date,
20the hour, if any, and the month, day and year of the
21effective date.
22(6) The manner in which the plan was adopted by the
23corporation.
24(7) Except as provided in section 1901 (relating to
25omission of certain provisions from filed plans), the plan of
26division.
27§ 1955. Filing of articles of division.
28(a) General rule.--The articles of division, and the
29certificates or statement, if any, required by section 139
30(relating to tax clearance of certain fundamental transactions)
1shall be filed in the Department of State.
2(b) Cross references.--See sections 134 (relating to
3docketing statement) and 135 (relating to requirements to be met
4by filed documents).
5§ 1956. Effective date of division.
6Upon the filing of articles of division in the Department of
7State or upon the effective date specified in the plan of
8division, whichever is later, the division shall become
9effective. The division of a domestic business corporation into
10one or more foreign business corporations or the division of a
11foreign business corporation shall be effective according to the
12laws of the jurisdictions where the foreign corporations are or
13are to be incorporated, but not until articles of division have
14been adopted and filed as provided in this subchapter.
15§ 1957. Effect of division.
16(a) Multiple resulting corporations.--Upon the division
17becoming effective, the dividing corporation shall be subdivided
18into the distinct and independent resulting corporations named
19in the plan of division and, if the dividing corporation is not
20to survive the division, the existence of the dividing
21corporation shall cease. The resulting corporations, if they are
22domestic business corporations, shall not thereby acquire
23authority to engage in any business or exercise any right that a
24corporation may not be incorporated under this subpart to engage
25in or exercise. Any resulting foreign business corporation that
26is stated in the articles of division to be a qualified foreign
27business corporation shall be a qualified foreign business
28corporation under Article D (relating to foreign business
29corporations), and the articles of division shall be deemed to
30be the application for a certificate of authority and the
1certificate of authority issued thereon of the corporation.
2(b) Property rights; allocations of assets and
3liabilities.--
4(1) (i) All the property, real, personal and mixed, and
5franchises of the dividing corporation, and all debts due
6on whatever account to it, including subscriptions for
7shares and other choses in action belonging to it, shall
8(except as otherwise provided in paragraph (2)), to the
9extent allocations of assets are contemplated by the plan
10of division, be deemed without further action to be
11allocated to and vested in the resulting corporations on
12such a manner and basis and with such effect as is
13specified in the plan, or per capita among the resulting
14corporations, as tenants in common, if no specification
15is made in the plan, and the title to any real estate, or
16interest therein, vested in any of the corporations shall
17not revert or be in any way impaired by reason of the
18division.
19(ii) Upon the division becoming effective, the
20resulting corporations shall each thenceforth be
21responsible as separate and distinct corporations only
22for such liabilities as each corporation may undertake or
23incur in its own name but shall be liable for the
24liabilities of the dividing corporation in the manner and
25on the basis provided in subparagraphs (iv) and (v).
26(iii) Liens upon the property of the dividing
27corporation shall not be impaired by the division.
28(iv) Except as provided in section 1952(g) (relating
29to proposal and adoption of plan of division), to the
30extent allocations of liabilities are contemplated by the
1plan of division, the liabilities of the dividing
2corporation shall be deemed without further action to be
3allocated to and become the liabilities of the resulting
4corporations on such a manner and basis and with such
5effect as is specified in the plan; and one or more, but
6less than all, of the resulting corporations shall be
7free of the liabilities of the dividing corporation to
8the extent, if any, specified in the plan, if in either
9case:
10(A) no fraud on minority shareholders or
11shareholders without voting rights or violation of
12law shall be effected thereby; and
13(B) the plan does not constitute a fraudulent
14transfer under 12 Pa.C.S. Ch. 51 (relating to
15fraudulent transfers).
16(v) If the conditions in subparagraph (iv) for
17freeing one or more of the resulting corporations from
18the liabilities of the dividing corporation or for
19allocating some or all of the liabilities of the dividing
20corporation are not satisfied, the liabilities of the
21dividing corporation as to which those conditions are not
22satisfied shall not be affected by the division nor shall
23the rights of creditors thereunder be impaired by the
24division and any claim existing or action or proceeding
25pending by or against the corporation with respect to
26those liabilities may be prosecuted to judgment as if the
27division had not taken place, or the resulting
28corporations may be proceeded against or substituted in
29place of the dividing corporation as joint and several
30obligors on those liabilities, regardless of any
1provision of the plan of division apportioning the
2liabilities of the dividing corporation.
3(vi) The conditions in subparagraph (iv) for freeing
4one or more of the resulting corporations from the
5liabilities of the dividing corporation and for
6allocating some or all of the liabilities of the dividing
7corporation shall be conclusively deemed to have been
8satisfied if the plan of division has been approved by
9the Department of Banking, the Insurance Department or
10the Pennsylvania Public Utility Commission in a final
11order issued after August 21, 2001, that has become not
12subject to further appeal.
13(2) (i) The allocation of any fee or freehold interest
14or leasehold having a remaining term of 30 years or more
15in any tract or parcel of real property situate in this
16Commonwealth owned by a dividing corporation (including
17property owned by a foreign business corporation dividing
18solely under the law of another jurisdiction) to a new
19corporation resulting from the division shall not be
20effective until one of the following documents is filed
21in the office for the recording of deeds of the county,
22or each of them, in which the tract or parcel is
23situated:
24(A) A deed, lease or other instrument of
25confirmation describing the tract or parcel.
26(B) A duly executed duplicate original copy of
27the articles of division.
28(C) A copy of the articles of division certified
29by the Department of State.
30(D) A declaration of acquisition setting forth
1the value of real estate holdings in such county of
2the corporation as an acquired company.
3(ii) The provisions of 75 Pa.C.S. § 1114 (relating
4to transfer of vehicle by operation of law) shall not be
5applicable to an allocation of ownership of any motor
6vehicle, trailer or semitrailer to a new corporation
7under this section or under a similar law of any other
8jurisdiction but any such allocation shall be effective
9only upon compliance with the requirements of 75 Pa.C.S.
10§ 1116 (relating to issuance of new certificate following
11transfer).
12(3) It shall not be necessary for a plan of division to
13list each individual asset or liability of the dividing
14corporation to be allocated to a new corporation so long as
15those assets and liabilities are described in a reasonable
16manner.
17(4) Each new corporation shall hold any assets and
18liabilities allocated to it as the successor to the dividing
19corporation, and those assets and liabilities shall not be
20deemed to have been assigned to the new corporation in any
21manner, whether directly or indirectly or by operation of
22law.
23(c) Taxes.--Any taxes, interest, penalties and public
24accounts of the Commonwealth claimed against the dividing
25corporation that are settled, assessed or determined prior to or
26after the division shall be the liability of any of the
27resulting corporations and, together with interest thereon,
28shall be a lien against the franchises and property, both real
29and personal, of all the corporations. Upon the application of
30the dividing corporation, the Department of Revenue, with the
1concurrence of the Office of Employment Security of the
2Department of Labor and Industry, shall release one or more, but
3less than all, of the resulting corporations from liability and
4liens for all taxes, interest, penalties and public accounts of
5the dividing corporation due the Commonwealth for periods prior
6to the effective date of the division if those departments are
7satisfied that the public revenues will be adequately secured.
8(d) Articles of surviving corporation.--The articles of
9incorporation of the surviving corporation, if there be one,
10shall be deemed to be amended to the extent, if any, that
11changes in its articles are stated in the plan of division.
12(e) Articles of new corporations.--The statements that are
13set forth in the plan of division with respect to each new
14domestic business corporation and that are required or permitted
15to be set forth in restated articles of incorporation of
16corporations incorporated under this subpart, or the articles of
17incorporation of each new corporation set forth therein, shall
18be deemed to be the articles of incorporation of each new
19corporation.
20(f) Directors and officers.--Unless otherwise provided in
21the plan, the directors and officers of the dividing corporation
22shall be the initial directors and officers of each of the
23resulting corporations.
24(g) Disposition of shares.--Unless otherwise provided in the
25plan, the shares and other securities or obligations, if any, of
26each new corporation resulting from the division shall be
27distributable to:
28(1) the surviving corporation, if the dividing
29corporation survives the division; or
30(2) the holders of the common or other residuary shares
1of the dividing corporation pro rata, in any other case.
2(h) Conflict of laws.--It is the intent of the General
3Assembly that:
4(1) The effect of a division of a domestic business
5corporation shall be governed solely by the laws of this
6Commonwealth and any other jurisdiction under the laws of
7which any of the resulting corporations is incorporated.
8(2) The effect of a division on the assets and
9liabilities of the dividing corporation shall be governed
10solely by the laws of this Commonwealth and any other
11jurisdiction under the laws of which any of the resulting
12corporations is incorporated.
13(3) The validity of any allocations of assets or
14liabilities by a plan of division of a domestic business
15corporation, regardless of whether or not any of the new
16corporations is a foreign business corporation, shall be
17governed solely by the laws of this Commonwealth.
18(4) In addition to the express provisions of this
19subsection, this subchapter shall otherwise generally be
20granted the protection of full faith and credit under the
21Constitution of the United States.
22SUBCHAPTER E
23CONVERSION
24§ 1961. Conversion authorized.
25(a) General rule.--Any business corporation may, in the
26manner provided in this subchapter, be converted into a
27nonprofit corporation, designated in this subchapter as the
28resulting corporation.
29(b) Exceptions.--This subchapter shall not authorize any
30conversion involving:
1(1) Beneficial, benevolent, fraternal or fraternal
2benefit societies having a lodge system and a representative
3form of government, or transacting any type of insurance
4whatsoever.
5(2) Any corporation that by the laws of this
6Commonwealth is subject to the supervision of the Department
7of Banking, the Insurance Department or the Pennsylvania
8Public Utility Commission, unless the agency expressly
9approves the transaction in writing.
10§ 1962. Proposal and adoption of plan of conversion.
11(a) Preparation of plan.--A plan of conversion shall be
12prepared, setting forth:
13(1) The terms and conditions of the conversion.
14(2) A restatement of the articles of the resulting
15corporation, which articles shall comply with the
16requirements of this part relating to nonprofit corporations.
17(3) Any provisions desired providing special treatment
18of shares held by any shareholder or group of shareholders as
19authorized by, and subject to the provisions of, section 1906
20(relating to special treatment of holders of shares of same
21class or series).
22(4) Such other provisions as are deemed desirable.
23(b) Proposal and adoption.--The plan of conversion shall be
24proposed and adopted, and may be amended after its adoption and
25terminated, by the business corporation in the manner provided
26for the proposal, adoption, amendment and termination of a plan
27of merger in Subchapter C (relating to merger, consolidation,
28share exchanges and sale of assets), except section 1924(b)
29(relating to adoption by board of directors). There shall be
30included in, or enclosed with, the notice of meeting of
1shareholders of the business corporation that will act upon the
2plan a copy or a summary of the plan and of Subchapter D of
3Chapter 15 (relating to dissenters rights) and of subsection
4(c).
5(c) Dissenters rights in conversion.--Any shareholder of a
6business corporation that adopts a plan of conversion into a
7nonprofit corporation who objects to the plan of conversion and
8complies with the provisions of Subchapter D of Chapter 15 shall
9be entitled to the rights and remedies of dissenting
10shareholders therein provided.
11(d) Reference to outside facts.--Any of the terms of a plan
12of conversion may be made dependent upon facts ascertainable
13outside of the plan if the manner in which the facts will
14operate upon the terms of the plan is set forth in the plan.
15Such facts may include, without limitation, actions or events
16within the control of or determinations made by the corporation
17or a representative of the corporation.
18§ 1963. Articles of conversion.
19Upon the adoption of a plan of conversion by the business
20corporation desiring to convert, as provided in this subchapter,
21articles of conversion shall be executed by the corporation and
22shall set forth:
23(1) The name of the corporation and, subject to section
24109 (relating to name of commercial registered office
25provider in lieu of registered address), the address,
26including street and number, if any, of its registered
27office.
28(2) The statute under which the corporation was
29incorporated and the date of incorporation.
30(3) If the plan is to be effective on a specified date,
1the hour, if any, and the month, day and year of the
2effective date.
3(4) The manner in which the plan was adopted by the
4corporation.
5(5) Except as provided in section 1901 (relating to
6omission of certain provisions from filed plans), the plan of
7conversion.
8§ 1964. Filing of articles of conversion.
9(a) General rule.--The articles of conversion shall be filed
10in the Department of State.
11(b) Cross reference.--See section 134 (relating to docketing
12statement).
13§ 1965. Effective date of conversion.
14Upon the filing of articles of conversion in the Department
15of State or upon the effective date specified in the plan of
16conversion, whichever is later, the conversion shall become
17effective.
18§ 1966. Effect of conversion.
19Upon the conversion becoming effective, the converting
20business corporation shall be deemed to be a nonprofit
21corporation subject to the provisions of this part relating to
22nonprofit corporations for all purposes, shall cease to be a
23business corporation and shall not thereafter operate in any
24manner resulting in pecuniary profit, incidental or otherwise,
25to its members or shareholders. The corporation shall remain
26liable for all existing obligations, public or private, and
27taxes due the Commonwealth or any other taxing authority for
28periods prior to the effective date of the conversion and, as a
29nonprofit corporation, it shall continue to be entitled to all
30assets theretofore pertaining to it as a business corporation.
1§ 1980. Dissolution by domestication.
2Whenever a domestic business corporation has domesticated
3itself under the laws of another jurisdiction by action similar
4to that provided by section 4161 (relating to domestication) and
5has authorized that action by the vote required by this
6subchapter for the approval of a proposal that the corporation
7dissolve voluntarily, the corporation may surrender its charter
8under the laws of this Commonwealth by filing in the Department
9of State articles of dissolution under this subchapter
10containing the statement specified by section 1977(b)(1) through
11(4) (relating to articles of dissolution). If the corporation as
12domesticated in the other jurisdiction qualifies to do business
13in this Commonwealth either prior to or simultaneously with the
14filing of the articles of dissolution under this section, the
15corporation shall not be required to file with the articles of
16dissolution the tax clearance certificates that would otherwise
17be required by section 139 (relating to tax clearance of certain
18fundamental transactions).]
19Section 24. Sections 2101(c), 2121, 2301(c), 2501(b) and
20(c), 2521, 2538(a)(1) and (2) and (b), 2539, 2701(b), 2721,
212901(c), 2921(b), 3101(c), 3301(c) and 3304(b) of Title 15 are
22amended to read:
23§ 2101. Application and effect of chapter.
24* * *
25(c) Laws applicable to nonstock corporations.--Except as
26otherwise provided in this chapter, Part I (relating to
27preliminary provision) and this subpart shall be generally
28applicable to all nonstock corporations. The specific provisions
29of this chapter shall control over the general provisions of
30Part I and this subpart. In the case of a nonstock corporation,
1references in this part to "shares," "shareholder," "share
2register," "share ledger," "transfer book for shares," "number
3of shares entitled to vote" or "class of shares" shall mean
4memberships, member, membership register, membership ledger,
5membership transfer book, number of votes entitled to be cast or
6class of members, respectively. Except as otherwise provided in
7this article, a nonstock corporation may be simultaneously
8subject to this chapter and one or more other chapters of this
9article.
10§ 2121. Corporate name of nonstock corporations.
11(a) General rule.--The corporate name of a nonstock
12corporation may contain the word "mutual."
13(b) Insurance names.--See section [1303(c)(1)(iii) (relating
14to corporate name)] 202(c)(1)(iii) (relating to requirements for
15names generally).
16§ 2301. Application and effect of chapter.
17* * *
18(c) Laws applicable to statutory close corporations.--Except
19as otherwise provided in this chapter, Part I (relating to
20preliminary provisions) and this subpart shall be generally
21applicable to all statutory close corporations. The specific
22provisions of this chapter shall control over the general
23provisions of Part I and this subpart. Except as otherwise
24provided in this article, a statutory close corporation may be
25simultaneously subject to this chapter and one or more other
26chapters of this article.
27* * *
28§ 2501. Application and effect of chapter.
29* * *
30(b) Laws applicable to registered corporations.--Except as
1otherwise provided in this chapter, Part I (relating to
2preliminary provisions) and this subpart shall be generally
3applicable to all registered corporations. The specific
4provisions of this chapter shall control over the general
5provisions of Part I and this subpart. Except as otherwise
6provided in this article, a registered corporation may be
7simultaneously subject to this chapter and one or more other
8chapters of this article.
9(c) Effect of a contrary provision of the articles.--
10(1) [The] Except as provided in section 2521 (relating
11to call of special meetings of shareholders), the articles of
12a registered corporation may provide either expressly or by
13necessary implication that any one or more of the provisions
14of Subchapters B (relating to powers, duties and safeguards),
15C (relating to directors and shareholders) and D (relating to
16fundamental changes generally) shall not be applicable in
17whole or in part to the corporation.
18(2) The articles of a registered corporation may provide
19that any one or more of the provisions of Subchapter E
20(relating to control transactions) and following of this
21chapter shall not be applicable in whole or in part to the
22corporation only if, to the extent and in the manner,
23expressly permitted by the subchapter the applicability of
24which is so affected. Where any provision of Subchapter E and
25following of this chapter permits the applicability of a
26subchapter to be varied by a provision of the articles, the
27applicability may be varied by an amendment of the articles
28only if, to the extent and in the manner, expressly permitted
29by the subchapter the applicability of which is so affected.
30* * *
1§ 2521. Call of special meetings of shareholders.
2(a) General rule.--The shareholders of a registered
3corporation shall not be entitled by statute to call a special
4meeting of the shareholders.
5(b) Exception.--Subsection (a) shall not apply to the call
6of a special meeting by an interested shareholder (as defined in
7section 2553 (relating to interested shareholder)) for the
8purpose of approving a business combination under section
92555(3) or (4) (relating to requirements relating to certain
10business combinations).
11(c) Contrary articles provision.--A provision of the
12articles of a registered corporation described in section
132502(1) (relating to registered corporation status) adopted
14after July 1, 2015, may not provide that a special meeting may
15be called by less than 25% of the votes that all shareholders
16would be entitled to cast at the meeting.
17§ 2538. Approval of transactions with interested shareholders.
18(a) General rule.--The following transactions shall require
19the affirmative vote of the shareholders entitled to cast at
20least a majority of the votes that all shareholders other than
21the interested shareholder are entitled to cast with respect to
22the transaction, without counting the vote of the interested
23shareholder:
24(1) Any transaction authorized under Subchapter C of
25Chapter 19 (relating to merger[,consolidation, share
26exchanges] liabilities and sale of assets) or Subchapter C
27(relating to merger) or D (relating to interest exchange) of
28Chapter 3 between a registered corporation or subsidiary
29thereof and a shareholder of the registered corporation.
30(2) Any transaction authorized under Subchapter [D] F of
1Chapter [19] 3 (relating to division) in which the interested
2shareholder receives a disproportionate amount of any of the
3shares or other securities of any corporation surviving or
4resulting from the plan of division.
5* * *
6(b) Exceptions.--Subsection (a) shall not apply to a
7transaction:
8(1) that has been approved by a majority vote of the
9board of directors without counting the vote of directors
10who:
11(i) are directors or officers of, or have a material
12equity interest in, the interested shareholder; or
13(ii) were nominated for election as a director by
14the interested shareholder, and first elected as a
15director, within 24 months of the date of the vote on the
16proposed transaction;
17(2) in which the consideration to be received by the
18shareholders for shares of any class of which shares are
19owned by the interested shareholder is not less than the
20highest amount paid by the interested shareholder in
21acquiring shares of the same class; or
22(3) effected pursuant to section [1924(b)(1)(ii)
23(relating to adoption by board of directors)] 321(d)(1)(ii)
24(relating to approval by business corporation).
25* * *
26§ 2539. Adoption of plan of merger by board of directors.
27Section [1924(b)(1)(ii) (relating to adoption by board of
28directors)] 321(d)(1)(ii) (relating to approval by business
29corporation) shall be applicable to a plan relating to a merger
30[or consolidation] to which a registered corporation described
1in section 2502(1)(i) (relating to registered corporation
2status) is a party only if the plan:
3(1) has been approved by the board of directors of the
4registered corporation; and
5(2) is consistent with the requirements, if applicable,
6of Subchapter F (relating to business combinations).
7§ 2701. Application and effect of chapter.
8* * *
9(b) Laws applicable to management corporations.--Except as
10otherwise provided in this chapter, Part I (relating to
11preliminary provisions) and this subpart shall be generally
12applicable to all management corporations. The specific
13provisions of this chapter shall control over the general
14provisions of Part I and this subpart. Except as otherwise
15provided in this article, a management corporation may be
16simultaneously subject to this chapter and one or more other
17chapters of this article.
18* * *
19§ 2721. Bylaw and fundamental change procedures.
20So long as a business corporation is a management corporation
21subject to this chapter:
22(1) The board of directors shall have the full authority
23vested by this subpart in the shareholders to amend the
24articles under section 2704(b) (relating to procedure) to
25renew the election of the corporation to be subject to this
26chapter and to adopt or change the bylaws, and a bylaw
27adopted by the board of directors pursuant to this section
28may continue in effect as long as the corporation remains
29subject to this chapter.
30(2) [An amendment or plan shall not be adopted under
1Chapter 19 (relating to fundamental changes), and a bylaw
2shall not be adopted or changed by the shareholders, without
3the approval of the board of directors.] None of the
4following shall be adopted or changed by the shareholders
5without the approval of the board of directors:
6(i) a plan under Chapter 3 (relating to entity
7transactions);
8(ii) an amendment of the articles;
9(iii) an amendment, adoption or repeal of a bylaw;
10(iv) a plan of asset transfer; or
11(v) a resolution recommending dissolution.
12(3) In the case of a corporation that in the ordinary
13course of business redeems all outstanding shares at the
14option of the shareholder at the net asset value or at
15another agreed method or amount of value thereof, [an
16amendment or plan under Chapter 19] a plan under Chapter 3,
17an amendment of the articles or a plan of asset transfer
18under section 1932 (relating to voluntary transfer of
19corporate assets) shall not require the approval of the
20shareholders of the corporation for adoption by the
21corporation.
22§ 2901. Application and effect of chapter.
23* * *
24(c) Laws applicable to professional corporations.--Except as
25otherwise provided in this chapter, Part I (relating to
26preliminary provisions) and this subpart shall be generally
27applicable to all professional corporations. The specific
28provisions of this chapter shall control over the general
29provisions of Part I and this subpart. Except as otherwise
30provided in this article, a professional corporation may be
1simultaneously subject to this chapter and one or more other
2chapters of this article.
3§ 2921. Corporate name.
4* * *
5(b) Additional names permitted.--The provisions of section
6[1303(a) (relating to corporate name)] 202 (relating to
7requirements for names generally) shall not prohibit the use of
8a name of a professional corporation if the name contains and is
9restricted to the name or the last name of one or more of the
10present, prospective or former shareholders or of individuals
11who were associated with a predecessor or whose individual name
12or names appeared in the name of the predecessor. The name may
13also contain:
14(1) the word "and" or any symbol or substitute therefor;
15(2) the word "associates";
16(3) the term "P.C."; or
17(4) any or all of the words or terms in paragraphs (1),
18(2) and (3).
19§ 3101. Application and effect of chapter.
20* * *
21(c) Laws applicable to insurance corporations.--Except as
22otherwise provided in this chapter, Part I (relating to
23preliminary provisions) and this subpart shall be generally
24applicable to all insurance corporations. The specific
25provisions of this chapter shall control over the general
26provisions of Part I and this subpart. Except as otherwise
27provided in this article, an insurance corporation may be
28simultaneously subject to this chapter and one or more other
29chapters of this article.
30§ 3301. Application and effect of chapter.
1* * *
2(c) Laws applicable to benefit corporations.--Except as
3otherwise provided in this chapter, Part I (relating to
4preliminary provisions) and this subpart shall apply generally
5to benefit corporations. The [specific] provisions of this
6chapter shall control over [the general provisions of this
7subpart] inconsistent provisions of this title. A benefit
8corporation may be simultaneously subject to this chapter and
9one or more other chapters of this article.
10* * *
11§ 3304. Election of benefit corporation status.
12* * *
13(b) Fundamental transactions.--If an association that is not
14a benefit corporation is a party to a merger[, consolidation] or
15division or is the exchanging association in [a share] an
16interest exchange, and the surviving, new or any resulting
17association in the merger, [consolidation,] division or [share]
18interest exchange is to be a benefit corporation, then the plan
19of merger, [consolidation,] division or [share] interest
20exchange shall not be effective unless it is adopted by the
21[corporation] association by at least the minimum status vote.
22Section 25. Sections 4121, 4122 and 4123 of Title 15 are
23repealed:
24[§ 4121. Admission of foreign corporations.
25(a) General rule.--A foreign business corporation, before
26doing business in this Commonwealth, shall procure a certificate
27of authority to do so from the Department of State, in the
28manner provided in this subchapter. A foreign business
29corporation shall not be denied a certificate of authority by
30reason of the fact that the laws of the jurisdiction governing
1its incorporation and internal affairs differ from the laws of
2this Commonwealth.
3(b) Qualification under former statutes.--If a foreign
4corporation for profit was on March 19, 1966, admitted to do
5business in this Commonwealth by the filing of a power of
6attorney and statement under the act of June 8, 1911 (P.L.710,
7No.283), the power of attorney and statement shall be deemed an
8approved application for a certificate of authority issued under
9this subchapter and the corporation shall be deemed a holder of
10the certificate. The corporation shall include in its initial
11application, if any, for an amended certificate of authority
12under this subchapter the information required by this
13subchapter to be set forth in an application for a certificate
14of authority. A certificate of authority issued under the former
15provisions of the Business Corporation Law of 1933 shall be
16deemed to be issued under this subchapter, and the certificate
17of authority shall be deemed not to contain any reference to the
18kind of business that the corporation proposes to do in this
19Commonwealth.
20(c) Foreign insurance corporations.--A foreign insurance
21corporation shall not be required to procure a certificate of
22authority under this subchapter.
23§ 4122. Excluded activities.
24(a) General rule.--Without excluding other activities that
25may not constitute doing business in this Commonwealth, a
26foreign business corporation shall not be considered to be doing
27business in this Commonwealth for the purposes of this
28subchapter by reason of carrying on in this Commonwealth any one
29or more of the following acts:
30(1) Maintaining or defending any action or
1administrative or arbitration proceeding or effecting the
2settlement thereof or the settlement of claims or disputes.
3(2) Holding meetings of its directors or shareholders or
4carrying on other activities concerning its internal affairs.
5(3) Maintaining bank accounts.
6(4) Maintaining offices or agencies for the transfer,
7exchange and registration of its securities or appointing and
8maintaining trustees or depositaries with relation to its
9securities.
10(5) Effecting sales through independent contractors.
11(6) Soliciting or procuring orders, whether by mail or
12through employees or agents or otherwise, and maintaining
13offices therefor, where the orders require acceptance without
14this Commonwealth before becoming binding contracts.
15(7) Creating as borrower or lender, acquiring or
16incurring, obligations or mortgages or other security
17interests in real or personal property.
18(8) Securing or collecting debts or enforcing any rights
19in property securing them.
20(9) Transacting any business in interstate or foreign
21commerce.
22(10) Conducting an isolated transaction completed within
23a period of 30 days and not in the course of a number of
24repeated transactions of like nature.
25(11) Inspecting, appraising and acquiring real estate
26and mortgages and other liens thereon and personal property
27and security interests therein, and holding, leasing,
28conveying and transferring them, as fiduciary or otherwise.
29(b) Exceptions.--The specification of activities in
30subsection (a) does not establish a standard for activities that
1may subject a foreign business corporation to:
2(1) Service of process under any statute or general
3rule.
4(2) Taxation by the Commonwealth or any political
5subdivision thereof.
6§ 4123. Requirements for foreign corporation names.
7(a) General rule.--The Department of State shall not issue a
8certificate of authority to any foreign business corporation
9that, except as provided in subsection (b), has a name that is
10rendered unavailable for use by a domestic business corporation
11by any provision of section 1303(a), (b) or (c) (relating to
12corporate name), except subsection (c)(1)(ii) thereof (relating
13to banking names).
14(b) Exceptions.--
15(1) The provisions of section 1303(b) (relating to
16duplicate use of names) shall not prevent the issuance of a
17certificate of authority to a foreign business corporation
18setting forth a name that is not distinguishable upon the
19records of the department from the name of any other domestic
20or foreign corporation for profit or corporation not-for-
21profit, or of any corporation or other association then
22registered under 54 Pa.C.S. Ch. 5 (relating to corporate and
23other association names) or to any name reserved or
24registered as provided in this part, if the foreign business
25corporation applying for a certificate of authority files in
26the department a resolution of its board of directors
27adopting a fictitious name for use in transacting business in
28this Commonwealth, which fictitious name is distinguishable
29upon the records of the department from the name of the other
30corporation or other association or from any name reserved or
1registered as provided in this part and that is otherwise
2available for use by a domestic business corporation.
3(2) The provisions of section 1303(c) (relating to
4required approvals or conditions) shall not prevent the
5issuance of a certificate of authority to a foreign business
6corporation setting forth a name that is prohibited by that
7subsection if the foreign business corporation applying for a
8certificate of authority files in the department a resolution
9of its board of directors adopting a fictitious name for use
10in transacting business in this Commonwealth that is
11available for use by a domestic business corporation.]
12Section 26. Section 4124 of Title 15 is amended to read:
13§ 4124. [Application for a certificate of authority.]
14Advertisement of registration to do business.
15[(a) General rule.--An application for a certificate of
16authority shall be executed by the foreign business corporation
17and shall set forth:
18(1) The name of the corporation.
19(2) The name of the jurisdiction under the laws of which
20it is incorporated.
21(3) The address, including street and number, if any, of
22its principal office under the laws of the jurisdiction in
23which it is incorporated.
24(4) Subject to section 109 (relating to name of
25commercial registered office provider in lieu of registered
26address), the address, including street and number, if any,
27of its proposed registered office in this Commonwealth.
28(5) A statement that it is a corporation incorporated
29for a purpose or purposes involving pecuniary profit,
30incidental or otherwise.
1(b) Advertisement.--]A foreign business corporation shall
2officially publish notice of its intention to [apply or its
3application for a certificate of authority] register to do
4business or its registration to do business in this Commonwealth
5under Chapter 4 (relating to foreign associations). The notice
6may appear prior to or after the day on which [application is
7made to the Department of State] a registration statement is
8delivered to the department for filing and shall set forth
9briefly:
10(1) A statement that the corporation will [apply or has
11applied for a certificate of authority under the provisions
12of the Business Corporation Law of 1988] register or has
13registered to do business in this Commonwealth under Chapter
144.
15(2) The name of the corporation and [of the jurisdiction
16under the laws of which it is incorporated] its jurisdiction
17of formation.
18(3) The address, including street and number, if any, of
19its principal office under the laws of [the jurisdiction in
20which it is incorporated] its jurisdiction of formation.
21(4) Subject to section 109, the address, including
22street and number, if any, of its proposed registered office
23in this Commonwealth.
24(c) [Filing.--The application for a certificate of authority
25shall be filed in the Department of State.] (Reserved).
26(d) [Cross reference.--See section 134 (relating to
27docketing statement).] (Reserved).
28Section 27. Sections 4125, 4126, 4127, 4128 of Title 15 are
29repealed:
30[§ 4125. Issuance of certificate of authority.
1Upon the filing of the application for a certificate of
2authority, the foreign business corporation shall be deemed to
3hold a certificate of authority to do business in this
4Commonwealth.
5§ 4126. Amended certificate of authority.
6(a) General rule.--After receiving a certificate of
7authority, a qualified foreign business corporation may, subject
8to the provisions of this subchapter, change or correct any of
9the information set forth in its application for a certificate
10of authority or previous filings under this section by filing in
11the Department of State an application for an amended
12certificate of authority. The application shall be executed by
13the corporation and shall state:
14(1) The name under which the applicant corporation
15currently holds a certificate of authority to do business in
16this Commonwealth.
17(2) Subject to section 109 (relating to name of
18commercial registered office provider in lieu of registered
19address), the address, including street and number, if any,
20of its registered office in this Commonwealth.
21(3) The information to be changed or corrected.
22(4) If the application reflects a change in the name of
23the corporation, the application shall include a statement
24that either:
25(i) the change of name reflects a change effected in
26the jurisdiction of incorporation; or
27(ii) documents complying with section 4123(b)
28(relating to exceptions) accompany the application.
29(b) Issuance of amended certificate of authority.--Upon the
30filing of the application, the applicant corporation shall be
1deemed to hold an amended certificate of authority.
2(c) Cross references.--See sections 134 (relating to
3docketing statement) and 135 (relating to requirements to be met
4by filed documents).
5§ 4127. Merger, consolidation or division of qualified foreign
6corporations.
7(a) General rule.--Whenever a qualified foreign business
8corporation is a nonsurviving party to a statutory merger,
9consolidation or division permitted by the laws of the
10jurisdiction under which it is incorporated, the corporation or
11other association surviving the merger, or the new corporation
12or other association resulting from the consolidation or
13division, as the case may be, shall file in the department a
14statement of merger, consolidation or division, which shall be
15executed by the surviving or new corporation or other
16association and shall set forth:
17(1) The name of each nonsurviving qualified foreign
18business corporation.
19(2) The name of the jurisdictions under the laws of
20which each nonsurviving qualified foreign business
21corporation was incorporated.
22(3) The date on which each nonsurviving qualified
23foreign business corporation received a certificate of
24authority to do business in this Commonwealth.
25(4) A statement that the corporate existence of each
26nonsurviving qualified foreign business corporation has been
27terminated by merger, consolidation or division, as the case
28may be.
29(5) In the case of a merger, consolidation or division
30in which any of the new or resulting associations is a
1corporation, or if the surviving corporation in a merger was
2a nonqualified foreign business corporation prior to the
3merger, the statements on the part of the surviving or each
4new or resulting corporation required by section 4124(a)
5(relating to application for a certificate of authority).
6(b) Effect of filing.--The filing of the statement shall
7operate, as of the effective date of the merger, consolidation
8or division, to cancel the certificate of authority of each
9nonsurviving constituent corporation that was a qualified
10foreign business corporation and to qualify the surviving, new
11or resulting corporations, under this subchapter. If the
12surviving, new or resulting corporations do not desire to
13continue as qualified foreign business corporations, they may
14thereafter withdraw in the manner provided by section 4129
15(relating to application for termination of authority).
16(c) Surviving qualified foreign corporations.--It shall not
17be necessary for a surviving corporation that was a qualified
18foreign business corporation to effect any filing under this
19subchapter with respect to a merger or division or to procure an
20amended certificate of authority to do business in this
21Commonwealth unless the name of the corporation is changed by
22the merger or division.
23(d) Cross references.--See sections 134 (relating to
24docketing statement) and 135 (relating to requirements to be met
25by filed documents).
26§ 4128. Revocation of certificate of authority.
27(a) General rule.--Whenever the Department of State finds
28that a qualified foreign business corporation has failed to
29secure an amended certificate of authority as required by this
30subchapter after changing its name, or has failed or refused to
1appear by its proper representatives, or otherwise to comply
2with any subpoena issued by any court having jurisdiction of the
3subject matter, or to produce books, papers, records or
4documents as required by a subpoena, or is violating any of the
5laws of this Commonwealth, or that its articles have been
6revoked or voided by its jurisdiction of incorporation, the
7department shall give notice and opportunity for hearing by
8registered or certified mail to the corporation that the default
9exists and that its certificate of authority, including any
10amendments thereof, will be revoked unless the default is cured
11within 30 days after the mailing of the notice. If the default
12is not cured within the period of 30 days, the department shall
13revoke the certificate of authority, including any amendments
14thereof, of the foreign business corporation. Upon revoking the
15certificate of authority, the department shall mail to the
16corporation, at its registered office in this Commonwealth, a
17certificate of revocation.
18(b) Effect of revocation.--Upon the issuance of the
19certificate of revocation, the authority of the corporation to
20do business in this Commonwealth shall cease, and the
21corporation shall not thereafter do any business in this
22Commonwealth unless it applies for and receives a new
23certificate of authority.
24(c) Exception.--Subsections (a) and (b) shall not apply to a
25foreign insurance corporation.]
26Section 28. Section 4129 of Title 15 is amended to read:
27§ 4129. [Application for] Advertisement of termination of
28[authority] registration to do business.
29[(a) General rule.--Any qualified foreign business
30corporation may withdraw from doing business in this
1Commonwealth and surrender its certificate of authority by
2filing in the Department of State an application for termination
3of authority, executed by the corporation, which shall set
4forth:
5(1) The name of the corporation and, subject to section
6109 (relating to name of commercial registered office
7provider in lieu of registered address), the address,
8including street and number, if any, of its last registered
9office in this Commonwealth.
10(2) The name of the jurisdiction under the laws of which
11it is incorporated.
12(3) The date on which it received a certificate of
13authority to do business in this Commonwealth.
14(4) A statement that it surrenders its certificate of
15authority to do business in this Commonwealth.
16(5) A statement that notice of its intention to withdraw
17from doing business in this Commonwealth was mailed by
18certified or registered mail to each municipal corporation in
19which the registered office or principal place of business of
20the corporation in this Commonwealth is located, and that the
21official publication required by subsection (b) has been
22effected.
23(6) The post office address, including street and
24number, if any, to which process may be sent in an action or
25proceeding upon any liability incurred before the filing of
26the application for termination of authority.]
27(b) Advertisement.--A [qualified] registered foreign
28business corporation shall, before filing [an application for
29termination of authority] a statement under section 415
30(relating to voluntary withdrawal of registration), officially
1publish and mail a notice of its intention to withdraw from
2doing business in this Commonwealth in a manner similar to that
3required by section 1975(b) (relating to notice to creditors and
4taxing authorities). The notice shall set forth [briefly]:
5(1) The name of the corporation and [the jurisdiction
6under the laws of which it is incorporated] its jurisdiction
7of formation.
8(2) The address, including street and number, if any, of
9its principal office under the laws of its jurisdiction of
10[incorporation] formation.
11(3) Subject to section 109, the address, including
12street and number, if any, of its last registered office in
13this Commonwealth.
14(c) [Filing.--The application for termination of authority
15and the certificates or statement required by section 139
16(relating to tax clearance of certain fundamental transactions)
17shall be filed in the department. See section 134 (relating to
18docketing statement).] (Reserved).
19(d) [Effect of filing.--Upon the filing of the application
20for termination of authority, the authority of the corporation
21to do business in this Commonwealth shall cease. The termination
22of authority shall not affect any action or proceeding pending
23at the time thereof or affect any right of action arising with
24respect to the corporation before the filing of the application
25for termination of authority. Process against the corporation in
26an action upon any liability incurred before the filing of the
27application for termination of authority may be served as
28provided in 42 Pa.C.S. Ch. 53 (relating to bases of jurisdiction
29and interstate and international procedure) or as otherwise
30provided or prescribed by law.] (Reserved).
1Section 29. Sections 4130, 4131, 4141, 4142, 4143,4144 and
2Subchapter D of Chapter 41 of Title 15 are repealed:
3[§ 4130. Change of address after withdrawal.
4(a) General rule.--Any foreign business corporation that has
5withdrawn from doing business in this Commonwealth, or its
6successor in interest, may, from time to time, change the
7address to which process may be sent in an action upon any
8liability incurred before the filing of an application for
9termination of authority by filing in the Department of State of
10a statement of change of address by withdrawn corporation
11executed by the corporation, setting forth:
12(1) The name of the withdrawn corporation and, if the
13statement is filed by a successor in interest, the name and
14capacity of the successor.
15(2) The name of the jurisdiction under the laws of which
16the corporation filing the statement is incorporated.
17(3) The former post office address, including street and
18number, if any, of the withdrawn corporation as of record in
19the department.
20(4) The new post office address, including street and
21number, if any, of the withdrawn corporation or its
22successor.
23(b) Cross reference.--See section 134 (relating to docketing
24statement).
25§ 4131. Registration of name.
26(a) General rule.--A nonqualified foreign business
27corporation may register its name under 54 Pa.C.S. Ch. 5
28(relating to corporate and other association names) if the name
29is available for use by a qualified foreign business corporation
30under section 4123 (relating to requirements for foreign
1corporation names), by filing in the Department of State an
2application for registration of name, executed by the
3corporation, which shall set forth:
4(1) The name of the corporation.
5(2) The address, including street and number, if any, of
6the corporation.
7(b) Annual renewal.--A corporation that has in effect a
8registration of its corporate name may renew the registration
9from year to year by annually filing an application for renewal
10setting forth the facts required to be set forth in an original
11application for registration. A renewal application may be filed
12between October 1 and December 31 in each year and shall extend
13the registration for the following calendar year.
14(c) Cross reference.--See section 134 (relating to docketing
15statement).
16§ 4141. Penalty for doing business without certificate of
17authority.
18(a) Right to bring actions or proceedings suspended.--A
19nonqualified foreign business corporation doing business in this
20Commonwealth within the meaning of Subchapter B (relating to
21qualification) shall not be permitted to maintain any action or
22proceeding in any court of this Commonwealth until the
23corporation has obtained a certificate of authority. Nor, except
24as provided in subsection (b), shall any action or proceeding be
25maintained in any court of this Commonwealth by any successor or
26assignee of the corporation on any right, claim or demand
27arising out of the doing of business by the corporation in this
28Commonwealth until a certificate of authority has been obtained
29by the corporation or by a corporation that has acquired all or
30substantially all of its assets.
1(b) Contracts, property and defense against actions
2unaffected.--The failure of a foreign business corporation to
3obtain a certificate of authority to transact business in this
4Commonwealth shall not impair the validity of any contract or
5act of the corporation, shall not prevent the corporation from
6defending any action in any court of this Commonwealth and shall
7not render escheatable any of its real or personal property.
8§ 4142. General powers and duties of qualified foreign
9corporations.
10(a) General rule.--A qualified foreign business corporation,
11so long as its certificate of authority is not revoked, shall
12enjoy the same rights and privileges as a domestic business
13corporation, but no more, and, except as in this subpart
14otherwise provided, shall be subject to the same liabilities,
15restrictions, duties and penalties now in force or hereafter
16imposed upon domestic business corporations, to the same extent
17as if it had been incorporated under this subpart.
18(b) Agricultural lands.--Interests in agricultural land
19shall be subject to the restrictions of, and escheatable as
20provided by, the act of April 6, 1980 (P.L.102, No.39), referred
21to as the Agricultural Land Acquisition by Aliens Law.
22(c) Foreign insurance corporations.--A foreign insurance
23corporation shall, insofar as it is engaged in the business of
24writing insurance or reinsurance as principal, be subject to the
25laws of this Commonwealth regulating the business of insurance
26in lieu of the provisions of subsection (a).
27§ 4143. General powers and duties of nonqualified foreign
28corporations.
29(a) Acquisition of real and personal property.--Every
30nonqualified foreign business corporation may acquire, hold,
1mortgage, lease and transfer real and personal property in this
2Commonwealth in the same manner and subject to the same
3limitations as a qualified foreign business corporation.
4(b) Duties.--Except as provided in section 4141(a) (relating
5to right to bring actions suspended), a nonqualified foreign
6business corporation doing business in this Commonwealth within
7the meaning of Subchapter B (relating to qualification) shall be
8subject to the same liabilities, restrictions, duties and
9penalties now or hereafter imposed upon a qualified foreign
10business corporation.
11§ 4144. Registered office of qualified foreign corporations.
12(a) General rule.--Subject to the provisions of section
131507(c) (relating to alternative procedure), every qualified
14foreign business corporation shall have, and continuously
15maintain, in this Commonwealth a registered office, which may
16but need not be the same as its place of business in this
17Commonwealth.
18(b) Change.--A qualified foreign business corporation may,
19from time to time, change the address of its registered office
20in the manner provided by section 1507(b) (relating to statement
21of change of registered office).
22SUBCHAPTER D
23DOMESTICATION
24Sec.
254161. Domestication.
264162. Effect of domestication.
27§ 4161. Domestication.
28(a) General rule.--Any qualified foreign business
29corporation may become a domestic business corporation by filing
30in the Department of State articles of domestication. The
1articles of domestication, upon being filed in the department,
2shall constitute the articles of the domesticated foreign
3corporation, and it shall thereafter continue as a corporation
4which shall be a domestic business corporation subject to this
5subpart.
6(b) Articles of domestication.--The articles of
7domestication shall be executed by the corporation and shall set
8forth in the English language:
9(1) The name of the corporation. If the name is in a
10foreign language, it shall be set forth in Roman letters or
11characters or Arabic or Roman numerals. If the name is one
12that is rendered unavailable by any provision of section
131303(b) or (c) (relating to corporate name), the corporation
14shall adopt, in accordance with any procedures for changing
15the name of the corporation that are applicable prior to the
16domestication of the corporation, and shall set forth in the
17articles of domestication an available name.
18(2) Subject to section 109 (relating to name of
19commercial registered office provider in lieu of registered
20address), the address, including street and number, if any,
21of its registered office in this Commonwealth.
22(3) A statement that upon domestication the corporation
23will be subject to the domestic corporation provisions of the
24Business Corporation Law of 1988 and, if desired, a brief
25statement of the purpose or purposes for which it is to be
26domesticated which shall be a purpose or purposes for which a
27domestic business corporation may be incorporated under
28Article B (relating to domestic business corporations
29generally) and which may consist of or include a statement
30that the corporation shall have unlimited power to engage in
1and to do any lawful act concerning any or all lawful
2business for which corporations may be incorporated under the
3Business Corporation Law of 1988.
4(4) The term for which upon domestication it is to
5exist, if not perpetual.
6(5) Any desired provisions relating to the manner and
7basis of reclassifying the shares of the corporation.
8(6) A statement that the filing of articles of
9domestication and, if desired, the renunciation of the
10original charter or articles of the corporation has been
11authorized (unless its charter or other organic documents
12require a greater vote) by a majority of the votes cast by
13all shareholders entitled to vote thereon and, if any class
14of shares is entitled to vote thereon as a class, a majority
15of the votes cast in each class vote.
16(7) Any provisions desired providing special treatment
17of shares held by any shareholder or group of shareholders if
18the laws of the jurisdiction under which the corporation was
19incorporated prior to its domestication permit such special
20treatment.
21(8) Any other provisions authorized by Article B to be
22set forth in the original articles.
23(c) Cross references.--See sections 134 (relating to
24docketing statement) and 135 (relating to requirements to be met
25by filed documents).
26§ 4162. Effect of domestication.
27(a) General rule.--As a domestic business corporation, the
28domesticated corporation shall no longer be a foreign business
29corporation for the purposes of this subpart and shall, instead,
30be a domestic business corporation with all the powers and
1privileges and all the duties and limitations granted and
2imposed upon domestic business corporations. In all other
3respects, the domesticated corporation shall be deemed to be the
4same corporation as it was prior to the domestication without
5any change in or effect on its existence. Without limiting the
6generality of the previous sentence, the domestication shall not
7be deemed to have affected in any way:
8(1) the right and title of the corporation in and to its
9assets, property, franchises, estates and choses in action;
10(2) the liability of the corporation for its debts,
11obligations, penalties and public accounts due the
12Commonwealth;
13(3) any liens or other encumbrances on the property or
14assets of the corporation; or
15(4) any contract, license or other agreement to which
16the corporation is a party or under which it has any rights
17or obligations.
18(b) Reclassification of shares.--The shares of the
19domesticated corporation shall be unaffected by the
20domestication except to the extent, if any, reclassified in the
21articles of domestication.]
22Section 30. Sections 5103(a) introductory paragraph and the
23definitions of "articles," "foreign nonprofit corporation,"
24"nonqualified foreign corporation" and "qualified foreign
25corporation" or "qualified foreign nonprofit corporation" are
26amended to read:
27§ 5103. Definitions.
28(a) General definitions.--Subject to additional definitions
29contained in subsequent provisions of this subpart that are
30applicable to specific provisions of this subpart, the following
1words and phrases when used in Part I (relating to preliminary
2provisions) or in this subpart shall have the meanings given to
3them in this section unless the context clearly indicates
4otherwise:
5* * *
6"Articles." The original articles of incorporation, all
7amendments thereof, and any other articles, statements or
8certificates permitted or required to be filed in the Department
9of State by sections 108 (relating to change in location or
10status of registered office provided by agent) and 138 (relating
11to statement of correction), Chapter 3 (relating to entity
12transactions) or this subpart and including what have heretofore
13been designated by law as certificates of incorporation or
14charters. If an amendment of the articles or [articles of merger
15or division made in the manner permitted by this subpart] a
16statement filed under Chapter 3 restates articles in their
17entirety [or if there are articles of consolidation, conversion
18or domestication], thenceforth the "articles" shall not include
19any prior documents and any certificate issued by the department
20with respect thereto shall so state.
21* * *
22"Foreign nonprofit corporation." A foreign corporation not-
23for-profit or other entity subject to Chapter 61 (relating to
24foreign nonprofit corporations), whether or not required to
25[qualify thereunder] register under Chapter 4 (relating to
26foreign associations).
27* * *
28["Nonqualified foreign corporation" or "nonqualified foreign
29nonprofit corporation." A foreign corporation not-for-profit
30that is not a qualified foreign corporation, as defined in this
1section.]
2* * *
3["Qualified foreign corporation" or "qualified foreign
4nonprofit corporation." A foreign corporation not-for-profit
5authorized under Chapter 61 (relating to foreign nonprofit
6corporations) to do business in this Commonwealth.]
7* * *
8Section 31. Section 5106 of Title 15 is amended to read:
9§ 5106. Uniform application of subpart.
10(a) General rule.--Except as provided in subsection (b),
11this [subpart] title and its amendments are intended to provide
12uniform rules for the governance and regulation of the affairs
13of nonprofit corporations and of their officers, directors and
14members and of members of other bodies, regardless of the date
15or manner of incorporation or qualification, or of the issuance
16of any evidences of membership in or shares of a nonprofit
17corporation.
18(b) Exceptions.--
19(1) Unless expressly provided otherwise in any amendment
20to this [subpart] title, the amendment shall take effect only
21prospectively.
22(2) Any existing corporation lawfully using a name or,
23as a part of its name, a word that could not be used as or
24included in the name of a corporation subsequently
25incorporated or qualified under this [subpart] title may
26continue to use the name or word as part of its name if the
27use or inclusion of the word or name was lawful when first
28adopted by the corporation in this Commonwealth.
29(3) Subsection (a) shall not adversely affect the rights
30specifically provided for or saved in this subpart,
1including, without limiting the generality of the foregoing,
2the provisions of section [5952(d) (relating to proposal and
3adoption of plan of division)] 363 (relating to approval of
4division).
5(4) Nothing in this [subpart] title shall be deemed to
6repeal or supersede any provision in section 7 of the act of
7April 26, 1855 (P.L.328, No.347), entitled "An act relating
8to Corporations and to Estates held for Corporate, Religious
9and Charitable uses."
10Section 32. Sections 5303, 5304 and 5305 of Title 15 are
11repealed:
12[§ 5303. Corporate name.
13(a) General rule.--The corporate name may be in any
14language, but must be expressed in Roman letters or characters
15or Arabic or Roman numerals.
16(b) Duplicate use of names.--The corporate name shall be
17distinguishable upon the records of the Department of State
18from:
19(1) The name of any other domestic corporation for
20profit or not-for-profit which is either in existence or for
21which articles of incorporation have been filed but have not
22yet become effective, or of any foreign corporation for
23profit or not-for-profit which is either authorized to do
24business in this Commonwealth or for which an application for
25a certificate of authority has been filed but which has not
26yet become effective, or the name of any association
27registered at any time under 54 Pa.C.S. Ch. 5 (relating to
28corporate and other association names), unless the other
29association:
30(i) has stated that it is about to change its name,
1or to cease to do business, or is being wound up, or is a
2foreign association about to withdraw from doing business
3in this Commonwealth, and the statement and a written
4consent to the adoption of the name executed by the other
5association is filed in the Department of State;
6(ii) has filed with the Department of Revenue a
7certificate of out of existence, or has failed for a
8period of three successive years to file with the
9Department of Revenue a report or return required by law
10and the fact of such failure has been certified by the
11Department of Revenue to the Department of State;
12(iii) has abandoned its name under the laws of its
13jurisdiction of incorporation, by amendment, merger,
14consolidation, division, expiration, dissolution or
15otherwise, without its name being adopted by a successor
16in a merger, consolidation, division or otherwise, and an
17official record of that fact, certified as provided by 42
18Pa.C.S. § 5328 (relating to proof of official records),
19is presented by any person to the department; or
20(iv) has had the registration of its name under 54
21Pa.C.S. Ch. 5 terminated and, if the termination was
22effected by operation of 54 Pa.C.S. § 504 (relating to
23effect of failure to make filings), the application for
24the use of the name is accompanied by a verified
25statement stating that at least 30 days' written notice
26of intention to appropriate the name was given to the
27delinquent association at its last known place of
28business and that, after diligent search by the affiant,
29the affiant believes the association to be out of
30existence.
1(2) A name the exclusive right to which is at the time
2reserved by any other person whatsoever in the manner
3provided by statute. A name shall be rendered unavailable for
4corporate use by reason of the filing in the Department of
5State of any assumed or fictitious name required by 54
6Pa.C.S. Ch. 3 (relating to fictitious names) to be filed in
7the department only if and to the extent expressly so
8provided in that chapter.
9(c) Required approvals or conditions.--
10(1) The corporate name shall not imply that the
11corporation is:
12(i) A governmental agency of the Commonwealth or of
13the United States.
14(ii) A bank, bank and trust company, savings bank,
15private bank or trust company, as defined in the act of
16November 30, 1965 (P.L.847, No.356), known as the Banking
17Code of 1965.
18(iii) An insurance company.
19(iv) A public utility as defined in 66 Pa.C.S. § 102
20(relating to definitions).
21(v) A credit union. See 17 Pa.C.S. § 104 (relating
22to prohibition on use of words "credit union," etc.).
23(2) The corporate name shall not contain:
24(i) The word "college," "university" or "seminary"
25when used in such a way as to imply that it is an
26educational institution conforming to the standards and
27qualifications prescribed by the State Board of
28Education, unless there is submitted a certificate from
29the Department of Education certifying that the
30corporation or proposed corporation is entitled to use
1that designation.
2(ii) Words that constitute blasphemy, profane
3cursing or swearing or that profane the Lord's name.
4(iii) The words "engineer" or "engineering" or
5"surveyor" or "surveying" or any other word implying that
6any form of the practice of engineering or surveying as
7defined in the act of May 23, 1945 (P.L.913, No.367),
8known as the Professional Engineers Registration Law, is
9provided unless at least one of the incorporators of a
10proposed corporation or the directors of the existing
11corporation has been properly registered with the State
12Registration Board for Professional Engineers in the
13practice of engineering or surveying and there is
14submitted to the department a certificate from the board
15to that effect.
16(iv) The words "Young Men's Christian Association"
17or any other words implying that the corporation is
18affiliated with the State Young Men's Christian
19Association of Pennsylvania unless the corporation is
20incorporated for the purpose of the improvement of the
21spiritual, mental, social and physical condition of young
22people, by the support and maintenance of lecture rooms,
23libraries, reading rooms, religious and social meetings,
24gymnasiums, and such other means and services as may
25conduce to the accomplishment of that object, according
26to the general rules and regulations of such State
27association.
28(v) The words "architect" or "architecture" or any
29other word implying that any form of the practice of
30architecture as defined in the act of December 14, 1982
1(P.L.1227, No.281), known as the Architects Licensure
2Law, is provided unless at least one of the incorporators
3of a proposed corporation or the directors of the
4existing corporation has been properly registered with
5the Architects Licensure Board in the practice of
6architecture and there is submitted to the department a
7certificate from the board to that effect.
8(vi) The word "cooperative" or an abbreviation
9thereof unless the corporation is a cooperative
10corporation.
11(d) Other rights unaffected.--This section shall not
12abrogate or limit the law as to unfair competition or unfair
13practices, nor derogate from the common law, the principles of
14equity or the provisions of Title 54 (relating to names) with
15respect to the right to acquire and protect trade names.
16Subsection (b) shall not apply if the applicant files in the
17department a certified copy of a final order of a court of
18competent jurisdiction establishing the prior right of the
19applicant to the use of a name in this Commonwealth.
20(e) Remedies for violation of section.--The use of a name in
21violation of this section shall not vitiate or otherwise affect
22the corporate existence, but any court having jurisdiction may
23enjoin the corporation from using or continuing to use a name in
24violation of this section upon the application of:
25(1) the Attorney General, acting on his own motion or at
26the instance of any administrative department, board or
27commission of this Commonwealth; or
28(2) any person adversely affected.
29(f) Cross references.--See sections 135(e) (relating to
30distinguishable names) and 5106(b)(2) (relating to limited
1uniform application of subpart).
2§ 5304. Required name changes by senior corporations.
3(a) Adoption of new name upon reactivation.--Where a
4corporate name is made available on the basis that the
5corporation or other association that formerly registered the
6name has failed to file with the Department of Revenue a report
7or a return required by law or where the corporation or other
8association has filed with the Department of Revenue a
9certificate of out of existence, the corporation or other
10association shall cease to have by virtue of its prior
11registration any right to the use of the name. The corporation
12or other association, upon withdrawal of the certificate of out
13of existence or upon the removal of its delinquency in the
14filing of the required reports or returns, shall make inquiry
15with the Department of State with regard to the availability of
16its name and, if the name has been made available to another
17domestic or foreign corporation for profit or not-for-profit or
18other association by virtue of these conditions, shall adopt a
19new name in accordance with law before resuming its activities.
20(b) Enforcement of undertaking to release name.--If a
21corporation has used a name that is not distinguishable upon the
22records of the Department of State from the name of another
23corporation or other association as permitted by section 5303(b)
24(1) (relating to duplicate use of names) and the other
25corporation or other association continues to use its name in
26this Commonwealth and does not change its name, cease to do
27business, be wound up, or withdraw as it proposed to do in its
28consent or change its name as required by subsection (a), any
29court having jurisdiction may enjoin the other corporation or
30other association from continuing to use its name or a name that
1is not distinguishable therefrom, upon the application of:
2(1) the Attorney General, acting on his own motion or at
3the instance of any administrative department, board or
4commission of this Commonwealth; or
5(2) upon the application of any person adversely
6affected.
7§ 5305. Reservation of corporate name.
8(a) General rule.--The exclusive right to the use of a
9corporate name may be reserved by any person. The reservation
10shall be made by delivering to the Department of State an
11application to reserve a specified corporate name, executed by
12the applicant. If the department finds that the name is
13available for corporate use, it shall reserve the name for the
14exclusive use of the applicant for a period of 120 days.
15(b) Transfer of reservation.--The right to exclusive use of
16a specified corporate name reserved under subsection (a) may be
17transferred to any other person by delivering to the department
18a notice of the transfer, executed by the person who reserved
19the name, and specifying the name and address of the transferee.
20(c) Cross references.--See sections 134 (relating to
21docketing statement) and 6131 (relating to registration of
22name).]
23Section 33. Sections 5341, 5704(b)(1), 5757 and 5766(c) of
24Title 15 are amended to read:
25§ 5341. Statement of revival.
26(a) General rule.--Any nonprofit corporation whose charter
27or articles have been forfeited by proclamation of the Governor
28pursuant to section 1704 of the act of April 9, 1929 (P.L.343,
29No.176), known as The Fiscal Code, or otherwise, or whose
30corporate existence has expired by reason of any limitation
1contained in its charter or articles and the failure to effect a
2timely renewal or extension of its corporate existence, may, at
3any time by [filing] delivering to the department for filing a
4statement of revival, procure a revival of its charter or
5articles, together with all the rights, franchises, privileges
6and immunities and subject to all of its duties, debts and
7liabilities that had been vested in and imposed upon the
8corporation by its charter or articles as last in effect.
9(b) Contents of statement.--The statement of revival shall
10be [executed] signed in the name of the forfeited or expired
11corporation and shall, subject to section 109 (relating to name
12of commercial registered office provider in lieu of registered
13address), set forth:
14(1) The name of the corporation at the time its charter
15or articles were forfeited or expired and the address,
16including street and number, if any, of its last registered
17office.
18(2) The statute by or under which the corporation was
19incorporated and the date of incorporation.
20(3) The name that the corporation adopts as its new name
21if the adoption of a new name is required by section [5304]
22207 (relating to required name changes by senior
23[corporations] associations).
24(4) The address, including street and number, if any, of
25its registered office in this Commonwealth.
26(5) A reference to the proclamation or other action by
27which its charter or articles were forfeited or a reference
28to the limitation contained in its expired charter or
29articles.
30(6) A statement that the corporate existence of the
1corporation shall be revived.
2(7) A statement that the filing of the statement of
3revival has been authorized by the corporation. Every
4forfeited or expired corporation may act by its last
5directors or may elect directors and officers in the manner
6provided by this subpart for the limited purpose of effecting
7a filing under this section.
8(c) Filing and effect.--The statement of revival and, in the
9case of a forfeited corporation, the clearance certificates
10required by section 139 (relating to tax clearance of certain
11fundamental transactions) shall be [filed in the Department of
12State] delivered to the department for filing. Upon the filing
13of the statement of revival, the corporation shall be revived
14with the same effect as if its charter or articles had not been
15forfeited or expired by limitation. The revival shall validate
16all contracts and other transactions made and effected within
17the scope of the articles of the corporation by its
18representatives during the time when its charter or articles
19were forfeited or expired to the same effect as if its charter
20or articles had not been forfeited or expired.
21(d) Cross [reference.--See section] references.--See
22sections 134 (relating to docketing statement) and 135 (relating
23to requirements to be met by filed documents).
24§ 5704. Place and notice of meetings of members.
25* * *
26(b) Notice.--Notice in record form of every meeting of the
27members shall be given by, or at the direction of, the secretary
28or other authorized person to each member of record entitled to
29vote at the meeting at least:
30(1) ten days prior to the day named for a meeting that
1will consider a transaction under Chapter 3 (relating to
2entity transactions) or a fundamental change under Chapter 59
3(relating to fundamental changes); or
4* * *
5§ 5757. Action by members.
6(a) General rule.--Except as otherwise provided in this
7[subpart] title or in a bylaw adopted by the members, whenever
8any corporate action is to be taken by vote of the members of a
9nonprofit corporation, it shall be authorized upon receiving the
10affirmative vote of a majority of the votes cast by the members
11entitled to vote thereon and, if any members are entitled to
12vote thereon as a class, upon receiving the affirmative vote of
13a majority of the votes cast by the members entitled to vote as
14a class.
15(b) Changes in required vote.--Whenever a provision of this
16[subpart] title requires a specified number or percentage of
17votes of members or of a class of members for the taking of any
18action, a nonprofit corporation may prescribe in a bylaw adopted
19by the members that a higher number or percentage of votes shall
20be required for the action. The number or percentage of members
21necessary to call a special meeting of members or to petition
22for the proposal of an amendment of articles under this subpart
23may not be increased under this subsection. See sections 5504(d)
24(relating to adoption, amendment and contents of bylaws) and
255914(d) (relating to adoption of amendments).
26(c) Expenses.--Unless otherwise restricted in the articles,
27the corporation shall pay the reasonable expenses of
28solicitation of votes, proxies or consents of members by or on
29behalf of the board of directors or its nominees for election to
30the board, including solicitation by professional proxy
1solicitors and otherwise, and may pay the reasonable expenses of
2a solicitation by or on behalf of other persons.
3(d) Cross reference.--See section 322 (relating to approval
4by nonprofit corporation).
5§ 5766. Consent of members in lieu of meeting.
6* * *
7(c) [Effectiveness] Notice of action by partial consent.--
8[An action taken pursuant to subsection (b) shall not become
9effective until after at least ten days' notice of the action
10has been given to each member entitled to vote thereon who has
11not consented thereto.] Unless the bylaws require notice before
12an action pursuant to subsection (b) takes effect, prompt notice
13that an action has been taken shall be given to each member
14entitled to vote on the action that has not consented.
15Section 34. The heading of Chapter 59 of Title 15 is amended
16to read:
17CHAPTER 59
18[FUNDAMENTAL CHANGES] AMENDMENTS, SALE
19OF ASSETS AND DISSOLUTION
20Section 34.1. Sections 5901, 5902(a) and 5905 of Title 15
21are amended to read:
22[§ 5901. Omission of certain provisions from filed plans.
23(a) General rule.--A plan as filed in the Department of
24State under any provision of this chapter may omit all
25provisions of the plan except provisions, if any:
26(1) that are intended to amend or constitute the
27operative provisions of the articles of a corporation as in
28effect subsequent to the effective date of the plan; or
29(2) that allocate or specify the respective assets and
30liabilities of the resulting corporations, in the case of a
1plan of division.
2(b) Availability of full plan.--If any of the provisions of
3a plan are omitted from the plan as filed in the department, the
4articles of amendment, merger, consolidation, division or
5conversion shall state that the full text of the plan is on file
6at the principal place of business of the surviving or new or a
7resulting corporation and shall state the address thereof. A
8corporation that takes advantage of this section shall furnish a
9copy of the full text of the plan, on request and without cost,
10to any member of any corporation that was a party to the plan
11and on request and at cost to any other person.]
12§ 5902. Statement of termination.
13(a) General rule.--If articles of amendment [or articles of
14merger, consolidation, division or conversion of a nonprofit
15corporation or to which it is a party] have been filed in the
16[Department of State] department prior to the termination of the
17amendment [or plan] pursuant to provisions therefor set forth in
18the resolution or petition relating to the amendment [or in the
19plan], the termination shall not be effective unless the
20corporation shall, prior to the time the amendment or plan is to
21become effective, file in the department a statement of
22termination. The statement of termination shall be executed by
23the corporation that filed the amendment [or by each corporation
24that is a party to the plan, unless the plan permits termination
25by less than all of the corporations, in which case the
26statement shall be executed on behalf of the corporation or
27corporations exercising the right to terminate,] and shall set
28forth:
29(1) A copy of the articles of amendment [or articles of
30merger, consolidation, division or conversion relating to the
1amendment or plan that is terminated].
2(2) A statement that the amendment [or plan] has been
3terminated in accordance with the provisions therefor set
4forth therein.
5* * *
6§ 5905. Proposal of fundamental transactions.
7Where any provision of this chapter requires that an
8amendment of the articles[, a plan] or the dissolution of a
9nonprofit corporation be proposed or approved by action of the
10board of directors, that requirement shall be construed to
11authorize and be satisfied by the written agreement or consent
12of all of the members of the corporation entitled to vote
13thereon.
14Section 35. The heading of Subchapter C of Chapter 59 of
15Title 15 is amended to read:
16SUBCHAPTER C
17[MERGER, CONSOLIDATION AND] SALE OF ASSETS
18Section 36. Sections 5921, 5922, 5923, 5924, 5925, 5926,
195927, 5928 and 5929 of Title 15 are repealed:
20[§ 5921. Merger and consolidation authorized.
21(a) Domestic surviving or new corporation.--Any two or more
22domestic nonprofit corporations, or any two or more foreign
23nonprofit corporations, or any one or more domestic nonprofit
24corporations and any one or more foreign nonprofit corporations,
25may, in the manner provided in this subchapter, be merged into
26one of the domestic nonprofit corporations, designated in this
27subchapter as the surviving corporation, or consolidated into a
28new corporation to be formed under this subpart, if the foreign
29corporations are authorized by the laws of the jurisdiction
30under which they are incorporated to effect a merger or
1consolidation with a corporation of another jurisdiction.
2(b) Foreign surviving or new corporation.--Any one or more
3domestic nonprofit corporations, and any one or more foreign
4nonprofit corporations, may, in the manner provided in this
5subchapter, be merged into one of the foreign nonprofit
6corporations, designated in this subchapter as the surviving
7corporation, or consolidated into a new corporation to be
8incorporated under the laws of the jurisdiction under which one
9of the foreign nonprofit corporations is incorporated, if the
10laws of that jurisdiction authorize a merger with or
11consolidation into a corporation of another jurisdiction.
12§ 5922. Plan of merger or consolidation.
13(a) Preparation of plan.--A plan of merger or consolidation,
14as the case may be, shall be prepared, setting forth:
15(1) The terms and conditions of the merger or
16consolidation.
17(2) If the surviving or new corporation is or is to be a
18domestic nonprofit corporation:
19(i) any changes desired to be made in the articles,
20which may include a restatement of the articles in the
21case of a merger; or
22(ii) in the case of a consolidation, all of the
23statements required by this subpart to be set forth in
24restated articles.
25(3) Such other provisions as are deemed desirable.
26(b) Post-adoption amendment.--A plan of merger or
27consolidation may contain a provision that the boards of
28directors or other bodies of the constituent corporations may
29amend the plan at any time prior to its effective date, except
30that an amendment made subsequent to the adoption of the plan by
1the members of any constituent corporation shall not change:
2(1) The term of memberships or the amount or kind of
3securities, obligations, cash, property or rights to be
4received in exchange for or on conversion of all or any of
5the memberships in the constituent corporation.
6(2) Any term of the articles of the surviving or new
7corporation to be effected by the merger or consolidation.
8(3) Any of the terms and conditions of the plan if the
9change would adversely affect the members of the constituent
10corporation.
11(c) Proposal.--Every merger or consolidation shall be
12proposed in the case of each domestic nonprofit corporation:
13(1) by the adoption by the board of directors or other
14body of a resolution approving the plan of merger or
15consolidation;
16(2) unless otherwise provided in the articles, by
17petition of members entitled to cast at least 10% of the
18votes that all members are entitled to cast thereon, setting
19forth the proposed plan of merger or consolidation, which
20petition shall be directed to the board of directors and
21filed with the secretary of the corporation; or
22(3) by such other method as may be provided in the
23bylaws.
24(d) Submission to members.--Except where the corporation has
25no members entitled to vote thereon, the board of directors or
26other body shall direct that the plan be submitted to a vote of
27the members entitled to vote thereon at a regular or special
28meeting of the members.
29(e) Party to plan or transaction.--A corporation,
30partnership, business trust or other association that approves a
1plan in its capacity as a member or creditor of a merging or
2consolidating corporation or that furnishes all or a part of the
3consideration contemplated by a plan does not thereby become a
4party to the plan or the merger or consolidation for the
5purposes of this subchapter.
6(f) Reference to outside facts.--Any of the terms of a plan
7of merger or consolidation may be made dependent upon facts
8ascertainable outside of the plan if the manner in which the
9facts will operate upon the terms of the plan is set forth in
10the plan. Such facts may include, without limitation, actions or
11events within the control of or determinations made by a party
12to the plan or a representative of a party to the plan.
13§ 5923. Notice of meeting of members.
14(a) General rule.--Notice in record form of the meeting of
15members that will act on the proposed plan shall be given to
16each member of record, whether or not entitled to vote thereon,
17of each domestic nonprofit corporation that is a party to the
18merger or consolidation. The notice shall include or be
19accompanied by a copy of the proposed plan or a summary thereof.
20The notice shall provide that a copy of the bylaws of the
21surviving or new corporation will be furnished to any member on
22request and without cost.
23(b) Cross reference.--See Subchapter A of Chapter 57
24(relating to notice and meetings generally).
25§ 5924. Adoption of plan.
26(a) General rule.--The plan of merger or consolidation shall
27be adopted upon receiving the affirmative vote of the members
28present entitled to cast at least a majority of the votes that
29all members present are entitled to cast thereon of each of the
30domestic nonprofit corporations that is a party to the merger or
1consolidation and, if any class of members is entitled to vote
2thereon as a class, the affirmative vote of the members present
3of such class entitled to cast at least a majority of the votes
4that all members present of such class are entitled to cast
5thereon.
6(b) Adoption in absence of voting members.--If a merging or
7consolidating corporation has no members entitled to vote
8thereon, or no members entitled to vote thereon other than
9persons who also constitute the board of directors or other
10body, a plan of merger or consolidation shall be deemed adopted
11by the corporation when it has been adopted by the board of
12directors or other body pursuant to section 5922 (relating to
13plan of merger or consolidation).
14(c) Termination of plan.--Prior to the time when a merger or
15consolidation becomes effective, the merger or consolidation may
16be terminated pursuant to provisions for termination, if any,
17set forth in the plan. If articles of merger or consolidation
18have been filed in the department prior to the termination, a
19statement under section 5902 (relating to statement of
20termination) shall be filed in the department.
21§ 5925. Authorization by foreign corporations.
22The plan of merger or consolidation shall be authorized,
23adopted or approved by each foreign nonprofit corporation that
24desires to merge or consolidate in accordance with the laws of
25the jurisdiction in which it is incorporated and, in the case of
26a foreign domiciliary corporation, in accordance with the
27provisions of this subpart to the extent provided by section
286145 (relating to applicability of certain safeguards to foreign
29domiciliary corporations).
30§ 5926. Articles of merger or consolidation.
1Upon the adoption of the plan of merger or consolidation by
2the corporations desiring to merge or consolidate, as provided
3in this subchapter, articles of merger or articles of
4consolidation, as the case may be, shall be executed by each
5corporation and shall, subject to section 109 (relating to name
6of commercial registered office provider in lieu of registered
7address), set forth:
8(1) The name and the location of the registered office,
9including street and number, if any, of the domestic
10surviving or new corporation or, in the case of a foreign
11surviving or new corporation, the name of the corporation and
12its jurisdiction of incorporation, together with either:
13(i) if a qualified foreign nonprofit corporation,
14the address, including street and number, if any, of its
15registered office in this Commonwealth; or
16(ii) if a nonqualified foreign nonprofit
17corporation, the address, including street and number, if
18any, of its principal office under the laws of the
19jurisdiction in which it is incorporated.
20(2) The name and address, including street and number,
21if any, of the registered office of each other domestic
22nonprofit corporation and qualified foreign nonprofit
23corporation that is a party to the merger or consolidation.
24(3) If the plan is to be effective on a specified date,
25the hour, if any, and the month, day and year of the
26effective date.
27(4) The manner in which the plan was adopted by each
28domestic corporation and, if one or more foreign corporations
29are parties to the merger or consolidation, the fact that the
30plan was authorized, adopted or approved, as the case may be,
1by each of the foreign corporations in accordance with the
2laws of the jurisdiction in which it is incorporated.
3(5) Except as provided in section 5901 (relating to
4omission of certain provisions from filed plans), the plan of
5merger or consolidation.
6§ 5927. Filing of articles of merger or consolidation.
7(a) General rule.--The articles of merger or articles of
8consolidation, as the case may be, and the certificates or
9statement, if any, required by section 139 (relating to tax
10clearance of certain fundamental transactions) shall be filed in
11the Department of State.
12(b) Cross reference.--See section 134 (relating to docketing
13statement).
14§ 5928. Effective date of merger or consolidation.
15Upon the filing of the articles of merger or the articles of
16consolidation in the department or upon the effective date
17specified in the plan of merger or consolidation, whichever is
18later, the merger or consolidation shall be effective. The
19merger or consolidation of one or more domestic nonprofit
20corporations into a foreign nonprofit corporation shall be
21effective according to the provisions of law of the jurisdiction
22in which the foreign corporation is incorporated, but not until
23articles of merger or articles of consolidation have been
24adopted and filed, as provided in this subchapter.
25§ 5929. Effect of merger or consolidation.
26(a) Single surviving or new corporation.--Upon the merger or
27consolidation becoming effective, the several corporations
28parties to the merger or consolidation shall be a single
29corporation which, in the case of a merger, shall be the
30corporation designated in the plan of merger as the surviving
1corporation and, in the case of a consolidation, shall be the
2new corporation provided for in the plan of consolidation. The
3separate existence of all corporations parties to the merger or
4consolidation shall cease, except that of the surviving
5corporation, in the case of a merger. The surviving or new
6corporation, as the case may be, if it is a domestic nonprofit
7corporation, shall not thereby acquire authority to engage in
8any business or exercise any right that a corporation may not be
9incorporated under this subpart to engage in or exercise.
10(b) Property rights.--Except as otherwise provided by order,
11if any, obtained pursuant to section 5547(b) (relating to
12nondiversion of certain property), all the property, real,
13personal and mixed, and franchises of each of the corporations
14parties to the merger or consolidation, and all debts due on
15whatever account to any of them, including subscriptions for
16membership and other choses in action belonging to any of them,
17shall be deemed to be vested in and shall belong to the
18surviving or new corporation, as the case may be, without
19further action, and the title to any real estate, or any
20interest therein, vested in any of the corporations shall not
21revert or be in any way impaired by reason of the merger or
22consolidation. The surviving or new corporation shall
23thenceforth be responsible for all the liabilities of each of
24the corporations so merged or consolidated. Liens upon the
25property of the merging or consolidating corporations shall not
26be impaired by the merger or consolidation, and any claim
27existing or action or proceeding pending by or against any of
28the corporations may be prosecuted to judgment as if the merger
29or consolidation had not taken place, or the surviving or new
30corporation may be proceeded against or substituted in its
1place. Any devise, gift or grant contained in any will or other
2instrument, in trust or otherwise, made before or after such
3merger or consolidation, to or for any of the constituent
4corporations, shall inure to the surviving or new corporation,
5as the case may be, subject to compliance with the requirements
6of section 5550 (relating to devises, bequests and gifts after
7certain fundamental changes).
8(c) Taxes.--Any taxes, interest, penalties and public
9accounts of the Commonwealth claimed against any of the merging
10or consolidating corporations that are settled, assessed or
11determined prior to or after the merger or consolidation shall
12be the liability of the surviving or new corporation and,
13together with interest thereon, shall be a lien against the
14franchises and property, both real and personal, of the
15surviving or new corporation.
16(d) Articles of incorporation.--In the case of a merger, the
17articles of incorporation of the surviving domestic nonprofit
18corporation, if any, shall be deemed to be amended to the
19extent, if any, that changes in its articles are stated in the
20plan of merger. In the case of a consolidation into a domestic
21nonprofit corporation, the statements that are set forth in the
22plan of consolidation, or articles of incorporation set forth
23therein, shall be deemed to be the articles of incorporation of
24the new corporation.]
25Section 37. Section 5930(a) of Title 15 is amended to read:
26§ 5930. Voluntary transfer of corporate assets.
27(a) General rule.--A sale, lease, exchange or other
28disposition of all, or substantially all, of the property and
29assets, with or without goodwill, of a nonprofit corporation, if
30not made pursuant to Subchapter [D] F of Chapter [19] 3
1(relating to division), may be made only pursuant to a plan of
2asset transfer. The property or assets of a direct or indirect
3subsidiary corporation that is controlled by a parent
4corporation shall also be deemed the property or assets of the
5parent corporation for purposes of this subsection. The plan of
6asset transfer shall set forth the terms and consideration of
7the sale, lease, exchange or other disposition or may authorize
8the board of directors or other body to fix any or all of the
9terms and conditions, including the consideration to be received
10by the corporation. Any of the terms of the plan may be made
11dependent upon facts ascertainable outside of the plan if the
12manner in which the facts will operate upon the terms of the
13plan is set forth in the plan. The plan of asset transfer shall
14be proposed and adopted, and may be amended after its adoption
15and terminated, by a nonprofit corporation in the manner
16provided in this subchapter for the proposal, adoption,
17amendment and termination of a plan of merger. A copy or summary
18of the plan shall be included in, or enclosed with, the notice
19of the meeting at which members will act on the plan. In order
20to make effective any plan so adopted, it shall not be necessary
21to file any articles or other document in the department, but
22the corporation shall comply with the requirements of section
235547(b) (relating to nondiversion of certain property).
24* * *
25Section 38. The heading of Subchapter D of Chapter 59 of
26Title 15 is amended to read:
27SUBCHAPTER D
28[DIVISION] (RESERVED)
29Section 39. Sections 5951, 5952, 5953, 5954, 5955, 5956,
305957 and Subchapter E of Chapter 59 and sections 6121, 6122 and
16123 of Title 15 are repealed:
2[§ 5951. Division authorized.
3(a) Division of domestic corporation.--Any domestic
4nonprofit corporation may, in the manner provided in this
5subchapter, be divided into two or more domestic nonprofit
6corporations incorporated or to be incorporated under this
7article, or into one or more domestic nonprofit corporations and
8one or more foreign nonprofit corporations to be incorporated
9under the laws of another jurisdiction or jurisdictions, or into
10two or more foreign nonprofit corporations, if the laws of the
11other jurisdictions authorize the division.
12(b) Division of foreign corporation.--Any foreign nonprofit
13corporation may, in the manner provided in this subchapter, be
14divided into one or more domestic nonprofit corporations to be
15incorporated under this subpart and one or more foreign
16nonprofit corporations incorporated or to be incorporated under
17the laws of another jurisdiction or jurisdictions, or into two
18or more domestic nonprofit corporations, if the foreign
19nonprofit corporation is authorized under the laws of the
20jurisdiction under which it is incorporated to effect a
21division.
22(c) Surviving and new corporations.--The corporation
23effecting a division, if it survives the division, is designated
24in this subchapter as the surviving corporation. All
25corporations originally incorporated by a division are
26designated in this subchapter as new corporations. The surviving
27corporation, if any, and the new corporation or corporations are
28collectively designated in this subchapter as the resulting
29corporations.
30§ 5952. Proposal and adoption of plan of division.
1(a) Preparation of plan.--A plan of division shall be
2prepared, setting forth:
3(1) The terms and conditions of the division, including
4the manner and basis of:
5(i) The reclassification of the membership interests
6or shares of the surviving corporation, if there be one.
7(ii) The disposition of the membership interests or
8shares or obligations, if any, of the new corporation or
9corporations resulting from the division.
10(2) A statement that the dividing nonprofit corporation
11will, or will not, survive the division.
12(3) Any changes desired to be made in the articles of
13the surviving corporation, if there be one, including a
14restatement of the articles.
15(4) The articles of incorporation required by subsection
16(b).
17(5) Such other provisions as are deemed desirable.
18(b) Articles of new corporations.--There shall be included
19in or annexed to the plan of division:
20(1) Articles of incorporation, which shall contain all
21of the statements required by this subpart to be set forth in
22restated articles, for each of the new domestic nonprofit
23corporations, if any, resulting from the division.
24(2) Articles of incorporation, certificates of
25incorporation or other charter documents for each of the new
26foreign nonprofit corporations, if any, resulting from the
27division.
28(c) Proposal and adoption.--Except as otherwise provided in
29section 5953 (relating to division without member approval), the
30plan of division shall be proposed and adopted, and may be
1amended after its adoption and terminated, by a domestic
2nonprofit corporation in the manner provided for the proposal,
3adoption, amendment and termination of a plan of merger in
4Subchapter C (relating to merger, consolidation and sale of
5assets) or, if the dividing corporation is a foreign nonprofit
6corporation, in accordance with the laws of the jurisdiction in
7which it is incorporated and, in the case of a foreign
8domiciliary corporation, the provisions of this subpart to the
9extent provided by section 6145 (relating to applicability of
10certain safeguards to foreign corporations). There shall be
11included in or enclosed with the notice of the meeting of
12members that will act on the plan a copy or summary of the plan.
13(d) Special requirements.--If any provision of the bylaws of
14a dividing domestic nonprofit corporation adopted before January
151, 1972 shall require for the adoption of a plan of merger or
16consolidation or a plan involving the sale, lease or exchange of
17all or substantially all of the property and assets of the
18corporation a specific number or percentage of votes of
19directors, members, or members of an other body or other special
20procedures, the plan of division shall not be adopted without
21such number or percentage of votes or compliance with such other
22special procedures.
23(e) Financial status of resulting corporations.--Unless the
24plan of division provides that the dividing corporation shall
25survive the division and that all membership interests or shares
26or obligations, if any, of all new corporations resulting from
27the plan shall be owned solely by the surviving corporation, no
28plan of division may be made effective at a time when the
29dividing corporation is insolvent or when the division would
30render any of the resulting corporations insolvent.
1(f) Rights of holders of indebtedness.--If any debt
2securities, notes or similar evidences of indebtedness for money
3borrowed, whether secured or unsecured, indentures or other
4contracts were issued, incurred or executed by the dividing
5corporation before January 1, 1972, and have not been amended
6subsequent to that date, the liability of the dividing
7corporation thereunder shall not be affected by the division nor
8shall the rights of the obligees thereunder be impaired by the
9division, and each of the resulting corporations may be
10proceeded against or substituted in place of the dividing
11corporation as joint and several obligors on such liability,
12regardless of any provision of the plan of division apportioning
13the liabilities of the dividing corporation.
14(g) Reference to outside facts.--Any of the terms of a plan
15of division may be made dependent upon facts ascertainable
16outside of the plan if the manner in which the facts will
17operate upon the terms of the plan is set forth in the plan.
18Such facts may include, without limitation, actions or events
19within the control of or determinations made by the dividing
20corporation or a representative of the dividing corporation.
21§ 5953. Division without member approval.
22Unless otherwise required by its bylaws or by section 5952
23(relating to proposal and adoption of plan of division), a plan
24of division that does not alter the state of incorporation of a
25nonprofit corporation nor amend in any respect the provisions of
26its articles, except amendments that under section 5914(b)
27(relating to adoption in absence of voting members) may be made
28without member action, shall not require the approval of the
29members of the corporation if the transfers of assets effected
30by the division, if effected by means of a sale, lease, exchange
1or other disposition, would not require the approval of members
2under section 5930 (relating to voluntary transfer of corporate
3assets).
4§ 5954. Articles of division.
5Upon the adoption of a plan of division by the corporation
6desiring to divide, as provided in this subchapter, articles of
7division shall be executed by the corporation and shall, subject
8to section 109 (relating to name of commercial registered office
9provider in lieu of registered address), set forth:
10(1) The name and the location of the registered office,
11including street and number, if any, of the dividing domestic
12nonprofit corporation or, in the case of a dividing foreign
13nonprofit corporation, the name of the corporation and the
14jurisdiction in which it is incorporated, together with
15either:
16(i) If a qualified foreign nonprofit corporation,
17the address, including street and number, if any, of its
18registered office in this Commonwealth.
19(ii) If a nonqualified foreign nonprofit
20corporation, the address, including street and number, if
21any, of its principal office under the laws of that
22jurisdiction.
23(2) The statute under which the dividing corporation was
24incorporated and the date of incorporation.
25(3) A statement that the dividing corporation will, or
26will not, survive the division.
27(4) The name and the address, including street and
28number, if any, of the registered office of each new domestic
29nonprofit corporation or qualified foreign nonprofit
30corporation resulting from the division.
1(5) If the plan is to be effective on a specified date,
2the hour, if any, and the month, day and year of the
3effective date.
4(6) The manner in which the plan was adopted by the
5corporation.
6(7) Except as provided in section 5901 (relating to
7omission of certain provisions from filed plans), the plan of
8division.
9§ 5955. Filing of articles of division.
10(a) General rule.--The articles of division and the
11certificates or statement, if any, required by section 139
12(relating to tax clearance of certain fundamental transactions)
13shall be filed in the Department of State.
14(b) Cross reference.--See section 134 (relating to docketing
15statement).
16§ 5956. Effective date of division.
17Upon the filing of articles of division in the department or
18upon the effective date specified in the plan of division,
19whichever is later, the division shall become effective. The
20division of a domestic nonprofit corporation into one or more
21foreign nonprofit corporations or the division of a foreign
22nonprofit corporation shall be effective according to the laws
23of the jurisdictions where the foreign corporations are or are
24to be incorporated and, in the case of a foreign domiciliary
25corporation, the provisions of this subpart to the extent
26provided by section 6145 (relating to applicability of certain
27safeguards to foreign domiciliary corporations), but not until
28articles of division have been adopted and filed as provided in
29this subchapter.
30§ 5957. Effect of division.
1(a) Multiple resulting corporations.--Upon the division
2becoming effective, the dividing corporation shall be subdivided
3into the distinct and independent resulting corporations named
4in the plan of division and, if the dividing corporation is not
5to survive the division, the existence of the dividing
6corporation shall cease. The resulting corporations, if they are
7domestic nonprofit corporations, shall not thereby acquire
8authority to engage in any business or exercise any right that a
9corporation may not be incorporated under this subpart to engage
10in or exercise. Any resulting foreign nonprofit corporation that
11is stated in the articles of division to be a qualified foreign
12nonprofit corporation shall be a qualified foreign nonprofit
13corporation under Article C (relating to foreign nonprofit
14corporations), and the articles of division shall be deemed to
15be the application for a certificate of authority and the
16certificate of authority issued thereon of the corporation.
17(b) Property rights; allocations of assets and
18liabilities.--
19(1) Except as otherwise provided by order, if any,
20obtained pursuant to section 5547(b) (relating to
21nondiversion of certain property):
22(i) All the property, real, personal and mixed, and
23franchises of the dividing corporation, and all debts due
24on whatever account to it, including subscriptions for
25membership and other choses in action belonging to it,
26shall, to the extent allocations of assets are
27contemplated by the plan of division, be deemed without
28further action to be allocated to and vested in the
29resulting corporations on such a manner and basis and
30with such effect as is specified in the plan, or per
1capita among the resulting corporations, as tenants in
2common, if no specification is made in the plan, and the
3title to any real estate, or interest therein, vested in
4any of the corporations shall not revert or be in any way
5impaired by reason of the division.
6(ii) Upon the division becoming effective, the
7resulting corporations shall each thenceforth be
8responsible as separate and distinct corporations only
9for such liabilities as each corporation may undertake or
10incur in its own name, but shall be liable for the
11liabilities of the dividing corporation in the manner and
12on the basis provided in subparagraphs (iv) and (v).
13(iii) Liens upon the property of the dividing
14corporation shall not be impaired by the division.
15(iv) Except as provided in section 5952(f) (relating
16to proposal and adoption of plan of division), to the
17extent allocations of liabilities are contemplated by the
18plan of division, the liabilities of the dividing
19corporation shall be deemed without further action to be
20allocated to and become the liabilities of the resulting
21corporations on such a manner and basis and with such
22effect as is specified in the plan; and one or more, but
23less than all, of the resulting corporations shall be
24free of the liabilities of the dividing corporation to
25the extent, if any, specified in the plan, if in either
26case:
27(A) no fraud on members without voting rights or
28violation of law shall be effected thereby; and
29(B) the plan does not constitute a fraudulent
30transfer under 12 Pa.C.S. Ch. 51 (relating to
1fraudulent transfers).
2(v) If the conditions in subparagraph (iv) for
3freeing one or more of the resulting corporations from
4the liabilities of the dividing corporation or for
5allocating some or all of the liabilities of the dividing
6corporation are not satisfied, the liabilities of the
7dividing corporation as to which those conditions are not
8satisfied shall not be affected by the division nor shall
9the rights of creditors thereunder be impaired by the
10division and any claim existing or action or proceeding
11pending by or against the corporation with respect to
12those liabilities may be prosecuted to judgment as if the
13division had not taken place, or the resulting
14corporations may be proceeded against or substituted in
15place of the dividing corporation as joint and several
16obligors on those liabilities, regardless of any
17provision of the plan of division apportioning the
18liabilities of the dividing corporation.
19(2) It shall not be necessary for a plan of division to
20list each individual asset or liability of the dividing
21corporation to be allocated to a new corporation so long as
22those assets and liabilities are described in a reasonable
23manner.
24(3) Each new corporation shall hold any assets and
25liabilities allocated to it as the successor to the dividing
26corporation, and those assets and liabilities shall not be
27deemed to have been assigned to the new corporation in any
28manner, whether directly or indirectly or by operation of
29law.
30(c) Taxes.--Any taxes, interest, penalties and public
1accounts of the Commonwealth claimed against the dividing
2corporation that are settled, assessed or determined prior to or
3after the division shall be the liability of any of the
4resulting corporations and, together with interest thereon,
5shall be a lien against the franchises and property, both real
6and personal, of all the corporations. Upon the application of
7the dividing corporation, the Department of Revenue, with the
8concurrence of the Office of Employment Security of the
9Department of Labor and Industry, shall release one or more, but
10less than all, of the resulting corporations from liability and
11liens for all taxes, interest, penalties and public accounts of
12the dividing corporation due the Commonwealth for periods prior
13to the effective date of the division if those departments are
14satisfied that the public revenues will be adequately secured.
15(d) Articles of surviving corporation.--The articles of
16incorporation of the surviving corporation, if there be one,
17shall be deemed to be amended to the extent, if any, that
18changes in its articles are stated in the plan of division.
19(e) Articles of new corporations.--The statements that are
20set forth in the plan of division with respect to each new
21domestic nonprofit corporation and that are required or
22permitted to be set forth in restated articles of incorporation
23of corporations incorporated under this subpart, or the articles
24of incorporation of each new corporation set forth therein,
25shall be deemed to be the articles of incorporation of each new
26corporation.
27(f) Directors and officers.--Unless otherwise provided in
28the plan, the directors and officers of the dividing corporation
29shall be the initial directors and officers of each of the
30resulting corporations.
1(g) Disposition of memberships.--Unless otherwise provided
2in the plan, the memberships and other securities or
3obligations, if any, of each new corporation resulting from the
4division shall be distributable to:
5(1) the surviving corporation if the dividing
6corporation survives the division; or
7(2) the members of the dividing corporation pro rata in
8any other case.
9(h) Conflict of laws.--It is the intent of the General
10Assembly that:
11(1) The effect of a division of a domestic nonprofit
12corporation shall be governed solely by the laws of this
13Commonwealth and any other jurisdiction under the laws of
14which any of the resulting corporations is incorporated.
15(2) The effect of a division on the assets and
16liabilities of the dividing corporation shall be governed
17solely by the laws of this Commonwealth and any other
18jurisdiction under the laws of which any of the resulting
19corporations is incorporated.
20(3) The validity of any allocations of assets or
21liabilities by a plan of division of a domestic nonprofit
22corporation, regardless of whether any of the new
23corporations is a foreign nonprofit corporation, shall be
24governed solely by the laws of this Commonwealth.
25(4) In addition to the express provisions of this
26subsection, this subchapter shall otherwise generally be
27granted the protection of full faith and credit under the
28Constitution of the United States.
29SUBCHAPTER E
30CONVERSION
1Sec.
25961. Conversion authorized.
35962. Proposal and adoption of plan of conversion.
45963. Articles of conversion.
55964. Filing of articles of conversion.
65965. Effective date of conversion.
75966. Effect of conversion.
8§ 5961. Conversion authorized.
9(a) General rule.--Any nonprofit corporation may, in the
10manner provided in this subchapter, be converted into a business
11corporation, hereinafter designated as the resulting
12corporation.
13(b) Exceptions.--
14(1) This subchapter shall not authorize any conversion
15involving:
16(i) A cooperative corporation.
17(ii) Beneficial, benevolent, fraternal or fraternal
18benefit societies having a lodge system and a
19representative form of government, or transacting any
20type of insurance whatsoever.
21(iii) Any corporation which by the laws of this
22Commonwealth is subject to the supervision of the
23Department of Banking, the Insurance Department or the
24Pennsylvania Public Utility Commission.
25(2) Paragraph (1) of this subsection shall not be
26construed as repealing any statute which provides a procedure
27for the conversion of a nonprofit corporation into an
28insurance corporation.
29§ 5962. Proposal and adoption of plan of conversion.
30(a) Preparation of plan.--A plan of conversion shall be
1prepared, setting forth:
2(1) The terms and conditions of the conversion.
3(2) The mode of carrying the conversion into effect.
4(3) A restatement of the articles of the resulting
5corporation, which articles shall comply with the
6requirements of Subpart B of Part II (relating to business
7corporations).
8(4) Such other details and provisions as are deemed
9desirable.
10(b) Proposal and adoption.--The plan of conversion shall be
11proposed and adopted, and may be terminated, in the manner
12provided for the proposal, adoption and termination of a plan of
13merger in Subchapter C (relating to merger, consolidation and
14sale of assets).
15§ 5963. Articles of conversion.
16Upon the adoption of a plan of conversion by the nonprofit
17corporation desiring to convert, as provided in this subchapter,
18articles of conversion shall be executed by the corporation and
19shall set forth:
20(1) The name of the corporation and, subject to section
21109 (relating to name of commercial registered office
22provider in lieu of registered address), the address,
23including street and number, if any, of its registered
24office.
25(2) The statute under which the corporation was
26incorporated and the date of incorporation.
27(3) If the plan is to be effective on a specified date,
28the hour, if any, and the month, day and year of the
29effective date.
30(4) The manner in which the plan was adopted by the
1corporation.
2(5) Except as provided in section 5901 (relating to
3omission of certain provisions from filed plans), the plan of
4conversion.
5§ 5964. Filing of articles of conversion.
6(a) General rule.--The articles of conversion shall be filed
7in the Department of State.
8(b) Cross reference.--See section 134 (relating to docketing
9statement).
10§ 5965. Effective date of conversion.
11Upon the filing of articles of conversion in the Department
12of State, or upon the effective date specified in the plan of
13conversion, whichever is later, the conversion shall become
14effective.
15§ 5966. Effect of conversion.
16Upon the conversion becoming effective, the corporation shall
17be deemed to be a business corporation for all purposes, shall
18cease to be a nonprofit corporation, and may thereafter operate
19for a purpose or purposes resulting in pecuniary profit,
20incidental or otherwise, to its members or shareholders. The
21corporation shall issue share certificates to each shareholder
22entitled thereto. The corporation shall remain liable for all
23existing obligations, public and private, taxes due the
24Commonwealth or any other taxing authority for periods prior to
25the effective date of the conversion, and, as such business
26corporation, it shall continue to be entitled to all assets
27theretofore pertaining to it as a nonprofit corporation except
28as otherwise provided by order, if any, obtained pursuant to
29section 5547(b) (relating to nondiversion of certain property).
30§ 5980. Dissolution by domestication.
1Whenever a domestic nonprofit corporation has domesticated
2itself under the laws of another jurisdiction by action similar
3to that provided under section 6161 (relating to domestication)
4and has authorized that action by the vote required by this
5subchapter for the approval of a proposal that the corporation
6dissolve voluntarily, the corporation may surrender its charter
7under the laws of this Commonwealth by filing in the department
8articles of dissolution under this subchapter containing the
9statements specified under section 5977(b)(1) through (4)
10(relating to articles of dissolution). If the corporation as
11domesticated in the other jurisdiction qualifies to do business
12in this Commonwealth either prior to or simultaneously with the
13filing of the articles of dissolution under this section, the
14corporation shall not be required to file with the articles of
15dissolution the tax clearance certificates that would otherwise
16be required under section 139 (relating to tax clearance of
17certain fundamental transactions).
18§ 6121. Admission of foreign corporations.
19(a) General rule.--A foreign nonprofit corporation, before
20doing business in this Commonwealth, shall procure a certificate
21of authority to do so from the Department of State, in the
22manner provided in this subchapter. A foreign nonprofit
23corporation shall not be denied a certificate of authority by
24reason of the fact that the laws of the jurisdiction governing
25its incorporation and internal affairs differ from the laws of
26this Commonwealth.
27(b) Qualification under former statute.--If a foreign
28corporation was on March 19, 1966, admitted to do business in
29this Commonwealth by the filing of a power of attorney and
30statement under the act of June 8, 1911 (P.L.710, No.283), such
1power of attorney and statement shall be deemed an approved
2application for a certificate of authority issued under this
3subchapter and the corporation shall be deemed a holder of the
4certificate. The corporation shall include in its initial
5application, if any, for an amended certificate of authority
6under this subchapter the information required by this
7subchapter to be set forth in an application for a certificate
8of authority. A certificate of authority issued under the former
9provisions of the Nonprofit Corporation Law of 1933 or former 15
10Pa.C.S. Pt. III Art. B, known as the Nonprofit Corporation Law
11of 1972, as added by the act of November 15, 1972 (P.L.1063,
12No.271), shall be deemed to be issued under this subchapter and
13the certificate of authority shall be deemed not to contain any
14reference to the kind of business that the corporation proposes
15to do in this Commonwealth.
16§ 6122. Excluded activities.
17(a) General rule.--Without excluding other activities which
18may not constitute doing business in this Commonwealth, a
19foreign nonprofit corporation shall not be considered to be
20doing business in this Commonwealth for the purposes of this
21subchapter by reason of carrying on in this Commonwealth any one
22or more of the following acts:
23(1) Maintaining or defending any action or
24administrative or arbitration proceeding or effecting the
25settlement thereof or the settlement of claims or disputes.
26(2) Holding meetings of its directors, other body or
27members or carrying on other activities concerning its
28internal affairs.
29(3) Maintaining bank accounts.
30(4) Maintaining offices or agencies for the transfer,
1exchange and registration of its memberships or securities,
2or appointing and maintaining trustees or depositories with
3relation to its memberships or securities.
4(5) Granting funds.
5(6) Distributing information to its members.
6(7) Creating as borrower or lender, acquiring or
7incurring obligations or mortgages or other security
8interests in real or personal property.
9(8) Securing or collecting debts or enforcing any rights
10in property securing them.
11(9) Transacting any business in interstate or foreign
12commerce.
13(10) Conducting an isolated transaction completed within
14a period of 30 days and not in the course of a number of
15repeated transactions of like nature.
16(11) Inspecting, appraising and acquiring real estate
17and mortgages and other liens thereon and personal property
18and security interests therein, and holding, leasing,
19conveying and transferring them, as fiduciary or otherwise.
20(b) Exceptions.--The specification of activities in
21subsection (a) does not establish a standard for activities that
22may subject a foreign corporation to:
23(1) Service of process under any statute or general
24rule.
25(2) Taxation by the Commonwealth or any political
26subdivision thereof.
27(3) The provisions of section 6145 (relating to
28applicability of certain safeguards to foreign domiciliary
29corporations).
30§ 6123. Requirements for foreign corporation names.
1(a) General rule.--The Department of State shall not issue a
2certificate of authority to any foreign nonprofit corporation
3that, except as provided in subsection (b), has a name that is
4rendered unavailable for use by a domestic nonprofit corporation
5by any provision of section 5303(a), (b) or (c) (relating to
6corporate name).
7(b) Exceptions.--
8(1) The provisions of section 5303(b) (relating to
9duplicate use of names) shall not prevent the issuance of a
10certificate of authority to a foreign nonprofit corporation
11setting forth a name that is not distinguishable upon the
12records of the department from the name of any other domestic
13or foreign corporation for profit or not-for-profit, or of
14any corporation or other association then registered under 54
15Pa.C.S. Ch. 5 (relating to corporate and other association
16names) or to any name reserved or registered as provided in
17this part, if the foreign nonprofit corporation applying for
18a certificate of authority files in the department a
19resolution of its board of directors or other body adopting a
20fictitious name for use in transacting business in this
21Commonwealth, which fictitious name is distinguishable upon
22the records of the department from the name of the other
23corporation or other association and from any name reserved
24or registered as provided in this part that is otherwise
25available for use by a domestic nonprofit corporation.
26(2) The provisions of section 5303(c) (relating to
27required approvals or conditions) shall not prevent the
28issuance of a certificate of authority to a foreign nonprofit
29corporation setting forth a name that is prohibited by that
30subsection if the foreign nonprofit corporation applying for
1a certificate of authority files in the department a
2resolution of its board of directors or other body adopting a
3fictitious name for use in transacting business in this
4Commonwealth that is available for use by a domestic
5nonprofit corporation.]
6Section 40. Section 6124 of Title 15 is amended to read:
7§ 6124. [Application for a certificate of authority.]
8Advertisement of registration to do business.
9[(a) General rule.--An application for a certificate of
10authority shall be executed by the foreign nonprofit corporation
11and shall set forth:
12(1) The name of the corporation.
13(2) The name of the jurisdiction under the laws of which
14it is incorporated.
15(3) The address, including street and number, if any, of
16its principal office under the laws of the jurisdiction in
17which it is incorporated.
18(4) Subject to section 109 (relating to name of
19commercial registered office provider in lieu of registered
20address), the address, including street and number, if any,
21of its proposed registered office in this Commonwealth.
22(5) A statement that it is a corporation incorporated
23for a purpose or purposes not involving pecuniary profit,
24incidental or otherwise.
25(b) Advertisement.--]A foreign nonprofit corporation shall
26officially publish notice of its intention to [apply or its
27application for a certificate of authority] register to do
28business or its registration to do business in this Commonwealth
29under Chapter 4 (relating to foreign associations). The notice
30may appear prior to or after the day on which [application is
1made to the Department of State] a registration statement is
2delivered to the department for filing and shall set forth
3[briefly]:
4(1) A statement that the corporation will [apply or has
5applied for a certificate of authority under the provisions
6of the Nonprofit Corporation Law of 1988] register or has
7registered to do business in this Commonwealth under Chapter
84.
9(2) The name of the corporation and [of the jurisdiction
10under the laws of which it is incorporated] its jurisdiction
11of formation.
12(3) The address, including street and number, if any, of
13its principal office under the laws of [the jurisdiction in
14which it is incorporated] its jurisdiction of formation.
15(4) Subject to section 109, the address, including
16street and number, if any, of its proposed registered office
17in this Commonwealth.
18(c) [Filing.--The application for a certificate of authority
19shall be filed in the Department of State.] (Reserved).
20(d) [Cross reference.--See section 134 (relating to
21docketing statement).] (Reserved).
22Section 41. Sections 6125, 6126, 6127 and 6128 of Title 15
23are repealed:
24[§ 6125. Issuance of certificate of authority.
25Upon the filing of the application for a certificate of
26authority, the foreign nonprofit corporation shall be deemed to
27hold a certificate of authority to do business in this
28Commonwealth.
29§ 6126. Amended certificate of authority.
30(a) General rule.--After receiving a certificate of
1authority, a qualified foreign nonprofit corporation may,
2subject to the provisions of this subchapter, change or correct
3any of the information set forth in its application for a
4certificate of authority or previous filings under this section
5by filing in the Department of State an application for an
6amended certificate of authority. The application shall be
7executed by the corporation and shall state:
8(1) The name under which the applicant corporation
9currently holds a certificate of authority to do business in
10this Commonwealth.
11(2) Subject to section 109 (relating to name of
12commercial registered office provider in lieu of registered
13address), the address, including street and number, if any,
14of its registered office in this Commonwealth.
15(3) The information to be changed or corrected.
16(4) If the application reflects a change in the name of
17the corporation, the application shall include a statement
18that either:
19(i) the change of name reflects a change effected in
20the jurisdiction of incorporation; or
21(ii) documents complying with section 6123(b)
22(relating to exceptions) accompany the application.
23(b) Issuance of amended certificate of authority.--Upon the
24filing of the application, the applicant corporation shall be
25deemed to hold an amended certificate of authority.
26(c) Cross reference.--See section 134 (relating to docketing
27statement).
28§ 6127. Merger, consolidation or division of qualified foreign
29corporations.
30(a) General rule.--Whenever a qualified foreign nonprofit
1corporation is a nonsurviving party to a statutory merger,
2consolidation or division permitted by the laws of the
3jurisdiction under which it is incorporated, the corporation
4surviving the merger, or the new corporation resulting from the
5consolidation or division, as the case may be, shall file in the
6Department of State a statement of merger, consolidation or
7division, which shall be executed by the surviving or new
8corporation and shall set forth:
9(1) The name of each nonsurviving qualified foreign
10nonprofit corporation.
11(2) The name of the jurisdictions under the laws of
12which each nonsurviving qualified foreign nonprofit
13corporation was incorporated.
14(3) The date on which each nonsurviving qualified
15foreign nonprofit corporation received a certificate of
16authority to do business in this Commonwealth.
17(4) A statement that the corporate existence of each
18nonsurviving qualified foreign nonprofit corporation has been
19terminated by merger, consolidation or division, as the case
20may be.
21(5) In the case of a consolidation or division or if the
22surviving corporation was a nonqualified foreign nonprofit
23corporation prior to the merger, the statements on the part
24of the surviving or new corporation required by section
256124(a) (relating to application for a certificate of
26authority).
27(b) Effect of filing.--The filing of the statement shall
28operate, as of the effective date of the merger, consolidation
29or division, to cancel the certificate of authority of each
30nonsurviving constituent corporation that was a qualified
1foreign nonprofit corporation and to qualify the surviving or
2new corporation under this subchapter. If the surviving or new
3corporation does not desire to continue as a qualified foreign
4nonprofit corporation, it may thereafter withdraw in the manner
5provided by section 6129 (relating to application for
6termination of authority).
7(c) Surviving qualified foreign corporations.--It shall not
8be necessary for a surviving corporation that was a qualified
9foreign nonprofit corporation to effect any filing under this
10subchapter with respect to a merger or division or to procure an
11amended certificate of authority to do business in this
12Commonwealth unless the name of such corporation is changed by
13the merger or division.
14(d) Cross reference.--See section 134 (relating to docketing
15statement).
16§ 6128. Revocation of certificate of authority.
17(a) General rule.--Whenever the Department of State finds
18that a qualified foreign nonprofit corporation has failed to
19secure an amended certificate of authority as required by this
20subchapter after changing its name, or has failed or refused to
21appear by its proper representatives, or otherwise to comply
22with any subpoena issued by any court having jurisdiction of the
23subject matter, or to produce books, papers, records or
24documents as required by a subpoena, or is violating any of the
25laws of this Commonwealth, or that its articles have been
26revoked or voided by its jurisdiction of incorporation, the
27department shall give notice and opportunity for hearing by
28registered or certified mail to the corporation that the default
29exists and that its certificate of authority, including any
30amendments thereof, will be revoked unless the default is cured
1within 30 days after the mailing of the notice. If the default
2is not cured within the period of 30 days, the department shall
3revoke the certificate of authority, including any amendments
4thereof, of the foreign nonprofit corporation. Upon revoking the
5certificate of authority, the department shall mail to the
6corporation, at its registered office in this Commonwealth, a
7certificate of revocation.
8(b) Effect of revocation.--Upon the issuance of the
9certificate of revocation, the authority of the corporation to
10do business in this Commonwealth shall cease and the corporation
11shall not thereafter do any business in this Commonwealth unless
12it applies for and receives a new certificate of authority.]
13Section 42. Section 6129 of Title 15 is amended to read:
14§ 6129. [Application for] Advertisement of termination of
15[authority] registration to do business.
16[(a) General rule.--Any qualified foreign nonprofit
17corporation may withdraw from doing business in this
18Commonwealth and surrender its certificate of authority by
19filing in the Department of State an application for termination
20of authority, executed by the corporation, which shall set
21forth:
22(1) The name of the corporation and, subject to section
23109 (relating to name of commercial registered office
24provider in lieu of registered address), the address,
25including street and number, if any, of its registered office
26in this Commonwealth.
27(2) The name of the jurisdiction under the laws of which
28it is incorporated.
29(3) The date on which it received a certificate of
30authority to do business in this Commonwealth.
1(4) A statement that it surrenders its certificate of
2authority to do business in this Commonwealth.
3(5) A statement that notice of its intention to withdraw
4from doing business in this Commonwealth was mailed by
5certified or registered mail to each municipal corporation in
6which the registered office or principal place of business of
7the corporation in this Commonwealth is located, and that the
8official publication required by subsection (b) has been
9effected.
10(6) The post office address, including street and
11number, if any, to which process may be sent in an action or
12proceeding upon any liability incurred before the filing of
13the application for termination of authority.
14(b) Advertisement.--]A [qualified] registered foreign
15nonprofit corporation shall, before filing [an application for
16termination of authority] a statement of withdrawal under
17section 415 (relating to voluntary withdrawal of registration),
18officially publish and mail a notice of its intention to
19withdraw from doing business in this Commonwealth in a manner
20similar to that required by section 5975(b) (relating to notice
21to creditors and taxing authorities). The notice shall set forth
22[briefly]:
23(1) The name of the corporation and [the jurisdiction
24under the laws of which it is incorporated] its jurisdiction
25of formation.
26(2) The address, including street and number, if any, of
27its principal office under the laws of its jurisdiction of
28[incorporation] formation.
29(3) Subject to section 109, the address, including
30street and number, if any, of its last registered office in
1this Commonwealth.
2(c) [Filing.--The application for termination of authority
3and the certificates or statement required by section 139
4(relating to tax clearance of certain fundamental transactions)
5shall be filed in the department. See section 134 (relating to
6docketing statement).] (Reserved).
7(d) [Effect of filing.--Upon the filing of the application
8for termination of authority, the authority of the corporation
9to do business in this Commonwealth shall cease. The termination
10of authority shall not affect any action or proceeding pending
11at the time thereof or affect any right of action arising with
12respect to the corporation before the filing of the application
13for termination of authority. Process against the corporation in
14an action upon any liability incurred before the filing of the
15application for termination of authority may be served as
16provided in 42 Pa.C.S. Ch. 53 (relating to bases of jurisdiction
17and interstate and international procedure) or as otherwise
18provided or prescribed by law.] (Reserved).
19Section 43. Sections 6130, 6131, 6141, 6142, 6143, 6144 and
20Subchapter D of Chapter 61 of Title 15 are repealed:
21[§ 6130. Change of address after withdrawal.
22(a) General rule.--Any foreign nonprofit corporation that
23has withdrawn from doing business in this Commonwealth, or its
24successor in interest, may, from time to time, change the
25address to which process may be sent in an action upon any
26liability incurred before the filing of an application for
27termination of authority by filing in the Department of State a
28statement of change of address by the withdrawn corporation
29executed by the corporation, setting forth:
30(1) The name of the withdrawn corporation and, if the
1statement is filed by a successor in interest, the name and
2capacity of the successor.
3(2) The name of the jurisdiction under the laws of which
4the corporation filing the statement is incorporated.
5(3) The former post office address, including street and
6number, if any, of the withdrawn corporation as of record in
7the department.
8(4) The new post office address, including street and
9number, if any, of the withdrawn corporation or its
10successor.
11(b) Cross reference.--See section 134 (relating to docketing
12statement).
13§ 6131. Registration of name.
14(a) General rule.--A nonqualified foreign nonprofit
15corporation may register its name under 54 Pa.C.S. Ch. 5
16(relating to corporate and other association names) if the name
17is available for use by a qualified foreign nonprofit
18corporation under section 6123 (relating to requirements for
19foreign corporation names), by filing in the Department of State
20an application for registration of name, executed by the
21corporation, which shall set forth:
22(1) The name of the corporation.
23(2) The address, including street and number, if any, of
24the corporation.
25(b) Annual renewal.--A corporation that has in effect a
26registration of its corporate name may renew the registration
27from year to year by annually filing an application for renewal
28setting forth the facts required to be set forth in an original
29application for registration. A renewal application may be filed
30between October 1 and December 31 in each year and shall extend
1the registration for the following calendar year.
2(c) Cross reference.--See section 134 (relating to docketing
3statement).
4§ 6141. Penalty for doing business without certificate of
5authority.
6(a) Right to bring actions suspended.--A nonqualified
7foreign nonprofit corporation doing business in this
8Commonwealth within the meaning of Subchapter B (relating to
9qualification) shall not be permitted to maintain any action or
10proceeding in any court of this Commonwealth until the
11corporation has obtained a certificate of authority. Except as
12provided in subsection (b), an action or proceeding may not be
13maintained in any court of this Commonwealth by any successor or
14assignee of the corporation on any right, claim or demand
15arising out of the doing of business by the corporation in this
16Commonwealth until a certificate of authority has been obtained
17by the corporation or by a corporation that has acquired all or
18substantially all of its assets.
19(a.1) Contracts, property and defense against actions
20unaffected.--The failure of a foreign nonprofit corporation to
21obtain a certificate of authority to transact business in this
22Commonwealth shall not impair the validity of any contract or
23act of the corporation, shall not prevent the corporation from
24defending any action in any court of this Commonwealth and shall
25not render escheatable any of its real or personal property.
26§ 6142. General powers and duties of qualified foreign
27corporations.
28(a) General rule.--A qualified foreign nonprofit
29corporation, so long as its certificate of authority is not
30revoked, shall enjoy the same rights and privileges as a
1domestic nonprofit corporation, but no more, and, except as in
2this subpart otherwise provided, shall be subject to the same
3liabilities, restrictions, duties and penalties now in force or
4hereafter imposed upon domestic nonprofit corporations, to the
5same extent as if it had been incorporated under this subpart.
6(b) Agricultural lands.--Interests in agricultural land
7shall be subject to the restrictions of and escheatable as
8provided by the act of April 6, 1980 (P.L.102, No.39), referred
9to as the Agricultural Land Acquisition by Aliens Law.
10§ 6143. General powers and duties of nonqualified foreign
11corporations.
12(a) Acquisition of real and personal property.--Every
13nonqualified foreign nonprofit corporation may acquire, hold,
14mortgage, lease and transfer real and personal property in this
15Commonwealth, in the same manner and subject to the same
16limitations as a qualified foreign nonprofit corporation.
17(b) Duties.--Except as provided in section 6141(a) (relating
18to penalty for doing business without certificate of authority),
19a nonqualified foreign nonprofit corporation doing business in
20this Commonwealth within the meaning of Subchapter B (relating
21to qualification) shall be subject to the same liabilities,
22restrictions, duties and penalties now or hereafter imposed upon
23a qualified foreign nonprofit corporation.
24§ 6144. Registered office of qualified foreign corporations.
25(a) General rule.--Subject to the provisions of section
265507(c) (relating to alternative procedure), every qualified
27foreign nonprofit corporation shall have, and continuously
28maintain, in this Commonwealth a registered office, which may
29but need not be the same as its place of business in this
30Commonwealth.
1(b) Change.--A qualified foreign corporation may, from time
2to time, change the address of its registered office in the
3manner provided by section 5507(b) (relating to statement of
4change of registered office).
5SUBCHAPTER D
6DOMESTICATION
7Sec.
86161. Domestication.
96162. Effect of domestication.
10§ 6161. Domestication.
11(a) General rule.--Any qualified foreign nonprofit
12corporation may become a domestic nonprofit corporation by
13filing in the Department of State articles of domestication. The
14articles of domestication, upon being filed in the department,
15shall constitute the articles of the domesticated foreign
16corporation, and it shall thereafter continue as a corporation
17which shall be a domestic nonprofit corporation subject to this
18subpart.
19(b) Articles of domestication.--The articles of
20domestication shall be executed by the corporation and shall set
21forth in the English language:
22(1) The name of the corporation. If the name is in a
23foreign language, it shall be set forth in Roman letters or
24characters or Arabic or Roman numerals.
25(2) Subject to section 109 (relating to name of
26commercial registered office provider in lieu of registered
27address), the address, including street and number, if any,
28of its registered office in this Commonwealth.
29(3) A statement that upon domestication the corporation
30will be subject to the domestic corporation provisions of the
1Nonprofit Corporation Law of 1988 and a brief statement of
2the purpose or purposes for which it is to be domesticated
3which shall be a purpose or purposes for which a domestic
4nonprofit corporation may be incorporated under Article B
5(relating to domestic nonprofit corporations generally).
6(4) The term for which upon domestication it is to
7exist, if not perpetual.
8(5) Any desired provisions relating to the manner and
9basis of reclassifying the memberships in the corporation.
10(6) A statement that the filing of articles of
11domestication and, if desired, the renunciation of the
12original charter or articles of the corporation has been
13authorized (unless its charter or other organic documents
14require a greater vote) by a majority of the votes cast by
15all members entitled to vote thereon and, if any class of
16members is entitled to vote thereon as a class, a majority of
17the votes cast in each class vote.
18(7) Any other provisions authorized by Article B to be
19set forth in the original articles.
20(c) Cross reference.--See section 134 (relating to docketing
21statement).
22§ 6162. Effect of domestication.
23As a domestic nonprofit corporation, the domesticated
24corporation shall no longer be a foreign nonprofit corporation
25for the purposes of this subpart and shall have all the powers
26and privileges and be subject to all the duties and limitations
27granted and imposed upon domestic nonprofit corporations. The
28property, franchises, debts, liens, estates, taxes, penalties
29and public accounts due the Commonwealth shall continue to be
30vested in and imposed upon the corporation to the same extent as
1if it were the successor by merger of the domesticating
2corporation with and into a domestic nonprofit corporation under
3Subchapter C of Chapter 59 (relating to merger, consolidation
4and sale of assets). Memberships in the domesticated corporation
5shall be unaffected by the domestication except to the extent,
6if any, reclassified in the articles of domestication.]
7Section 43.1. Title 15 is amended by adding a section to
8read:
9§ 7411. Expiration.
10This chapter shall expire December 31, 2014.
11Section 44. The definitions of "bureau" and "corporation" in
12section 7702 of Title 15 are amended to read:
13§ 7702. Definitions.
14The following words and phrases when used in this chapter
15shall have the meanings given to them in this section unless the
16context clearly indicates otherwise:
17["Bureau." The Corporation Bureau of the department.]
18"Corporation." A corporation [organized] for profit which
19has elected to be governed by this chapter.
20* * *
21Section 45. Sections 7703(b)(1), 7704(d)(1) and 7723(a) of
22Title 15 are amended to read:
23§ 7703. Corporations.
24* * *
25(b) Name.--
26(1) [The corporation may adopt any corporate name to
27indicate its cooperative character as long as the name has
28not been previously adopted.] The name of the corporation
29must comply with section 202 (relating to requirements for
30names generally).
1* * *
2§ 7704. Articles of incorporation.
3* * *
4(d) Content of articles.--The articles of incorporation
5shall be signed by the persons originally associating themselves
6together and shall state [distinctly]:
7(1) The name [by which] of the corporation [shall be
8known, which may not be the same as, or confusingly similar
9to, the name of an association or corporation existing under
10the law of the Commonwealth, the name of a foreign or alien
11association or corporation authorized to transact business in
12this Commonwealth, or a corporate name reserved or registered
13as provided by law].
14* * *
15§ 7723. Dissolution.
16(a) General rule.--A corporation may dissolve and wind up;
17may merge [or consolidate] with other corporations; and may sell
18to, lease to or exchange with other corporations all or
19substantially all of its property and assets. Except as
20otherwise provided in this chapter, these actions are governed
21by Chapter 3 (relating to entity transactions) and Subchapter C
22of Chapter 19 (relating to merger[, consolidation, share
23exchanges] liabilities and sale of assets). A workers'
24cooperative corporation which has not revoked its election to be
25governed by this chapter may not [consolidate or] merge with one
26or more corporations organized under any law other than this
27chapter. If a member objects to a corporation's merger [or
28consolidation], the member may terminate membership in the
29corporation. The price of redemption of the member's interest
30shall be the amount in the member's individual capital account
1on terms and conditions as the law, the articles of
2incorporation and the bylaws provide.
3* * *
4Section 46. Section 8203 of Title 15 is repealed:
5[§ 8203. Name.
6(a) General rule.--The name of a registered limited
7liability partnership shall:
8(1) Not be one rendered unavailable for use by a
9corporation by any provision of section 1303(b) and (c)
10(relating to corporate name).
11(2) Contain the term "company," "limited" or "limited
12liability partnership," or an abbreviation of one of those
13terms, or words or abbreviations of like import in English or
14any other language.
15(b) Reservation of name.--The exclusive right to the use of
16a name for purposes of this subchapter may be reserved and
17transferred in the manner provided in section 1305 (relating to
18reservation of corporate name).]
19Section 47. Section 8211(b) of Title 15 is amended to read:
20§ 8211. Foreign registered limited liability partnerships.
21* * *
22[(b) Registration to do business.--A foreign registered
23limited liability partnership, regardless of whether or not it
24is also a foreign limited partnership, shall be subject to
25Subchapter K of Chapter 85 (relating to foreign limited
26partnerships) as if it were a foreign limited partnership,
27except that:
28(1) Its application for registration shall state that it
29is a registered limited liability partnership.
30(2) The name under which it registers and conducts
1business in this Commonwealth shall comply with the
2requirements of section 8203 (relating to name).
3(3) Section 8582(a)(5) and (6) (relating to
4registration) shall not be applicable to the application for
5registration of a foreign limited liability partnership that
6is not a foreign limited partnership.]
7* * *
8Section 48. The definitions of "certificate of limited
9partnership," "foreign limited partnership," "nonqualified
10foreign limited partnership" and "qualified foreign limited
11partnership" in section 8503(a) of Title 15 are amended to read:
12§ 8503. Definitions and index of definitions.
13(a) Definitions.--The following words and phrases when used
14in this chapter shall have the meanings given to them in this
15section unless the context clearly indicates otherwise:
16"Certificate of limited partnership." The certificate
17referred to in section 8511 (relating to certificate of limited
18partnership) and the certificate as amended. The term includes
19any other statements or certificates permitted or required to be
20filed in the Department of State by sections 108 (relating to
21change in location or status of registered office provided by
22agent) and 138 (relating to statement of correction), Chapter 3
23(relating to entity transactions) or this part. If an amendment
24of the certificate of limited partnership or a [certificate of
25merger or division made in the manner permitted by this chapter]
26statement filed under Chapter 3 restates the certificate in its
27entirety [or if there is a certificate of consolidation],
28thenceforth the "certificate of limited partnership" shall not
29include any prior documents and any certificate issued by the
30department with respect thereto shall so state.
1* * *
2"Foreign limited partnership." A partnership formed under
3the laws of any jurisdiction other than this Commonwealth and
4having as partners one or more general partners and one or more
5limited partners, whether or not required to register under
6[Subchapter K (relating to foreign limited partnerships)]
7Chapter 4 (relating to foreign associations).
8* * *
9["Nonqualified foreign limited partnership." A foreign
10limited partnership that is not a qualified foreign limited
11partnership as defined in this section.]
12* * *
13["Qualified foreign limited partnership." A foreign limited
14partnership that is registered under Subchapter K (relating to
15foreign limited partnerships) to do business in this
16Commonwealth.]
17* * *
18Section 49. Section 8505 of Title 15 is repealed:
19[§ 8505. Name.
20(a) General rule.--The name of each limited partnership as
21set forth in its certificate of limited partnership:
22(1) Shall be expressed in Roman letters or characters or
23Arabic or Roman numerals.
24(2) Shall not be one rendered unavailable to use by a
25corporation by any provision of section 1303(b) and (c)
26(relating to corporate name).
27(3) May contain the name of a limited partner or a
28general partner. See section 8523(d) (relating to use of name
29of limited partner).
30(b) Reservation of name.--The exclusive right to the use of
1a name for purposes of this chapter may be reserved and
2transferred in the manner provided by section 1305 (relating to
3reservation of corporate name).]
4Section 50. Sections 8513(d) and 8514(a) of Title 15 are
5amended to read:
6§ 8513. Cancellation of certificate.
7* * *
8[(d) Dissolution by domestication.--Whenever a domestic
9limited partnership has domesticated itself under the laws of
10another jurisdiction by action similar to that provided by
11section 8590 (relating to domestication) and has authorized that
12action by the vote required by this chapter for the approval of
13a proposal that the limited partnership dissolve voluntarily,
14the limited partnership may surrender its certificate of limited
15partnership under the laws of this Commonwealth by filing in the
16department a certificate of cancellation under subsection (a).]
17* * *
18§ 8514. Execution of certificates.
19(a) General rule.--Each certificate or other document
20required or permitted by this chapter to be [filed in] delivered
21to the Department of State for filing shall be [executed] signed
22in the following manner:
23(1) An original certificate of limited partnership must
24be signed by all general partners named therein.
25(2) A certificate of amendment must be signed by at
26least one general partner and by each other general partner
27designated in the certificate as a new general partner.
28(3) A certificate of cancellation must be signed by all
29general partners or liquidating trustees or, if there is no
30general partner or liquidating trustee, by a majority in
1interest of the limited partners.
2(4) A certificate of change of registered office must be
3signed by a general partner.
4(5) A certificate of summary of record must be signed by
5all general partners.
6(6) A certificate of withdrawal must be signed by the
7person withdrawing.
8(7) A certificate of termination must be signed by a
9general partner.
10(8) A [certificate of merger, consolidation or division]
11statement of merger, interest exchange, conversion, division
12or domestication must be signed by a general partner.
13(9) [An application for registration as a foreign
14limited partnership] A foreign registration statement must be
15signed by a general partner.
16(10) [A certificate of amendment of registration of a
17foreign limited partnership] An amendment of a foreign
18registration statement must be signed by a general partner.
19(11) A [certificate of cancellation of registration of]
20statement of withdrawal by a foreign limited partnership must
21be signed by a general partner.
22[(12) A certificate of domestication must be signed by a
23general partner.]
24* * *
25Section 51. Subchapter F of Chapter 85 of Title 15 is
26repealed:
27[SUBCHAPTER F
28MERGER AND CONSLIDATION
29Sec.
308545. Merger and consolidation of limited partnerships
1authorized.
28546. Approval of merger or consolidation.
38547. Certificate of merger or consolidation.
48548. Effective date of merger or consolidation.
58549. Effect of merger or consolidation.
6§ 8545. Merger and consolidation of limited partnerships
7authorized.
8(a) Domestic surviving or new limited partnership.--Any two
9or more domestic limited partnerships, or any two or more
10foreign limited partnerships, or any one or more domestic
11limited partnerships and any one or more foreign limited
12partnerships, may, in the manner provided in this subchapter, be
13merged into one of the domestic limited partnerships, designated
14in this subchapter as the surviving limited partnership, or
15consolidated into a new limited partnership to be formed under
16this chapter, if the foreign limited partnerships are authorized
17by the laws of the jurisdiction under which they are organized
18to effect a merger or consolidation with a limited partnership
19of another jurisdiction.
20(b) Foreign surviving or new limited partnership.--Any one
21or more domestic limited partnerships, and any one or more
22foreign limited partnerships, may, in the manner provided in
23this subchapter, be merged into one of the foreign limited
24partnerships, designated in this subchapter as the surviving
25limited partnership, or consolidated into a new limited
26partnership to be organized under the laws of the jurisdiction
27under which one of the foreign limited partnerships is
28organized, if the laws of that jurisdiction authorize a merger
29with or consolidation into a limited partnership of another
30jurisdiction.
1(c) Business trusts and other associations.--The provisions
2of this subchapter applicable to domestic and foreign limited
3partnerships shall also be applicable to a merger or
4consolidation to which a domestic limited partnership is a party
5or in which such a partnership is the resulting entity with or
6into a domestic or foreign corporation, business trust, general
7partnership or other association. Except as otherwise provided
8by law in this or any other state, the powers and duties vested
9in and imposed upon the general partners and limited partners in
10this subchapter shall be exercised and performed by the group of
11persons under the direction of whom the business and affairs of
12the corporation, business trust or other association are managed
13and the holders or owners of shares or other interests in the
14corporation, business trust or other association, respectively,
15irrespective of the names by which the managing group and the
16holders or owners of shares or other interests are designated.
17The units into which the shares or other interests in the
18corporation, business trust or other association are divided
19shall be deemed to be partnership interests for the purposes of
20applying the provisions of this subchapter to a merger or
21consolidation involving the corporation, business trust or other
22association.
23§ 8546. Approval of merger or consolidation.
24(a) Preparation of plan of merger or consolidation.--A plan
25of merger or consolidation, as the case may be, shall be
26prepared, setting forth:
27(1) The terms and conditions of the merger or
28consolidation.
29(2) If the surviving or new partnership is or is to be a
30domestic limited partnership:
1(i) in the case of a merger, any changes desired to
2be made in the certificate of limited partnership or
3partnership agreement, which may include a restatement of
4either or both; or
5(ii) in the case of a consolidation:
6(A) all of the statements required by this
7chapter to be set forth in a restated certificate of
8limited partnership; and
9(B) the written provisions, if any, of the
10partnership agreement.
11(3) The manner and basis of converting the partnership
12interests of each limited partnership into partnership
13interests, securities or obligations of the surviving or new
14limited partnership, as the case may be, and, if any of the
15partnership interests of any of the limited partnerships that
16are parties to the merger or consolidation are not to be
17converted solely into partnership interests, securities or
18obligations of the surviving or new limited partnership, the
19partnership interests, securities or obligations of any other
20person or cash, property or rights that the holders of such
21partnership interests are to receive in exchange for, or upon
22conversion of, such partnership interests, and the surrender
23of any certificates evidencing them, which securities or
24obligations, if any, of any other person or cash, property or
25rights may be in addition to or in lieu of the partnership
26interests, securities or obligations of the surviving or new
27limited partnership.
28(4) Such other provisions as are deemed desirable.
29(b) Post-adoption amendment of plan of merger or
30consolidation.--A plan of merger or consolidation may contain a
1provision that the general partners of the constituent limited
2partnerships may amend the plan at any time prior to its
3effective date, except that an amendment made subsequent to any
4adoption of the plan by the limited partners of any constituent
5domestic limited partnership shall not change:
6(1) The amount or kind of partnership interests,
7obligations, cash, property or rights to be received in
8exchange for or on conversion of all or any of the
9partnership interests of the constituent domestic limited
10partnership adversely to the holders of those partnership
11interests.
12(2) Any term of the certificate of limited partnership
13or partnership agreement of the surviving or new limited
14partnership as it is to be in effect immediately following
15consummation of the merger or consolidation except provisions
16that may be amended without the approval of the limited
17partners.
18(3) Any of the other terms and conditions of the plan if
19the change would adversely affect the holders of any
20partnership interests of the constituent domestic limited
21partnership.
22(c) Proposal of merger or consolidation.--Every merger or
23consolidation shall be proposed in the case of each domestic
24limited partnership by the adoption by the general partners of a
25resolution approving the plan of merger or consolidation. Except
26where the approval of the limited partners is unnecessary under
27this subchapter or the partnership agreement, the general
28partners shall submit the plan to a vote of the limited partners
29entitled to vote thereon at a regular or special meeting of the
30limited partners.
1(d) Party to plan.--An association that approves a plan in
2its capacity as a partner or creditor of a merging or
3consolidating limited partnership, or that furnishes all or a
4part of the consideration contemplated by a plan, does not
5thereby become a party to the merger or consolidation for the
6purposes of this subchapter.
7(e) Notice of meeting of limited partners.--Notwithstanding
8any other provision of the partnership agreement, written notice
9of the meeting of limited partners called for the purpose of
10considering the proposed plan shall be given to each limited
11partner of record, whether or not entitled to vote thereon, of
12each domestic limited partnership that is a party to the
13proposed merger or consolidation. There shall be included in, or
14enclosed with, the notice a copy of the proposed plan or a
15summary thereof. The provisions of this subsection may not be
16relaxed by the certificate of limited partnership or partnership
17agreement.
18(f) Adoption of plan by limited partners.--The plan of
19merger or consolidation shall be adopted upon receiving a
20majority of the votes cast by all limited partners, if any,
21entitled to vote thereon of each of the domestic limited
22partnerships that is a party to the proposed merger or
23consolidation and, if any class of limited partners is entitled
24to vote thereon as a class, a majority of the votes cast in each
25class vote. A proposed plan of merger or consolidation shall not
26be deemed to have been adopted by the limited partnership unless
27it has also been approved by the general partners, regardless of
28the fact that the general partners have directed or suffered the
29submission of the plan to the limited partners for action.
30(g) Adoption by general partners.--
1(1) Unless otherwise required by the partnership
2agreement, a plan of merger or consolidation shall not
3require the approval of the limited partners of a limited
4partnership if:
5(i) the plan, whether or not the limited partnership
6is the surviving limited partnership, does not alter the
7status of the limited partnership as a domestic limited
8partnership or alter in any respect the provisions of its
9certificate of limited partnership or partnership
10agreement, except changes that may be made without action
11by the limited partners; and
12(ii) each partnership interest outstanding
13immediately prior to the effective date of the merger or
14consolidation is to continue as or to be converted into,
15except as may be otherwise agreed by the holder thereof,
16an identical partnership interest in the surviving or new
17limited partnership after the effective date of the
18merger or consolidation.
19(2) If a merger or consolidation is effected pursuant to
20paragraph (1), the plan of merger or consolidation shall be
21deemed adopted by the limited partnership when it has been
22adopted by the general partners pursuant to subsection (c).
23(h) Termination of plan.--Prior to the time when a merger or
24consolidation becomes effective, the merger or consolidation may
25be terminated pursuant to provisions therefor, if any, set forth
26in the plan. If a certificate of merger or consolidation has
27been filed in the department prior to the termination, a
28certificate of termination executed by each limited partnership
29that is a party to the merger or consolidation, unless the plan
30permits termination by less than all of the limited
1partnerships, in which case the certificate shall be executed on
2behalf of the limited partnership exercising the right to
3terminate, shall be filed in the department. The certificate of
4termination shall set forth:
5(1) A copy of the certificate of merger or consolidation
6relating to the plan that is terminated.
7(2) A statement that the plan has been terminated in
8accordance with the provisions therefor set forth therein.
9See sections 134 (relating to docketing statement), 135
10(relating to requirements to be met by filed documents), 138
11(relating to statement of correction) and 8514 (relating to
12execution of certificates).
13(i) Authorization by foreign limited partnerships.--The plan
14of merger or consolidation shall be authorized, adopted or
15approved by each foreign limited partnership that desires to
16merge or consolidate in accordance with the laws of the
17jurisdiction in which it is organized.
18(j) Reference to outside facts.--Any of the terms of a plan
19of merger or consolidation may be made dependent upon facts
20ascertainable outside of the plan if the manner in which the
21facts will operate upon the terms of the plan is set forth in
22the plan. Such facts may include, without limitation, actions or
23events within the control of or determinations made by a party
24to the plan or a representative of a party to the plan.
25§ 8547. Certificate of merger or consolidation.
26(a) General rule.--Upon the adoption of the plan of merger
27or consolidation by the limited partnerships desiring to merge
28or consolidate, as provided in this subchapter, a certificate of
29merger or a certificate of consolidation, as the case may be,
30shall be executed by each limited partnership and shall, subject
1to section 109 (relating to name of commercial registered office
2provider in lieu of registered address), set forth:
3(1) The name and the location of the registered office,
4including street and number, if any, of the domestic
5surviving or new limited partnership or, in the case of a
6foreign surviving or new limited partnership, the name of the
7limited partnership and its jurisdiction of organization,
8together with either of the following:
9(i) If a qualified foreign limited partnership, the
10address, including street and number, if any, of its
11registered office in this Commonwealth.
12(ii) If a nonqualified foreign limited partnership,
13the address, including street and number, if any, of its
14principal office under the laws of the jurisdiction in
15which it is organized.
16(2) The name and address, including street and number,
17if any, of the registered office of each other domestic
18limited partnership and qualified foreign limited partnership
19that is a party to the plan.
20(3) If the plan is to be effective on a specified date,
21the hour, if any, and the month, day and year of the
22effective date.
23(4) The manner in which the plan was adopted by each
24domestic limited partnership and, if one or more foreign
25limited partnerships are parties to the plan, the fact that
26the plan was authorized, adopted or approved, as the case may
27be, by each of the foreign limited partnerships in accordance
28with the laws of the jurisdiction in which it is organized.
29(5) Except as provided in subsection (b), the plan of
30merger or consolidation.
1(b) Omission of certain provisions of plan of merger or
2consolidation.--A certificate of merger or consolidation may
3omit all provisions of the plan of merger or consolidation
4except provisions, if any, that are intended to amend or
5constitute the operative provisions of the certificate of
6limited partnership of a limited partnership as in effect
7subsequent to the effective date of the plan, if the certificate
8of merger or consolidation states that the full text of the plan
9is on file at the principal place of business of the surviving
10or new limited partnership and states the address thereof. A
11limited partnership that takes advantage of this subsection
12shall furnish a copy of the full text of the plan, on request
13and without cost, to any partner of any limited partnership that
14was a party to the plan and, unless all parties to the plan had
15fewer than 30 partners each, on request and at cost to any other
16person.
17(c) Filing of certificate of merger or consolidation.--The
18certificate of merger or certificate of consolidation, as the
19case may be, and the certificates or statement, if any, required
20by section 139 (relating to tax clearance of certain fundamental
21transactions) shall be filed in the department.
22(d) Cross references.--See sections 134 (relating to
23docketing statement) and 8514 (relating to execution of
24certificates).
25§ 8548. Effective date of merger or consolidation.
26Upon the filing of the certificate of merger or the
27certificate of consolidation in the Department of State or upon
28the effective date specified in the plan of merger or
29consolidation, whichever is later, the merger or consolidation
30shall be effective. The merger or consolidation of one or more
1domestic limited partnerships into a foreign limited partnership
2shall be effective according to the provisions of law of the
3jurisdiction in which the foreign limited partnership is
4organized, but not until a certificate of merger or certificate
5of consolidation has been adopted and filed, as provided in this
6subchapter.
7§ 8549. Effect of merger or consolidation.
8(a) Single surviving or new limited partnership.--Upon the
9merger or consolidation becoming effective, the several limited
10partnerships parties to the plan of merger or consolidation
11shall be a single limited partnership which, in the case of a
12merger, shall be the limited partnership designated in the plan
13of merger as the surviving limited partnership and, in the case
14of a consolidation, shall be the new limited partnership
15provided for in the plan of consolidation. The separate
16existence of all limited partnerships parties to the plan of
17merger or consolidation shall cease, except that of the
18surviving limited partnership, in the case of a merger.
19(b) Property rights.--All the property, real, personal and
20mixed, of each of the limited partnerships parties to the plan
21of merger or consolidation, and all debts due on whatever
22account to any of them, as well as all other things and causes
23of action belonging to any of them, shall be deemed to be vested
24in and shall belong to the surviving or new limited partnership,
25as the case may be, without further action, and the title to any
26real estate, or any interest therein, vested in any of the
27limited partnerships shall not revert or be in any way impaired
28by reason of the merger or consolidation. The surviving or new
29limited partnership shall thenceforth be responsible for all the
30liabilities of each of the limited partnerships so merged or
1consolidated. Liens upon the property of the merging or
2consolidating limited partnerships shall not be impaired by the
3merger or consolidation, and any claim existing or action or
4proceeding pending by or against any of the limited partnerships
5may be prosecuted to judgment as if the merger or consolidation
6had not taken place or the surviving or new limited partnership
7may be proceeded against or substituted in its place.
8(c) Taxes.--Any taxes, interest, penalties and public
9accounts of the Commonwealth claimed against any of the merging
10or consolidating limited partnerships that are settled, assessed
11or determined prior to or after the merger or consolidation
12shall be the liability of the surviving or new limited
13partnership and, together with interest thereon, shall be a lien
14against the property, both real and personal, of the surviving
15or new limited partnership.
16(d) Certificate of limited partnership.--In the case of a
17merger, the certificate of limited partnership of the surviving
18domestic limited partnership, if any, shall be deemed to be
19amended to the extent, if any, that changes in its certificate
20of limited partnership are stated in the plan of merger. In the
21case of a consolidation into a domestic limited partnership, the
22statements that are set forth in the plan of consolidation, or
23certificate of limited partnership set forth therein, shall be
24deemed to be the certificate of limited partnership of the new
25limited partnership.]
26Section 52. Section 8571(c) of Title 15 is amended to read:
27§ 8571. Nonjudicial dissolution.
28* * *
29[(c) Dissolution by domestication.--Whenever a domestic
30limited partnership has domesticated itself under the laws of
1another jurisdiction by action similar to that provided by
2section 8590 (relating to domestication) and has authorized that
3action in the manner required by this subchapter for the
4approval of a proposal that the partnership dissolve
5voluntarily, the partnership may surrender its certificate of
6limited partnership under the laws of this Commonwealth by
7filing in the department a certificate of cancellation under
8section 8513 (relating to cancellation of certificate). If the
9partnership, as domesticated in the other jurisdiction,
10registers to do business in this Commonwealth either prior to or
11simultaneously with the filing of the certificate of
12cancellation under this subsection, the partnership shall not be
13required to file with the certificate of cancellation the tax
14clearance certificates that would otherwise be required by
15section 139 (relating to tax clearance of certain fundamental
16transactions).]
17* * *
18Section 53. Subchapters J and K of Chapter 85 of Title 15
19are repealed:
20[SUBCHAPTER J
21DIVISION
22Sec.
238576. Division authorized.
248577. Proposal and adoption of plan of division.
258578. Division without approval of limited partners.
268579. Certificate of division.
278580. Effect of division.
28§ 8576. Division authorized.
29(a) Division of domestic limited partnership.--Any domestic
30limited partnership may, in the manner provided in this
1subchapter, be divided into two or more domestic limited
2partnerships organized or to be organized under this chapter or
3into one or more domestic limited partnerships and one or more
4foreign limited partnerships to be organized under the laws of
5another jurisdiction or jurisdictions or into two or more
6foreign limited partnerships if the laws of the other
7jurisdictions authorize the division.
8(b) Division of foreign limited partnership.--Any foreign
9limited partnership may, in the manner provided in this
10subchapter, be divided into one or more domestic limited
11partnerships to be organized under this chapter and one or more
12foreign limited partnerships organized or to be organized under
13the laws of another jurisdiction or jurisdictions or into two or
14more domestic limited partnerships if the foreign limited
15partnership is authorized under the laws of the jurisdiction
16under which it is organized to effect a division.
17(c) Surviving and new limited partnerships.--The limited
18partnership effecting a division, if it survives the division,
19is designated in this subchapter as the surviving limited
20partnership. All limited partnerships originally organized by a
21division are designated in this subchapter as new limited
22partnerships. The surviving limited partnership, if any, and the
23new limited partnership or partnerships are collectively
24designated in this subchapter as the resulting limited
25partnerships.
26§ 8577. Proposal and adoption of plan of division.
27(a) Preparation of plan.--A plan of division shall be
28prepared, setting forth:
29(1) The terms and conditions of the division, including
30the manner and basis of:
1(i) The reclassification of the partnership
2interests in the surviving limited partnership, if there
3be one, and, if any of the partnership interests in the
4dividing limited partnership are not to be converted
5solely into partnership interests or other securities or
6obligations of one or more of the resulting limited
7partnerships, the partnership interests or other
8securities or obligations of any other person or cash,
9property or rights that the holders of the partnership
10interests are to receive in exchange for or upon
11conversion of the partnership interests and the surrender
12of any certificates evidencing them, which securities or
13obligations, if any, of any other person or cash,
14property or rights may be in addition to or in lieu of
15partnership interests or other securities or obligations
16of one or more of the resulting limited partnerships.
17(ii) The disposition of the partnership interests
18and other securities or obligations, if any, of the new
19limited partnership or partnerships resulting from the
20division.
21(2) A statement that the dividing limited partnership
22will or will not survive the division.
23(3) Any changes desired to be made in the certificate of
24limited partnership of the surviving limited partnership, if
25there be one, including a restatement of the certificate.
26(4) The certificates of limited partnership required by
27subsection (c).
28(5) Such other provisions as are deemed desirable.
29(b) Reference to outside facts.--Any of the terms of the
30plan may be made dependent upon facts ascertainable outside of
1the plan if the manner in which the facts will operate upon the
2terms of the plan is set forth in the plan. Such facts may
3include, without limitation, actions or events within the
4control of or determinations made by the dividing limited
5partnership or a representative of the dividing limited
6partnership.
7(c) Certificates of limited partnership of new limited
8partnerships.--There shall be included in or annexed to the plan
9of division:
10(1) Certificates of limited partnership, which shall
11contain all of the statements required by this chapter to be
12set forth in a restated certificate of limited partnership
13for each of the new domestic limited partnerships, if any,
14resulting from the division.
15(2) Certificates of limited partnership or other
16organizational documents for each of the new foreign limited
17partnerships, if any, resulting from the division.
18(d) Proposal and adoption.--Except as otherwise provided in
19section 8578 (relating to division without approval of limited
20partners), the plan of division shall be proposed and adopted
21and may be amended after its adoption and termination by a
22domestic limited partnership in the manner provided for the
23proposal, adoption, amendment and termination of a plan of
24merger in Subchapter F (relating to merger and consolidation),
25except section 8546(g) (relating to approval of merger or
26consolidation) or, if the dividing limited partnership is a
27foreign limited partnership, in accordance with the laws of the
28jurisdiction in which it is organized. There shall be included
29in or enclosed with the notice of the meeting of limited
30partners to act on the plan, a copy or a summary of the plan.
1(f) Rights of holders of indebtedness.--If any such debt
2securities, notes, similar evidences of indebtedness, indentures
3or other contracts were issued, incurred or executed by the
4dividing limited partnership before August 21, 2001, and have
5not been amended subsequent to that date, the liability of the
6dividing limited partnership thereunder shall not be affected by
7the division nor shall the rights of the obligees thereunder be
8impaired by the division, and each of the resulting limited
9partnerships may be proceeded against or substituted in place of
10the dividing limited partnership as joint and several obligors
11on such liability, regardless of any provision of the plan of
12division apportioning the liabilities of the dividing limited
13partnership.
14(g) Special requirements.--If any provision of the
15certificate of limited partnership or partnership agreement of a
16dividing domestic limited partnership adopted before February 5,
171995, requires for the proposal or adoption of a plan of merger
18or consolidation a specific number or percentage of votes of
19general or limited partners or other special procedures, the
20plan of division shall not be proposed or adopted by the general
21or limited partners without that number or percentage of votes
22or compliance with the other special procedures.
23§ 8578. Division without approval of limited partners.
24Unless otherwise restricted by its partnership agreement, a
25plan of division that does not alter the state of organization
26of a limited partnership nor amend in any respect the provisions
27of its certificate of limited partnership or partnership
28agreement (except amendments that may be made without action by
29the limited partners) shall not require the approval of the
30limited partners of the limited partnership if:
1(1) the dividing limited partnership survives the
2division and all the partnership interests and other
3securities and obligations, if any, of all new limited
4partnerships resulting from the plan are owned solely by the
5surviving limited partnership; or
6(2) the transfers of assets effected by the division, if
7effected by means of a sale, lease, exchange or other
8disposition, would not require the approval of the limited
9partners.
10§ 8579. Certificate of division.
11(a) Contents.--Upon the adoption of a plan of division by
12the limited partnership desiring to divide, as provided in this
13subchapter, a certificate of division shall be executed by the
14limited partnership and shall, subject to section 109 (relating
15to name of commercial registered office provider in lieu of
16registered address), set forth:
17(1) The name and the location of the registered office,
18including street and number, if any, of the dividing domestic
19limited partnership or, in the case of a dividing foreign
20limited partnership, the name of the limited partnership and
21the jurisdiction in which it is organized, together with
22either:
23(i) If a qualified foreign limited partnership, the
24address, including street and number, if any, of its
25registered office in this Commonwealth.
26(ii) If a nonqualified foreign limited partnership,
27the address, including street and number, if any, of its
28principal office under the laws of that jurisdiction.
29(2) The statute under which the dividing limited
30partnership was organized and the date of organization.
1(3) A statement that the dividing limited partnership
2will or will not survive the division.
3(4) The name and the address, including street and
4number, if any, of the registered office of each new domestic
5limited partnership or qualified foreign limited partnership
6resulting from the division.
7(5) If the plan is to be effective on a specific date,
8the hour, if any, and the month, day and year of the
9effective date.
10(6) The manner in which the plan was adopted by the
11limited partnership.
12(7) The plan of division.
13(b) Filing.--The certificate of division and the
14certificates or statement, if any, required by section 139
15(relating to tax clearance of certain fundamental transactions)
16shall be filed in the Department of State.
17(c) Effective date of certificate of division.--Upon the
18filing of a certificate of division in the Department of State
19or upon the effective date specified in the plan of division,
20whichever is later, the division shall become effective. The
21division of a domestic limited partnership into one or more
22foreign limited partnerships or the division of a foreign
23limited partnership shall be effective according to the laws of
24the jurisdictions where the foreign limited partnerships are or
25are to be organized, but not until a certificate of division has
26been adopted and filed as provided in this subchapter.
27(d) Cross references.--See sections 134 (relating to
28docketing statement), 135 (relating to requirements to be met by
29filed documents) and 8514 (relating to execution of
30certificates).
1§ 8580. Effect of division.
2(a) Multiple resulting limited partnerships.--Upon the
3division becoming effective, the dividing limited partnership
4shall be subdivided into the distinct and independent resulting
5limited partnerships named in the plan of division, and, if the
6dividing limited partnership is not to survive the division, the
7existence of the dividing limited partnership shall cease. The
8resulting limited partnerships, if they are domestic limited
9partnerships, shall not thereby acquire authority to engage in
10any business or exercise any right that a limited partnership
11may not be organized under this chapter to engage in or
12exercise. Any resulting foreign limited partnership that is
13stated in the certificate of division to be a qualified foreign
14limited partnership shall be a qualified foreign limited
15partnership under Subchapter K (relating to foreign limited
16partnerships), and the certificate of division shall be deemed
17to be the application for registration as a foreign limited
18partnership of the limited partnership.
19(b) Property rights; allocations of assets and
20liabilities.--
21(1) (i) All the property, real, personal and mixed, of
22the dividing limited partnership, and all debts due on
23whatever account to it, including subscriptions for
24partnership interests or other causes of action belonging
25to it, shall, except as otherwise provided in paragraph
26(2), to the extent allocations of assets are contemplated
27by the plan of division, be deemed without further action
28to be allocated to and vested in the resulting limited
29partnerships on such a manner and basis and with such
30effect as is specified in the plan, or per capita among
1the resulting limited partnerships, as tenants in common,
2if no specification is made in the plan, and the title to
3any real estate or interest therein vested in any of the
4limited partnerships shall not revert or be in any way
5impaired by reason of the division.
6(ii) Upon the division becoming effective, the
7resulting limited partnerships shall each thenceforth be
8responsible as separate and distinct limited partnerships
9only for such liabilities as each limited partnership may
10undertake or incur in its own name but shall be liable
11for the liabilities of the dividing limited partnership
12in the manner and on the basis provided in subparagraphs
13(iv) and (v).
14(iii) Liens upon the property of the dividing
15limited partnership shall not be impaired by the
16division.
17(iv) To the extent allocations of liabilities are
18contemplated by the plan of division, the liabilities of
19the dividing limited partnership shall be deemed without
20further action to be allocated to and become the
21liabilities of the resulting limited partnerships on such
22a manner and basis and with such effect as is specified
23in the plan; and one or more but less than all of the
24resulting limited partnerships shall be free of the
25liabilities of the dividing limited partnership to the
26extent, if any, specified in the plan if in either case:
27(A) no fraud of partners or violation of law
28shall be effected thereby; and
29(B) the plan does not constitute a fraudulent
30transfer under 12 Pa.C.S. Ch. 51 (relating to
1fraudulent transfers).
2(v) If the conditions in subparagraph (iv) for
3freeing one or more of the resulting limited partnerships
4from the liabilities of the dividing limited partnership,
5or for allocating some or all of the liabilities of the
6dividing limited partnership, are not satisfied, the
7liabilities of the dividing limited partnership as to
8which those conditions are not satisfied shall not be
9affected by the division nor shall the rights of
10creditors thereunder or of any person dealing with the
11limited partnership be impaired by the division, and any
12claim existing or action or proceeding pending by or
13against the limited partnership with respect to those
14liabilities may be prosecuted to judgment as if the
15division had not taken place, or the resulting limited
16partnerships may be proceeded against or substituted in
17place of the dividing limited partnership as joint and
18several obligors on those liabilities, regardless of any
19provision of the plan of division apportioning the
20liabilities of the dividing limited partnership.
21(vi) The conditions in subparagraph (iv) for freeing
22one or more of the resulting limited partnerships from
23the liabilities of the dividing limited partnership and
24for allocating some or all of the liabilities of the
25dividing limited partnership shall be conclusively deemed
26to have been satisfied if the plan of division has been
27approved by the Pennsylvania Public Utility Commission in
28a final order issued after August 21, 2001, that has
29become not subject to further appeal.
30(2) (i) The allocation of any fee or freehold interest
1or leasehold having a remaining term of 30 years or more
2in any tract or parcel of real property situate in this
3Commonwealth owned by a dividing limited partnership
4(including property owned by a foreign limited
5partnership dividing solely under the law of another
6jurisdiction) to a new limited partnership resulting from
7the division shall not be effective until one of the
8following documents is filed in the office for the
9recording of deeds of the county, or each of them, in
10which the tract or parcel is situated:
11(A) A deed, lease or other instrument of
12confirmation describing the tract or parcel.
13(B) A duly executed duplicate original copy of
14the certificate of division.
15(C) A copy of the certificate of division
16certified by the Department of State.
17(D) A declaration of acquisition setting forth
18the value of real estate holdings in the county of
19the limited partnership as an acquired company.
20(ii) The provisions of 75 Pa.C.S. § 1114 (relating
21to transfer of vehicle by operation of law) shall not be
22applicable to an allocation of ownership of any motor
23vehicle, trailer or semitrailer to a new limited
24partnership under this section or under a similar law of
25any other jurisdiction, but any such allocation shall be
26effective only upon compliance with the requirements of
2775 Pa.C.S. § 1116 (relating to issuance of new
28certificate following transfer).
29(3) It shall not be necessary for a plan of division to
30list each individual asset or liability of the dividing
1limited partnership to be allocated to a new limited
2partnership so long as those assets and liabilities are
3described in a reasonable and customary manner.
4(4) Each new limited partnership shall hold any assets
5and liabilities allocated to it as the successor to the
6dividing limited partnership, and those assets and
7liabilities shall not be deemed to have been assigned to the
8new limited partnership in any manner, whether directly or
9indirectly or by operation of law.
10(c) Taxes.--Any taxes, interest, penalties and public
11accounts of the Commonwealth claimed against the dividing
12limited partnership that are settled, assessed or determined
13prior to or after the division shall be the liability of any of
14the resulting limited partnerships and, together with interest
15thereon, shall be a lien against the franchises and property,
16both real and personal, of all the limited partnerships. Upon
17the application of the dividing limited partnership, the
18Department of Revenue, with the concurrence of the Office of
19Employment Security of the Department of Labor and Industry,
20shall release one or more, but less than all, of the resulting
21limited partnerships from liability and liens for all taxes,
22interest, penalties and public accounts of the dividing limited
23partnership due the Commonwealth for periods prior to the
24effective date of the division if those departments are
25satisfied that the public revenues will be adequately secured.
26(d) Certificate of limited partnership of surviving limited
27partnership.--The certificate of limited partnership of the
28surviving limited partnership, if there be one, shall be deemed
29to be amended to the extent, if any, that changes in its
30certificate of limited partnership are stated in the plan of
1division.
2(e) Certificates of limited partnership of new limited
3partnerships.--The statements that are set forth in the plan of
4division with respect to each new domestic limited partnership
5and that are required or permitted to be set forth in a restated
6certificate of limited partnership of limited partnerships
7organized under this chapter, or the certificate of limited
8partnership of each new limited partnership set forth therein,
9shall be deemed to be the certificate of limited partnership of
10each new limited partnership.
11(f) Disposition of partnership interests.--Unless otherwise
12provided in the plan, the partnership interests and other
13securities or obligations, if any, of each new limited
14partnership resulting from the division shall be distributable
15to:
16(1) the surviving limited partnership if the dividing
17limited partnership survives the division; or
18(2) the partners of the dividing limited partnership in
19the proportions in which the partners share in distributions,
20in any other case.
21(g) Conflict of laws.--It is the intent of the General
22Assembly that:
23(1) The effect of a division of a domestic limited
24partnership shall be governed solely by the laws of this
25Commonwealth and any other jurisdiction under the laws of
26which any of the resulting limited partnerships is organized.
27(2) The effect of a division on the assets and
28liabilities of the dividing limited partnership shall be
29governed solely by the laws of this Commonwealth and any
30other jurisdiction under the laws of which any of the
1resulting limited partnerships is organized.
2(3) The validity of any allocations of assets or
3liabilities by a plan of division of a domestic limited
4partnership, regardless of whether or not any of the new
5limited partnerships is a foreign limited partnership, shall
6be governed solely by the laws of this Commonwealth.
7(4) In addition to the express provisions of this
8subsection, this subchapter shall otherwise generally be
9granted the protection of full faith and credit under the
10Constitution of the United States.
11SUBCHAPTER K
12FOREIGN LIMITED PARTNERSHIPS
13Sec.
148581. Governing law.
158582. Registration.
168583. Effect of filing.
178584. Name.
188585. Changes and amendments.
198586. Cancellation of registration.
208587. Doing business without registration.
218588. Action by Attorney General.
228589. General powers and duties of qualified foreign limited
23partnerships.
248590. Domestication.
25§ 8581. Governing law.
26Subject to the Constitution of Pennsylvania:
27(1) The laws of the jurisdiction under which a foreign
28limited partnership is organized govern its organization and
29internal affairs and the liability of its limited partners.
30(2) A foreign limited partnership may not be denied
1registration by reason of any difference between those laws
2and the laws of this Commonwealth.
3§ 8582. Registration.
4(a) General rule.--Before doing business in this
5Commonwealth, a foreign limited partnership shall register under
6this subchapter. In order to register, a foreign limited
7partnership shall execute and file in the Department of State an
8application for registration as a foreign limited partnership
9setting forth:
10(1) The name of the foreign limited partnership and, if
11different, the name under which it proposes to register and
12do business in this Commonwealth.
13(2) The jurisdiction and date of its formation.
14(3) Subject to section 109 (relating to name of
15commercial registered office provider in lieu of registered
16address), the address, including street and number, if any,
17of its registered office.
18(4) The address of the office required to be maintained
19in the jurisdiction of its organization by the laws of that
20jurisdiction or, if not so required, of the principal office
21of the foreign limited partnership.
22(5) The name and business address of each general
23partner.
24(6) The address of the office at which is kept a list of
25the names and addresses of the limited partners and their
26capital contributions, together with an undertaking by the
27foreign limited partnership to keep those records until the
28registration of the foreign limited partnership in this
29Commonwealth is canceled or withdrawn.
30(b) Exceptions.--None of the activities described in section
14122 (relating to excluded activities) shall be considered doing
2business in this Commonwealth for the purposes of this
3subchapter.
4(c) Cross references.--See sections 134 (relating to
5docketing statement) and 8514 (relating to execution of
6certificates).
7§ 8583. Effect of filing.
8Upon the filing of the application for registration as a
9foreign limited partnership, the partnership shall be authorized
10to do business in this Commonwealth.
11§ 8584. Name.
12(a) General rule.--A foreign limited partnership may
13register with the Department of State under any name (whether or
14not it is the name under which it is registered in its
15jurisdiction of organization) that could be used by a domestic
16limited partnership.
17(b) Cross reference.--See section 8505 (relating to name).
18§ 8585. Changes and amendments.
19(a) General rule.--If any arrangements or other facts
20described in the application for registration of a foreign
21limited partnership have changed, making the application
22inaccurate in any material respect, the foreign limited
23partnership shall promptly execute and file in the Department of
24State a certificate of amendment of registration setting forth:
25(1) The name under which the foreign limited partnership
26is registered to do business in this Commonwealth.
27(2) Subject to section 109 (relating to name of
28commercial registered office provider in lieu of registered
29address), the address, including street and number, if any,
30of its registered office in this Commonwealth.
1(3) The arrangements or other facts that have changed.
2(b) Effect of filing.--The application for registration as a
3foreign limited partnership shall be amended upon filing of the
4certificate of amendment of registration in the department.
5(c) Cross references.--See sections 134 (relating to
6docketing statement), 138 (relating to statement of correction)
7and 8514 (relating to execution of certificates).
8§ 8586. Cancellation of registration.
9(a) General rule.--A qualified foreign limited partnership
10may cancel its registration by executing and filing in the
11Department of State a certificate of cancellation of
12registration setting forth:
13(1) The name under which the foreign limited partnership
14is registered to do business in this Commonwealth.
15(2) Subject to section 109 (relating to name of
16commercial registered office provider in lieu of registered
17address), the address, including street and number, if any,
18of its last registered office in this Commonwealth.
19(3) The name of the jurisdiction under the laws of which
20it is organized.
21(4) The date on which it registered to do business in
22this Commonwealth.
23(5) A statement that it withdraws from doing business in
24this Commonwealth.
25(6) A statement that notice of its intention to withdraw
26from doing business in this Commonwealth was mailed by
27certified or registered mail to each municipal corporation in
28which the registered office or principal place of business of
29the foreign limited partnership in this Commonwealth is
30located.
1(7) The post office address, including street and
2number, if any, to which process may be sent in an action
3upon any liability incurred before the filing of the
4certificate of cancellation of registration.
5(b) Filing.--The certificate of cancellation of registration
6and the certificates or statement required by section 139
7(relating to tax clearance of certain fundamental transactions)
8shall be filed in the department.
9(c) Effect of filing.--Upon the filing of the certificate of
10cancellation of registration, the authority of the foreign
11limited partnership to do business in this Commonwealth shall
12cease. The termination of authority shall not affect any action
13pending at the time thereof or affect any right of action
14arising with respect to the foreign limited partnership before
15the filing of the certificate of cancellation of registration.
16Process against the foreign limited partnership in an action
17upon any liability incurred before the filing of the certificate
18of cancellation of registration may be served as provided in 42
19Pa.C.S. Ch. 53 (relating to bases of jurisdiction and interstate
20and international procedure) or as otherwise provided or
21prescribed by law.
22(d) Cross references.--See sections 134 (relating to
23docketing statement) and 8514 (relating to execution of
24certificates).
25§ 8587. Doing business without registration.
26(a) Maintenance of actions or proceedings prohibited.--A
27nonqualified foreign limited partnership doing business in this
28Commonwealth may not maintain any action or proceeding in any
29court of this Commonwealth until it has registered under this
30subchapter, nor, except as provided in subsection (b), shall any
1action or proceeding be maintained in any court of this
2Commonwealth on any right, claim or demand arising out of the
3doing of business by the foreign limited partnership in this
4Commonwealth by any successor, assignee or acquiror of all or
5substantially all of the assets of the foreign limited
6partnership that is a foreign corporation for profit or not-for-
7profit or a foreign limited partnership until such foreign
8corporation or foreign limited partnership has been authorized
9to do business in this Commonwealth.
10(b) Contracts, property and defense of actions unaffected.--
11The failure of a foreign limited partnership to register under
12this subchapter shall not impair the validity of any contract or
13act of the foreign limited partnership, shall not prevent the
14foreign limited partnership from defending any action in any
15court of this Commonwealth and shall not render escheatable any
16of its real or personal property.
17(c) Liability of limited partner.--A limited partner of a
18foreign limited partnership is not liable as a general partner
19of the foreign limited partnership solely by reason of the
20foreign limited partnership having done business in this
21Commonwealth without registration under this subchapter.
22(d) Acquisition of real and personal property.--Every
23nonqualified foreign limited partnership may acquire, hold,
24mortgage, lease and transfer real and personal property in this
25Commonwealth in the same manner and subject to the same
26limitations as a qualified foreign limited partnership.
27(e) Duties.--Except as provided in subsection (a), a
28nonqualified foreign limited partnership doing business in this
29Commonwealth shall be subject to the same liabilities,
30restrictions, duties and penalties now or hereafter imposed upon
1a qualified foreign limited partnership.
2§ 8588. Action by Attorney General.
3The Attorney General may bring an action to restrain a
4foreign limited partnership from doing business in this
5Commonwealth in violation of this subchapter.
6§ 8589. General powers and duties of qualified foreign limited
7partnerships.
8(a) General rule.--A qualified foreign limited partnership,
9so long as its registration under this subchapter is not
10canceled or revoked, shall enjoy the same rights and privileges
11as a domestic limited partnership, but no more, and, except as
12in this part otherwise provided, shall be subject to the same
13liabilities, restrictions, duties and penalties now in force or
14hereafter imposed upon domestic limited partnerships, to the
15same extent as if it had been formed under this chapter.
16(b) Agricultural lands.--Interests in agricultural land
17shall be subject to the restrictions of, and escheatable as
18provided by, the act of April 6, 1980 (P.L.102, No.39), referred
19to as the Agricultural Land Acquisition by Aliens Law.
20§ 8590. Domestication.
21(a) General rule.--Any qualified foreign limited partnership
22may become a domestic limited partnership by filing in the
23Department of State a certificate of domestication. The
24certificate of domestication, upon being filed in the
25department, shall constitute the certificate of limited
26partnership of the domesticated foreign limited partnership, and
27it shall thereafter continue as a limited partnership which
28shall be a domestic limited partnership subject to this chapter.
29(b) Certificate of domestication.--The certificate of
30domestication shall be executed by the limited partnership and
1shall set forth in the English language:
2(1) The name of the limited partnership. If the name is
3in a foreign language, it shall be set forth in Roman letters
4or characters or Arabic or Roman numerals. If the name is one
5that is rendered unavailable for use by any provision of
6section 8505 (relating to name), the limited partnership
7shall adopt, in accordance with any procedures for changing
8the name of the limited partnership that are applicable prior
9to the domestication of the limited partnership, and shall
10set forth in the certificate of domestication an available
11name.
12(2) Subject to section 109 (relating to name of
13commercial registered office provider in lieu of registered
14address), the address, including street and number, if any,
15of its registered office in this Commonwealth.
16(3) A statement that upon domestication the limited
17partnership will be subject to the domestic limited
18partnership provisions of the Pennsylvania Revised Uniform
19Limited Partnership Act and, if desired, a brief statement of
20the purpose or purposes for which it is to be domesticated,
21which shall be a purpose or purposes for which a domestic
22limited partnership may be organized under this chapter and
23which may consist of or include a statement that the limited
24partnership shall have unlimited power to engage in and to do
25any lawful act concerning any or all lawful business for
26which limited partnerships may be organized under the
27Pennsylvania Revised Uniform Limited Partnership Act.
28(4) Any desired provisions relating to the manner and
29basis of reclassifying the partnership interests in the
30limited partnership.
1(5) A statement that the filing of the certificate of
2domestication and, if desired, the renunciation of the
3original certificate of limited partnership of the limited
4partnership has been authorized (unless its certificate of
5limited partnership or other organic documents require a
6greater vote) by a majority of the votes cast by all partners
7entitled to vote thereon and, if any class of partners is
8entitled to vote thereon as a class, a majority of the votes
9cast in each class vote.
10(6) Any other provisions authorized by this chapter to
11be set forth in an original certificate of limited
12partnership.
13See sections 134 (relating to docketing statement), 135
14(relating to requirements to be met by filed documents) and 8514
15(relating to execution of certificates).
16(c) Effect of domestication.--
17(1) As a domestic limited partnership, the domesticated
18limited partnership shall no longer be a foreign limited
19partnership for the purposes of this chapter and shall
20instead be a domestic limited partnership with all the powers
21and privileges and all the duties and limitations granted and
22imposed upon domestic limited partnerships. In all other
23respects, the domesticated limited partnership shall be
24deemed to be the same limited partnership as it was prior to
25the domestication without any change in or effect on its
26existence. Without limiting the generality of the previous
27sentence, the domestication shall not be deemed to have
28dissolved the limited partnership or to have affected in any
29way:
30(i) the right and title of the limited partnership
1in and to its assets, property, franchises, estates and
2choses in action;
3(ii) the liability of the limited partnership for
4its debts, obligations, penalties and public accounts due
5the Commonwealth;
6(iii) any liens or other encumbrances on the
7property or assets of the limited partnership; or
8(iv) any contract, license or other agreement to
9which the limited partnership is a party or under which
10it has any rights or obligations.
11(2) The partnership interests in the domesticated
12limited partnership shall be unaffected by the domestication
13except to the extent, if any, reclassified in the certificate
14of domestication.]
15Section 54. The definitions of "certificate of
16organization," "foreign limited liability company" and
17"qualified foreign limited liability company" in section 8903(a)
18of Title 15 are amended to read:
19§ 8903. Definitions and index of definitions.
20(a) Definitions.--The following words and phrases when used
21in this chapter shall have the meanings given to them in this
22section unless the context clearly indicates otherwise:
23"Certificate of organization." The certificate of
24organization referred to in section 8913 (relating to
25certificate of organization) and the certificate of organization
26as amended. The term includes any other statements or
27certificates permitted or required to be filed in the Department
28of State by sections 108 (relating to change in location or
29status of registered office provided by agent) and 138 (relating
30to statement of correction), Chapter 3 (relating to entity
1transactions) or this part. If an amendment of the certificate
2of organization or a [certificate of merger or division made in
3the manner permitted by this chapter] statement filed under
4Chapter 3 restates the certificate of organization in its
5entirety [or if there is a certificate of consolidation or
6domestication], thenceforth the certificate of organization
7shall not include any prior documents, and any certificate
8issued by the Department of State with respect thereto shall so
9state.
10* * *
11"Foreign limited liability company." An association
12organized under the laws of any jurisdiction other than this
13Commonwealth, whether or not required to register under
14[Subchapter J (relating to foreign companies)] Chapter 4
15(relating to foreign associations), which would be a limited
16liability company if organized under the laws of this
17Commonwealth.
18* * *
19"Qualified foreign limited liability company." A foreign
20limited liability company that is registered under [Subchapter J
21(relating to foreign companies) to do business in this
22Commonwealth] Chapter 4 (relating to foreign associations).
23* * *
24Section 55. Sections 8905 and 8908 and Subchapters G and H
25of Chapter 89 and section 8978 and Subchapter J of Chapter 89 of
26Title 15 are repealed:
27[§ 8905. Name.
28(a) General rule.--The name of each limited liability
29company as set forth in its certificate of organization shall:
30(1) Be expressed in Roman letters or characters or
1Arabic or Roman numerals.
2(2) Not be one rendered unavailable for use by a
3corporation by any provision of section 1303(b) and (c)
4(relating to corporate name).
5(3) Contain the term "company," "limited" or "limited
6liability company" or an abbreviation of one of those terms.
7(b) Reservation of name.--The exclusive right to the use of
8a name for purposes of this chapter may be reserved and
9transferred in the manner provided by section 1305 (relating to
10reservation of corporate name).
11§ 8908. Election of professional association to become limited
12liability company.
13(a) General rule.--This chapter applies to every
14professional association subject to Chapter 93 (relating to
15professional associations) that elects to accept the provisions
16of this chapter in the manner set forth in subsection (b).
17(b) Procedure for election.--A professional association may
18elect to accept this chapter by filing in the Department of
19State a certificate of election of limited liability company
20status which shall be executed by all of the associates of the
21professional association and shall set forth:
22(1) The name of the professional association.
23(2) The name of the county in the office of the
24prothonotary of which the initial articles of association of
25the association were filed.
26(3) A statement that the associates of the professional
27association have elected to accept the provisions of this
28chapter for the government and regulation of the affairs of
29the association.
30(4) The provisions that shall constitute the initial
1certificate of organization of the limited liability company
2resulting from the filing, which may include such amendments
3to the articles of association of the professional
4association as the associates may choose to adopt.
5See sections 134 (relating to docketing statement) and 135
6(relating to requirements to be met by filed documents).
7(c) Date of organization.--This chapter shall become
8applicable to the professional association, and it shall be
9deemed organized as a limited liability company, on the date the
10certificate of election is filed in the department.
11SUBCHAPTER G
12MERGERS AND CONSOLIDATIONS
13Sec.
148956. Merger and consolidation of limited liability companies
15authorized.
168957. Approval of merger or consolidation.
178958. Certificate of merger or consolidation.
188959. Effect of merger or consolidation.
19§ 8956. Merger and consolidation of limited liability companies
20authorized.
21(a) Domestic surviving or new limited liability company.--
22Any two or more domestic limited liability companies, or any two
23or more foreign limited liability companies, or any one or more
24domestic limited liability companies and any one or more foreign
25limited liability companies, may, in the manner provided in this
26subchapter, be merged into one of the domestic limited liability
27companies designated in this subchapter as the surviving limited
28liability company, or consolidated into a new limited liability
29company to be formed under this chapter, if the foreign limited
30liability companies are authorized by the laws of the
1jurisdiction under which they are organized to effect a merger
2or consolidation with a limited liability company of another
3jurisdiction.
4(b) Foreign surviving or new limited liability company.--Any
5one or more domestic limited liability companies and any one or
6more foreign limited liability companies may, in the manner
7provided in this subchapter, be merged into one of the foreign
8limited liability companies designated in this subchapter as the
9surviving limited liability company, or consolidated into a new
10limited liability company to be organized under the laws of the
11jurisdiction under which one of the foreign limited liability
12companies is organized, if the laws of that jurisdiction
13authorize a merger with or consolidation into a limited
14liability company of another jurisdiction.
15(c) Business trusts and other associations.--The provisions
16of this subchapter applicable to domestic and foreign limited
17liability companies shall also be applicable to a merger or
18consolidation to which a domestic limited liability company is a
19party or in which such a company is the resulting entity with or
20into a domestic or foreign corporation, partnership, business
21trust or other association. The surviving or resulting entity in
22such a merger or consolidation may be a corporation,
23partnership, business trust or other association. Except as
24otherwise provided by law in this Commonwealth or any other
25jurisdiction, the powers and duties vested in and imposed upon
26the managers and members in this subchapter shall be exercised
27and performed by the group of persons under the direction of
28whom the business and affairs of the corporation, partnership,
29business trust or other association are managed and the holders
30or owners of shares or other interests in the corporation,
1partnership, business trust or other association, respectively,
2irrespective of the names by which the managing group and the
3holders or owners of shares or other interests are designated.
4The units into which the shares or other interests in the
5corporation, partnership, business trust or other association
6are divided shall be deemed to be membership interests for the
7purposes of applying the provisions of this subchapter to a
8merger or consolidation involving the corporation, partnership,
9business trust or other association.
10§ 8957. Approval of merger or consolidation.
11(a) Preparation of plan of merger or consolidation.--A plan
12of merger or consolidation, as the case may be, shall be
13prepared, setting forth:
14(1) The terms and conditions of the merger or
15consolidation.
16(2) If the surviving or new limited liability company is
17or is to be a domestic limited liability company:
18(i) in the case of a merger, any changes desired to
19be made in the certificate of organization or operating
20agreement, which may include a restatement of either or
21both; or
22(ii) in the case of a consolidation:
23(A) all of the statements required by this
24chapter to be set forth in a restated certificate of
25organization; and
26(B) the written provisions, if any, of the
27operating agreement.
28(3) The manner and basis of converting the membership
29interests of each company into membership interests,
30securities or obligations of the surviving or new company, as
1the case may be, and, if any of the membership interests of
2any of the companies that are parties to the merger or
3consolidation are not to be converted solely into membership
4interests, securities or obligations of the surviving or new
5company, the membership interests, securities or obligations
6of any other person or cash, property or rights that the
7holders of such membership interests are to receive in
8exchange for, or upon conversion of, such membership
9interests, and the surrender of any certificates evidencing
10them, which securities or obligations, if any, of any other
11person or cash, property or rights may be in addition to or
12in lieu of the membership interests, securities or
13obligations of the surviving or new company.
14(4) Such other provisions as are deemed desirable.
15(b) Reference to outside facts.--Any of the terms of the
16plan may be made dependent upon facts ascertainable outside of
17the plan if the manner in which the facts will operate upon the
18terms of the plan is set forth in the plan. Such facts may
19include, without limitation, actions or events within the
20control of or determinations made by a party to the plan or a
21representative of a party to the plan.
22(c) Post-adoption amendment of plan of merger or
23consolidation.--A plan of merger or consolidation may contain a
24provision that the managers, if any, of the constituent
25companies may amend the plan at any time prior to its effective
26date, except that an amendment made subsequent to any adoption
27of the plan by the members of any constituent domestic company
28shall not, without the approval of the members, change:
29(1) The amount or kind of membership interests,
30obligations, cash, property or rights to be received in
1exchange for or on conversion of all or any of the membership
2interests of the constituent domestic company adversely to
3the holders of those membership interests.
4(2) Any provision of the certificate of organization or
5operating agreement of the surviving or new company as it is
6to be in effect immediately following consummation of the
7merger or consolidation except provisions that may be amended
8without the approval of the members.
9(3) Any of the other terms and conditions of the plan if
10the change would adversely affect the holders of any
11membership interests of the constituent domestic company.
12(d) Proposal of merger or consolidation.--Every merger or
13consolidation shall be proposed, in the case of each domestic
14limited liability company that is managed by one or more
15managers, by the adoption by the managers of a resolution
16approving the plan of merger or consolidation and, in any other
17case, in accordance with any applicable procedures specified in
18the operating agreement. Except where the approval of the
19members is unnecessary under this subchapter or the operating
20agreement, the plan shall be submitted to a vote of the members
21entitled to vote thereon at a regular or special meeting of the
22members.
23(e) Party to plan.--An association that approves a plan in
24its capacity as a member or creditor of a merging or
25consolidating company or that furnishes all or a part of the
26consideration contemplated by a plan does not thereby become a
27party to the merger or consolidation for the purposes of this
28subchapter.
29(f) Notice of meeting of members.--Written notice of the
30meeting of members that will act on the proposed plan shall be
1given to each member of record, whether or not entitled to vote
2thereon, of each domestic limited liability company that is a
3party to the merger or consolidation. There shall be included in
4or enclosed with the notice a copy of the proposed plan or a
5summary thereof. The provisions of this subsection may not be
6relaxed by any provision of the certificate of organization or
7operating agreement.
8(g) Adoption of plan by members.--The plan of merger or
9consolidation shall be adopted upon receiving a majority of the
10votes cast by all members, if any, entitled to vote thereon of
11each of the domestic limited liability companies that is a party
12to the merger or consolidation and, if any class of members is
13entitled to vote thereon as a class, a majority of the votes
14cast in each class vote. A proposed plan of merger or
15consolidation shall not be deemed to have been adopted by a
16company that is managed by one or more managers unless it has
17also been approved by the managers, regardless of the fact that
18the managers have directed or suffered the submission of the
19plan to the members for action.
20(h) Adoption by managers.--
21(1) Unless otherwise required by a written provision of
22the operating agreement, a plan of merger or consolidation
23shall not require the approval of the members of a company
24that is managed by one or more managers if:
25(i) the plan, whether or not the company is the
26surviving company, does not alter the status of the
27company as a domestic limited liability company or alter
28in any respect the provisions of its certificate of
29organization or operating agreement, except changes that
30may be made without action by the members; and
1(ii) each membership interest outstanding
2immediately prior to the effective date of the merger or
3consolidation is to continue as or to be converted into,
4except as may be otherwise agreed by the holder thereof,
5an identical membership interest in the surviving or new
6company after the effective date of the merger or
7consolidation.
8(2) If a merger or consolidation is effected pursuant to
9paragraph (1), the plan of merger or consolidation shall be
10deemed adopted by the company when it has been adopted by the
11managers pursuant to subsection (d).
12(i) Termination of plan.--Prior to the time when a merger or
13consolidation becomes effective, the merger or consolidation may
14be terminated pursuant to provisions therefor, if any, set forth
15in the plan. If a certificate of merger or consolidation has
16been filed in the department prior to the termination, a
17certificate of termination executed by each company that is a
18party to the merger or consolidation, unless the plan permits
19termination by less than all of the companies, in which case the
20certificate shall be executed on behalf of the company
21exercising the right to terminate, shall be filed in the
22department. The certificate of termination shall set forth:
23(1) A copy of the certificate of merger or consolidation
24relating to the plan that is terminated.
25(2) A statement that the plan has been terminated in
26accordance with the provisions therefor set forth therein.
27See sections 134 (relating to docketing statement), 135
28(relating to requirements to be met by filed documents), 138
29(relating to statement of correction) and 8907 (relating to
30execution of documents).
1(j) Authorization by foreign limited liability companies.--
2The plan of merger or consolidation shall be authorized, adopted
3or approved by each foreign limited liability company that
4desires to merge or consolidate in accordance with the laws of
5the jurisdiction in which it is organized.
6§ 8958. Certificate of merger or consolidation.
7(a) General rule.--Upon the adoption of the plan of merger
8or consolidation by the limited liability companies desiring to
9merge or consolidate, as provided in this subchapter, a
10certificate of merger or a certificate of consolidation, as the
11case may be, shall be executed by each company and shall,
12subject to section 109 (relating to name of commercial
13registered office provider in lieu of registered address), set
14forth:
15(1) The name and the location of the registered office,
16including street and number, if any, of the domestic
17surviving or new limited liability company or, in the case of
18a foreign surviving or new limited liability company, the
19name of the company and its jurisdiction of organization,
20together with either of the following:
21(i) If a qualified foreign limited liability
22company, the address, including street and number, if
23any, of its registered office in this Commonwealth.
24(ii) If a nonqualified foreign limited liability
25company, the address, including street and number, if
26any, of its principal office under the laws of the
27jurisdiction in which it is organized.
28(2) The name and address, including street and number,
29if any, of the registered office of each other domestic
30limited liability company and qualified foreign limited
1liability company that is a party to the merger or
2consolidation.
3(3) If the plan is to be effective on a specified date,
4the hour, if any, and the month, day and year of the
5effective date.
6(4) The manner in which the plan was adopted by each
7domestic limited liability company and, if one or more
8foreign limited liability companies are parties to the merger
9or consolidation, the fact that the plan was authorized,
10adopted or approved, as the case may be, by each of the
11foreign limited liability companies in accordance with the
12laws of the jurisdiction in which it is organized.
13(5) Except as provided in subsection (b), the plan of
14merger or consolidation.
15(b) Omission of certain provisions of plan of merger or
16consolidation.--A certificate of merger or consolidation may
17omit all provisions of the plan of merger or consolidation
18except provisions, if any, that are intended to amend or
19constitute the operative provisions of the certificate of
20organization of a company as in effect subsequent to the
21effective date of the plan, if the certificate of merger or
22consolidation states that the full text of the plan is on file
23at the principal place of business of the surviving or new
24company and states the address thereof. A company that takes
25advantage of this subsection shall furnish a copy of the full
26text of the plan, on request and without cost, to any member of
27any company that was a party to the plan and, unless all parties
28to the plan had fewer than 30 members each, on request and at
29cost to any other person.
30(c) Filing of certificate of merger or consolidation.--The
1certificate of merger or certificate of consolidation, as the
2case may be, and the certificates or statement, if any, required
3by section 139 (relating to tax clearance of certain fundamental
4transactions) shall be filed in the department.
5(d) Effective date of merger or consolidation.--Upon the
6filing of the certificate of merger or the certificate of
7consolidation in the Department of State or upon the effective
8date specified in the plan of merger or consolidation, whichever
9is later, the merger or consolidation shall be effective. The
10merger or consolidation of one or more domestic limited
11liability companies into a foreign limited liability company
12shall be effective according to the provisions of law of the
13jurisdiction in which the foreign limited liability company is
14organized, but not until a certificate of merger or certificate
15of consolidation has been adopted and filed, as provided in this
16subchapter.
17(e) Cross references.--See sections 134 (relating to
18docketing statement), 135 (relating to requirements to be met by
19filed documents) and 8907 (relating to execution of documents).
20§ 8959. Effect of merger or consolidation.
21(a) Single surviving or new limited liability company.--Upon
22the merger or consolidation becoming effective, the several
23limited liability companies parties to the merger or
24consolidation shall be a single company which, in the case of a
25merger, shall be the company designated in the plan of merger as
26the surviving company and, in the case of a consolidation, shall
27be the new company provided for in the plan of consolidation.
28The separate existence of all companies parties to the merger or
29consolidation shall cease, except that of the surviving company,
30in the case of a merger.
1(b) Property rights.--All the property, real, personal and
2mixed, of each of the companies parties to the merger or
3consolidation and all debts due on whatever account to any of
4them, as well as all other things and causes of action belonging
5to any of them, shall be deemed to be vested in and shall belong
6to the surviving or new company, as the case may be, without
7further action, and the title to any real estate or any interest
8therein vested in any of the companies shall not revert or be in
9any way impaired by reason of the merger or consolidation. The
10surviving or new company shall thenceforth be responsible for
11all the liabilities of each of the companies so merged or
12consolidated. Liens upon the property of the merging or
13consolidating companies shall not be impaired by the merger or
14consolidation, and any claim existing or action or proceeding
15pending by or against any of the companies may be prosecuted to
16judgment as if the merger or consolidation had not taken place
17or the surviving or new company may be proceeded against or
18substituted in its place.
19(c) Taxes.--Any taxes, interest, penalties and public
20accounts of the Commonwealth claimed against any of the merging
21or consolidating companies that are settled, assessed or
22determined prior to or after the merger or consolidation shall
23be the liability of the surviving or new company and, together
24with interest thereon, shall be a lien against the property,
25both real and personal, of the surviving or new company.
26(d) Certificate of organization.--In the case of a merger,
27the certificate of organization of the surviving domestic
28limited liability company, if any, shall be deemed to be amended
29to the extent, if any, that changes in its certificate of
30organization are stated in the plan of merger. In the case of a
1consolidation into a domestic limited liability company, the
2statements that are set forth in the plan of consolidation or
3certificate of organization set forth therein shall be deemed to
4be the certificate of organization of the new limited liability
5company.
6SUBCHAPTER H
7DIVISION
8Sec.
98961. Division authorized.
108962. Proposal and adoption of plan of division.
118963. Division without member approval.
128964. Certificate of division.
138965. Effect of division.
14§ 8961. Division authorized.
15(a) Division of domestic company.--Any domestic limited
16liability company may, in the manner provided in this
17subchapter, be divided into two or more domestic limited
18liability companies organized or to be organized under this
19chapter, or into one or more domestic limited liability
20companies and one or more foreign limited liability companies to
21be organized under the laws of another jurisdiction or
22jurisdictions, or into two or more foreign limited liability
23companies, if the laws of the other jurisdictions authorize the
24division.
25(b) Division of foreign company.--Any foreign limited
26liability company may, in the manner provided in this
27subchapter, be divided into one or more domestic limited
28liability companies to be organized under this chapter and one
29or more foreign limited liability companies organized or to be
30organized under the laws of another jurisdiction or
1jurisdictions, or into two or more domestic limited liability
2companies, if the foreign limited liability company is
3authorized under the laws of the jurisdiction under which it is
4incorporated to effect a division.
5(c) Surviving and new companies.--The company effecting a
6division, if it survives the division, is designated in this
7subchapter as the surviving company. All companies originally
8organized by a division are designated in this subchapter as new
9companies. The surviving company, if any, and the new company or
10companies are collectively designated in this subchapter as the
11resulting companies.
12§ 8962. Proposal and adoption of plan of division.
13(a) Preparation of plan.--A plan of division shall be
14prepared, setting forth:
15(1) The terms and conditions of the division, including
16the manner and basis of:
17(i) The reclassification of the membership interests
18of the surviving company, if there be one, and, if any of
19the membership interests of the dividing company are not
20to be converted solely into membership interests or other
21securities or obligations of one or more of the resulting
22companies, the membership interests or other securities
23or obligations of any other person or cash, property or
24rights that the holders of such membership interests are
25to receive in exchange for or upon conversion of such
26membership interests, and the surrender of any
27certificates evidencing them, which securities or
28obligations, if any, of any other person or cash,
29property or rights may be in addition to or in lieu of
30membership interests or other securities or obligations
1of one or more of the resulting companies.
2(ii) The disposition of the membership interests and
3other securities or obligations, if any, of the new
4company or companies resulting from the division.
5(2) A statement that the dividing company will or will
6not survive the division.
7(3) Any changes desired to be made in the certificate of
8organization of the surviving company, if there be one,
9including a restatement of the certificate.
10(4) The certificates of organization required by
11subsection (c).
12(5) Such other provisions as are deemed desirable.
13(b) Reference to outside facts.--Any of the terms of the
14plan may be made dependent upon facts ascertainable outside of
15the plan if the manner in which the facts will operate upon the
16terms of the plan is set forth in the plan. Such facts may
17include, without limitation, actions or events within the
18control of or determinations made by the dividing limited
19liability company or a representative of the dividing limited
20liability company.
21(c) Certificates of organization of new companies.--There
22shall be included in or annexed to the plan of division:
23(1) Certificates of organization, which shall contain
24all of the statements required by this chapter to be set
25forth in a restated certificate, for each of the new domestic
26limited liability companies, if any, resulting from the
27division.
28(2) Certificates of organization or other organizational
29documents for each of the new foreign limited liability
30companies, if any, resulting from the division.
1(d) Proposal and adoption.--Except as otherwise provided in
2section 8963 (relating to division without member approval), the
3plan of division shall be proposed and adopted and may be
4amended after its adoption and terminated by a domestic limited
5liability company in the manner provided for the proposal,
6adoption, amendment and termination of a plan of merger in
7Subchapter G (relating to mergers and consolidations) or, if the
8dividing company is a foreign limited liability company, in
9accordance with the laws of the jurisdiction in which it is
10organized.
11§ 8963. Division without member approval.
12Unless otherwise required by a written provision of the
13operating agreement, a plan of division that does not alter the
14state of organization of a limited liability company that is
15managed by one or more managers nor amend in any respect the
16provisions of its certificate of organization or operating
17agreement (except amendments which may be made without action by
18the members) shall not require the approval of the members of
19the company if:
20(1) the dividing company has only one class of
21membership interests outstanding and the membership interests
22and other securities, if any, of each company resulting from
23the plan are distributed pro rata to the members of the
24dividing company;
25(2) the dividing company survives the division and all
26the membership interests and other securities and
27obligations, if any, of all new companies resulting from the
28plan are owned solely by the surviving company; or
29(3) the transfers of assets effected by the division, if
30effected by means of a sale, lease, exchange or other
1disposition, would not require the approval of the members.
2§ 8964. Certificate of division.
3(a) Contents.--Upon the adoption of a plan of division by
4the limited liability company desiring to divide, as provided in
5this subchapter, a certificate of division shall be executed by
6the company and shall, subject to section 109 (relating to name
7of commercial registered office provider in lieu of registered
8address), set forth:
9(1) The name and the location of the registered office,
10including street and number, if any, of the dividing domestic
11limited liability company or, in the case of a dividing
12foreign limited liability company, the name of the company
13and the jurisdiction in which it is organized, together with
14either:
15(i) If a qualified foreign limited liability
16company, the address, including street and number, if
17any, of its registered office in this Commonwealth.
18(ii) If a nonqualified foreign limited liability
19company, the address, including street and number, if
20any, of its principal office under the laws of that
21jurisdiction.
22(2) The statute under which the dividing company was
23organized and the date of organization.
24(3) A statement that the dividing company will or will
25not survive the division.
26(4) The name and address, including street and number,
27if any, of the registered office of each new domestic limited
28liability company or qualified foreign limited liability
29company resulting from the division.
30(5) If the plan is to be effective on a specific date,
1the hour, if any, and the month, day and year of the
2effective date.
3(6) The manner in which the plan was adopted by the
4company.
5(7) The plan of division.
6(b) Filing.--The certificate of division and the
7certificates or statement, if any, required by section 139
8(relating to tax clearance of certain fundamental transactions)
9shall be filed in the Department of State.
10(c) Effective date of division.--Upon the filing of the
11certificate of division in the Department of State or upon the
12effective date specified in the plan of division, whichever is
13later, the division shall become effective. The division of a
14domestic limited liability company into one or more foreign
15limited liability companies or the division of a foreign limited
16liability company shall be effective according to the laws of
17the jurisdictions where the foreign companies are or are to be
18organized but not until a certificate of division has been
19adopted and filed as provided in this subchapter.
20(d) Cross references.--See sections 134 (relating to
21docketing statement), 135 (relating to requirements to be met by
22filed documents) and 8907 (relating to execution of documents).
23§ 8965. Effect of division.
24(a) Multiple resulting companies.--Upon the division
25becoming effective, the dividing company shall be subdivided
26into the distinct and independent resulting companies named in
27the plan of division, and, if the dividing company is not to
28survive the division, the existence of the dividing company
29shall cease. The resulting companies, if they are domestic
30limited liability companies, shall not thereby acquire authority
1to engage in any business or exercise any right that a company
2may not be organized under this chapter to engage in or
3exercise. Any resulting foreign limited liability company that
4is stated in the certificate of division to be a qualified
5foreign limited liability company shall be a qualified foreign
6limited liability company under Subchapter J (relating to
7foreign companies), and the certificate of division shall be
8deemed to be the application for registration of a foreign
9limited liability company of the limited liability company.
10(b) Property rights; allocations of assets and
11liabilities.--
12(1) (i) All the property, real, personal and mixed, of
13the dividing company and all debts due on whatever
14account to it, including subscriptions for membership
15interests and other causes of action belonging to it,
16shall, except as otherwise provided in paragraph (2), to
17the extent allocations of assets are contemplated by the
18plan of division, be deemed without further action to be
19allocated to and vested in the resulting companies on
20such a manner and basis and with such effect as is
21specified in the plan, or per capita among the resulting
22companies as tenants in common if no specification is
23made in the plan, and the title to any real estate or
24interest therein vested in any of the companies shall not
25revert or be in any way impaired by reason of the
26division.
27(ii) Upon the division becoming effective, the
28resulting companies shall each thenceforth be responsible
29as separate and distinct companies only for such
30liabilities as each company may undertake or incur in its
1own name but shall be liable for the liabilities of the
2dividing company in the manner and on the basis provided
3in subparagraphs (iv) and (v).
4(iii) Liens upon the property of the dividing
5company shall not be impaired by the division.
6(iv) To the extent allocations of liabilities are
7contemplated by the plan of division, the liabilities of
8the dividing company shall be deemed without further
9action to be allocated to and become the liabilities of
10the resulting companies on such a manner and basis and
11with such effect as is specified in the plan; and one or
12more, but less than all, of the resulting companies shall
13be free of the liabilities of the dividing company to the
14extent, if any, specified in the plan if in either case:
15(A) no fraud on members or violation of law
16shall be effected thereby; and
17(B) the plan does not constitute a fraudulent
18transfer under 12 Pa.C.S. Ch. 51 (relating to
19fraudulent transfers).
20(v) If the conditions in subparagraph (iv) for
21freeing one or more of the resulting companies from the
22liabilities of the dividing company, or for allocating
23some or all of the liabilities of the dividing company,
24are not satisfied, the liabilities of the dividing
25company as to which those conditions are not satisfied
26shall not be affected by the division nor shall the
27rights of creditors thereunder or of any person dealing
28with the company be impaired by the division, and any
29claim existing or action or proceeding pending by or
30against the company with respect to those liabilities may
1be prosecuted to judgment as if the division had not
2taken place, or the resulting companies may be proceeded
3against or substituted in place of the dividing company
4as joint and several obligors on those liabilities,
5regardless of any provision of the plan of division
6apportioning the liabilities of the dividing company.
7(vi) The conditions in subparagraph (iv) for freeing
8one or more of the resulting companies from the
9liabilities of the dividing company and for allocating
10some or all of the liabilities of the dividing company
11shall be conclusively deemed to have been satisfied if
12the plan of division has been approved by the
13Pennsylvania Public Utility Commission in a final order
14issued after August 21, 2001, that has become not subject
15to further appeal.
16(2) (i) The allocation of any fee or freehold interest
17or leasehold having a remaining term of 30 years or more
18in any tract or parcel of real property situate in this
19Commonwealth owned by a dividing company (including
20property owned by a foreign limited liability company
21dividing solely under the law of another jurisdiction) to
22a new company resulting from the division shall not be
23effective until one of the following documents is filed
24in the office for the recording of deeds of the county,
25or each of them, in which the tract or parcel is
26situated:
27(A) A deed, lease or other instrument of
28confirmation describing the tract or parcel.
29(B) A duly executed duplicate original copy of
30the certificate of division.
1(C) A copy of the certificate of division
2certified by the Department of State.
3(D) A declaration of acquisition setting forth
4the value of real estate holdings in such county of
5the company as an acquired company.
6(ii) The provisions of 75 Pa.C.S. § 1114 (relating
7to transfer of vehicle by operation of law) shall not be
8applicable to an allocation of ownership of any motor
9vehicle, trailer or semitrailer to a new company under
10this section or under a similar law of any other
11jurisdiction but any such allocation shall be effective
12only upon compliance with the requirements of 75 Pa.C.S.
13§ 1116 (relating to issuance of new certificate following
14transfer).
15(3) It shall not be necessary for a plan of division to
16list each individual asset or liability of the dividing
17company to be allocated to a new company so long as those
18assets and liabilities are described in a reasonable and
19customary manner.
20(4) Each new company shall hold any assets and
21liabilities allocated to it as the successor to the dividing
22company, and those assets and liabilities shall not be deemed
23to have been assigned to the new company in any manner,
24whether directly or indirectly or by operation of law.
25(c) Taxes.--Any taxes, interest, penalties and public
26accounts of the Commonwealth claimed against the dividing
27company that are settled, assessed or determined prior to or
28after the division shall be the liability of any of the
29resulting companies and, together with interest thereon, shall
30be a lien against the franchises and property, both real and
1personal, of all the companies. Upon the application of the
2dividing company, the Department of Revenue, with the
3concurrence of the Office of Employment Security of the
4Department of Labor and Industry, shall release one or more, but
5less than all, of the resulting companies from liability and
6liens for all taxes, interest, penalties and public accounts of
7the dividing company due the Commonwealth for periods prior to
8the effective date of the division if those departments are
9satisfied that the public revenues will be adequately secured.
10(d) Certificate of organization of surviving company.--The
11certificate of organization of the surviving company, if there
12be one, shall be deemed to be amended to the extent, if any,
13that changes in its certificate are stated in the plan of
14division.
15(e) Certificates of organization of new companies.--The
16statements that are set forth in the plan of division with
17respect to each new domestic limited liability company and that
18are required or permitted to be set forth in a restated
19certificate of organization of companies organized under this
20chapter or the certificate of organization of each new company
21set forth therein shall be deemed to be the certificate of
22organization of each new company.
23(f) Managers.--Unless otherwise provided in the plan, the
24managers, if any, of the dividing limited liability company
25shall be the initial managers of each of the resulting
26companies.
27(g) Disposition of membership interests.--Unless otherwise
28provided in the plan, the membership interests and other
29securities or obligations, if any, of each new company resulting
30from the division shall be distributable to:
1(1) the surviving company if the dividing company
2survives the division; or
3(2) the members of the dividing company in the
4proportions in which the members share in distributions, in
5any other case.
6(h) Conflict of laws.--It is the intent of the General
7Assembly that:
8(1) The effect of a division of a domestic limited
9liability company shall be governed by the laws of this
10Commonwealth and any other jurisdiction under the laws of
11which any of the resulting companies is organized.
12(2) The effect of a division on the assets and
13liabilities of the dividing company shall be governed solely
14by the laws of this Commonwealth and any other jurisdiction
15under the laws of which any of the resulting companies is
16organized.
17(3) The validity of any allocation of assets or
18liabilities by a plan of division of a domestic limited
19liability company, regardless of whether or not any of the
20new companies is a foreign limited liability company, shall
21be governed solely by the laws of this Commonwealth.
22(4) In addition to the express provisions of this
23subsection, this subchapter shall otherwise generally be
24granted the protection of full faith and credit under the
25Constitution of the United States.
26§ 8978. Dissolution by domestication.
27Whenever a domestic limited liability company has
28domesticated itself under the laws of another jurisdiction by
29action similar to that provided by section 8982 (relating to
30domestication) and has authorized that action by the vote
1required by this subchapter for the approval of a proposal that
2the company dissolve voluntarily, the company may surrender its
3certificate of organization under the laws of this Commonwealth
4by filing in the Department of State a certificate of
5dissolution under section 8975 (relating to certificate of
6dissolution). In lieu of the statements required by section
78975(a)(2) through (4), the certificate of dissolution shall set
8forth a statement that the company has domesticated itself under
9the laws of another jurisdiction. If the company, as
10domesticated in the other jurisdiction, registers to do business
11in this Commonwealth either prior to or simultaneously with the
12filing of the certificate of dissolution under this section, the
13company shall not be required to file with the certificate of
14dissolution the tax clearance certificates that would otherwise
15be required by section 139 (relating to tax clearance of certain
16fundamental transactions).
17SUBCHAPTER J
18FOREIGN COMPANIES
19Sec.
208981. Foreign limited liability companies.
218982. Domestication.
22§ 8981. Foreign limited liability companies.
23(a) General rule.--A foreign limited liability company shall
24be subject to Subchapter K of Chapter 85 (relating to foreign
25limited partnerships) as if it were a foreign limited
26partnership, except that:
27(1) Section 8582(a)(5) and (6) (relating to
28registration) shall not be applicable to the application for
29registration of a foreign limited liability company.
30(2) If the foreign limited liability company is to be a
1qualified foreign restricted professional company, its
2application for registration shall so state and shall also
3contain a brief description of the professional service or
4services to be rendered by the company.
5(3) A qualified foreign limited liability company shall
6enjoy the same rights and privileges as a domestic limited
7liability company, but no more, and, except as otherwise
8provided by law, shall be subject to the same liabilities,
9restrictions, duties and penalties now in force or hereafter
10imposed upon domestic limited liability companies to the same
11extent as if it had been organized under this chapter.
12(b) Provision applicable to all foreign limited liability
13companies.--Section 8926 (relating to certain specifically
14authorized debt terms) shall be applicable to any obligation, as
15defined in section 1510 (relating to certain specifically
16authorized debt terms), of a foreign limited liability company
17executed or effected in this Commonwealth or affecting real
18property situated in this Commonwealth.
19§ 8982. Domestication.
20(a) General rule.--Any qualified foreign limited liability
21company may become a domestic limited liability company by
22filing in the Department of State a certificate of
23domestication. The certificate of domestication, upon being
24filed in the department, shall constitute the certificate of
25organization of the domesticated company, and it shall
26thereafter continue as a limited liability company which shall
27be a domestic limited liability company subject to this chapter.
28(b) Certificate of domestication.--The certificate of
29domestication shall be executed by the company and shall set
30forth in the English language:
1(1) The name of the company. If the name is in a foreign
2language, it shall be set forth in Roman letters or
3characters or Arabic or Roman numerals. If the name is one
4that is rendered unavailable for use by any provision of
5section 8905 (relating to name), the company shall adopt, in
6accordance with any procedures for changing the name of the
7company that are applicable prior to the domestication of the
8company, and shall set forth in the certificate of
9domestication an available name.
10(2) Subject to section 109 (relating to name of
11commercial registered office provider in lieu of registered
12address), the address, including street and number, if any,
13of its registered office in this Commonwealth.
14(3) A statement that upon domestication the company will
15be subject to the domestic limited liability company
16provisions of the Limited Liability Company Law of 1994 and,
17if desired, a brief statement of the purpose or purposes for
18which it is to be domesticated which shall be a purpose or
19purposes for which a domestic limited liability company may
20be organized under this chapter and which may consist of or
21include a statement that the company shall have unlimited
22power to engage in and to do any lawful act concerning any or
23all lawful business for which companies may be organized
24under the Limited Liability Company Law of 1994.
25(4) Any desired provisions relating to the manner and
26basis of reclassifying the membership interests of the
27company.
28(5) A statement that the filing of the certificate of
29domestication and, if desired, the renunciation of the
30original certificate of organization of the company has been
1authorized, unless its certificate of organization or other
2organic documents require a greater vote, by a majority of
3the votes cast by all members entitled to vote thereon and,
4if any class of members is entitled to vote thereon as a
5class, a majority of the votes cast in each class vote.
6(6) Any other provisions authorized or required by this
7chapter to be set forth in an original certificate of
8organization.
9See sections 134 (relating to docketing statement), 135
10(relating to requirements to be met by filed documents) and 8907
11(relating to execution of documents).
12(c) Effect of domestication.--
13(1) As a domestic limited liability company, the
14domesticated company shall no longer be a foreign limited
15liability company for the purposes of this chapter and shall
16instead be a domestic limited liability company with all the
17powers and privileges and all the duties and limitations
18granted and imposed upon domestic limited liability
19companies. In all other respects, the domesticated limited
20liability company shall be deemed to be the same limited
21liability company as it was prior to the domestication
22without any change in or effect on its existence. Without
23limiting the generality of the previous sentence, the
24domestication shall not be deemed to have dissolved the
25company or to have affected in any way:
26(i) the right and title of the company in and to its
27assets, property, franchises, estates and choses in
28action;
29(ii) the liability of the company for its debts,
30obligations, penalties and public accounts due the
1Commonwealth;
2(iii) any liens or other encumbrances on the
3property or assets of the company; or
4(iv) any contract, license or other agreement to
5which the company is a party or under which it has any
6rights or obligations.
7(2) The membership interests in the domesticated company
8shall be unaffected by the domestication except to the
9extent, if any, reclassified in the certificate of
10domestication.]
11Section 56. The definition of "transfer" in section 9112 of
12Title 15 is amended to read:
13§ 9112. Definitions.
14The following words and phrases when used in this chapter
15shall have the meanings given to them in this section unless the
16context clearly indicates otherwise:
17* * *
18["Transfer." Includes:
19(1) an assignment;
20(2) a conveyance;
21(3) a sale;
22(4) a lease;
23(5) an encumbrance, including a mortgage or security
24interest;
25(6) a gift; and
26(7) a transfer by operation of law.]
27Section 57. Sections 9302(3), 9502(a) introductory
28paragraph, 9503(b) and 9507(a) of Title 15 are amended to read:
29§ 9302. Application of chapter.
30This chapter shall apply to and the word "association" in
1this chapter shall mean a professional association organized
2under the act of August 7, 1961 (P.L.941, No.416), known as the
3Professional Association Act, which has not:
4* * *
5(3) [Elected to become a limited liability company in
6the manner provided by section 8908 (relating to election of
7professional association to become limited liability
8company).] Converted to a limited liability company under
9Subchapter E of Chapter 3 (relating to conversion).
10* * *
11§ 9502. Creation, status and termination of business trusts.
12(a) Creation.--[A business trust may be created in real or
13personal property, or both, with power in] Except as provided in
14the instrument, the trustee has the power:
15* * *
16§ 9503. Documentation of trust.
17* * *
18(b) Definition of "instrument".--The term "instrument," as
19used in this chapter, shall mean the original deed of trust or
20other written instrument, all amendments thereof and any other
21statements or certificates permitted or required to be filed in
22the department by sections 108 (relating to change in location
23or status of registered office provided by agent) and 138
24(relating to statement of correction), Chapter 3 (relating to
25entity transactions) or this chapter. If an amendment of the
26instrument or [articles of merger made in the manner permitted
27by section 1921(c) (relating to business trusts and other
28associations) or a certificate of merger made in the manner
29permitted by section 8545(c) (relating to business trusts and
30other associations)] a statement filed under Chapter 3 restates
1an instrument in its entirety, thenceforth the "instrument"
2shall not include any prior documents, and any certificate
3issued by the department with respect thereto shall so state.
4* * *
5§ 9507. Foreign business trusts.
6[(a) General rule.--A business trust organized under any
7laws other than those of this Commonwealth shall be subject to
8Subchapters B (relating to qualification) and C (relating to
9powers, duties and liabilities) of Chapter 41, as if it were a
10foreign business corporation, except that a qualified foreign
11business trust shall enjoy the same rights and privileges as a
12domestic business trust, but no more, and, except as otherwise
13provided by law, shall be subject to the same liabilities,
14restrictions, duties and penalties now in force or hereafter
15imposed upon domestic business trusts, to the same extent as if
16it were a domestic business trust.]
17* * *
18Section 58. Section 302 of Title 54 is amended to read:
19§ 302. Definitions.
20(a) Definitions.--The following words and phrases when used
21in this chapter shall have, unless the context clearly indicates
22otherwise, the meanings given to them in this section:
23"Business." Any commercial or professional activity.
24"Entity." Any individual or any corporation, association,
25partnership, joint-stock company, business trust, syndicate,
26joint adventureship or other combination or group of persons,
27regardless of whether it is organized or formed under the laws
28of this Commonwealth or any other jurisdiction.
29"Fictitious name." Any assumed or fictitious name, style or
30designation other than the proper name of the entity using such
1name. The term includes a name assumed by a general partnership,
2syndicate, joint adventureship or similar combination or group
3of persons.
4"Proper name." When used with respect to an association of a
5type listed in the following paragraphs, the term means the name
6set forth in:
7(1) the [articles of incorporation, for a corporation;]
8public organic record, for a domestic filing association;
9(2) the statement of registration, for a limited
10liability partnership;
11[(3) the certificate of limited partnership, for a
12limited partnership;]
13(4) the statement of election, for an electing
14partnership;
15[(5) the certificate of organization, for a limited
16liability company;
17(6) the articles of association, for a professional
18association;
19(7) the deed of trust or other trust instrument, if any,
20that has been filed in the Department of State for a business
21trust; or
22(8) a publicly filed document in another jurisdiction
23which is of a type listed in paragraphs (1) through (7).]
24(9) the statement of registration of a foreign
25registered association under 15 Pa.C.S. § 412(a)(1)(i)
26(relating to foreign registration statement), or if that name
27does not comply with 15 Pa.C.S. § 202 (relating to
28requirements for names generally), the name set forth in the
29statement under 15 Pa.C.S. § 412 (a)(1)(ii).
30(b) Other defined terms.--The definitions in 15 Pa.C.S. §
1102 (relating to definitions) apply to this title except to the
2extent they are inconsistent with the provisions of this title.
3Section 59. Section 303 of Title 54 is amended by adding a
4subsection to read:
5§ 303. Scope of chapter.
6* * *
7(d) Effect of registration.--The registration of a name
8under this chapter does not render the name unavailable for use
9by another entity.
10Section 60. Sections 311(e)(1) and (4), 501(a)(3), (4), (5),
11(6) and (8) and (b), 502(a)(2) introductory paragraph and 503(b)
12(1)(ii) and (c) of Title 54 are amended to read:
13§ 311. Registration.
14* * *
15(e) Duplicate use of names.--The fictitious name shall be
16distinguishable upon the records of the department from:
17(1) The name of any domestic [corporation, or any]
18filing entity, domestic limited liability limited
19partnership, domestic electing partnership, registered
20foreign [corporation authorized to do business in this
21Commonwealth,] association or the name of any corporation or
22other association registered at any time under Chapter 5
23(relating to corporate and other association names) unless
24such name is available or is made available for use under the
25provisions or procedures of 15 Pa.C.S. § [5303(b)(1)(i) or
26(ii) (relating to duplicate use of names) or the equivalent.]
27202(b)(1) (relating to requirements for names generally).
28* * *
29(4) A name the exclusive right to which is at the time
30reserved or registered by any other person [whatsoever in the
1manner provided by] under 15 Pa.C.S. § 208 (relating to
2reservation of name) or 209 (relating to registration of name
3of nonregistered foreign association) or another statute.
4* * *
5§ 501. Register established.
6(a) General rule.--A register is established by this chapter
7which shall consist of such of the following names as are not
8deleted therefrom by operation of section 504 (relating to
9effect of failure to make filings) or 506 (relating to voluntary
10termination of registration by corporations and other
11associations):
12* * *
13(3) In the case of a domestic or [qualified] registered
14foreign corporation, a name rendered unavailable for
15corporate use by other corporations by reason of any filing
16in the department by such domestic or [qualified] registered
17foreign corporation.
18(4) A name registered under 15 Pa.C.S. § [4131] 209
19(relating to registration of name of nonregistered foreign
20association) or any similar provision of law.
21(5) In the case of a business trust which exists subject
22to 15 Pa.C.S. Ch. 95 (relating to business trusts), the name
23of the trust as set forth in the[:
24(i)] instrument filed in the department under 15
25Pa.C.S. § 9503 (relating to documentation of trust)[; or
26(ii) application for registration filed under 15
27Pa.C.S. § 9507 (relating to foreign business trusts)].
28(6) In the case of a limited partnership or limited
29liability company subject to 15 Pa.C.S. Ch. 85 (relating to
30limited partnerships) or 89 (relating to limited liability
1companies), the name of the partnership or company as set
2forth in the certificate of limited partnership, certificate
3of organization or [application for] statement of
4registration as a registered foreign [limited partnership or
5foreign limited liability company, as the case may be]
6association.
7(8) In the case of a registered limited liability
8partnership subject to 15 Pa.C.S. Ch. 82 (relating to
9registered limited liability partnerships) that is not also a
10limited partnership, the name of the partnership as set forth
11in the statement of registration [or application for
12registration] as a registered foreign [registered limited
13liability partnership] association.
14(b) Subsequent availability of certain names.--Whenever, by
15reason of change in name, withdrawal or dissolution of a
16domestic or [qualified] registered foreign [corporation]
17association, failure to renew a registration of its name by a
18[nonqualified] nonregistered foreign [corporation] association,
19or for any other cause, its name is no longer rendered
20unavailable by the express provisions of Title 15 (relating to
21corporations and unincorporated associations), such name shall
22no longer be deemed to be registered under subsection (a)(3) or
23(4) on the register established by this chapter.
24§ 502. Certain additions to register.
25(a) Corporation names.--
26* * *
27(2) Any person who is not eligible to make a filing
28under 15 Pa.C.S. § [4131 (relating to registration of name)
29or 6131] 209 (relating to registration of name of
30nonregistered foreign association) may register a corporation
1name with the department by filing an application for
2registration of name, executed by the person, which shall set
3forth:
4* * *
5§ 503. Decennial filings required.
6* * *
7(b) Exceptions.--Subsection (a) shall not apply to any of
8the following:
9(1) A corporation or other association that during the
10ten years ending on December 31 of the year in which a filing
11would otherwise be required under subsection (a) has made any
12filing in the department pursuant to a provision of this
13title or 15 Pa.C.S. (relating to corporations and
14unincorporated associations) other than:
15* * *
16(ii) a filing under[:
17(A) 15 Pa.C.S. § 1305 (relating to reservation
18of corporate name);
19(B) 15 Pa.C.S. § 5305 (relating to reservation
20of corporate name);
21(C) 15 Pa.C.S. § 8203(b) (relating to name);
22(D) 15 Pa.C.S. § 8505(b) (relating to name); or
23(E)] 15 Pa.C.S. § [8905(b)] 208 (relating to
24reservation of name) or 209 (relating to registration
25of name of nonregistered foreign association).
26* * *
27[(c) Exemptions.--An association shall be exempt from the
282001 decennial filing if the association made a filing:
29(1) After December 31, 1989, and before January 1, 1992,
30pursuant to a provision of this title or 15 Pa.C.S. other
1than a filing under:
2(i) 15 Pa.C.S. § 1305;
3(ii) 15 Pa.C.S. § 5305;
4(iii) 15 Pa.C.S. § 8203(b);
5(iv) 15 Pa.C.S. § 8505(b); or
6(v) 15 Pa.C.S. § 8905(b).
7(2) Under this section during the year 2000.]
8* * *
9Section 61. This act shall take effect as follows:
10(1) The following provisions shall take effect
11immediately:
12(i) The addition of 15 Pa.C.S. § 7411.
13(ii) This section.
14(2) The remainder of this act shall take effect July 1,
152015.