HOUSE AMENDED
PRIOR PRINTER'S NOS. 212, 1172 | PRINTER'S NO. 1210 |
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. | 304 | Session of 2013 |
INTRODUCED BY GREENLEAF, ALLOWAY, FERLO, BROWNE, PILEGGI AND BREWSTER, JANUARY 24, 2013
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES, JUNE 11, 2013
AN ACT
1Amending Titles 15 (Corporations and Unincorporated
2Associations) and 54 (Names) of the Pennsylvania Consolidated
3Statutes, in Title 15, making extensive revisions, additions
4and deletions to preliminary material on general provisions;
5to corporation material on general provisions, on
6incorporation, on corporate powers, duties and safeguards, on
7officers, directors and shareholders, on fundamental changes,
8on registered corporations, on insurance corporations, on
9benefit corporations, on foreign business corporations, on
10incorporation and on foreign nonprofit corporations; to
11material on limited liability companies; to material on
12unincorporated associations; and to material on business
13trusts; in Title 54, further providing for general provisions
14and for corporate and other association names; and making
15related repeals.
16The General Assembly of the Commonwealth of Pennsylvania
17hereby enacts as follows:
18Section 1. This act shall be known and may be cited as the
19GAA Amendments Act of 2013.
20Section 2. The definitions of "banking institution,"
21"representative" and "savings association" in section 102 of
22Title 15 of the Pennsylvania Consolidated Statutes are amended
23and the section is amended by adding definitions to read:
1§ 102. Definitions.
2Subject to additional or inconsistent definitions contained
3in subsequent provisions of this title that are applicable to
4specific provisions of this title, the following words and
5phrases when used in this title shall have, unless the context
6clearly indicates otherwise, the meanings given to them in this
7section:
8* * *
9"Banking institution." [A banking institution as defined in
10section 1103 (relating to definitions).] An institution as
11defined in section 102(r) of the act of November 30, 1965
12(P.L.847, No.356), known as the Banking Code of 1965.
13"Bureau." The Bureau of Corporations and Charitable
14Organizations of the department.
15* * *
16"Domestic banking institution." A domestic association which
17is an institution as defined in section 102(r) of the act of
18November 30, 1965 (P.L.847, No.356), known as the Banking Code
19of 1965.
20* * *
21"Domestic insurance corporation." An insurance corporation
22as defined in section 3102 (relating to definitions).
23"Domestic savings association." A domestic corporation for
24profit which is an association as defined in section 102(3) of
25the act of December 14, 1967 (P.L.746, No.345), known as the
26Savings Association Code of 1967.
27* * *
28"Execute." When used with respect to authenticating or
29adopting a filing, document or other record, means "sign."
30* * *
1"Obligation." Includes a note or other form of indebtedness,
2whether secured or unsecured.
3"Officially publish." Publish in two newspapers of general
4circulation in the English language in the county in which the
5registered office of the association is located or, in the case
6of a proposed association, will be located, one of which must be
7the legal newspaper, if any, designated by the rules of court
8for the publication of legal notices. If there is only one
9newspaper of general circulation in the county, advertisement in
10that newspaper is sufficient. If no other frequency is
11specified, the notice must be published one time. See section
12109(a)(2) (relating to name of commercial registered office
13provider in lieu of registered address).
14* * *
15"Record form." Inscribed on a tangible medium or stored in
16an electronic or other medium and retrievable in perceivable
17form.
18"Representative." [A representative as defined in section
191103 (relating to definitions).] When used with respect to an
20association, joint venture, trust or other enterprise, a person
21occupying the position or discharging the functions of a
22director, officer, partner, manager, trustee, fiduciary,
23employee or agent, regardless of the name or title by which the
24person may be designated. The term does not imply that a
25director, as such, is an agent of a corporation.
26"Savings association." [A savings association as defined in
27section 1103.] An association as defined in section 102(3) of
28the act of December 14, 1967 (P.L.746, No.345), known as the
29Savings Association Code of 1967.
30"Sign." With present intent to authenticate or adopt
1information in record form:
2(1) to sign manually or adopt a tangible symbol; or
3(2) to attach to, or logically associate with,
4information in record form, an electronic sound, symbol or
5process.
6* * *
7Section 3. Section 107 of Title 15 is amended to read:
8§ 107. Form of records.
9[Any records] (a) General rule.--Information maintained by a
10corporation or other association in the regular course of its
11business, including shareholder or membership records, books of
12account and minute books, may be kept [on, or be in the form of,
13punch cards, magnetic storage media, photographs,
14microphotographs or any other information storage device if the
15records so kept can be converted into reasonably legible written
16form within a reasonable time] in record form. [Any corporation
17or other association shall so convert any records so kept upon
18the request of any person entitled to inspect the records. Where
19records are kept in this manner, a reasonably legible written
20form produced from the information storage device that
21accurately portrays the record shall be admissible in evidence,
22and shall be accepted for all other purposes, to the same extent
23as an original written record of the same information would have
24been accepted.]
25(b) Meaning of "written."--References in this title to a
26document in writing or to a written provision of an agreement or
27other document shall be deemed to include and be satisfied by a
28document or provision of an agreement or document in record
29form.
30Section 4. Title 15 is amended by adding a section to read:
1§ 111. Relation of title to Electronic Signatures in Global and
2National Commerce Act.
3(a) General rule.--Except as set forth in subsection (b),
4this title modifies, limits and supersedes the Electronic
5Signatures in Global and National Commerce Act (Public Law 106-
6229, 15 U.S.C. § 7001, et seq.).
7(b) Exception.--This title does not do any of the following:
8(1) Modify, limit or supersede section 101(c) of the
9Electronic Signatures in Global and National Commerce Act (15
10U.S.C. § 7001(c)).
11(2) Authorize electronic delivery of a notice described
12in section 103(b) of the Electronic Signatures in Global and
13National Commerce Act (15 U.S.C. § 7003(b)).
14Section 5. Sections 131, 133(a) and (d), 134(a)(3), 135(a)
15(2) and (7) and (d), <-136(b)(2) and (3) 136(b), 152, 153(a) and
16155(a) and (b) of Title 15 are amended to read:
17§ 131. Application of subchapter.
18As used in this subchapter, the term "this title" includes
19Titles 17 (relating to credit unions) and 54 (relating to names)
<-20and any other provision of law that makes reference to the and
21any other provision of law that:
22(1) makes reference to the powers and procedures of this
23subchapter[.]<- or, to the extent not inconsistent with this
24subchapter, requires a filing in the bureau and does not
25specify some or all of the necessary procedures therefor;<- or
26(2) to the extent not inconsistent with this subchapter:
27(i) requires a filing in the bureau; and
28(ii) does not specify some or all of the necessary
29procedures for the filing provided in this subchapter.
30§ 133. Powers of Department of State.
1(a) General rule.--The [Department of State shall have]
2department has the power and authority reasonably necessary to
3enable it to administer this subchapter efficiently and to
4perform the functions specified in section 132 (relating to
5functions of Department of State), in 13 Pa.C.S. (relating to
6commercial code) and in 17 Pa.C.S. (relating to credit unions).
7The following shall not be agency regulations for the purposes
8of section 612 of the act of April 9, 1929 (P.L.177, No.175),
9known as The Administrative Code of 1929, the act of October 15,
101980 (P.L.950, No.164), known as the Commonwealth Attorneys Act,
11the act of June 25, 1982 (P.L.633, No.181), known as the
12Regulatory Review Act, or any similar provision of law, but
13shall be subject to the opportunity of public comment
14requirement under section 201 of the act of July 31, 1968 (P.L.
15769, No.240), referred to as the Commonwealth Documents Law:
16(1) Sample filing forms promulgated by the department
17[under subsection (d)].
18(2) Instructions accompanying sample filing forms and
19other explanatory material published in the Pennsylvania Code
20that is intended to substantially track applicable statutory
21provisions relating to the particular filing or to any of the
22functions of the department covered by this subsection, if a
23regulation of the department expressly states that [such]
24those instructions or explanatory materials shall not have
25the force of law.
26(3) Regulations, which the department is hereby
27authorized to promulgate, that:
28(i) Authorize payment of fees and other remittances
29through or by a credit or debit card issuer or other
30financial intermediary.
1(ii) Authorize contracts with credit or debit card
2issuers and other financial intermediaries relating to
3the collection, transmission and payment of fees and
4other remittances.
5[(iii) Adjust the level of fees and other
6remittances as otherwise fixed by law so as to facilitate
7their transmission through or by a credit card issuer or
8other financial intermediary pursuant to such regulations
9without net cost to the department.]
10(iv) Adjust, not more than once per year, the fees
11set forth in section 153(a) (relating to fee schedule)
12and 13 Pa.C.S. § 9525 (relating to fees) for filings
13transmitted to the department electronically.
14(v) Relate to the format or means of delivering
15documents to the department <-or for filing.
16* * *
17(d) [Physical characteristics and copies of documents.--All
18articles and other documents authorized or required to be filed
19in the department under this title shall be in such format as to
20size, shape and other physical characteristics as shall be
21prescribed by regulations promulgated by the department. The
22regulations may require the submission of not to exceed three
23conformed copies of any document in addition to the original and
24any copies thereof otherwise required by law. All formats
25promulgated by the department for use under this title shall
26include a statement of the number of copies required to be filed
27and shall be published in the Pennsylvania Code.]
28* * *
29§ 134. Docketing statement.
30(a) General rule.--The [Department of State] department may,
1but shall not be required to, prescribe by regulation one or
2more official docketing statement forms designed to elicit from
3a person effecting a filing under this title information that
4the department has found to be necessary or desirable in
5connection with the processing of a filing. A form of docketing
6statement prescribed under this subsection:
7* * *
8(3) May be required by the department in connection with
9a filing only if notice of the requirement appears on the
10official format for the filing prescribed [under section
11133(d) (relating to physical characteristics and copies of
12documents)] by the department.
13* * *
14§ 135. Requirements to be met by filed documents.
15(a) General rule.--A document shall be accepted for filing
16by the [Department of State] department if it satisfies the
17following requirements:
18* * *
19(2) The document complies with any regulations
20promulgated by the department [pursuant to section 133(d)
21(relating to physical characteristics and copies of
22documents)] and is accompanied by any applicable statement
23prescribed under section 134.
24* * *
25(7) It is in record form and executed. The department
26shall not examine a document to determine whether the
27document has been [executed] signed by an authorized person
28or by sufficient authorized persons or otherwise is duly
29[executed. A document shall be deemed executed if it contains
30a facsimile signature, so long as the operative portions of
1the document meet any applicable requirements prescribed
2under section 133(d) (relating to physical characteristics
3and copies of documents)] signed.
4* * *
<-5(d) [Method of filing.--The department may prescribe by
6regulation procedures for filing documents by electronic mail,
7facsimile transmission, telex or other similar means of
8communication] (Reserved).
9* * *
10§ 136. Processing of documents by Department of State.
11* * *
12(b) [Immediate<-] Duplicate certified certified] Duplicate
13copy.--
<-14* * *
<-15(1) If a duplicate copy, which may be either a signed or
16conformed copy, of any articles or other document authorized
17or required by this title to be filed in the department is
18delivered to the department with the original signed
19document, the department shall [compare the duplicate copy
20with the original signed document and, if it finds that they
21are identical, shall certify the duplicate copy by making
22upon it the same endorsement that is required to appear upon
23the original, together with a further endorsement that the
24duplicate copy is a true copy of the original signed
25document,] stamp the duplicate copy with the date received by
26the department and return the duplicate copy to the person
27who delivered it to the department.
28[(2) <-[If the duplicate copy is delivered by hand to the
29office of the department at the seat of government at least
30four hours before the close of business on any day not a
1holiday and relates to a matter other than a label or other
2mark requiring examination under Title 54 (relating to names)
3or the reservation or registration of a name under this title
4and, in the case of a document that creates a new
5association, effects or reflects a change in name or
6qualifies a foreign association to do business in this
7Commonwealth, if the duplicate copy is accompanied by
8evidence that the proposed name has been reserved or
9registered by or on behalf of the applicant, the department
10before the close of business on that day shall either:
11(i) Certify the duplicate copy as required by this
12subsection and make such certified copy available at the
13office of the department to or upon the order of the
14person who delivered it to the department.
15(ii) Make available at the office of the department
16to or upon the order of the person who delivered it to
17the department a brief statement in writing of the
18reasons of the department for refusing to certify such
19duplicate copy.
20See section 153(a)(10) (relating to certification fees).]
<-21(Reserved).
22(3) In lieu of [comparing<-] date-stamping the duplicate
23copy [with<-] of the original signed document as provided in
24[paragraphs (1) and (2)] paragraph (1), the department may
25make a copy of the original signed document at the cost of
26the person who delivered it to the department.
27* * *
28§ 152. 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"Ancillary transaction." Includes:
3(1) preclearance of document[,];
4(2) amendment of articles, charter, certificate or other
5organic document, restatement of articles, charter,
6certificate or other organic document[, change in registered
7or principal office, change in share structure,];
8(3) dissolution, cancellation or termination[,
9reorganization,] of an association;
10(4) withdrawal by foreign association[,];
11(5) withdrawal by a partner[, or];
12(6) any [similar transaction,] transaction similar to
13any item listed in paragraphs (1) through (5); or
14(7) [the deposit in the Department of State] delivery to
15the department for filing in, by or with the [Department of
16State] department or the Secretary of the Commonwealth of any
17articles, statements, proceedings, agreements or any [like]
18similar papers affecting associations under the statutes of
19this Commonwealth[.] for which a specific fee is not set
20forth in section 153 (relating to fee schedule) or other
21applicable statute.
22["Bureau." The Corporation Bureau of the Department of State
23or any successor agency within the department.]
24§ 153. Fee schedule.
25(a) General rule.--The nonrefundable fees of the bureau,
26including fees for the public acts and transactions of the
27Secretary of the Commonwealth administered through the bureau,
28shall be as follows:
29(1) Domestic corporations: | Â |
30(i) Articles of incorporation, letters
1patent or similar instruments incorporating a | Â
 $125 |
3(ii) Articles or agreement or similar | Â 70 |
5(iii) Additional fee for each association | Â 40 |
7(iv) Additional fee for each new association | Â 125 |
9(v) Articles of conversion or a similar | Â 70 |
11(vi) Each ancillary transaction............ | 70 |
12(2) Foreign corporations: | Â |
13(i) Certificates of authority or similar | Â 250 |
15(ii) Amended certificate of authority or | Â 250 |
17(iii) Domestication......................... | 125 |
18(iv) Statement of merger or consolidation or | Â Â Â 70 |
22(v) Additional fee for each qualified | Â Â 40 |
25(vi) Each ancillary transaction............. | 70 |
26(3) Partnerships and limited liability companies: | Â |
27(i) Certificate of limited partnership or
1liability company................................ | Â Â Â Â
125 |
2(ii) Certificate of merger, consolidation or | Â 70 |
4(iii) Additional fee for each association | Â 40 |
6(iv) Additional fee for each new association | Â 125 |
8(v) Application for registration of foreign | Â Â 250 |
11(vi) Certificate of amendment of | Â Â 250 |
14(vii) Statement of registration of | Â Â Â 125 |
18(viii) Domestication of foreign limited | Â 125 |
20(ix) Each ancillary transaction............. | 70 |
21(4) Unincorporated nonprofit associations: | Â |
22(i) Statement appointing an agent to receive | Â 70 |
24(ii) Resignation of appointed agent.......... | 40 |
25(iii) Amendment or cancellation of statement | Â 70 |
27(5) Business trusts: | Â |
28(i) Deed of trust or other initial | Â 125 |
30(ii) Each ancillary transaction.............. | 70 |
1(6) Fictitious names: | Â | |||||
2(i) Registration............................ | 70 |
3(ii) Each ancillary transaction............. | 70 |
4(7) Service of process: | Â |
5(i) Each defendant named or served........... | 70 |
6(ii) (Reserved).............................. | Â |
7(8) Trademarks, emblems, union labels, | Â Â |
9(i) Trademark registration.................. | 50 |
10(ii) Each ancillary trademark transaction... | 50 |
11(iii) Any other registration under this | Â 70 |
13(iv) Any other ancillary transaction under | Â 70 |
15(9) Uniform Commercial Code: As provided in 13 | Â Â |
17(10) Copy fees, including copies furnished under | Â Â |
19(i) Each page of photocopy furnished........ | 3 |
20(ii) (Reserved)............................. | Â |
21(11) Certification fees: | Â |
22(i) For certifying copies of any document or | Â Â Â 40 |
26(ii) (Reserved)............................. | Â |
27(iii) For issuing any other certificate of | Â Â Â 40 |
1(12) Report of record search other than a search | Â Â | |||||
3(i) For preparing and providing a report of | Â Â 15 |
6(ii) (Reserved)............................. | Â |
7(13) Reservation and registration of names: | Â |
8(i) Reservation of association name......... | 70 |
9(ii) Registration of foreign or other | Â 70 |
11(14) Change of registered office or address: | Â |
12(i) Each statement of change of registered | Â 5 |
14(ii) Each statement or certificate of change | Â 5 |
16(iii) Each statement of change of address... | 5 |
17(15) Contingent domestication: | Â |
18(i) Statement of contingent domestication... | 125 |
19(ii) Each year, or portion of a year, during | Â Â 1,500 |
22(16) Expedited service: | Â |
23(i) For the processing of any filing under | Â Â Â Â 1,000 |
28(ii) For the processing of any filing under
1completed within three hours, an additional fee | Â Â Â
 300 |
<-3(iii) For processing of any filing under | Â Â Â 100 |
<-8(iii) For processing of any filing under | Â Â Â
100 |
13* * *
14§ 155. Disposition of funds.
15(a) [Establishment of restricted account.--] Corporation
16Bureau Restricted Account.--The Corporation Bureau Restricted
17Account, established under section 814 of the act of April 9,
181929 (P.L.177, No.175), known as The Administrative Code of
191929, is continued. This account shall receive 30% of the amount
20received by the department under this subchapter except for the
21fees collected under 13 Pa.C.S. § 9525(a)(1)(ii) (relating to
22fees). This account shall receive 5% of the amount received by
23the department under 13 Pa.C.S. § 9525(a)(1)(ii). The balance of
24the amount received by the department under this subchapter
25shall be deposited in the General Fund. Money in the account
26shall be used solely for the operation of the bureau and for its
27modernization as may be required for improved operations of the
28bureau unless a surplus arises after two consecutive years, at
29which time the Secretary of the Commonwealth shall transfer any
30amount in excess of the bureau's budget into the General Fund.
1(b) Expenditures.--The [Department of State] department
2shall submit a budget for the operation or modernization of the
3[Corporation Bureau] bureau to the Governor for approval. Such
4funds as are approved by the Governor are hereby appropriated
5from the Corporation Bureau Restricted Account to the
6[Department of State] department for the operation of the
7bureau.
8* * *
<-9Section 5.1. Title 15 is amended by adding a section to
10read:
11§ 156. References.
12In statutes, regulations and orders, a reference to the
13Corporation Bureau shall be deemed a reference to the Bureau of
14Corporations and Charitable Organization<- organizations.
15Section 6. The introductory paragraph and the definitions of
16"act," "banking institution," "corporation for profit,"
17"corporation not-for-profit," "court," "credit union,"
18"department," "distribution," "domestic corporation for profit,"
19"domestic corporation not-for-profit," "foreign corporation for
20profit," "foreign corporation not-for-profit," "insurance
21corporation," "Internal Revenue Code of 1986," "obligation,"
22"officially publish," "representative," "savings association"
23and "voting" in section 1103 of Title 15 are amended and the
24section is amended by adding a subsection to read:
25§ 1103. Definitions.
26(a) General definitions.--Subject to additional definitions
27contained in subsequent provisions of this subpart that are
28applicable to specific provisions of this subpart, the following
29words and phrases when used in this subpart shall have the
30meanings given to them in this section unless the context
1clearly indicates otherwise:
2["Act" or "action." Includes failure to act.]
3* * *
4["Banking institution" or "domestic banking institution." A
5domestic corporation for profit that is an institution as
6defined in the act of November 30, 1965 (P.L.847, No.356), known
7as the Banking Code of 1965.]
8* * *
9["Corporation for profit." A corporation incorporated for a
10purpose or purposes involving pecuniary profit, incidental or
11otherwise, to its shareholders or members.
12"Corporation not-for-profit." A corporation not incorporated
13for a purpose or purposes involving pecuniary profit, incidental
14or otherwise.
15"Court." Subject to any inconsistent general rule prescribed
16by the Supreme Court of Pennsylvania:
17(1) the court of common pleas of the judicial district
18embracing the county where the registered office of the
19corporation is or is to be located; or
20(2) where a corporation results from a merger,
21consolidation, division or other transaction without
22establishing a registered office in this Commonwealth or
23withdraws as a foreign corporation, the court of common pleas
24in which venue would have been laid immediately prior to the
25transaction or withdrawal.
26"Credit union." A credit union as defined in 17 Pa.C.S. §
27102 (relating to application of title).
28"Department." The Department of State of the Commonwealth.]
29* * *
30"Distribution." A direct or indirect transfer of money or
1other property (except its own shares or options, rights or
2warrants to acquire its own shares) or incurrence of
3indebtedness by a corporation to or for the benefit of any or
4all of its shareholders in respect of any of its shares whether
5by dividend or by purchase, redemption or other acquisition of
6its shares or otherwise. Neither the making of, nor payment or
7performance upon, a guaranty or similar arrangement by a
8corporation for the benefit of any or all of its shareholders
9nor a direct or indirect transfer or allocation of assets or
10liabilities effected under Chapter 19 (relating to fundamental
11changes) with the approval of the shareholders shall constitute
12a distribution for the purposes of this subpart.
13["Domestic corporation for profit." A corporation for profit
14incorporated under the laws of this Commonwealth.
15"Domestic corporation not-for-profit." A corporation not-
16for-profit incorporated under the laws of this Commonwealth.]
17* * *
18["Foreign corporation for profit." A corporation for profit
19incorporated under any laws other than those of this
20Commonwealth.
21"Foreign corporation not-for-profit." A corporation not-for-
22profit incorporated under any laws other than those of this
23Commonwealth.]
24* * *
25["Insurance corporation" or "domestic insurance corporation."
26An insurance corporation as defined in section 3102 (relating to
27definitions).
28"Internal Revenue Code of 1986." The Internal Revenue Code
29of 1986 (Public Law 99-514, 26 U.S.C. § 1 et seq.).]
30* * *
1["Obligation." Includes a note or other form of
2indebtedness, whether secured or unsecured.]
3* * *
4["Officially publish." Publish in two newspapers of general
5circulation in the English language in the county in which the
6registered office of the corporation is located, or in the case
7of a proposed corporation is to be located, one of which shall
8be the legal newspaper, if any, designated by the rules of court
9for the publication of legal notices or, if there is no legal
10newspaper, in two newspapers of general circulation in the
11county. When there is but one newspaper of general circulation
12in any county, advertisement in that newspaper shall be
13sufficient. Where no other frequency is specified, the notice
14shall be published one time in the appropriate newspaper or
15newspapers. See section 109(a)(2) (relating to name of
16commercial registered office provider in lieu of registered
17address).]
18* * *
19["Representative." When used with respect to an association,
20joint venture, trust or other enterprise, means a person
21occupying the position or discharging the functions of a
22director, officer, employee or agent thereof, regardless of the
23name or title by which the person may be designated. The term
24does not imply that a director, as such, is an agent of a
25corporation.
26"Savings association" or "domestic savings association." A
27domestic corporation for profit that is an association as
28defined in the act of December 14, 1967 (P.L.746, No.345), known
29as the Savings Association Code of 1967.]
30* * *
1"Voting" or "casting a vote." Includes the giving of
2[written] consent in lieu of voting. The term does not include
3either recording the fact of abstention or failing to vote for a
4candidate or for approval or disapproval of a matter, whether or
5not the person entitled to vote characterizes the conduct as
6voting or casting a vote.
7(b) Index of other definitions.--The following is a
8nonexclusive list of words and phrases which when used in this
9subpart shall have the meanings given to them in section 102
10(relating to definitions):
11"Act" or "action."
12"Banking institution" or "domestic banking institution."
13"Corporation for profit."
14"Corporation not-for-profit."
15"Court."
16"Credit union."
17"Department."
18"Domestic corporation for profit."
19"Domestic corporation not-for-profit."
20"Execute."
21"Foreign corporation for profit."
22"Foreign corporation not-for-profit."
23"Insurance corporation" or "domestic insurance corporation."
24"Internal Revenue Code of 1986."
25"Obligation."
26"Officially publish."
27"Record form."
28"Representative."
29"Savings association" or "domestic savings association."
30"Sign."
1Section 7. Section 1104 of Title 15 is repealed:
2[§ 1104. Other general provisions.
3The following provisions of this title are applicable to
4corporations subject to this subpart:
5Section 101 (relating to short title and application of
6title).
7Section 102 (relating to definitions).
8Section 103 (relating to subordination of title to regulatory
9laws).
10Section 104 (relating to equitable remedies).
11Section 105 (relating to fees).
12Section 106 (relating to effect of filing papers required to
13be filed).
14Section 107 (relating to form of records).
15Section 108 (relating to change in location or status of
16registered office provided by agent).
17Section 109 (relating to name of commercial registered office
18provider in lieu of registered address).
19Section 110 (relating to supplementary general principles of
20law applicable).
21Section 132 (relating to functions of Department of State).
22Section 133 (relating to powers of Department of State).
23Section 134 (relating to docketing statement).
24Section 135 (relating to requirements to be met by filed
25documents).
26Section 136 (relating to processing of documents by
27Department of State).
28Section 137 (relating to court to pass upon rejection of
29documents by Department of State).
30Section 138 (relating to statement of correction).
1Section 139 (relating to tax clearance of certain fundamental
2transactions).
3Section 140 (relating to custody and management of orphan
4corporate and business records).
5Section 152 (relating to definitions).
6Section 153 (relating to fee schedule).
7Section 154 (relating to enforcement and collection).
8Section 155 (relating to disposition of funds).
9Section 162 (relating to contingent domestication of certain
10foreign associations).
11Section 501 (relating to reserved power of General Assembly).
12Section 503 (relating to actions to revoke corporate
13franchises).
14Section 504 (relating to validation of certain defective
15corporations).
16Section 505 (relating to validation of certain defective
17corporate acts).
18Section 506 (relating to scope and duration of certain
19franchises).
20Section 507 (relating to validation of certain share
21authorizations).]
22Section 8. Section 1306 of Title 15 is amended by adding a
23subsection to read:
24§ 1306. Articles of incorporation.
25* * *
26(e) Reference to external facts.--Except for the provisions
27required by subsection (a)(1), (2), (3), (4)(i), (5) and (7),
28any provision of the articles of incorporation may be made
29dependent upon facts ascertainable outside of the articles if
30the manner in which the facts will operate upon the provision is
1set forth in the articles. The facts may include actions or
2events within the control of or determinations made by the
3corporation or a representative of the corporation.
4Section 9. Sections 1504(c) and 1523 of Title 15 are amended
5to read:
6§ 1504. Adoption, amendment and contents of bylaws.
7* * *
8(c) Bylaw provisions in articles.--Where any provision of
9this subpart or any other provision of law refers to a rule as
10set forth in the bylaws of a corporation or in a bylaw adopted
11by the shareholders, the reference shall be construed to include
12and be satisfied by any rule on the same subject as set forth in
13the articles of the corporation.
14* * *
15§ 1523. Pricing and issuance of shares.
16Except as otherwise restricted in the bylaws, shares of a
17business corporation may be issued at a price determined by the
18board of directors[,]; or the board may [set a minimum price or
19establish a formula or method by which the price may be
20determined.] authorize one or more directors or one or more
21officers, acting alone or with the participation of one or more
22directors, to determine, within limits, pursuant to a formula or
23method or subject to relevant criteria specifically prescribed
24by the board:
25(1) the persons that shares will be issued to; and
26(2) the number of shares, price or consideration and
27other terms on which shares will be issued.
28Section 10. Section 1527(a)(3) of Title 15 is amended and
29the section is amended by adding a subsection to read:
30§ 1527. Issuance of fractional shares or scrip.
1(a) General rule.--A business corporation may but shall not
2be required to create and issue fractions of a share, either
3represented by a certificate or uncertificated, which, unless
4otherwise provided in the articles, shall represent proportional
5interests in all the voting rights, preferences, limitations and
6special rights, if any, of full shares. If the corporation
7creates but does not provide for the issuance of fractions of a
8share, it shall:
9* * *
10(3) issue scrip or other evidence of ownership, in
11registered form (either represented by a certificate or
12uncertificated) or in bearer form (represented by a
13certificate), entitling the holder to receive a full share
14upon the surrender of the scrip or other evidence of
15ownership aggregating a full share, or the transfer of
16uncertificated scrip aggregating a full share, but which
17shall not[, unless otherwise provided therein or with respect
18thereto,] entitle the holder to exercise any voting right, to
19receive dividends or to participate in any of the assets of
20the corporation in the event of liquidation.
21* * *
22(c) Limitation.--The articles may not provide that scrip or
23other evidence of ownership entitles the holder to exercise any
24voting right, to receive dividends or to participate in any of
25the assets of the corporation in the event of liquidation.
26Section 11. Section 1528 of Title 15 is amended by adding a
27subsection to read:
28§ 1528. Shares represented by certificates and uncertificated
29shares.
30* * *
1(g) Bearer shares prohibited.--A business corporation may
2not issue share certificates in bearer form. This subsection may
3not be varied by the articles.
4Section 12. Section 1529(b) of Title 15 is amended to read:
5§ 1529. Transfer of securities; restrictions.
6* * *
7(b) Transfer restrictions generally.--A restriction on the
8transfer or registration of transfer of securities of a business
9corporation may be imposed by the bylaws or by an agreement
10among any number of securityholders or among them and the
11corporation. A restriction so imposed shall not be binding with
12respect to securities issued prior to the adoption of the
13restriction unless the holders of the securities are parties to
14the agreement or voted in favor of the restriction. A
15restriction may be amended by the vote or consent, and otherwise
16in the manner, provided in the bylaws or agreement for amending
17the restriction or, in the absence of such a provision, as
18provided for amending the bylaws or agreement generally.
19* * *
20Section 13. Section 1552(b) of Title 15 is redesignated and
21the section is amended by adding subsections to read:
22§ 1552. Power of corporation to acquire its own shares.
23* * *
24(b) Security for acquisition.--In connection with an
25acquisition by a corporation of its shares, the corporation may
26grant a security interest in the acquired shares to secure an
27obligation to pay for the acquisition. A share shall not be
28canceled on the books of the corporation until the obligation of
29the corporation secured by the share is fully paid or
30discharged.
1(c) Application of distribution tests.--A corporation may
2acquire or agree to acquire its shares, even though the
3acquisition would violate section 1551 (relating to
4distributions to shareholders), if payment of all or part of the
5purchase price is deferred until the payment would not violate
6that section.
7[(b)] (d) Cross reference.--See section 1914(c)(2) (relating
8to adoption by board of directors).
9Section 14. Section 1575(a) introductory paragraph of Title
1015 is amended to read:
11§ 1575. Notice to demand payment.
12(a) General rule.--If the proposed corporate action is
13approved by the required vote at a meeting of shareholders of a
14business corporation, the corporation shall mail a further
15notice to all dissenters who gave due notice of intention to
16demand payment of the fair value of their shares and who
17refrained from voting in favor of the proposed action. If the
18proposed corporate action is [to be] approved by the
19shareholders by less than unanimous consent without a meeting or
20is taken without [a vote of] the need for approval by the
21shareholders, the corporation shall send to all shareholders who
22are entitled to dissent and demand payment of the fair value of
23their shares a notice of the adoption of the plan or other
24corporate action. In either case, the notice shall:
25* * *
26Section 15. Section 1704(a) and (b) of Title 15 are amended
27and the section is amended by adding subsections to read:
28§ 1704. Place and notice of meetings of shareholders.
29(a) Place.--Meetings of shareholders may be held at such
30geographic location within or without this Commonwealth as may
1be provided in or fixed pursuant to the bylaws. Unless otherwise
2provided in or pursuant to the bylaws, all meetings of the
3shareholders shall be held at the executive office of the
4corporation wherever situated. If a meeting of the shareholders
5is held by means of the Internet or other electronic
6communications technology in a fashion pursuant to which the
7shareholders have the opportunity to read or hear the
8proceedings substantially concurrently with their occurrence,
9vote on matters submitted to the shareholders [and], pose
10questions to the directors, make appropriate motions and comment
11on the business of the meeting, the meeting need not be held at
12a particular geographic location.
13(b) Notice.--[Written notice] Notice in record form of every
14meeting of the shareholders shall be given by, or at the
15direction of, the secretary or other authorized person to each
16shareholder of record entitled to vote at the meeting at least:
17(1) ten days prior to the day named for a meeting that
18will consider a fundamental change under Chapter 19 (relating
19to fundamental changes); or
20(2) five days prior to the day named for the meeting in
21any other case.
22[If the secretary or other authorized person neglects or refuses
23to give notice of a meeting, the person or persons calling the
24meeting may do so.]
25* * *
26(d) Alternative authority.--If the secretary or other
27authorized person neglects or refuses to give notice of a
28meeting, a person calling the meeting may do so.
29(e) Cross reference.--See section 2528 (relating to notice
30of shareholder meetings).
1Section 16. Sections 1705(a), 1727(b), 1756(a)(4) and
21759(a), (c) and (e) of Title 15 are amended to read:
3§ 1705. Waiver of notice.
4(a) [Written waiver] General rule.--Whenever any [written]
5notice is required to be given under the provisions of this
6subpart or the articles or bylaws of any business corporation, a
7waiver thereof [in writing, signed] which is filed with the
8secretary of the corporation in record form signed by the person
9or persons entitled to the notice, whether before or after the
10time stated therein, shall be deemed equivalent to the giving of
11the notice. Neither the business to be transacted at, nor the
12purpose of, a meeting need be specified in the waiver of notice
13of the meeting.
14* * *
15§ 1727. Quorum of and action by directors.
16* * *
17(b) Action by consent.--Unless otherwise restricted in the
18bylaws, any action required or permitted to be [taken] approved
19at a meeting of the directors may be [taken] approved without a
20meeting if[, prior or subsequent to the action,] a consent or
21consents [thereto] to the action in record form are signed,
22before, on or after the effective date of the action, by all of
23the directors in office [is] on the date the first consent is
24signed. The consent or consents must be filed with the
25[secretary of the corporation] minutes of the proceedings of the
26board of directors.
27§ 1756. Quorum.
28(a) General rule.--A meeting of shareholders of a business
29corporation duly called shall not be organized for the
30transaction of business unless a quorum is present. Unless
1otherwise provided in a bylaw adopted by the shareholders:
2* * *
3(4) If a proxy casts a vote or takes other action on
4behalf of a shareholder on any issue other than a procedural
5motion considered at a meeting of shareholders, the
6shareholder shall be deemed to be present during the entire
7meeting for purposes of determining whether a quorum is
8present for consideration of any other issue.
9* * *
10§ 1759. Voting and other action by proxy.
11(a) General rule.--
12(1) Every shareholder entitled to vote at a meeting of
13shareholders or to express consent or dissent to corporate
14action [in writing] without a meeting may authorize another
15person to act for him by proxy.
16(2) The [presence of, or] vote or other action on behalf
17of a shareholder at a meeting of shareholders, or the
18expression of consent or dissent to corporate action [in
19writing], by a proxy of a shareholder shall constitute the
20[presence of, or] vote or action by, or [written] consent or
21dissent of the shareholder for the purposes of this subpart.
22(3) Where two or more proxies of a shareholder are
23present, the corporation shall, unless otherwise expressly
24provided in the proxy, accept as the vote or other action of
25all shares represented thereby the vote cast or other action
26taken by a majority of them and, if a majority of the proxies
27cannot agree whether the shares represented shall be voted or
28upon the manner of voting the shares or taking the other
29action, the voting of the shares or right to take other
30action shall be divided equally among those persons.
1* * *
2(c) Revocation.--A proxy, unless coupled with an interest,
3shall be revocable at will, notwithstanding any other agreement
4or any provision in the proxy to the contrary, but the
5revocation of a proxy shall not be effective until notice
6thereof has been given to the secretary of the corporation or
7its designated agent in writing or by electronic transmission.
8An unrevoked proxy shall not be valid after three years from the
9date of its [execution] signature, authentication or
10transmission unless a longer time is expressly provided therein.
11A proxy shall not be revoked by the death or incapacity of the
12maker unless, before the vote is counted or the authority is
13exercised, [written] notice in record form of the death or
14incapacity is given to the secretary of the corporation or its
15designated agent.
16* * *
17(e) Cross [reference] references.--See [section] sections
181702 (relating to manner of giving notice) and 3135 (relating to
19proxies of members of mutual insurance companies).
20Section 17. Section 1764(a) of Title 15 is amended and the
21section is amended by adding a subsection to read:
22§ 1764. Voting lists.
23(a) General rule.--The officer or agent having charge of the
24transfer books for shares of a business corporation shall make a
25complete list of the shareholders entitled to vote at any
26meeting of shareholders, arranged in alphabetical order, with
27the address of and the number of shares held by each. This
28section does not require the corporation to include electronic
29mail addresses or other electronic contact information on the
30list. The list shall be produced and kept open at the time and
1place of [the] each meeting of shareholders of a nonregistered
2corporation held at a geographic location and shall be subject
3to the inspection of any shareholder during the whole time of
4the meeting for the purposes thereof [except that, if a business
5corporation has 5,000 or more shareholders, in lieu of the
6making of the list the corporation may make the information
7therein available at the meeting by any other means]. See
8section 2529 (relating to voting lists).
9* * *
10(c) Electronic meetings.--If a meeting of shareholders of a
11nonregistered corporation is not held at a geographic location,
12the corporation shall make the list of shareholders required by
13subsection (a) available in a reasonably accessible manner.
14Section 18. Section 1766(a), (b) and (d) of Title 15 are
15amended to read:
16§ 1766. Consent of shareholders in lieu of meeting.
17(a) Unanimous consent.--Unless otherwise restricted in the
18bylaws, any action required or permitted to be taken at a
19meeting of the shareholders or of a class of shareholders of a
20business corporation may be taken without a meeting if[, prior
21or subsequent to the action,] a consent or consents [thereto] to
22the action in record form are signed, before, on or after the
23effective date of the action, by all of the shareholders who
24would be entitled to vote at a meeting for such purpose [shall
25be filed]. The consent or consents must be filed with the
26[secretary of the corporation] minutes of the proceedings of the
27shareholders.
28(b) Partial consent.--If the bylaws so provide, any action
29required or permitted to be taken at a meeting of the
30shareholders or of a class of shareholders may be taken without
1a meeting upon the signed consent of shareholders who would have
2been entitled to cast the minimum number of votes that would be
3necessary to authorize the action at a meeting at which all
4shareholders entitled to vote thereon were present and voting.
5The consents shall be filed in record form with the [secretary
6of the corporation] minutes of the proceedings of the
7shareholders.
8* * *
9(d) Cross [reference] references.--See [section] sections
101702 (relating to manner of giving notice) and 2524 (relating to
11consent of shareholders in lieu of meeting).
12Section 19. Section 1906(d)(3) of Title 15 is amended and
13the section is amended by adding a subsection to read:
14§ 1906. Special treatment of holders of shares of same class or
15series.
16* * *
17(c.1) Determination of groups.--For purposes of applying
18subsections (a)(1) and (b), the determination of which
19shareholders are part of each group receiving special treatment
20shall be made as of the record date for shareholder action on
21the plan.
22(d) Exceptions.--This section shall not apply to:
23* * *
24(3) A plan that contains an express provision that this
25section shall not apply or that fails to contain an express
26provision that this section shall apply. [The shareholders of
27a corporation that proposes a plan to which this section is
28not applicable by reason of this paragraph shall have the
29remedies contemplated by section 1105 (relating to
30restriction on equitable relief).]
1* * *
2Section 20. Title 15 is amended by adding sections to read:
3§ 1907. Purpose of fundamental transactions.
4A transaction under this chapter does not require an
5independent business purpose in order for the transaction to be
6lawful.
7§ 1908. Submission of matters to shareholders.
8A business corporation may agree, in record form, to submit
9an amendment or plan to its shareholders whether or not the
10board of directors determines, at any time after approving the
11matter, that the matter is no longer advisable and recommends
12that the shareholders reject or vote against it, regardless of
13whether the board of directors changes its recommendation. If a
14corporation so agrees to submit a matter to its shareholders,
15the matter is deemed to have been validly adopted by the
16corporation when it has been approved by the shareholders.
17Section 21. Sections 1911(a)(4), 1913, 1922(a)(3), 1923,
181931(a), (b)(2), (d) and (g), 1957(b)(1)(iv), 1973, 1978(b) and
192522 of Title 15 are amended to read:
20§ 1911. Amendment of articles authorized.
21(a) General rule.--A business corporation, in the manner
22provided in this subchapter, may from time to time amend its
23articles for one or more of the following purposes:
24* * *
25(4) To cancel or otherwise affect the right of holders
26of the shares of any class or series to receive dividends
27that have accrued but have not been declared or to otherwise
28effect a reclassification of or otherwise affect the
29substantial rights of the holders of any shares, including,
30without limitation, by providing special treatment of shares
1held by any shareholder or group of shareholders [as
2authorized by, and subject to the provisions of,] consistent
3with section 1906 (relating to special treatment of holders
4of shares of same class or series).
5* * *
6§ 1913. Notice of meeting of shareholders.
7(a) General rule.--[Written notice] Notice in record form of
8the meeting of shareholders of a business corporation that will
9act on the proposed amendment [shall] must be given to each
10shareholder entitled to vote thereon. [There shall be included
11in, or enclosed with, the notice a copy of] The notice must
12include the proposed amendment or a summary of the changes to be
13effected thereby and, if Subchapter D of Chapter 15 (relating to
14dissenters rights) is applicable, [a copy] the text of that
15subchapter.
16(b) Cross [reference] references.--See Subchapter A of
17Chapter 17 (relating to notice and meetings generally) and
18section 2528 (relating to notice of shareholder meetings).
19§ 1922. Plan of merger or consolidation.
20(a) Preparation of plan.--A plan of merger or consolidation,
21as the case may be, shall be prepared, setting forth:
22* * *
23(3) The manner and basis of converting the shares of
24each corporation into shares or other securities or
25obligations of the surviving or new corporation, or of
26canceling some or all of the shares of a corporation, as the
27case may be, and, if any of the shares of any of the
28corporations that are parties to the merger or consolidation
29are not to be canceled or converted solely into shares or
30other securities or obligations of the surviving or new
1corporation, the shares or other securities or obligations of
2any other person or cash, property or rights that the holders
3of such shares are to receive in exchange for, or upon
4conversion of, such shares, and the surrender of any
5certificates evidencing them, which securities or
6obligations, if any, of any other person or cash, property or
7rights may be in addition to or in lieu of the shares or
8other securities or obligations of the surviving or new
9corporation.
10* * *
11§ 1923. Notice of meeting of shareholders.
12(a) General rule.--[Written notice] Notice in record form of
13the meeting of shareholders that will act on the proposed plan
14[shall] must be given to each shareholder of record, whether or
15not entitled to vote thereon, of each domestic business
16corporation that is a party to the merger or consolidation.
17[There shall be included in, or enclosed with, the notice a copy
18of] The notice must include or be accompanied by the proposed
19plan or a summary thereof [and, if]. If Subchapter D of Chapter
2015 (relating to dissenters rights) is applicable to the holders
21of shares of any class or series, [a copy] the text of that
22subchapter and of section 1930 (relating to dissenters rights)
23[shall] must be furnished to the holders of shares of that class
24or series. If the surviving or new corporation will be a
25nonregistered corporation, the notice [shall] must state that a
26copy of its bylaws as they will be in effect immediately
27following the merger or consolidation will be furnished to any
28shareholder on request and without cost.
29(b) Cross references.--See Subchapter A of Chapter 17
30(relating to notice and meetings generally) and [section]
1sections 2512 (relating to dissenters rights procedure) and 2528
2(relating to notice of shareholder meetings).
3§ 1931. Share exchanges.
4(a) General rule.--All the outstanding shares of one or more
5classes or series of a domestic business corporation, designated
6in this section as the exchanging corporation, may, in the
7manner provided in this section, be acquired by any person,
8designated in this section as the acquiring person, through an
9exchange of all the shares pursuant to a plan of exchange. The
10plan of exchange may also provide for the [conversion of any
11other] shares of any other class or series of the exchanging
12corporation to be canceled or converted into shares, other
13securities or obligations of any person or cash, property or
14rights. The procedure authorized by this section shall not be
15deemed to limit the power of any person to acquire all or part
16of the shares or other securities of any class or series of a
17corporation through a voluntary exchange or otherwise by
18agreement with the holders of the shares or other securities.
19(b) Plan of exchange.--A plan of exchange shall be prepared,
20setting forth:
21* * *
22(2) The manner and basis of canceling the shares of the
23exchanging corporation or exchanging or converting the shares
24of the exchanging corporation into shares or other securities
25or obligations of the acquiring person, and, if any of the
26shares of the exchanging corporation are not to be exchanged
27or converted solely into shares or other securities or
28obligations of the acquiring person, the shares or other
29securities or obligations of any other person or cash,
30property or rights that the holders of the shares of the
1exchanging corporation are to receive in exchange for, or
2upon conversion of, the shares and the surrender of any
3certificates evidencing them, which securities or
4obligations, if any, of any other person or cash, property
5and rights may be in addition to or in lieu of the shares or
6other securities or obligations of the acquiring person.
7* * *
8(d) Dissenters rights in share exchanges.--Any holder of
9shares that are to be canceled, exchanged or converted pursuant
10to a plan of exchange who objects to the plan and complies with
11the provisions of Subchapter D of Chapter 15 shall be entitled
12to the rights and remedies of dissenting shareholders therein
13provided, if any. See section 1906(c) (relating to dissenters
14rights upon special treatment).
15* * *
16(g) Effect of plan.--Upon the plan of exchange becoming
17effective, the shares of the exchanging corporation that are,
18under the terms of the plan, to be canceled, converted or
19exchanged shall cease to exist or shall be converted or
20exchanged. The former holders of the shares shall thereafter be
21entitled only to the shares, other securities or obligations or
22cash, property or rights into which they have been converted or
23for which they have been exchanged in accordance with the plan,
24and the acquiring person shall be the holder of the shares of
25the exchanging corporation stated in the plan to be acquired by
26such person. The articles of incorporation of the exchanging
27corporation shall be deemed to be amended to the extent, if any,
28that changes in its articles are stated in the plan of exchange.
29* * *
30§ 1957. Effect of division.
1* * *
2(b) Property rights; allocations of assets and
3liabilities.--
4(1) * * *
5(iv) [To] Except as provided in section 1952(g)
6(relating to proposal and adoption of plan of division),
7to the extent allocations of liabilities are contemplated
8by the plan of division, the liabilities of the dividing
9corporation shall be deemed without further action to be
10allocated to and become the liabilities of the resulting
11corporations on such a manner and basis and with such
12effect as is specified in the plan; and one or more, but
13less than all, of the resulting corporations shall be
14free of the liabilities of the dividing corporation to
15the extent, if any, specified in the plan, if in either
16case:
17(A) no fraud on minority shareholders or
18shareholders without voting rights or violation of
19law shall be effected thereby; and
20(B) the plan does not constitute a fraudulent
21transfer under 12 Pa.C.S. Ch. 51 (relating to
22fraudulent transfers).
23* * *
24§ 1973. Notice of meeting of shareholders.
25(a) General rule.--[Written notice] Notice in record form of
26the meeting of shareholders that will consider the resolution
27recommending dissolution of the business corporation [shall]
28must be given to each shareholder of record entitled to vote
29thereon [and the purpose shall be included]. The purpose of the
30meeting must be stated in the notice [of the meeting].
1(b) Cross [reference] references.--See Subchapter A of
2Chapter 17 (relating to notice and meetings generally) and
3section 2528 (relating to notice of shareholder meetings).
4§ 1978. Winding up of corporation after dissolution.
5* * *
6(b) Standard of care of directors and officers.--The
7dissolution of the corporation shall not subject its directors
8or officers to standards of conduct different from those
9prescribed by or pursuant to Chapter 17 (relating to officers,
10directors and shareholders). Directors of a dissolved
11corporation who have complied with section 1975 (relating to
12predissolution provision for liabilities) or Subchapter H
13(relating to postdissolution provision for liabilities) and
14governing persons of a successor entity who have complied with
15Subchapter H shall not be personally liable to the creditors or
16claimants of the dissolved corporation.
17§ 2522. Adjournment of meetings of shareholders.
18[Any] Except as otherwise provided in the bylaws, any regular
19or special meeting of the shareholders of a registered
20corporation, including one at which directors are to be elected,
21may be adjourned for such period as the shareholders present and
22entitled to vote shall direct.
23Section 22. Title 15 is amended by adding sections to read:
24§ 2528. Notice of shareholder meetings.
25If a registered corporation solicits proxies generally with
26respect to a meeting of its shareholders, the corporation is not
27required to give notice of the meeting to any shareholder to
28whom the corporation is not required to send a proxy statement
29pursuant to the rules of the Securities and Exchange Commission.
30§ 2529. Voting lists.
1A registered corporation is not required to produce or make
2available to its shareholders a list of shareholders in
3connection with any meeting of its shareholders for which a
4judge or judges of election are appointed, but such a list must
5be furnished to the judge or judges of election.
6Section 23. Section 2545(b) of Title 15 is amended and the
7section is amended by adding a subsection to read:
8§ 2545. Notice to shareholders.
9* * *
10(b) Obligations of the corporation.--If the controlling
11person or group so requests, the corporation shall, at the
12option of the corporation and at the expense of the person or
13group, either furnish a list of all such shareholders and their
14postal addresses to the person or group or [mail] provide the
15notice to all such shareholders.
16* * *
17(e) Cross reference.--See section 1702 (relating to manner
18of giving notice).
19Section 24. Sections 3133(a) introductory paragraph and 3135
20of Title 15 are amended to read:
21§ 3133. Notice of meetings of members of mutual insurance
22companies.
23(a) General rule.--Unless otherwise restricted in the
24bylaws, persons authorized or required to give notice of an
25annual meeting of members of a mutual insurance company for the
26election of directors or of a meeting of members of a mutual
27insurance company called for the purpose of considering
28amendment of the articles or bylaws, or both, of the corporation
29may, in lieu of any [written] notice of meeting of members
30required to be given by this subpart, give notice of such
1meeting by causing notice of such meeting to be officially
2published. Such notice shall be published each week for at
3least:
4* * *
5§ 3135. Proxies of members of mutual insurance companies.
6In no event shall a proxy given by a member of a mutual
7insurance company, unless coupled with an interest, be voted on
8or utilized to express consent or dissent to corporate action
9[in writing] after 11 months from the date of execution of the
10proxy.
11Section 24.1. Section 3322(a) and (b) of Title 15 are
12amended and the section is amended by adding a subsection to
13read:
14§ 3322. Benefit director.
15(a) General rule.--
16(1) The board of directors of a benefit corporation
17which is a registered corporation shall include a director
18who:
19(i) shall be designated as the benefit director; and
20(ii) shall have, in addition to all of the powers,
21duties, rights and immunities of the other directors of
22the benefit corporation, the powers, duties, rights and
23immunities provided in this subchapter.
24(2) The board of directors of a benefit corporation
25which is not a registered corporation may include a director
26who:
27(i) shall be designated as the benefit director; and
28(ii) shall have, in addition to all of the powers,
29duties, rights and immunities of the other directors of
30the benefit corporation, the powers, duties, rights and
1immunities provided in this subchapter.
2(b) Election, removal and qualifications.--The benefit
3director shall be elected and may be removed in the manner
4provided under Subchapter C of Chapter 17 (relating to directors
5and officers) [and]. Except as set forth in subsection (e)(2)(i)
6or (g), the benefit director shall be an individual who is
7independent. The benefit director may serve as the benefit
8officer at the same time as serving as the benefit director. The
9articles or bylaws of a benefit corporation may prescribe
10additional qualifications of the benefit director not
11inconsistent with this subsection.
12* * *
13(g) Professional corporations.--The benefit director of a
14professional corporation does not need to be independent.
15Section 24.2. Sections 3325(b)(2)(i) and (iii) and 3331(a)
16(5) of Title 15, added October 24, 2012 (P.L.1228, No.152), are
17amended to read:
18§ 3325. Right of action.
19* * *
20(b) Parties with standing.--A benefit enforcement proceeding
21may be commenced or maintained only:
22* * *
23(2) derivatively by:
24(i) a shareholder that owned at least 2% of the
25total number of shares of a class or series outstanding
26at the time of the act complained of;
27* * *
28(iii) a person or group of persons that owns
29beneficially or of record 5% or more of the equity
30interests in an association of which the benefit
1corporation is a subsidiary at the time of the act
2complained of; or
3* * *
4§ 3331. Annual benefit report.
5(a) Contents.--A benefit corporation must deliver to each
6shareholder an annual benefit report including:
7* * *
8[(5) The name of each person that owns 5% or more of the
9outstanding shares of the benefit corporation either
10beneficially, to the extent known to the benefit corporation
11without independent investigation, or of record.]
12* * *
13Section 24.3. Section 4127(a) introductory paragraph and
14(5), (b) and (d) of Title 15 are amended to read:
15§ 4127. Merger, consolidation or division of qualified foreign
16corporations.
17(a) General rule.--Whenever a qualified foreign business
18corporation is a nonsurviving party to a statutory merger,
19consolidation or division permitted by the laws of the
20jurisdiction under which it is incorporated, the corporation or
21other association surviving the merger, or the new corporation
22or other association resulting from the consolidation or
23division, as the case may be, shall file in the [Department of
24State] department a statement of merger, consolidation or
25division, which shall be executed by the surviving or new
26corporation or other association and shall set forth:
27* * *
28(5) In the case of a merger, consolidation or division
29in which any of the new or resulting associations is a
30corporation, or if the surviving corporation in a merger was
1a nonqualified foreign business corporation prior to the
2merger, the statements on the part of the surviving or each
3new or resulting corporation required by section 4124(a)
4(relating to application for a certificate of authority).
5(b) Effect of filing.--The filing of the statement shall
6operate, as of the effective date of the merger, consolidation
7or division, to cancel the certificate of authority of each
8nonsurviving constituent corporation that was a qualified
9foreign business corporation and to qualify the surviving [or
10new corporation], new or resulting corporations, under this
11subchapter. If the surviving [or new corporation does], new or
12resulting corporations do not desire to continue as [a]
13qualified foreign business [corporation, it] corporations, they
14may thereafter withdraw in the manner provided by section 4129
15(relating to application for termination of authority).
16* * *
17(d) Cross [reference] references.--See [section] sections
18134 (relating to docketing statement) and 135 (relating to
19requirements to be met by filed documents).
20Section 25. The introductory paragraph and the definitions
21of "act," "board of directors," "bylaws," "charitable purposes,"
22"corporation for profit," "corporation not-for-profit," "court,"
23"department," "directors," "domestic corporation for profit,"
24"domestic corporation not-for-profit," "foreign corporation for
25profit," "foreign corporation not-for-profit," "fraternal
26benefit society," "member," "nonprofit corporation,"
27"nonqualified foreign corporation," "other body,"
28"representative," "trust instrument," "unless otherwise
29provided" and "unless otherwise restricted," in section 5103 of
30Title 15 are amended and the section is amended by adding
1definitions and a subsection to read:
2§ 5103. Definitions.
3(a) General definitions.--Subject to additional definitions
4contained in subsequent provisions of this subpart that are
5applicable to specific provisions of this subpart, the following
6words and phrases when used in this subpart shall have the
7meanings given to them in this section unless the context
8clearly indicates otherwise:
9["Act" or "action." Includes failure to act.]
10"Amendment." An amendment of the articles.
11* * *
12"Board of directors" or "board." The group of persons
13[vested with the management of] under the direction of whom the
14business and affairs of the corporation are managed irrespective
15of the name by which [such] the group is designated. The term
16does not include an other body. [The term, when used in any
17provision of this subpart relating to the organization or
18procedures of or the manner of taking action by the board of
19directors, shall be construed to include and refer to any
20executive or other committee of the board. Any provision of this
21subpart relating or referring to action to be taken by the board
22of directors or the procedure required therefor shall be
23satisfied by the taking of corresponding action by a committee
24of the board of directors to the extent authority to take such
25action has been delegated to such committee pursuant to section
265731 (relating to executive and other committees of the board).]
27See section 5731(c) (relating to executive and other committees
28of the board).
29* * *
30"Business corporation." A domestic corporation for profit
1defined in section 1103 (relating to definitions).
2"Bylaws." The code or codes of rules adopted for the
3regulation or management of the business and affairs of the
4corporation irrespective of the name or names by which [such]
5the rules are designated. The term includes provisions of the
6articles as provided by section 5504(c) (relating to adoption,
7amendment and contents of bylaws).
8"Charitable purposes." The relief of poverty, the
9advancement and provision of education, including postsecondary
10education, the advancement of religion, [the promotion of
11health,] the prevention and treatment of disease or injury,
12including mental retardation and mental disorders, governmental
13or municipal purposes, and any other [purposes] purpose the
14accomplishment of which is recognized as important and
15beneficial to the [community] public.
16* * *
17["Corporation for profit." A corporation incorporated for a
18purpose or purposes involving pecuniary profit, incidental or
19otherwise, to its shareholders or members.
20"Corporation not-for-profit." A corporation not incorporated
21for a purpose or purposes involving pecuniary profit, incidental
22or otherwise.
23"Court." Subject to any inconsistent general rule prescribed
24by the Supreme Court of Pennsylvania:
25(1) the court of common pleas of the judicial district
26embracing the county where the registered office of the
27corporation is or is to be located; or
28(2) where a corporation results from a merger,
29consolidation, division or other transaction without
30establishing a registered office in this Commonwealth or
1withdraws as a foreign corporation, the court of common pleas
2in which venue would have been laid immediately prior to the
3transaction or withdrawal.
4"Department." The Department of State of the Commonwealth.]
5"Directors." [Persons] Individuals designated, elected or
6appointed, by that or any other name or title, to act as members
7of the board of directors, and their successors. The term does
8not include a member of an other body, [as such] unless the
9person is also a director. The term, when used in relation to
10any power or duty requiring collective action, shall be
11construed to mean "board of directors."
12* * *
13["Domestic corporation for profit." A corporation for profit
14incorporated under the laws of this Commonwealth.
15"Domestic corporation not-for-profit." A corporation not-
16for-profit incorporated under the laws of this Commonwealth.]
17"Employee." The term does not include a member, director or
18member of an other body, unless the person is also an employee.
19See section 5730 (relating to compensation of directors) as to
20acceptance by a director of duties that make the director also
21an employee.
22* * *
23["Foreign corporation for profit." A corporation for profit
24incorporated under any laws other than those of this
25Commonwealth.
26"Foreign corporation not-for-profit." A corporation not-for-
27profit incorporated under any laws other than those of this
28Commonwealth.]
29"Foreign domiciliary corporation." A foreign nonprofit
30corporation described in section 6102 (relating to foreign
1domiciliary corporations).
2* * *
3"Fraternal benefit society." A domestic corporation not-for-
4profit that is a society as defined in [the act of July 29, 1977
5(P.L.105, No.38) known as the Fraternal Benefit Society Code]
6section 2402 of the act of May 17, 1921 (P.L.682, No.284), known
7as The Insurance Company Law of 1921.
8* * *
9"Member." [One having membership rights in a corporation in
10accordance with the provisions of its bylaws. The term, when
11used in relation to the taking of corporate action includes:
12(1) the proxy of a member, if action by proxy is
13permitted under the bylaws of the corporation; and
14(2) a delegate to any convention or assembly of
15delegates of members established pursuant to any provision of
16this subpart.
17If and to the extent the bylaws confer rights of members upon
18holders of securities evidencing indebtedness or governmental or
19other entities pursuant to any provision of this subpart the
20term shall be construed to include such security holders and
21governmental or other entities. The term shall be construed to
22include "shareholder" if the corporation issues shares of
23stock.] Any of the following:
24(1) A person that has voting rights in a membership
25corporation.
26(2) When used in relation to the taking of corporate
27action by a membership corporation, a delegate to a
28convention or assembly of delegates of members established
29pursuant to any provision of this subpart who has the right
30to vote at the convention or assembly in accordance with the
1rules of the convention or assembly.
2(3) A person that has been given voting rights or other
3membership rights in a membership corporation by a bylaw
4adopted by the members pursuant to section 5770 (relating to
5voting powers and other rights of certain securityholders and
6other entities) or other provision of law, but only to the
7extent of those rights.
8(4) A shareholder of a corporation, if the corporation
9issues shares of stock.
10"Membership corporation." A nonprofit corporation having
11articles of incorporation that do not provide that the
12corporation is to have no members.
13"Nonprofit corporation" or "domestic nonprofit corporation."
14A domestic corporation not-for-profit [which] that is not
15excluded from the scope of this subpart by section 5102
16(relating to application of subpart).
17"Nonqualified foreign corporation" or "nonqualified foreign
18nonprofit corporation." A foreign corporation not-for-profit
19[which] that is not a qualified foreign corporation, as defined
20in this section.
21* * *
22"Other body." A term employed in this subpart to denote a
23person or group, other than the board of directors or a
24committee thereof, who pursuant to authority expressly conferred
25by this subpart may be vested by the bylaws of the corporation
26with powers [which] that, if not vested by the bylaws in [such]
27the person or group, would by this subpart be required to be
28exercised by [either]:
29(1) the [membership of a corporation taken as a whole]
30members;
1(2) a convention or assembly of delegates of members
2established pursuant to any provision of this subpart; or
3(3) the board of directors.
4Except as otherwise provided in this subpart, a corporation may
5establish distinct persons or groups to exercise different
6powers [which] that this subpart authorizes a corporation to
7vest in an other body.
8"Plan." A plan of reclassification, merger, consolidation,
9asset transfer, division or conversion.
10* * *
11["Representative." When used with respect to a corporation,
12partnership, joint venture, trust or other enterprise, means a
13director, officer, employee or agent thereof.]
14"Trust instrument." Any lawful deed of gift, grant, will or
15other document by which the donor, grantor or testator [shall
16give, grant or devise] gives, grants or devises any real or
17personal property or the income [therefrom] from any real or
18personal property in trust for any charitable purpose.
19"Unless otherwise provided" or "except as otherwise
20provided." When used to introduce or modify a rule, the term
21implies that the alternative provisions contemplated may either
22relax or restrict the stated rule.
23"Unless otherwise restricted" or "except as otherwise
24restricted." When used to introduce or modify a rule, the term
25implies that the alternative provisions contemplated may further
26restrict, but may not relax, the stated rule.
27"Voting" or "casting a vote." Includes the giving of consent
28in lieu of voting. Whether or not the person entitled to vote
29characterizes the conduct as voting or casting a vote, the term
30does not include:
1(1) recording the fact of abstention; or
2(2) failing to vote for a candidate or for approval or
3disapproval of a matter.
4"Voting rights." The right of a person in a membership
5corporation, other than in the capacity of a director or member
6of an other body, to vote on the election or removal of
7directors or members of an other body or on approval of an
8amendment of the articles of incorporation, a plan or the
9dissolution of the corporation.
10(b) Index of other definitions.--The following is a
11nonexclusive list of words and phrases which when used in this
12subpart shall have the meanings given to them in section 102
13(relating to definitions):
14"Act" or "action."
15"Corporation for profit."
16"Corporation not-for-profit."
17"Court."
18"Department."
19"Domestic corporation for profit."
20"Domestic corporation not-for-profit."
21"Execute."
22"Foreign corporation for profit."
23"Foreign corporation not-for-profit."
24"Internal Revenue Code of 1986."
25"Obligation."
26"Officially publish."
27"Record form."
28"Representative."
29"Sign."
30Section 26. Sections 5104, 5105, 5106, 5107, 5108, 5109,
15302, 5306(a)(6) introductory paragraph and (11)(ii), 5307,
25308, 5309, 5310, 5331 and 5501 of Title 15 are amended to read:
3[§ 5104. Other general provisions.
4The following provisions of this title are applicable to
5corporations subject to this subpart:
6Section 101 (relating to short title and application of
7title).
8Section 102 (relating to definitions).
9Section 103 (relating to subordination of title to regulatory
10laws).
11Section 104 (relating to equitable remedies).
12Section 105 (relating to fees).
13Section 106 (relating to effect of filing papers required to
14be filed).
15Section 107 (relating to form of records).
16Section 108 (relating to change in location or status of
17registered office provided by agent).
18Section 109 (relating to name of commercial registered office
19provider in lieu of registered address).
20Section 110 (relating to supplementary general principles of
21law applicable).
22Section 132 (relating to functions of Department of State).
23Section 133 (relating to powers of Department of State).
24Section 134 (relating to docketing statement).
25Section 135 (relating to requirements to be met by filed
26documents).
27Section 136 (relating to processing of documents by
28Department of State).
29Section 137 (relating to court to pass upon rejection of
30documents by Department of State).
1Section 138 (relating to statement of correction).
2Section 139 (relating to tax clearance of certain fundamental
3transactions).
4Section 140 (relating to custody and management of orphan
5corporate and business records).
6Section 152 (relating to definitions).
7Section 153 (relating to fee schedule).
8Section 154 (relating to enforcement and collection).
9Section 155 (relating to disposition of funds).
10Section 162 (relating to contingent domestication of certain
11foreign associations).
12Section 501 (relating to reserved power of General Assembly).
13Section 503 (relating to actions to revoke corporate
14franchises).
15Section 504 (relating to validation of certain defective
16corporations).
17Section 505 (relating to validation of certain defective
18corporate acts).
19Section 2552 (relating to definitions) (definitions of
20"affiliate" and "associate").]
21§ 5105. [Saving clause and restriction] Restriction on
22equitable relief.
23[(a) General rule.--Except as otherwise provided in
24subsection (b) of this section, this subpart and its amendments
25shall not impair or affect any act done, offense committed, or
26substantial right accruing, accrued, or acquired, or liability,
27duty, obligation, penalty, judgment or punishment incurred prior
28to the time this subpart or any amendment thereto takes effect,
29but the same may be enjoyed, asserted, enforced, prosecuted, or
30inflicted as fully and to the same extent as if this subpart or
1any amendment thereto had not been enacted.
2(b) Exception.--] A member of a nonprofit corporation shall
3not have any right to claim the right to valuation [of] and
4payment [for] of the fair value of his membership interest or
5shares because of any proposed plan or amendment [of articles]
6authorized under any provision of this subpart, or to obtain, in
7the absence of fraud or fundamental unfairness, an injunction
8against [any such] the plan or amendment.
9§ 5106. [Limited uniform] Uniform application of subpart.
10(a) General rule.--Except as provided in subsection (b),
11this subpart and its amendments are intended to provide uniform
12rules for the [government] governance and regulation of the
13affairs of nonprofit corporations and of their officers,
14directors and members and of members of other bodies, regardless
15of the date or manner of incorporation or qualification, or of
16the issuance of any evidences of membership in or shares
17[thereof] of a nonprofit corporation.
18(b) Exceptions.--
19(1) Unless expressly provided otherwise in any amendment
20to this subpart [any such], the amendment shall take effect
21only prospectively.
22(2) Any existing corporation lawfully using a name[,]
23or, as a part of its name, a word[, which] that could not be
24used as or included in the name of a corporation [hereafter]
25subsequently incorporated or qualified under this subpart[,]
26may continue to use [such] the name[,] or word as part of its
27name[, provided] if the use or inclusion of [such] the word
28or name was lawful when first adopted by the corporation in
29this Commonwealth.
30(3) [Nothing in subsection] Subsection (a) shall not
1adversely affect the rights specifically provided for or
2saved [by the general terms of section 5105 (relating to
3saving clause and restriction on equitable relief)] in this
4subpart, including, without limiting the generality of the
5foregoing, the provisions of section 5952(d) (relating to
6proposal and adoption of plan of division).
7(4) Nothing in this subpart shall be deemed to repeal or
8supersede any provision in section 7 of the act of April 26,
91855 (P.L.328, No.347), entitled "An act relating to
10Corporations and to Estates held for Corporate, Religious and
11Charitable uses."
12§ 5107. Subordination of subpart to canon law.
13If and to the extent canon law or similar principles
14applicable to a corporation incorporated for religious purposes
15[shall set] sets forth provisions relating to the government and
16regulation of the affairs of the corporation [which] that are
17inconsistent with the provisions of this subpart on the same
18subject, the [provisions of] canon law or similar principles
19shall control except to the extent[, and only to the extent,
20required] prohibited by the Constitution of the United States or
21the Constitution of Pennsylvania[, or both].
22§ 5108. Limitation on incorporation.
23[No corporation which might] A corporation that can be
24incorporated under this subpart shall [hereafter] not be
25incorporated except under the provisions of this subpart.
26§ 5109. Execution of documents.
27(a) General rule.--Any document filed in the [Department of
28State] department under this title by a domestic or foreign
29nonprofit corporation [or a foreign corporation not-for-profit]
30subject to this subpart may be executed on behalf of the
1corporation by any one duly authorized officer [thereof] of the
2corporation. The corporate seal may be affixed and attested, but
3the affixation or attestation of the corporate seal shall not be
4necessary for the due execution of any filing by a corporation
5under this title.
6(b) Cross reference.--See section 135 (relating to
7requirements to be met by filed documents).
8[(c) Transitional provision.--This section supersedes any
9contrary provision of this subpart enacted prior to the
10enactment of the act of December 21, 1988 (P.L.1444, No.177),
11known as the General Association Act of 1988.]
12§ 5302. Number and qualifications of incorporators.
13One or more corporations for profit or not-for-profit or
14natural persons of full age may incorporate a nonprofit
15corporation under the provisions of this [article] subpart.
16§ 5306. Articles of incorporation.
17(a) General rule.--Articles of incorporation shall be signed
18by each of the incorporators and shall set forth in the English
19language:
20* * *
21(6) [A] If the corporation is a membership corporation,
22a statement whether the corporation is to be organized upon a
23nonstock basis or a stock share basis, and, if it is to be
24organized on a stock share basis:
25* * *
26(11) Any other provisions that the incorporators may
27choose to insert if:
28* * *
29(ii) such provisions are not inconsistent with this
30subpart and relate to the purpose or purposes of the
1corporation, the management of its business or affairs or
2the rights, powers or duties of its members, security
3holders, directors, members of an other body or officers.
4* * *
5§ 5307. Advertisement.
6The incorporators or the corporation shall officially publish
7a notice of intention to file or of the filing of articles of
8incorporation. The notice may appear prior to or after the day
9the articles of incorporation are filed in the [Department of
10State,] department and shall set forth briefly:
11(1) The name of the proposed corporation.
12(2) A statement that the corporation is to be or has
13been incorporated under the provisions of this [article]
14subpart.
15[(3) A brief summary of the purpose or purposes of the
16corporation.
17(4) A date on or before which the articles will be filed
18in the Department of State or the date the articles were
19filed.]
20§ 5308. Filing of articles.
21(a) General rule.--The articles of incorporation shall be
22[filed in the Department of State] delivered to the department
23for filing.
24(b) Cross [reference] references.--See [section] sections
25134 (relating to docketing statement) and 135 (relating to
26requirements to be met by filed documents).
27§ 5309. Effect of filing of articles of incorporation.
28(a) Corporate existence.--Upon the filing of the articles of
29incorporation in the [Department of State] department or upon
30the effective date specified in the articles of incorporation,
1whichever is later, the corporate existence shall begin.
2(b) Evidence of incorporation.--Subject to the provisions of
3section 503 (relating to actions to revoke corporate
4franchises), the articles of incorporation filed in the
5[Department of State, or approved by the court and] department,
6or recorded in the office of the recorder of deeds under the
7former provisions of law, shall be conclusive evidence of the
8fact that the corporation has been incorporated.
9§ 5310. Organization meeting.
10(a) General rule.--After the [filing of the articles of
11incorporation] corporate existence begins, an organization
12meeting of the initial directors[,] or, if directors are not
13named in the articles, of the [incorporator or] incorporators,
14shall be held, within or without this Commonwealth, for the
15purpose of adopting bylaws, which they shall have authority to
16do at [such] the meeting[,]; of electing directors [to hold
17office as provided in the bylaws], if directors are not named in
18the articles[,]; and [the transaction of such] of transacting
19other business as may come before the meeting. A bylaw adopted
20at [such] the organization meeting of directors or incorporators
21shall be deemed to be a bylaw adopted by the members for the
22purposes of this [article and of] subpart and any other
23provision of law.
24(b) Call of and action at meeting.--The meeting may be held
25at the call of any director or, if directors are not named in
26the articles, of any incorporator, who shall give at least five
27days' [written notice thereof] notice of the meeting to each
28other director or incorporator[, which]. The notice shall set
29forth the time and place of the meeting. For the purposes of
30this section [an], any director or incorporator may act in
1person, by consent or by proxy signed by him or his [attorney in
2fact] attorney-in-fact.
3(c) Death or incapacity of directors or incorporators.--If a
4designated director or an incorporator dies or is for any reason
5unable to act at the meeting, the other or others may act. If
6there is no other designated director or incorporator able to
7act, any person for whom [an] a director or incorporator was
8acting as agent may act or appoint another to act in his stead.
9§ 5331. [Unincorporated] Incorporation of unincorporated
10associations.
11In the case of the incorporation as a nonprofit corporation
12under this [article] subpart of an unincorporated association
13the articles of incorporation shall contain, in addition to the
14provisions [heretofore required in this chapter] required in
15Subchapter A (relating to incorporation generally), a statement
16that the incorporators constitute a majority of the members of
17the committee authorized to incorporate [such] the association
18by the requisite vote required by the organic law of the
19association for the amendment of [such] the organic law.
20§ 5501. Corporate capacity.
21Except as provided in section 103 [of this title] (relating
22to subordination of title to regulatory laws), a nonprofit
23corporation shall have the legal capacity of natural persons to
24act.
25Section 27. Section 5504(b), (c) and (d) of Title 15 are
26amended and the section is amended by adding a subsection to
27read:
28§ 5504. Adoption, amendment and contents of bylaws.
29* * *
30(b) Exception.--Except as provided in section 5310(a)
1(relating to organization meeting), the board of directors or
2other body shall not have the authority to adopt or change a
3bylaw on any subject that is committed expressly to the members
4by any of the provisions of this subpart. See:
5Subsection (d) (relating to amendment of voting provisions).
6Section 5713 (relating to personal liability of directors).
7Section 5721 (relating to board of directors).
8Section 5725(b) (relating to selection of directors).
9Section 5726(a) (relating to removal of directors by the
10members).
11Section 5726(b) (relating to removal of directors by the
12board).
13Section 5729 (relating to voting rights of directors).
14Section 5751(a) (relating to classes and qualifications of
15membership).
16Section 5752(c) (relating to rights of shareholders).
17Section 5754(a) (relating to members grouped in local units).
18Section 5755(a) (relating to regular meetings).
19Section 5756 (relating to quorum).
20Section 5757 (relating to action by members).
21Section 5758 (relating to voting rights of members).
22Section 5759(a) (relating to voting and other action by
23proxy).
24Section [5760(a)] 5762(a) (relating to voting [in nonprofit
25corporation matters] by corporations).
26Section [5762] 5765 (relating to judges of election).
27Section [5766(a)] 5769(a) (relating to termination and
28transfer of membership).
29Section [5767] 5770 (relating to voting powers and other
30rights of certain [security holders] securityholders and other
1entities).
2Section 5975(c) (relating to [winding up and distribution]
3predissolution provision for liabilities).
4(c) Bylaw provisions in articles.--Where any provision of
5this subpart or any other provision of law refers to a rule as
6set forth in the bylaws of a corporation or in a bylaw adopted
7by the members, the reference shall be construed to include and
8be satisfied by any rule on the same subject as set forth in the
9articles of the corporation.
10(d) Amendment of voting provisions.--
11(1) Unless otherwise restricted in a bylaw adopted by
12the members, whenever the bylaws require for the taking of
13any action by the members or a class of members a specific
14number or percentage of votes, the provision of the bylaws
15setting forth that requirement shall not be amended or
16repealed by any lesser number or percentage of votes of the
17members or of the class of members.
18(2) Paragraph (1) shall not apply to a bylaw setting
19forth the right of members to act by unanimous written
20consent as provided in section 5766(a) (relating to consent
21of members in lieu of meeting).
22(e) Cross reference.--See section 6145 (relating to
23applicability of certain safeguards to foreign domiciliary
24corporations).
25Section 28. Section 5509 of Title 15 is amended to read:
26§ 5509. Bylaws and other powers in emergency.
27(a) General rule.--[The] Except as otherwise restricted in
28the bylaws, the board of directors or other body of any
29nonprofit corporation may adopt emergency bylaws, subject to
30repeal or change by action of the members, which shall,
1notwithstanding any different provisions of law or of the
2articles or bylaws, be [operative] effective during any
3emergency resulting from [warlike damage or] an attack on the
4United States [or any], a nuclear [or atomic] disaster or
5another catastrophe as a result of which a quorum of the board
6cannot readily be assembled. The emergency bylaws may make any
7provision that may be [practical and necessary] appropriate for
8the circumstances of the emergency, including [provisions that]:
9(1) [A meeting of the board of directors or other body
10may be called by any officer or director or member of such
11other body in such manner and under such conditions as shall
12be prescribed in the emergency bylaws.] Procedures for
13calling meetings of the board or other body.
14(2) [The director or directors or the member or members
15of such other body in attendance at the meeting, or any other
16number fixed in the emergency bylaws, shall constitute a
17quorum.] Quorum requirements for meetings.
18(3) [The officers or other persons designated on a list
19approved by the board of directors or other body before the
20emergency, all in such order of priority and subject to such
21conditions and for such period of time, not longer than
22reasonably necessary after the termination of the emergency
23as may be provided in the emergency bylaws or in the
24resolution approving the list, shall, to the extent required
25to provide a quorum at any meeting of the board of directors
26or such other body, be deemed directors or members of such
27other body for such meeting.] Procedures for designating
28additional or substitute directors or members of an other
29body.
30(b) Lines of succession; head office.--The board of
1directors or [such] other body, or the officers, if given
2authorization by the board of directors or other body, either
3before or during any [such] emergency, may [provide,]:
4(1) provide, and from time to time modify, lines of
5succession in the event that during [such an] the emergency
6any or all officers or agents of the corporation shall for
7any reason be rendered incapable of discharging their
8duties[, and may,]; and
9(2) effective in the emergency, change the head offices
10or designate several alternative head offices or regional
11offices of the corporation[, or authorize the officers so to
12do].
13(c) Personnel not liable.--[No officer, director, member of
14such other body, or employee acting in accordance with any
15emergency bylaws shall be liable except for wilful misconduct.]
16A representative of the corporation:
17(1) Acting in accordance with any emergency bylaws shall
18not be liable except for willful misconduct.
19(2) Shall not be liable for any action taken by him in
20good faith in an emergency in furtherance of the ordinary
21business affairs of the corporation even though not
22authorized by the emergency or other bylaws then in effect.
23(d) Effect on regular bylaws.--To the extent that they are
24not inconsistent with any emergency bylaws [so] adopted, the
25bylaws of the corporation shall remain in effect during any
26emergency[,] and, upon its termination, the emergency bylaws
27shall cease to be [operative] effective.
28(e) Procedure in absence of emergency bylaws.--Unless
29otherwise provided in emergency bylaws, notice of any meeting of
30the board of directors or [such] an other body during [such] an
1emergency shall be given only to [such of the] those directors
2or members of [such] an other body [as it may be] it is feasible
3to reach at the time and by such means as [may be] are feasible
4at the time, including publication [or], radio or television. To
5the extent required to constitute a quorum at any meeting of the
6board of directors or [such] an other body during [such an] any
7emergency, the officers of the corporation who are present
8shall, unless otherwise provided in emergency bylaws, be deemed,
9in order of rank and within the same rank in order of seniority,
10directors or members of [such] the other body, as the case may
11be, for [such] the meeting.
12Section 29. Section 5511 of Title 15 is reenacted to read:
13§ 5511. Establishment of subordinate units.
14A nonprofit corporation may establish and terminate local
15branches, chapters, councils, clubs, churches, lodges, parishes
16or other subordinate units regardless of their designation, form
17of government, incorporated or unincorporated status or
18relationship to the corporation or other supervising and
19controlling organization of which the corporation is a member or
20with which it is in allegiance and to which it is subordinate.
21Section 30. Sections 5541, 5542, 5543, 5544, 5546, 5547(b),
225548(b) and 5550 of Title 15 are amended to read:
23§ 5541. Capital contributions of members.
24(a) General rule.--A nonprofit corporation organized on a
25nonstock basis may provide in its bylaws that members, upon or
26subsequent to admission, shall make capital contributions. The
27amount shall be specified in, or fixed by the board of directors
28or other body pursuant to authority granted by, the bylaws. The
29requirement of a capital contribution may apply to all members,
30[or] to the members of a single class, or to members of
1different classes in different amounts or proportions.
2(b) Consideration receivable.--[The capital contribution of
3a member shall consist of money or other property, tangible or
4intangible, or labor or services actually received by or
5performed for the corporation or for its benefit or in its
6formation or reorganization, or a combination thereof. In the
7absence of fraud in the transaction, the judgment of the board
8of directors or other body as to the value of the consideration
9received by the corporation shall be conclusive.] The capital
10contribution of a member, unless otherwise provided in the
11bylaws:
12(1) May consist of money, obligations (including an
13obligation of a member), services performed whether or not
14contracted for, contracts for services to be performed,
15memberships in or securities or obligations of the
16corporation or any other tangible or intangible property or
17benefit to the corporation. If a capital contribution is made
18in a form other than money, the value of the contribution
19shall be determined by or in the manner provided by the board
20of directors or other body.
21(2) Shall be provided or paid to or as ordered by the
22corporation.
23(c) Evidence of contribution.--The capital contribution of a
24member shall be recorded on the books of the corporation and may
25be evidenced by a written instrument delivered to the member,
26but [such] the instrument shall not be denominated a "share
27certificate" or by any other word or term implying that the
28instrument is a share certificate subject to section 5752
29(relating to organization on a stock share basis).
30(d) Transferability of interest.--Unless otherwise provided
1in the bylaws, the capital contribution of a member shall not be
2transferable.
3(e) Repayment of contribution.--The capital contribution of
4a member shall not be repaid by the corporation except upon
5dissolution of the corporation or as provided in this [article]
6subpart. A corporation may provide in its bylaws that its
7capital contributions, or some of them, shall be repayable, in
8whole or in part, at the option of the corporation only, [at
9such] in the amount or amounts (not to exceed the amount of the
10capital contribution), within [such] the period or periods[,]
11and on [such] the terms and conditions, not inconsistent with
12this [article] subpart, as are stated in, or fixed by the board
13of directors or other body pursuant to authority granted by, the
14bylaws.
15§ 5542. Subventions.
16(a) General rule.--The bylaws of a nonprofit corporation may
17provide that the corporation shall be authorized by resolution
18of the board of directors or other body to accept subventions
19from members or nonmembers on terms and conditions not
20inconsistent with this [article, and to issue certificates
21therefor] subpart. The resolution of the board or other body may
22provide that [holders of] the maker of a subvention
23[certificates] shall be entitled to a fixed or contingent
24periodic payment out of the corporate assets equal to a
25percentage of the original amount or value of the subvention.
26The rights of [holders of subvention certificates] makers of
27subventions shall at all times be subordinate to the rights of
28creditors of the corporation.
29(b) Consideration receivable.--[A subvention shall consist
30of money or other property, tangible or intangible, actually
1received by the corporation or expended for its benefit or in
2its formation or reorganization, or a combination thereof. In
3the absence of fraud in the transaction, the judgment of the
4board of directors or other body as to the value of the
5consideration received by the corporation shall be conclusive.
6(c) Form of certificate.--Each subvention certificate shall
7be signed by two duly authorized officers of the corporation,
8and may be sealed with the seal of the corporation or a
9facsimile thereof. The signatures of the officers upon a
10certificate may be facsimiles if the certificate is
11countersigned by a transfer agent or registered by a registrar
12other than the corporation itself or its employees. In case any
13officer who has signed or whose facsimile signature has been
14placed upon a certificate shall have ceased to be such officer
15before such certificate is issued, it may be issued by the
16corporation with the same effect as if he were such officer at
17the date of issue. The fact that the corporation is a nonprofit
18corporation shall be noted conspicuously on the face or back of
19each certificate.] Consideration for subventions, unless
20otherwise provided in the bylaws:
21(1) May consist of money, obligations (including an
22obligation of a subventor), services performed whether or not
23contracted for, contracts for services to be performed,
24memberships in or securities or obligations of the
25corporation, or any other tangible or intangible property or
26benefit to the corporation. If subventions are issued for
27other than money, the value of the consideration shall be
28determined by or in the manner provided by the board of
29directors or other body.
30(2) Shall be provided or paid to or as ordered by the
1corporation.
2(c.1) Form of subventions.--Subventions shall be represented
3by certificates or shall be uncertificated subventions. Each
4subvention certificate shall be executed by or on behalf of the
5corporation issuing the subvention in the manner it may
6determine. The fact that the corporation is a nonprofit
7corporation shall be noted conspicuously on the face or back of
8each certificate.
9(d) Transferability of subvention.--[Subvention
10certificates] Subventions shall be nontransferable unless the
11resolution of the board of directors or other body [shall
12provide] provides that they shall be transferable either at will
13or subject to specified restrictions.
14(e) Redemption at option of corporation.--The resolution of
15the board of directors or other body may provide that a
16subvention shall be redeemable, in whole or in part, at the
17option of the corporation at [such] the price or prices (not to
18exceed the original amount or value of the subvention plus any
19periodic payments due or accrued thereon), within [such] the
20period or periods, and on [such] the terms and conditions, not
21inconsistent with this [article] subpart, as are stated in the
22resolution.
23(f) Redemption at option of holders.--The resolution of the
24board of directors or other body may provide that makers or
25holders of all or some [subvention certificates] subventions
26shall have the right to require the corporation after a
27specified period of time to redeem [such certificates] the
28subventions, in whole or in part, at a price or prices that do
29not exceed the original amount or value of the subvention plus
30any periodic payments due or accrued [thereon] on the
1subvention, upon an affirmative showing that the financial
2condition of the corporation will permit the required payment to
3be made without impairment of its operations or injury to its
4creditors. The right to require redemption may in addition be
5conditioned upon the occurrence of a specified event. For the
6purpose of enforcing their rights under this subsection, makers
7or holders of [subvention certificates] subventions shall be
8entitled to inspect the books and records of the corporation.
9(g) Rights of makers or holders on dissolution.--[Holders]
10Makers or holders of [subvention certificates] subventions, upon
11dissolution of the corporation, shall be entitled, after the
12claims of creditors have been satisfied, to repayment of the
13original amount or value of the subvention plus any periodic
14payments due or accrued [thereon] on the subvention, unless a
15lesser sum is specified in the resolution of the board of
16directors or other body concerning [such] the subvention.
17§ 5543. Debt and security interests.
18(a) General rule.--[No corporation shall issue bonds or
19other evidences of indebtedness except for money or other
20property, tangible or intangible, or labor or services actually
21received by or performed for the corporation or for its benefit
22or in its formation or reorganization, or a combination thereof.
23In the absence of fraud in the transaction, the judgment of the
24board of directors or other body as to the value of the
25consideration received by the corporation shall be conclusive.]
26Unless otherwise provided in the bylaws, a nonprofit corporation
27may issue its bonds or other obligations for an amount and form
28of consideration as may be determined by or in the manner
29provided by the board of directors or other body.
30(b) Creation of lien on real or personal property.--The
1board of directors or other body may authorize any mortgage or
2pledge of, or the creation of a security interest in, all or any
3part of the real or personal property of the corporation, or any
4interest [therein. Unless] in the real or personal property. No
5application to or confirmation by a court shall be required and,
6unless otherwise restricted in the bylaws, no vote or consent of
7the members shall be required to make effective [such] the
8action by the board or other body.
9§ 5544. [Fees, dues] Dues and assessments.
10(a) General rule.--A nonprofit corporation may levy dues or
11assessments, or both, on its members, if authority to do so is
12conferred by the bylaws, subject to any limitations [therein]
13contained in the bylaws. [Such] The dues or assessments, or
14both, may be imposed upon all members of the same class either
15alike or in different amounts or proportions, and upon a
16different basis upon different classes of members. Members of
17one or more classes may be made exempt from either dues or
18assessments, or both, in the manner or to the extent provided in
19the bylaws.
20(b) Amount and method of collection.--The amount of the levy
21and method of collection of [such] the dues or assessments, or
22both, may be fixed in the bylaws, or the bylaws may authorize
23the board of directors or other body to fix the amount [thereof]
24of the dues or assessments from time to time, and make them
25payable at [such] the time and by [such] the methods of
26collection as the board of directors or other body may
27prescribe.
28(c) Enforcement of payment.--A nonprofit corporation may
29make bylaws necessary to enforce the collection of [such] dues
30or assessments, including provisions for the termination of
1membership, upon reasonable notice, for nonpayment of [such]
2dues or assessments, and for reinstatement of membership.
3§ 5546. Purchase, sale, mortgage and lease of real property.
4[Except for an industrial development corporation whose
5articles or bylaws otherwise provide, no purchase of real
6property shall be made by a nonprofit corporation and no
7corporation shall sell, mortgage, lease away or otherwise
8dispose of its real property, unless authorized by the vote of
9two-thirds of the members in office of the board of directors or
10other body, except that if there are 21 or more directors or
11members of such other body, the vote of a majority of the
12members in office shall be sufficient. No application to or
13confirmation of any court shall be required and, unless
14otherwise restricted in the bylaws, no vote or consent of the
15members shall be required to make effective such action by the
16board or other body. If the real property is subject to a trust
17the conveyance away shall be free of trust and the trust shall
18be impinged upon the proceeds of such conveyance.] Except as
19otherwise provided in this subpart and unless otherwise provided
20in the bylaws, no application to or confirmation of any court
21shall be required for the purchase by or the sale, lease or
22other disposition of the real or personal property, or any part
23of the real or personal property of a nonprofit corporation,
24and, unless otherwise restricted in section 5930 (relating to
25voluntary transfer of corporate assets) or in the bylaws, no
26vote or consent of the members shall be required to make
27effective such action by the board or other body. If the
28property is subject to a trust, the conveyance away shall be
29free of trust, and the trust shall be impinged upon the proceeds
30of the conveyance.
1§ 5547. Authority to take and hold trust property.
2* * *
3(b) Nondiversion of certain property.--Property committed to
4charitable purposes shall not, by any proceeding under Chapter
559 (relating to fundamental changes) or otherwise, be diverted
6from the objects to which it was donated, granted or devised,
7unless and until the board of directors or other body obtains
8from the court an order under 20 Pa.C.S. Ch. 77 [Subch. D]
9(relating to [creation, validity, modification and termination
10of trust] trusts) specifying the disposition of the property.
11§ 5548. Investment of trust funds.
12* * *
13(b) Use and management.--Except as otherwise permitted under
1420 Pa.C.S. Ch. 77 [Subch. D] (relating to [creation, validity,
15modification and termination of trust] trusts), the board of
16directors or other body shall apply all assets thus received to
17the purposes specified in the trust instrument. The directors or
18other body shall keep accurate accounts of all trust funds,
19separate and apart from the accounts of other assets of the
20corporation.
21* * *
22§ 5550. Devises, bequests and gifts after certain fundamental
23changes.
24A devise, bequest or gift to be effective in the future, in
25trust or otherwise, to or for a nonprofit corporation which has:
26(1) changed its purposes;
27(2) sold, leased away or exchanged all or substantially
28all its property and assets;
29(3) been converted into a business corporation;
30(4) become a party to a consolidation or a division;
1(5) become a party to a merger which it did not survive;
2or
3(6) been dissolved;
4after the execution of the document containing [such] the
5devise, bequest or gift and before the nonprofit corporation
6acquires a vested interest in the devise, bequest or gift shall
7be effective only as a court having jurisdiction over the assets
8may order under [the Estates Act of 1947] 20 Pa.C.S. Ch. 77
9(relating to trusts) or other applicable provisions of law.
10Section 31. Section 5551 of Title 15 is reenacted to read:
11§ 5551. Dividends prohibited; compensation and certain payments
12authorized.
13(a) General rule.--A nonprofit corporation shall not pay
14dividends or distribute any part of its income or profits to its
15members, directors, or officers. Nothing herein contained shall
16prohibit a fraternal benefit society operating under the
17insurance laws of Pennsylvania from paying dividends or refunds
18by whatever name known pursuant to the terms of its insurance
19contracts.
20(b) Reasonable compensation for services.--A nonprofit
21corporation may pay compensation in a reasonable amount to
22members, directors, or officers for services rendered.
23(c) Certain payments authorized.--A nonprofit corporation
24may confer benefits upon members or nonmembers in conformity
25with its purposes, may repay capital contributions, and may
26redeem its subvention certificates or evidences of indebtedness,
27as authorized by this article, except when the corporation is
28currently insolvent or would thereby be made insolvent or
29rendered unable to carry on its corporate purposes, or when the
30fair value of the assets of the corporation remaining after such
1conferring of benefits, payment or redemption would be
2insufficient to meet its liabilities. A nonprofit corporation
3may make distributions of cash or property to members upon
4dissolution or final liquidation as permitted by this article.
5Section 32. Title 15 is amended by adding a section to read:
6§ 5552. (Reserved).
7Section 33. Section 5552 of Title 15 is renumbered to read:
8§ [5552] 5553. Liabilities of members.
9(a) General rule.--A member of a nonprofit corporation shall
10not be liable, solely by reason of being a member, under an
11order of a court or in any other manner for a debt, obligation
12or liability of the corporation of any kind or for the acts of
13any member or representative of the corporation.
14(b) Obligations of member to corporation.--A member shall be
15liable to the corporation only to the extent of any unpaid
16portion of the capital contributions, membership dues or
17assessments which the corporation may have lawfully imposed upon
18him, or for any other indebtedness owed by him to the
19corporation. No action shall be brought by any creditor of the
20corporation to reach and apply any such liability to any debt of
21the corporation until after:
22(1) final judgment has been rendered against the
23corporation in favor of the creditor and execution thereon
24returned unsatisfied;
25(2) a case involving the corporation has been brought
26under 11 U.S.C. Ch. 7 (relating to liquidation) and a
27distribution has been made and the case closed or a notice of
28no assets has been issued; or
29(3) a receiver has been appointed with power to collect
30debts, and the receiver, on demand of a creditor to bring an
1action thereon, has refused to sue for the unpaid amount, or
2the corporation has been dissolved or ceased its activities
3leaving debts unpaid.
4(c) Action by a creditor.--An action by a creditor under
5subsection (b) shall not be brought more than three years after
6the happening of the first to occur of the events listed in
7subsection (b)(1) through (3).
8Section 34. Section 5553 of Title 15 is renumbered and
9amended to read:
10§ [5553] 5554. Annual report of directors or other body.
11(a) Contents.--The board of directors or other body of a
12nonprofit corporation shall present annually to the members a
13report, verified by the president and treasurer or by a majority
14of the directors or members of [such] the other body, showing in
15appropriate detail the following:
16(1) The assets and liabilities, including [the] trust
17funds, of the corporation as of the end of the fiscal year
18immediately preceding the date of the report.
19(2) The principal changes in assets and liabilities,
20including trust funds, during the fiscal year immediately
21preceding the date of the report.
22(3) The revenue or receipts of the corporation, both
23unrestricted and restricted to particular purposes, for the
24fiscal year immediately preceding the date of the report,
25including separate data with respect to each trust fund held
26by or for the corporation.
27(4) The expenses or disbursements of the corporation,
28for both general and restricted purposes, during the fiscal
29year immediately preceding the date of the report, including
30separate data with respect to each trust fund held by or for
1the corporation.
2(5) The number of members of the corporation as of the
3date of the report, together with a statement of increase or
4decrease in [such] their number during the year immediately
5preceding the date of the report, and a statement of the
6place where the names and addresses of the current members
7may be found.
8(b) Place of filing.--The annual report of the board of
9directors or other body shall be filed with the minutes of the
10meetings of members.
11(c) Report in absence of meeting of members.--The board of
12directors or other body of a corporation having no members shall
13direct the president and treasurer to present at the annual
14meeting of the board or [of such] other body a report in
15accordance with subsection (a) [of this section], but omitting
16the requirement of paragraph (5) [thereof]. [Such] The report
17shall be filed with the minutes of the annual meeting of the
18board or [of such] other body.
19(d) Cross reference.--See section 6145 (relating to
20applicability of certain safeguards to foreign domiciliary
21corporations).
22Section 35. Sections 5585, 5586, 5587, 5588, 5589, 5702(a),
235704(a) and (b), 5705(a), 5708, 5722(a), 5723, 5724, 5725, 5726,
245727, 5728(a) and (b), 5729(b) and 5730 of Title 15 are amended
25to read:
26§ 5585. Establishment or use of common trust funds authorized.
27(a) General rule.--Every nonprofit corporation may establish
28and maintain one or more common trust funds, the assets of which
29shall be held, invested and reinvested by the corporation itself
30or by a corporate trustee to which the assets have been
1transferred pursuant to section 5549 (relating to transfer of
2trust or other assets to institutional trustee). Upon the
3payment by the corporate trustee to the nonprofit corporation of
4the net income from [such] the assets, which income may be
5determined under section 5548(c) (relating to investment of
6trust funds) if [such] the election is properly made by the
7board of directors or other body of the corporation, for use and
8application to the several participating interests in [such] the
9common trust fund, the proportionate participation of each
10interest in [such] the net income shall be designated by the
11corporate trustee. The nonprofit corporation may, at any time,
12withdraw the whole or part of any participating interest in
13[such] the common trust fund for distribution by it as provided
14in this subchapter.
15(b) Limitations in trust instrument.--Nothing contained in
16this section shall be construed to authorize the corporation to
17invest assets of a trust or fund in any [such] common trust fund
18contrary to any specific limitation or restriction contained in
19the trust instrument[,] nor to limit or restrict the authority
20conferred upon the corporation with respect to investments by
21[any such] the trust instrument.
22(c) Effect of good faith mistakes.--[No mistakes] Mistakes
23made in good faith[,] and in the exercise of due care and
24prudence[,] in connection with the administration of any [such]
25common trust fund[,] shall not be held to exceed any power
26granted to or violate any duty imposed upon the corporation[,]
27if, promptly after the discovery of the mistake, the corporation
28takes [such] whatever action [as] may be practicable under the
29circumstances to remedy the mistake.
30§ 5586. Restrictions on investments.
1(a) Legal investments.--If the trust instrument [shall limit
2or restrict] limits or restricts the investment of [such] the
3assets to investments of the class authorized by law as legal
4investments, [the] a nonprofit corporation may invest and
5reinvest the assets of the trust or fund in any [such] common
6trust fund maintained by the corporation[, provided] if the
7investments composing [such] the fund consist solely of
8investments of the class authorized by [the Fiduciaries
9Investment Act of 1949] 20 Pa.C.S. Ch. 72 (relating to prudent
10investor rule) to be held by fiduciaries.
11(b) Other than legal investments.--If the trust instrument
12[shall] does not limit or restrict the investment of [such] the
13assets to investments of the class authorized by law as legal
14investments, the corporation may invest and reinvest the assets
15of the trust or fund in any [such] common trust fund maintained
16by the corporation[,] composed of [such] the investments as in
17the honest exercise of the judgment of the directors or other
18body of the corporation they may, after investigation, determine
19to be safe and proper investments.
20§ 5587. Determination of interests.
21A nonprofit corporation shall invest the assets of a trust or
22fund in a common trust fund authorized by this subchapter by
23adding [such] those assets thereto, and by apportioning a
24participation therein to [such] the trust or fund in the
25proportion that the assets of the trust or fund added thereto
26bears to the aggregate value of all the assets of [such] the
27common trust fund at the time of [such] the investment,
28including in [such] those assets the assets of the trust or fund
29so added. The withdrawal of a participation from [such] the
30common trust fund shall be on a basis of its proportionate
1interest in the aggregate value of all the assets of [such] the
2common trust fund at the time of [such] the withdrawal. The
3participating interest of any trust or fund in [such] the common
4trust fund may from time to time be withdrawn, in whole or in
5part, by the corporation. Upon [such withdrawals] a withdrawal,
6the corporation may make distribution in cash, or ratably in
7kind, or partly in cash and partly in kind. Participations in
8[such] the common trust funds shall not be sold by the
9corporation to any other corporation or person, but this
10sentence shall not prevent a corporate trustee designated under
11section 5585 (relating to establishment or use of common trust
12funds authorized) from investing the assets of [such a] the
13common trust fund in any collective investment fund established
14and maintained by it in accordance with law and to which the
15assets comprising [such a] the common trust fund are eligible
16contributions.
17§ 5588. Amortization of premiums on securities held.
18If a bond or other obligation for the payment of money is
19acquired as an investment for any common trust fund at a cost in
20excess of the par or maturity value thereof, the nonprofit
21corporation may, during [(but not beyond)] but not beyond the
22period that [such] the obligation is held as an investment in
23[such] the fund, amortize [such] the excess cost out of the
24income on [such] the obligation, by deducting from each payment
25of income and adding to principal an amount equal to the sum
26obtained by dividing [such] the excess cost by the number of
27periodic payments of income to accrue on [such] the obligation
28from the date of [such] the acquisition until its maturity date.
29§ 5589. Records; ownership of assets.
30The nonprofit corporation shall designate clearly upon its
1records the names of the trusts or funds on behalf of which
2[such] the corporation, as fiduciary or otherwise, owns a
3participation in any common trust fund and the extent of the
4interest of the trust or fund therein. [No such] The trust or
5fund shall not be deemed to have individual ownership of any
6asset in [such] the common trust fund, but shall be deemed to
7have a proportionate undivided interest in the common trust
8fund. The ownership of the individual assets comprising any
9common trust fund shall be solely in the nonprofit corporation
10as fiduciary or otherwise.
11§ 5702. Manner of giving notice.
12(a) General rule.--[Whenever written]
13(1) Any notice [is] required to be given to any person
14under the provisions of this subpart or by the articles or
15bylaws of any nonprofit corporation[, it may] shall be given
16to the person either personally or by sending a copy thereof
17[by]:
18(i) By first class or express mail, postage prepaid,
19[or by telegram (with messenger service specified), telex
20or TWX (with answer back received)] or courier service,
21charges prepaid, [or by facsimile transmission,] to [his]
22the person's postal address [(or to his telex, TWX or
23facsimile number)] appearing on the books of the
24corporation or, in the case of directors or members of an
25other body, supplied by [him] the person to the
26corporation for the purpose of notice. [If the notice is
27sent by mail, telegraph or courier service, it shall be
28deemed to have been given to the person entitled thereto
29when deposited in the United States mail or with a
30telegraph office or courier service for delivery to that
1person or, in the case of telex or TWX, when dispatched.]
2Notice under this subparagraph shall be deemed to have
3been given to the person entitled thereto when deposited
4in the United States mail or with a courier service for
5delivery to that person.
6(ii) By facsimile transmission, e-mail or other
7electronic communication to the person's facsimile number
8or address for e-mail or other electronic communications
9supplied by the person to the corporation for the purpose
10of notice. Notice under this subparagraph shall be deemed
11to have been given to the person entitled thereto when
12sent.
13(2) A notice of meeting shall specify the [place,] day
14[and], hour and geographic location, if any, of the meeting
15and any other information required by any other provision of
16this subpart.
17* * *
18§ 5704. Place and notice of meetings of members.
19(a) Place.--Meetings of members may be held at [such place]
20the geographic location within or without this Commonwealth [as
21may be] provided in or fixed pursuant to the bylaws. Unless
22otherwise provided in or pursuant to the bylaws, all meetings of
23the members shall be held [in this Commonwealth at the
24registered office of the corporation.] at the executive office
25of the corporation wherever situated. If a meeting of members is
26held by means of the Internet or other electronic communications
27technology in a fashion pursuant to which the members have the
28opportunity to read or hear the proceedings substantially
29concurrently with their occurrence, vote on matters submitted to
30the members, pose questions to the directors and members of any
1other body, make appropriate motions and comment on the business
2of the meeting, the meeting need not be held at a particular
3geographic location.
4(b) Notice.--[Written notice] Notice in record form of every
5meeting of the members shall be given by, or at the direction
6of, the secretary or other authorized person to each member of
7record entitled to vote at the meeting at least:
8(1) ten days prior to the day named for a meeting that
9will consider a fundamental change under Chapter 59 (relating
10to fundamental changes); or
11(2) five days prior to the day named for the meeting in
12any other case.
13If the secretary or other authorized person neglects or refuses
14to give notice of a meeting, the person or persons calling the
15meeting may do so.
16* * *
17§ 5705. Waiver of notice.
18(a) [Written waiver] General rule.--Whenever any [written]
19notice is required to be given under the provisions of this
20subpart or the articles or bylaws of any nonprofit corporation,
21a waiver thereof [in writing, signed] that is filed with the
22secretary of the corporation in record form, signed by the
23person or persons entitled to the notice, whether before or
24after the time stated therein, shall be deemed equivalent to the
25giving of the notice. [Except as otherwise required by this
26subsection, neither] Neither the business to be transacted at,
27nor the purpose of, a meeting need be specified in the waiver of
28notice of the meeting.
29* * *
30§ 5708. Use of conference telephone [and similar equipment.] or
1other electronic technology.
2(a) Incorporators, directors and members of an other body.--
3Except as otherwise provided in the bylaws, one or more persons
4may participate in a meeting of the incorporators, the board of
5directors or an other body[, or the members] of a nonprofit
6corporation by means of conference telephone or [similar
7communications equipment] other electronic technology by means
8of which all persons participating in the meeting can hear each
9other. Participation in a meeting pursuant to this section shall
10constitute presence in person at the meeting.
11(b) Members.--Except as otherwise provided in the bylaws,
12the presence or participation, including voting and taking other
13action, at a meeting of members, or the expression of consent or
14dissent to corporate action, by a member by conference telephone
15or other electronic means, including, without limitation, the
16Internet, shall constitute the presence of, or vote or action
17by, or consent or dissent of the member for the purposes of this
18subpart.
19§ 5722. Qualifications of directors.
20(a) General rule.--Each director of a nonprofit corporation
21shall be a natural person of full age, except as provided in
22subsection (b), who, unless otherwise restricted in the bylaws,
23need not be a resident of this Commonwealth or a member of the
24corporation. Except as otherwise provided in this section, the
25qualifications of directors may be prescribed in the bylaws.
26* * *
27§ 5723. Number of directors.
28The board of directors of a nonprofit corporation shall
29consist of one or more members. [Except as otherwise provided in
30this section, the] The number of directors shall be fixed by[,]
1or in the manner provided in[,] the bylaws[; or if]. If not so
2fixed, the number of directors shall be the same as that stated
3in the articles or three if no number is so stated.
4§ 5724. Term of office of directors.
5(a) General rule.--Each director of a nonprofit corporation
6shall hold office until the expiration of the term for which
7[he] the director was selected and until [his] a successor has
8been selected and qualified or until [his] the director's
9earlier death, resignation or removal. Directors, other than
10those selected by virtue of their office or former office in the
11corporation or in any other entity or organization, shall be
12selected for the term of office provided in the bylaws. In the
13absence of a provision fixing the term, it shall be one year.
14(b) Resignations.--Any director may resign at any time upon
15notice in record form to the corporation. The resignation shall
16be effective upon its receipt by the corporation or at a
17subsequent time specified in the notice of resignation.
18(c) Decrease in number.--A decrease in the number of
19directors shall not have the effect of shortening the term of
20any incumbent director.
21(d) Classified board of directors.--Except as otherwise
22provided in the bylaws, if the directors are classified in
23respect of the time for which they shall severally hold office:
24(1) Each class shall be as nearly equal in number as
25possible.
26(2) The term of office of at least one class shall
27expire in each year.
28(3) The members of a class shall not be elected for a
29longer period than four years.
30§ 5725. Selection of directors.
1(a) General rule.--Except as otherwise provided in this
2section, directors of a nonprofit corporation, other than those
3[named in the articles, if any,] constituting the first board of
4directors, shall be elected by the members.
5(b) Other methods.--If a bylaw adopted by the members so
6provides, directors may be elected, appointed, designated or
7otherwise selected by [such] the person or persons or by [such]
8the method or methods as shall be fixed by, or in the manner
9provided in, [such] the bylaw, and the directors may be
10classified as to the members who exercise the power to select
11directors.
12(c) Vacancies.--Except as otherwise provided in the
13bylaws[,]:
14(1) [vacancies] Vacancies in the board of directors,
15including vacancies resulting from an increase in the number
16of directors, [shall] may be filled by a majority of the
17remaining members of the board though less than a quorum, or
18by a sole remaining director, and each person so [elected]
19selected shall be a director to serve for the balance of the
20unexpired term unless otherwise restricted in the bylaws.
21(2) When one or more directors resign from the board
22effective at a future date, the directors then in office,
23including those who have so resigned, shall have power by the
24applicable vote to fill the vacancies, the vote thereon to
25take effect when the resignations become effective.
26(3) In the case of a corporation having a board of
27directors classified in respect of the time for which
28directors shall severally hold office, any director chosen to
29fill a vacancy, including a vacancy resulting from an
30increase in the number of directors, shall hold office until
1the next election of the class for which the director has
2been chosen and until a successor has been selected and
3qualified or until the director's earlier death, resignation
4or removal.
5(d) Alternate directors.--If the bylaws so provide, a person
6or group of persons entitled to elect, appoint, designate or
7otherwise select one or more directors may select [one or more
8alternates] an alternate for each [such] director. In the
9absence of a director from a meeting of the board [one of his
10alternates], the director's alternate may, in the manner and
11upon [such] the notice, if any, as may be provided in the
12bylaws, attend [such] the meeting or execute a consent in record
13form and exercise at the meeting [such of] or in the consent,
14the powers of the absent director as may be specified by, or in
15the manner provided in, the bylaws. When so exercising the
16powers of the absent director, [such] the alternate shall be
17subject in all respects to the provisions of this [article]
18subpart relating to directors.
19(e) Nomination of directors.--Unless otherwise provided in
20the bylaws [provide otherwise], directors shall be nominated by
21a nominating committee or from the floor.
22(f) Cross reference.--See the definition of "member" in
23section 5103 (relating to definitions).
24§ 5726. Removal of directors.
25(a) [By] Removal by the members.--
26(1) Unless otherwise provided in a bylaw adopted by the
27members, the entire board of directors, or a class of the
28board[,] where the board is classified with respect to the
29power to select directors, or any individual director[,] of a
30nonprofit corporation may be removed from office without
1assigning any cause by the vote of members, or a class of
2members, entitled to [cast at least a majority of the votes
3which all members present would be entitled to cast at any
4annual or other regular election of the directors or of such
5class of directors] elect directors, or the class of
6directors. In case the board or [such] a class of the board
7or any one or more directors are so removed, new directors
8may be elected at the same meeting. [If members are entitled
9to vote cumulatively for the board or a class of the board,
10no individual director shall be removed unless the entire
11board or class of the board is removed in case sufficient
12votes are cast against the resolution for his removal, which,
13if cumulatively voted at an annual or other regular election
14of directors, would be sufficient to elect one or more
15directors to the board or to the class.]
16(2) An individual director shall not be removed, unless
17the entire board or class of the board is removed, from the
18board of a corporation in which members are entitled to vote
19cumulatively for the board or a class of the board if
20sufficient votes are cast against the resolution for removal
21of the director which, if cumulatively voted at an annual or
22other regular election of directors, would be sufficient to
23elect one or more directors to the board or to the class.
24(b) [By] Removal by the board.--Unless otherwise provided in
25a bylaw adopted by the members, the board of directors may
26declare vacant the office of a director [if he is declared] who
27has been judicially declared of unsound mind [by an order of
28court or is convicted of felony] or who has been convicted of an
29offense punishable by imprisonment for a term of more than one
30year, or for any other proper cause which the bylaws may
1specify, or if, within 60 days, or [such] other time as the
2bylaws may specify, after notice of [his] selection, [he] a
3director does not accept [such] the office either in writing or
4by attending a meeting of the board of directors[,] and fulfill
5[such] the other requirements of qualification as the bylaws may
6specify.
7(c) [By] Removal by the court.--[The court may, upon
8petition of any member or director, remove from office any
9director in case of fraudulent or dishonest acts, or gross abuse
10of authority or discretion with reference to the corporation, or
11for any other proper cause, and may bar from office any director
12so removed for a period prescribed by the court. The corporation
13shall be made a party to such action.] Upon application of any
14member or director, the court may remove from office any
15director in case of fraudulent or dishonest acts, or gross abuse
16of authority or discretion with reference to the corporation, or
17for any other proper cause, and may bar from office any director
18so removed for a period prescribed by the court. The corporation
19shall be made a party to the action and as a prerequisite to the
20maintenance of an action under this subsection a member shall
21comply with Subchapter G (relating to judicial supervision of
22corporate action).
23(d) Effect of reinstatement.--An act of the board done
24during the period when a director has been suspended or removed
25for cause shall not be impugned or invalidated if the suspension
26or removal is thereafter rescinded by the members or by the
27board or by the final judgment of a court.
28§ 5727. Quorum of and action by directors.
29(a) General rule.--Unless otherwise provided in the bylaws,
30a majority of the directors in office of a nonprofit corporation
1shall be necessary to constitute a quorum for the transaction of
2business, and the acts of a majority of the directors present
3and voting at a meeting at which a quorum is present shall be
4the acts of the board of directors.
5(b) Action by [written] consent.--Unless otherwise
6restricted in the bylaws, any action [which may] required or
7permitted to be [taken] approved at a meeting of the directors
8may be [taken] approved without a meeting[,] if a consent or
9consents [in writing setting forth the action so taken shall be
10signed] to the action in record form are signed, before, on or
11after the effective date of the action, by all of the directors
12in office [and shall be] on the date the last consent is signed.
13The consent or consents must be filed with the secretary of the
14corporation.
15§ 5728. Interested [members,] directors or officers; quorum.
16(a) General rule.--[No] A contract or transaction between a
17nonprofit corporation and one or more of its [members,]
18directors or officers or between a nonprofit corporation and
19[any other corporation, partnership, association, or other
20organization] another domestic or foreign corporation for profit
21or not-for-profit, partnership, joint venture, trust or other
22association in which one or more of its directors or officers
23are directors or officers[,] or have a financial or other
24interest, shall not be void or voidable solely for [such] that
25reason, or solely because the [member,] director or officer is
26present at or participates in the meeting of the board of
27directors [which] that authorizes the contract or transaction,
28or solely because [his or their votes are] the vote of the
29director or officer is counted for [such] that purpose, if:
30(1) the material facts as to the relationship or
1interest and as to the contract or transaction are disclosed
2or are known to the board of directors and the board [in good
3faith] authorizes the contract or transaction by the
4affirmative votes of a majority of the disinterested
5directors even though the disinterested directors are less
6than a quorum;
7(2) the material facts as to [his] the director's or
8officer's relationship or interest and as to the contract or
9transaction are disclosed or are known to the members
10entitled to vote thereon, if any, and the contract or
11transaction is specifically approved in good faith by vote of
12[such] those members; or
13(3) the contract or transaction is fair as to the
14corporation as of the time it is authorized, approved or
15ratified by the board of directors or the members.
16(b) Quorum.--Common or interested directors may be counted
17in determining the presence of a quorum at a meeting of the
18board [which] that authorizes a contract or transaction
19specified in subsection (a) [of this section].
20* * *
21§ 5729. Voting rights of directors.
22* * *
23(b) Multiple and fractional voting.--The requirement of this
24[article] subpart for the presence of or vote or other action by
25a specified percentage of directors shall be satisfied by the
26presence of or vote or other action by directors entitled to
27cast [such] the specified percentage of the votes which all
28directors are entitled to cast.
29§ 5730. Compensation of directors.
30Except as otherwise restricted in the bylaws, the board of
1directors of a nonprofit corporation shall have the authority to
2fix the compensation of directors for their services as [such]
3directors, and a director may be a salaried officer of the
4corporation.
5Section 36. Section 5731 of Title 15 is amended by adding a
6subsection to read:
7§ 5731. Executive and other committees of the board.
8* * *
9(c) Status of committee action.--The term "board of
10directors" or "board," when used in any provision of this
11subpart relating to the organization or procedures of or the
12manner of taking action by the board of directors, shall be
13construed to include and refer to any executive or other
14committee of the board. Any provision of this subpart relating
15or referring to action to be taken by the board of directors or
16the procedure required therefor shall be satisfied by the taking
17of corresponding action by a committee of the board of directors
18to the extent authority to take the action has been delegated to
19the committee under this section.
20Section 37. Sections 5733, 5746(a), 5751, 5752, 5753, 5754,
215755, 5756(a)(1) and (3) and (b), 5757 and 5759 of Title 15 are
22amended to read:
23§ 5733. Removal of officers and agents.
24Unless otherwise provided in the bylaws, any officer or agent
25of a nonprofit corporation may be removed by the board of
26directors or other body [whenever in its judgment the best
27interests of the corporation will be served thereby, but such]
28with or without cause. The removal shall be without prejudice to
29the contract rights, if any, of any person so removed. Election
30or appointment of an officer or agent shall not of itself create
1contract rights.
2§ 5746. Supplementary coverage.
3(a) General rule.--The indemnification and advancement of
4expenses provided by or granted pursuant to the other sections
5of this subchapter shall not be deemed exclusive of any other
6rights to which a person seeking indemnification or advancement
7of expenses may be entitled under any bylaw, agreement, vote of
8members or disinterested directors or otherwise, both as to
9action in [his] an official capacity and as to action in another
10capacity while holding that office. Section 5728 (relating to
11interested [members,] directors or officers; quorum) shall be
12applicable to any bylaw, contract or transaction authorized by
13the directors under this section. A corporation may create a
14fund of any nature, which may, but need not, be under the
15control of a trustee, or otherwise secure or insure in any
16manner its indemnification obligations, whether arising under or
17pursuant to this section or otherwise.
18* * *
19§ 5751. Classes and qualifications of membership.
20(a) General rule.--Membership in a nonprofit corporation
21shall be of [such] the classes, and shall be governed by [such]
22the rules of admission, retention, suspension and expulsion,
23[as] prescribed in bylaws adopted by the members [shall
24prescribe], except that [all such] the rules shall be
25reasonable, germane to the purpose or purposes of the
26corporation[,] and equally enforced as to all members of the
27same class. Unless otherwise provided by a bylaw adopted by the
28members[, there]:
29(1) There shall be one class of members whose voting and
30other rights and interests shall be equal.
1(2) If there is only one class of members, the members
2shall have all the rights of members generally in a nonprofit
3corporation.
4(b) Corporations without voting members.--Where the articles
5provide that the corporation shall have no members, as such, or
6where a nonprofit corporation has under its bylaws or in fact no
7members entitled to vote on a matter, any provision of this
8[article] subpart or any other provision of law requiring notice
9to, the presence of, or the vote, consent or other action by
10members of the corporation in connection with [such] the matter
11shall be satisfied by notice to, the presence of, or the vote,
12consent or other action by the board of directors or other body
13of the corporation.
14(c) Membership status.--Regardless of whether a nonprofit
15corporation designates or refers to a person as a member of the
16corporation, the person is not a member of the corporation for
17purposes of this subpart unless the person satisfies the
18definition of "member" in section 5103(a) (relating to
19definitions).
20§ 5752. Organization on a stock share basis.
21(a) General rule.--A nonprofit corporation may be organized
22upon either a nonstock basis or, if so provided in its articles,
23upon a stock share basis[, as set forth in its articles].
24(b) Form of certificates; uncertificated shares.--The shares
25of nonprofit corporations organized upon a stock share basis
26shall be of [such] the denominations [as] provided in the bylaws
27[shall provide] and shall be represented by share
28certificates[.] unless the articles provide that any or all
29classes and series of shares, or any part thereof, shall be
30uncertificated shares. A provision of the articles providing for
1uncertificated shares shall not apply to shares represented by a
2certificate until the certificate is surrendered to the
3corporation. Except as otherwise expressly provided by law, the
4rights and obligations of the holders of shares represented by
5certificates and the rights and obligations of the holders of
6uncertificated shares of the same class and series shall be
7identical. The fact that the corporation is a nonprofit
8corporation shall be noted conspicuously on the face of each
9certificate. Within a reasonable time after the issuance or
10transfer of uncertificated shares, the corporation shall send to
11the registered owner thereof a written notice stating:
12(1) That the corporation is a nonprofit corporation
13incorporated under the laws of this Commonwealth.
14(2) The name of the registered owner.
15(3) The denomination and class of shares and the
16designation of the series, if any, of the shares issued or
17transferred.
18(c) Rights of shareholders.--Unless otherwise provided in a
19bylaw adopted by the members, each share shall entitle the
20holder thereof to one vote. No dividends shall be directly or
21indirectly paid on [any such] the shares, nor shall the
22shareholders be entitled to any portion of the earnings of
23[such] the corporation derived through increment of value upon
24its property, or otherwise incidentally made, until the
25dissolution of [any such] the corporation.
26(d) Transferability of shares.--Unless otherwise provided in
27the bylaws, [such] the shares shall not be transferable by
28operation of law or otherwise.
29(e) Power to cancel shares.--A nonprofit corporation shall
30have power to exclude from further membership any shareholder
1who fails to comply with the reasonable and lawful bylaws of the
2corporation, and may cancel the shares of any [such] offending
3member without liability for an accounting[,] except as may be
4provided in the bylaws.
5(f) Applicability of the Uniform Commercial Code.--The
6provisions of [Division 8 of Title 13] 13 Pa.C.S. Div. 8
7(relating to investment securities) shall not apply in any
8manner to the shares of a nonprofit corporation.
9(g) Cross reference.--See the definition of "member" in
10section 5103 (relating to definitions).
11§ 5753. Membership certificates.
12A nonprofit corporation organized upon a nonstock basis shall
13not issue shares of stock, but membership in [such] the
14corporation may be evidenced by certificates of membership. The
15fact that the corporation is a nonprofit corporation shall be
16noted conspicuously on the face of each certificate.
17§ 5754. Members grouped in local units.
18(a) General rule.--The bylaws of a nonprofit corporation may
19provide that the members of the corporation shall be grouped in
20incorporated or unincorporated local units formed upon the basis
21of territorial areas, or [such] other basis as may be determined
22in the bylaws, for the purpose of election of delegates or
23representatives to represent the members of [such] the local
24units at any regular or special meetings of [such] the
25corporation. Unless otherwise provided in a bylaw adopted by the
26members, each local unit participating in a representative
27capacity by means of one or more delegates or otherwise at a
28meeting of the corporation shall have a number of votes equal to
29the total membership of the local unit.
30(b) Voting at meetings of delegates.--The requirements of
1this [article] subpart for action by or the consent of a
2specified number or percentage of the members shall be satisfied
3by action by or the consent of [such] that number or percentage
4of votes of delegates or representatives of members selected
5pursuant to this section.
6(c) Calling and holding meetings of delegates.--The
7provisions of this [article] subpart relating to the manner of
8the calling and holding of and the taking of action at meetings
9of members shall be applicable to meetings of delegates or
10representatives of members.
11(d) Incorporation of local units.--A local unit of an
12incorporated or unincorporated parent body [which] that is
13incorporated or organized for a purpose or purposes not
14involving pecuniary profit, incidental or otherwise, to its
15members[,] may be incorporated under this [article] subpart by
16an incorporated parent body or by the members of [such] the
17local unit.
18§ 5755. Time of holding meetings of members.
19(a) Regular meetings.--The bylaws of a nonprofit corporation
20may provide for the number and the time of meetings of members,
21but unless otherwise provided in a bylaw adopted by the members
22at least one meeting of the members of a corporation [which]
23that has members, as such, entitled to vote, shall be held in
24each calendar year for the election of directors[, at such] at
25the time [as shall be] provided in or fixed pursuant to
26authority granted by the bylaws. Failure to hold the annual or
27other regular meeting at the designated time shall not work a
28dissolution of the corporation or affect otherwise valid
29corporate acts. If the annual or other regular meeting [shall
30not be] is not called and held within six months after the
1designated time, any member may call [such] the meeting at any
2time thereafter.
3(b) Special meetings.--Special meetings of the members may
4be called at any time by:
5(1) [by] the board of directors[, or];
6(2) members entitled to cast at least 10% of the votes
7[which] that all members are entitled to cast at the
8particular meeting[, or by such]; or
9(3) other officers or persons as may be provided in the
10bylaws.
11At any time, upon written request of any person who has called a
12special meeting, it shall be the duty of the secretary to fix
13the time of the meeting[,] which, if the meeting is called
14pursuant to a statutory right, shall be held not more than 60
15days after the receipt of the request. If the secretary [shall
16neglect or refuse] neglects or refuses to fix the time of the
17meeting, the person or persons calling the meeting may do so.
18(c) Adjournments.--Adjournments of any regular or special
19meeting may be taken[,] but any meeting at which directors are
20to be elected shall be adjourned only from day to day, or for
21[such] longer periods not exceeding 15 days each, as the members
22present and entitled to [cast at least a majority of the votes
23which all members present and voting are entitled to cast] vote
24shall direct, until [such] the directors have been elected.
25(d) Cross reference.--See section 6145 (relating to
26applicability of certain safeguards to foreign domiciliary
27corporations).
28§ 5756. Quorum.
29(a) General rule.--A meeting of members of a nonprofit
30corporation duly called shall not be organized for the
1transaction of business unless a quorum is present. Unless
2otherwise provided in a bylaw adopted by the members:
3(1) The presence of members entitled to cast at least a
4majority of the votes [which] that all members are entitled
5to cast on [the matters] a particular matter to be acted upon
6at the meeting shall constitute a quorum for the purposes of
7consideration and action on the matter.
8* * *
9(3) If a meeting cannot be organized because a quorum
10has not attended, those present may, except as otherwise
11provided in this [article] subpart, adjourn the meeting to
12[such] a time and place [as] they may determine.
13(b) Exceptions.--Notwithstanding any contrary provision in
14the articles or bylaws, those members entitled to vote who
15attend a meeting of members:
16(1) [In the case of any meeting called for the election
17of directors those who attend the second of such adjourned
18meetings] at which directors are to be elected that has been
19previously adjourned for lack of a quorum, although less than
20a quorum as fixed in this section[,] or in the [articles or]
21bylaws, shall nevertheless constitute a quorum for the
22purpose of election of directors[.];
23(2) [In the case of any meeting called for any other
24purpose those who attend the second of such adjourned
25meetings] that has been previously adjourned for one or more
26periods aggregating at least 15 days because of an absence of
27a quorum, although less than a quorum as fixed in this
28section[,] or in the [articles or] bylaws, shall nevertheless
29constitute a quorum for the purpose of acting upon any
30[resolution or other] matter set forth in the notice of the
1meeting[, if written notice of such second adjourned meeting,
2stating] if the notice states that those members who attend
3the adjourned meeting shall nevertheless constitute a quorum
4for the purpose of acting upon [such resolution or other] the
5matter[, is given to each member of record entitled to vote
6at such second adjourned meeting at least ten days prior to
7the day named for the second adjourned meeting].
8§ 5757. Action by members.
9(a) General rule.--[Except as otherwise provided in this
10article or in a bylaw adopted by the members, the acts at a duly
11organized meeting of members present entitled to cast at least a
12majority of the votes which all members present and voting are
13entitled to cast shall be the acts of the members.
14(b) Increased minimum vote.--Whenever in this article a
15specified number or percentage of votes of members or of a class
16of members is required for the taking of any action, a nonprofit
17corporation may prescribe in a bylaw adopted by the members that
18a higher number or percentage of votes shall be required for
19such action.] Except as otherwise provided in this subpart or in
20a bylaw adopted by the members, whenever any corporate action is
21to be taken by vote of the members of a nonprofit corporation,
22it shall be authorized upon receiving the affirmative vote of a
23majority of the votes cast by the members entitled to vote
24thereon and, if any members are entitled to vote thereon as a
25class, upon receiving the affirmative vote of a majority of the
26votes cast by the members entitled to vote as a class.
27(b) Changes in required vote.--Whenever a provision of this
28subpart requires a specified number or percentage of votes of
29members or of a class of members for the taking of any action, a
30nonprofit corporation may prescribe in a bylaw adopted by the
1members that a higher number or percentage of votes shall be
2required for the action. The number or percentage of members
3necessary to call a special meeting of members or to petition
4for the proposal of an amendment of articles under this subpart
5may not be increased under this subsection. See sections 5504(d)
6(relating to adoption, amendment and contents of bylaws) and
75914(d) (relating to adoption of amendments).
8(c) Expenses.--Unless otherwise restricted in the articles,
9the corporation shall pay the reasonable expenses of
10solicitation of votes, proxies or consents of members by or on
11behalf of the board of directors or its nominees for election to
12the board, including solicitation by professional proxy
13solicitors and otherwise, and may pay the reasonable expenses of
14a solicitation by or on behalf of other persons.
15§ 5759. Voting and other action by proxy.
16(a) General rule.--Voting by members of a nonprofit
17corporation shall be only in person unless a bylaw adopted by
18the members provides for voting by proxy. [The presence of or
19vote or other action at a meeting of members, or the expression
20of consent or dissent to corporate action in writing, by a proxy
21of a member pursuant to such a bylaw shall constitute the
22presence of, or vote or action by, or written consent or dissent
23of such member for the purposes of this article.] Unless
24otherwise restricted by a bylaw adopted by the members:
25(1) The presence of, or vote or other action at a
26meeting of members, or the expression of consent or dissent
27to corporate action, by a proxy of a member pursuant to a
28bylaw shall constitute the presence of, or vote or action by,
29or consent or dissent of the member for the purposes of this
30subpart.
1(2) Where two or more proxies of a member are present,
2the corporation shall, unless otherwise expressly provided in
3the proxy, accept as the vote or other action of all the
4members or shares represented thereby the vote cast or other
5action taken by a majority of them, and, if a majority of the
6proxies cannot agree whether the memberships or shares
7represented shall be voted or upon the manner of voting the
8memberships or shares or taking the other action, the voting
9of the memberships or shares or right to take other action
10shall be divided equally among those persons.
11(b) [Minimum requirements] Execution and filing.--Every
12proxy shall be executed [in writing] or authenticated by the
13member or by [his] the member's duly authorized [attorney in
14fact] attorney-in-fact and filed with or transmitted to the
15secretary of the corporation[.] or its designated agent. A
16member or the member's duly authorized attorney-in-fact may
17execute or authenticate a writing or transmit an electronic
18message authorizing another person to act for the member by
19proxy. A telegram, telex, cablegram, datagram, e-mail, Internet
20communication or other means of electronic transmission from a
21member or attorney-in-fact, or a photographic, facsimile or
22similar reproduction of a writing executed by a member or
23attorney-in-fact:
24(1) may be treated as properly executed or authenticated
25for purposes of this subsection; and
26(2) shall be so treated if it sets forth or utilizes a
27confidential and unique identification number or other mark
28furnished by the corporation to the member for the purposes
29of a particular meeting or transaction.
30(c) Revocation.--A proxy shall be revocable at will,
1notwithstanding any other agreement or any provision in the
2proxy to the contrary, but the revocation of a proxy shall not
3be effective until notice thereof has been given to the
4secretary of the corporation[. No] or its designated agent in
5writing or by electronic transmission. An unrevoked proxy shall
6not be valid after 11 months from the date of its execution,
7authentication or transmission unless a longer time is expressly
8provided therein[, but in no event shall a proxy be voted on
9after three years from the date of its execution]. A proxy shall
10not be revoked by the death or incapacity of the maker unless,
11before the vote is counted or the authority is exercised,
12[written] notice of [such] the death or incapacity is given to
13the secretary of the corporation[.] or its designated agent. See
14section 6145 (relating to applicability of certain safeguards to
15foreign domiciliary corporations).
16Section 38. Title 15 is amended by adding sections to read:
17§ 5760. (Reserved).
18§ 5761. (Reserved).
19Section 39. Sections 5760 and 5761 of Title 15 are
20renumbered and amended to read:
21§ [5760] 5762. Voting by corporations.
22(a) Voting in nonprofit corporation matters.--Unless
23otherwise provided in a bylaw of a nonprofit corporation adopted
24by the members, any other [corporation which is a member of such
25a nonprofit corporation may vote therein by any of its
26officers,] domestic or foreign corporation for profit or not-
27for-profit that is a member of the nonprofit corporation may
28vote by any of its officers or agents, or by proxy appointed by
29any officer or agent, unless some other person, by resolution of
30the board of directors of [such] the other corporation[,] or a
1provision of its articles or bylaws, a copy of which resolution
2or provision certified to be correct by one of its officers
3[shall have] has been filed with the secretary of the nonprofit
4corporation, [shall be] is appointed its general or special
5proxy[,] in which case [such] that person shall be entitled to
6vote [therein] as the proxy.
7(b) Voting by nonprofit corporations.--Shares of or
8memberships in a domestic or foreign corporation for profit or
9not-for-profit other than a nonprofit corporation, standing in
10the name of a shareholder or member [which] that is a nonprofit
11corporation, may be voted by the persons and in the manner
12provided for in the case of nonprofit corporations by subsection
13(a) [of this section] unless the laws of the jurisdiction in
14which the issuer of [any such] the shares or memberships is
15incorporated [shall] require the shares or memberships to be
16voted by some other person or persons or in some other manner[,]
17in which case, to the extent that [such] those laws are
18inconsistent [herewith] with this subsection, this subsection
19shall not apply.
20§ [5761] 5763. Determination of members of record.
21(a) Fixing record date.--Unless otherwise restricted in the
22bylaws, the board of directors of a nonprofit corporation may
23fix a time[, not more than 70 days] prior to the date of any
24meeting of members [or any adjournment thereof,] as a record
25date for the determination of the members entitled to notice of,
26or to vote at, [such] the meeting[. In such case only], which
27time, except in the case of an adjourned meeting, shall not be
28more than 90 days prior to the date of the meeting of members.
29Only members of record on the date [so] fixed shall [so] be so
30entitled notwithstanding any increase or other change in
1membership on the books of the corporation after any record date
2fixed as [aforesaid] provided in this subsection. Unless
3otherwise [restricted] provided in the bylaws, the board of
4directors may similarly fix a record date for the determination
5of members of record for any other purpose. When a determination
6of members of record has been made as provided in this section
7for purposes of a meeting, the determination shall apply to any
8adjournment thereof unless otherwise restricted in the bylaws or
9unless the board fixes a new record date for the adjourned
10meeting.
11(b) Determination when no record date fixed.--Unless
12otherwise [restricted] provided in the bylaws, if [no] a record
13date is not fixed:
14(1) The record date for determining members entitled to
15notice of or to vote at a meeting of members shall be at the
16close of business on the day next preceding the day on which
17notice is given, or, if notice is waived, at the close of
18business on the day [next] immediately preceding the day on
19which the meeting is held.
20(2) The record date for determining members entitled to:
21(i) express consent or dissent to corporate action
22in writing without a meeting, when [no] prior action by
23the board of directors or other body is not necessary[,];
24(ii) call a special meeting of the members; or
25(iii) propose an amendment of the articles;
26shall be the close of business on the day on which the first
27written consent or dissent, request for a special meeting or
28petition proposing an amendment of the articles is
29[expressed] filed with the secretary of the corporation.
30(3) The record date for determining members for any
1other purpose shall be at the close of business on the day on
2which the board of directors or other body adopts the
3resolution relating thereto.
4Section 40. Title 15 is amended by adding a section to read:
5§ 5764. (Reserved).
6Section 41. Sections 5762, 5763, 5764, 5765, 5766 and 5767
7of Title 15 are renumbered and amended to read:
8§ [5762] 5765. Judges of election.
9(a) General rule.--Unless otherwise provided in a bylaw
10adopted by the members:
11(1) In advance of any meeting of members of a nonprofit
12corporation, the board of directors or other body may appoint
13judges of election, who need not be members, to act at [such]
14the meeting or any adjournment thereof. If judges of election
15are not so appointed, the presiding officer of [any such] the
16meeting may, and on the request of any member shall, [make
17such appointment] appoint judges of election at the meeting.
18The number of judges shall be one or three. [No] A person who
19is a candidate for office to be filled at the meeting shall
20not act as a judge.
21(2) In case any person appointed as judge fails to
22appear or fails or refuses to act, the vacancy may be filled
23by appointment made by the board of directors or other body
24in advance of the convening of the meeting, or at the meeting
25by the presiding officer thereof.
26(3) The judges of election shall determine the number of
27members of record and the voting power of each, the members
28present at the meeting, the existence of a quorum, the
29authenticity, validity[,] and effect of proxies, if voting by
30proxy is permitted under the bylaws, receive votes or
1ballots, hear and determine all challenges and questions in
2any way arising in connection with the right to vote, count
3and tabulate all votes, determine the result[,] and [do such]
4perform the acts as may be proper to conduct the election or
5vote with fairness to all members. The judges of election
6shall perform their duties impartially, in good faith, to the
7best of their ability[,] and as expeditiously as is
8practical. If there are three judges of election, the
9decision, act or certificate of a majority shall be effective
10in all respects as the decision, act or certificate of all.
11(4) On request of the presiding officer of the meeting,
12or of any member, the judges shall make a report in writing
13of any challenge or question or matter determined by them,
14and execute a certificate of any fact found by them. Any
15report or certificate made by them shall be prima facie
16evidence of the facts stated therein.
17(b) Cross reference.--See section 6145 (relating to
18applicability of certain safeguards to foreign domiciliary
19corporations).
20§ [5763] 5766. Consent of members in lieu of meeting.
21(a) Unanimous consent.--Unless otherwise restricted in the
22bylaws, any action [which may] required or permitted to be taken
23at a meeting of the members or of a class of members of a
24nonprofit corporation may be taken without a meeting[,] if a
25consent or consents [in writing, setting forth the action so
26taken, shall be signed] to the action in record form are signed,
27before, on or after the effective date of the action, by all of
28the members who would be entitled to vote at a meeting for [such
29purpose and shall be filed] that purpose. The consent or
30consents must be filed with the [secretary of the corporation]
1minutes of the proceedings of the members.
2(b) Partial consent.--If the bylaws so provide, any action
3required or permitted to be taken at a meeting of the members or
4of a class of members may be taken without a meeting upon the
5signed consent of members who would have been entitled to cast
6the minimum number of votes that would be necessary to authorize
7the action at a meeting at which all members entitled to vote
8thereon were present and voting. The consents must be filed in
9record form with the minutes of the proceedings of the members.
10(c) Effectiveness of action by partial consent.--An action
11taken pursuant to subsection (b) shall not become effective
12until after at least ten days' notice of the action has been
13given to each member entitled to vote thereon who has not
14consented thereto.
15§ [5764] 5767. Appointment of custodian of corporation on
16deadlock or other cause.
17(a) General rule.--[The court, upon] Upon application of any
18member, the court may appoint one or more persons to be
19custodians of and for any nonprofit corporation when it [is made
20to appear] appears that:
21(1) [that] at any meeting for the election of directors
22or members of an other body, the members are so divided that
23they have failed to elect successors to [directors] those
24whose terms have expired or would have expired upon the
25qualification of their successors; or
26(2) [that] any of the conditions specified in section
275981 (relating to proceedings upon [petition of member, etc.)
28exists] application of member or director), other than that
29it is beneficial to the interest of the members that the
30corporation be wound up and dissolved, exist with respect to
1the corporation.
2(a.1) Exception.--The court shall not appoint a custodian to
3resolve a deadlock if the members by agreement or otherwise have
4provided for the appointment of a provisional director or member
5of an other body or other means for the resolution of the
6deadlock, but the court shall enforce the remedy so provided, if
7appropriate.
8(b) Power and title of custodian.--A custodian appointed
9under this section shall have all the power and title of a
10receiver appointed under Subchapter G of Chapter 59 (relating to
11involuntary liquidation and dissolution), but the authority of
12the custodian shall be to continue the business of the
13corporation and not to liquidate its affairs and distribute its
14assets[,] except when the court shall otherwise order [and
15except in cases arising under section 5981(1), (2) and (3)
16(relating to proceedings upon petition of member, etc.)].
17(c) Cross reference.--See section 6145 (relating to
18applicability of certain safeguards to foreign domiciliary
19corporations).
20§ [5765] 5768. Reduction of membership below stated number.
21Whenever the membership of a nonprofit corporation having a
22stated number of members [shall be] is reduced below [such] that
23number by death, withdrawal[,] or otherwise, the corporation
24shall not on that account be dissolved, but it shall be lawful
25for the surviving or continuing members to continue the
26corporate existence[,] unless otherwise restricted in the
27bylaws.
28§ [5766] 5769. Termination and transfer of membership.
29(a) General rule.--Membership in a nonprofit corporation
30shall be terminated in the manner provided in a bylaw adopted by
1the members. If [the] membership in any such corporation is
2limited to persons who are members in good standing in another
3corporation, or in any lodge, church, club, society or other
4entity or organization, the bylaws shall in each case define
5[such] the limitations, and may provide that failure on the part
6of [any such] a member to keep himself in good standing in
7[such] the other entity or organization shall be sufficient
8cause for [expelling the member from] terminating the membership
9of the member in the corporation requiring such eligibility.
10(b) Expulsion.--
11(1) [No] A member shall not be expelled from any
12nonprofit corporation without notice, trial and conviction,
13the form of which shall be prescribed by the bylaws.
14(2) Paragraph (1) [of this subsection] shall not apply
15to termination of membership pursuant to section 5544[(c)]
16(relating to [enforcement of payment of fees,] dues and
17assessments).
18(3) See section 6145 (relating to applicability of
19certain safeguards to foreign domiciliary corporations).
20(c) Effect of termination of membership.--Unless otherwise
21provided in the bylaws, the right of a member of a nonprofit
22corporation to vote, and his right, title and interest in or to
23the corporation or its property, shall cease [on the] upon
24termination of [his] membership.
25(d) Transfer of membership.--Unless otherwise provided in
26the bylaws, [no] a member may not transfer his membership or any
27right arising therefrom. The adoption of an amendment to the
28articles or bylaws of a nonprofit corporation that changes the
29identity of some or all of the members or the criteria for
30membership does not constitute a transfer for purposes of this
1subsection.
2§ [5767] 5770. Voting powers and other rights of certain
3securityholders and other entities.
4[Such] The power to vote in respect to the corporate affairs
5and management of a [nonprofit] membership corporation and other
6membership rights as may be provided in a bylaw adopted by the
7members may be conferred upon:
8(1) Registered holders of [securities evidencing
9indebtedness] obligations issued or to be issued by the
10corporation.
11(2) The United States of America, the Commonwealth, a
12state, or any political subdivision [thereof or other] of any
13of the foregoing, or any entity prohibited by law from
14becoming a member of a corporation.
15Section 42. Sections 5791, 5792, 5793, 5911, 5913, 5914,
165921, 5923(a), 5924, 5925, 5926(2) and (4), 5928, 5930, 5951,
175956, 5957(b)(1)(ii) and (iv) and (h)(1) and (3), 5972(b),
185973(a), 5975(c), 5976(a), 5977(a) and 5978(b) of Title 15 are
19amended to read:
20§ 5791. Corporate action subject to subchapter.
21(a) General rule.--This subchapter shall apply to, and the
22term "corporate action" in this subchapter shall mean any of the
23following actions:
24(1) The election, appointment, designation or other
25selection and the suspension, removal or expulsion of
26members, directors, members of an other body or officers of a
27nonprofit corporation.
28(2) The taking of any action on any matter [which] that
29is required under this [article] subpart or under any other
30provision of law to be, or [which] that under the bylaws may
1be, submitted for action to the members, directors, members
2of an other body or officers of a nonprofit corporation.
3(b) Cross reference.--See section 6145 (relating to
4applicability of certain safeguards to foreign domiciliary
5corporations).
6§ 5792. Proceedings prior to corporate action.
7(a) General rule.--Where under applicable law or the bylaws
8of a nonprofit corporation there has been a failure to hold a
9meeting to take corporate action and [such] the failure has
10continued for 30 days after the [date] designated or appropriate
11[therefor] date, the court may summarily order a meeting to be
12held upon the application of any person entitled, either alone
13or in conjunction with other persons similarly seeking relief
14under this section, to call a meeting to consider the corporate
15action in issue.
16(b) Conduct of meeting.--The court may determine the right
17to vote at [such] the meeting of persons claiming [such] that
18right, may appoint a master to hold [such] the meeting under
19such orders and powers as the court [may deem proper,] deems
20proper and may take [such action as may be] any action required
21to give due notice of the meeting and to convene and conduct the
22meeting in the interests of justice.
23(c) Cross reference.--See section 6145 (relating to
24applicability of certain safeguards to foreign domiciliary
25corporations).
26§ 5793. Review of contested corporate action.
27(a) General rule.--Upon [petition] application of any person
28[whose status as, or whose rights or duties as, a member,
29director, member of an other body, officer or otherwise of a
30nonprofit corporation are or may be affected] aggrieved by any
1corporate action, the court may hear and determine the validity
2of [such] the corporate action.
3(b) Powers and procedures.--[The court may make such orders
4in any such case as may be just and proper, with power to] By
5entering an appropriate order, the court may enforce the
6production of any books, papers and records of the corporation
7and other relevant evidence [which] that may relate to the
8issue. The court shall provide for notice of the pendency of the
9proceedings under this section to all persons affected thereby.
10If it is determined that no valid corporate action has been
11taken, the court may order a meeting to be held in accordance
12with section 5792 (relating to proceedings prior to corporate
13action).
14(c) Cross reference.--See section 6145 (relating to
15applicability of certain safeguards to foreign domiciliary
16corporations).
17§ 5911. Amendment of articles authorized.
18(a) General rule.--A nonprofit corporation, in the manner
19[hereinafter] provided in this subchapter, may [from time to
20time] amend its articles for one or more of the following
21purposes:
22(1) To adopt a new name, subject to the restrictions
23[heretofore] provided in this [article] subpart.
24(2) To modify any provision of the articles relating to
25its term of existence.
26(3) To change, add to[,] or diminish its purposes[,] or
27to set forth different or additional purposes.
28(4) To restate the articles in their entirety.
29(5) [In] To make any and as many other [respects]
30changes as desired.
1(b) Exceptions.--[No] An amendment adopted under this
2section shall not amend articles in such a way that as so
3amended they would not be authorized by this [article] subpart
4as original articles of incorporation[,] except that:
5(1) Restated articles shall, subject to section 109
6(relating to name of commercial registered office provider in
7lieu of registered address), state the address of the current
8instead of the initial registered office of the corporation
9in this Commonwealth[,] and need not state the names and
10addresses [of the first directors or] of the incorporators.
11(2) The corporation shall not be required to revise any
12other provision of its articles if [such] the provision is
13valid and operative immediately prior to the filing of [such]
14the amendment in the [Department of State] department.
15§ 5913. Notice of meeting of members.
16[Written notice shall, not less than ten days before the
17meeting of members called for the purpose of considering the
18proposed amendment,] (a) General rule.--Notice in record form
19of the meeting of members of a nonprofit corporation that will
20act on the proposed amendment shall be given to each member of
21record entitled to vote thereon. [There shall be included in, or
22enclosed with, such notice] The notice shall include a copy of
23the proposed amendment or a summary of the changes to be
24effected thereby.
25(b) Cross reference.--See Subchapter A of Chapter 57
26(relating to notice and meetings generally).
27§ 5914. Adoption of amendments.
28(a) General rule.--[The] Unless a bylaw adopted by the
29members or a specific provision of this subpart requires a
30greater vote, a proposed amendment of the articles of a
1nonprofit corporation shall be adopted upon receiving the
2affirmative vote of the members present entitled to cast at
3least a majority of the votes [which] that all members present
4are entitled to cast thereon, and if any class of members is
5entitled to vote thereon as a class, the affirmative vote of the
6members present of such class entitled to cast at least a
7majority of the votes [which] that all members present of such
8class are entitled to cast thereon. Any number of amendments may
9be submitted to the members and voted upon by them at one
10meeting.
11(a.1) Adoption by board of directors or other body.--Unless
12otherwise restricted in the bylaws, an amendment of articles
13shall not require the approval of the members of the corporation
14if:
15(1) the amendment is to provide for perpetual existence;
16(2) to the extent the amendment has not been approved by
17the members, it restates without change all of the operative
18provisions of the articles as theretofore amended or as
19amended thereby; or
20(3) the amendment accomplishes any combination of
21purposes specified in this subsection.
22Whenever a provision of this subpart authorizes the board of
23directors or other body to take any action without the approval
24of the members and provides that a statement, certificate, plan
25or other document relating to such action shall be filed in the
26department and shall operate as an amendment of the articles,
27the board upon taking such action may, in lieu of filing the
28statement, certificate, plan or other document, amend the
29articles under this subsection without the approval of the
30members to reflect the taking of such action. The amendment
1shall be deemed adopted by the corporation when it has been
2adopted by the board of directors or other body in the manner
3provided by subsection (b).
4(b) Adoption in absence of voting members.--If the
5corporation has no members entitled to vote thereon, or no
6members entitled to vote thereon other than persons who also
7constitute the board of directors or other body, the amendment
8shall be deemed adopted by the corporation when it has been
9adopted by the board of directors or other body pursuant to
10section 5912 (relating to proposal of amendments).
11(c) Termination of proposal.--[The resolution or petition
12may contain a provision that at any time prior to the filing of
13articles of amendment in the Department of State the proposal
14may be terminated by the board of directors or other body
15notwithstanding the adoption of the amendment by the
16corporation.] Prior to the time when an amendment becomes
17effective, the amendment may be terminated pursuant to
18provisions for amendment, if any, set forth in the resolution or
19petition. If articles of amendment have been filed in the
20department prior to the termination, a statement under section
215902 (relating to statement of termination) shall be filed in
22the department.
23(d) Amendment of voting provisions.--[Notwithstanding any
24contrary provision of the articles or bylaws,] Unless otherwise
25provided in the articles, whenever the articles [shall] require
26for the taking of any action by the members or a class of
27members a specific number or percentage of votes, the provision
28of the articles setting forth [such] that requirement shall not
29be amended or repealed by any lesser number or percentage of
30votes of the members or of [such] the class of members.
1§ 5921. Merger and consolidation authorized.
2(a) Domestic surviving or new corporation.--Any two or more
3domestic nonprofit corporations, or any two or more foreign
4nonprofit corporations [not-for-profit], or any one or more
5domestic nonprofit corporations[,] and any one or more foreign
6nonprofit corporations [not-for-profit], may, in the manner
7provided in this subchapter, be merged into one of [such] the
8domestic nonprofit corporations, [hereinafter] designated in
9this subchapter as the surviving corporation, or consolidated
10into a new corporation to be formed under this [article, if
11such] subpart, if the foreign corporations [not-for-profit] are
12authorized by the [law or] laws of the jurisdiction under which
13they are incorporated to effect [such] a merger or consolidation
14with a corporation of another jurisdiction.
15(b) Foreign surviving or new corporation.--Any one or more
16domestic nonprofit corporations, and any one or more foreign
17nonprofit corporations [not-for-profit], may, in the manner
18[hereinafter] provided in this subchapter, be merged into one of
19[such foreign corporations not-for-profit, hereinafter] the
20foreign nonprofit corporations, designated in this subchapter as
21the surviving corporation, or consolidated into a new
22corporation to be incorporated under the [law or] laws of the
23jurisdiction under which one of the foreign nonprofit
24corporations [not-for-profit] is incorporated, if the laws of
25[such] that jurisdiction authorize [such] a merger with or
26consolidation into a corporation of another jurisdiction.
27§ 5923. Notice of meeting of members.
28(a) General rule.--[Written notice] Notice in record form of
29the meeting of members that will act on the proposed plan shall
30be given to each member of record, whether or not entitled to
1vote thereon, of each domestic nonprofit corporation that is a
2party to the merger or consolidation. [There shall be included
3in, or enclosed with, the notice] The notice shall include or be
4accompanied by a copy of the proposed plan or a summary thereof.
5The notice shall [state] provide that a copy of the bylaws of
6the surviving or new corporation will be furnished to any member
7on request and without cost.
8* * *
9§ 5924. Adoption of plan.
10(a) General rule.--The plan of merger or consolidation shall
11be adopted upon receiving the affirmative vote of the members
12present entitled to cast at least a majority of the votes
13[which] that all members present are entitled to cast thereon of
14each of the [merging or consolidating] domestic nonprofit
15corporations[,] that is a party to the merger or consolidation
16and, if any class of members is entitled to vote thereon as a
17class, the affirmative vote of the members present of such class
18entitled to cast at least a majority of the votes [which] that
19all members present of such class are entitled to cast thereon.
20(b) Adoption in absence of voting members.--If [the] a
21merging or consolidating corporation has no members entitled to
22vote thereon, or no members entitled to vote thereon other than
23persons who also constitute the board of directors or other
24body, a plan of merger or consolidation shall be deemed adopted
25by the corporation when it has been adopted by the board of
26directors or other body pursuant to section 5922 (relating to
27plan of merger or consolidation).
28(c) Termination of plan.--[Any plan of merger or
29consolidation may contain a provision that at any time prior to
30the filing of articles of merger or consolidation in the
1Department of State the plan may be terminated by the board of
2directors or other body of any corporation which is a party to
3the plan notwithstanding adoption of the plan by all or any of
4the corporations which are parties to the plan.] Prior to the
5time when a merger or consolidation becomes effective, the
6merger or consolidation may be terminated pursuant to provisions
7for termination, if any, set forth in the plan. If articles of
8merger or consolidation have been filed in the department prior
9to the termination, a statement under section 5902 (relating to
10statement of termination) shall be filed in the department.
11§ 5925. Authorization by foreign corporations.
12The plan of merger or consolidation shall be authorized,
13adopted or approved by each foreign nonprofit corporation
14[which] that desires to merge or consolidate[,] in accordance
15with the laws of the jurisdiction in which it is incorporated[.]
16and, in the case of a foreign domiciliary corporation, in
17accordance with the provisions of this subpart to the extent
18provided by section 6145 (relating to applicability of certain
19safeguards to foreign domiciliary corporations).
20§ 5926. Articles of merger or consolidation.
21Upon the adoption of the plan of merger or consolidation by
22the corporations desiring to merge or consolidate, as provided
23in this subchapter, articles of merger or articles of
24consolidation, as the case may be, shall be executed by each
25corporation and shall, subject to section 109 (relating to name
26of commercial registered office provider in lieu of registered
27address), set forth:
28* * *
29(2) The name and address, including street and number,
30if any, of the registered office of each other domestic
1nonprofit corporation and qualified foreign nonprofit
2corporation that is a party to the [plan] merger or
3consolidation.
4* * *
5(4) The manner in which the plan was adopted by each
6domestic corporation and, if one or more foreign corporations
7are parties to the [plan] merger or consolidation, the fact
8that the plan was authorized, adopted or approved, as the
9case may be, by each of the foreign corporations in
10accordance with the laws of the jurisdiction in which it is
11incorporated.
12* * *
13§ 5928. Effective date of merger or consolidation.
14Upon the filing of the articles of merger or the articles of
15consolidation in the [Department of State,] department or upon
16the effective date specified in the plan of merger or
17consolidation, whichever is later, the merger or consolidation
18shall be effective. The merger or consolidation of one or more
19domestic nonprofit corporations into a foreign nonprofit
20corporation shall be effective according to the provisions of
21law of the jurisdiction in which [such] the foreign corporation
22is incorporated, but not until articles of merger or articles of
23consolidation have been adopted and filed, as provided in this
24subchapter.
25§ 5930. Voluntary transfer of corporate assets.
26(a) General rule.--[A nonprofit corporation shall not sell,
27lease away or exchange all, or substantially all, its property
28and assets, with or without good will, unless and until a plan
29of sale, lease or exchange of assets with respect thereto shall
30have been adopted by the corporation in the manner provided in
1this subchapter with respect to the adoption of a plan of
2merger.] A sale, lease, exchange or other disposition of all, or
3substantially all, of the property and assets, with or without
4goodwill, of a nonprofit corporation, if not made pursuant to
5Subchapter D of Chapter 19 (relating to division), may be made
6only pursuant to a plan of asset transfer. The property or
7assets of a direct or indirect subsidiary corporation that is
8controlled by a parent corporation shall also be deemed the
9property or assets of the parent corporation for purposes of
10this subsection. The plan of asset transfer shall set forth the
11terms and consideration of the sale, lease, exchange or other
12disposition or may authorize the board of directors or other
13body to fix any or all of the terms and conditions, including
14the consideration to be received by the corporation. Any of the
15terms of the plan 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. The
18plan of asset transfer shall be proposed and adopted, and may be
19amended after its adoption and terminated, by a nonprofit
20corporation in the manner provided in this subchapter for the
21proposal, adoption, amendment and termination of a plan of
22merger. A copy or summary of the plan shall be included in, or
23enclosed with, the notice of the meeting at which members will
24act on the plan. In order to make effective any plan [of sale,
25lease or exchange of assets] so adopted, it shall not be
26necessary to file any articles or other document in the
27[Department of State] department, but the corporation shall
28comply with the requirements of section 5547(b) (relating to
29nondiversion of certain property).
30(b) Exceptions.--Subsection (a) [of this section] shall not
1apply to a sale, lease [away or], exchange or other disposition
2of all, or substantially all, the property and assets of a
3nonprofit corporation [when made in connection with the
4dissolution or liquidation of the corporation. Such a
5transaction shall be governed by the provisions of Subchapter F
6(relating to voluntary dissolution and winding up) or Subchapter
7G (relating to involuntary liquidation and dissolution), as the
8case may be.]:
9(1) that directly or indirectly owns all of the
10outstanding shares or other ownership interest of another
11corporation to the other corporation;
12(2) if made in connection with the dissolution or
13liquidation of the corporation, which transaction shall be
14governed by the provisions of Subchapter F (relating to
15voluntary dissolution and winding up) or G of Chapter 19
16(relating to involuntary liquidation and dissolution), as
17appropriate; or
18(3) if made in connection with a transaction pursuant to
19which all the assets sold, leased, exchanged or otherwise
20disposed of are simultaneously leased back to the
21corporation.
22(c) Mortgage.--A mortgage [or pledge], pledge or grant of a
23security interest or dedication of property to the repayment of
24indebtedness, with or without recourse, shall not be deemed a
25sale, lease [or exchange], exchange or other disposition for the
26purposes of this section.
27(d) Restrictions.--[Nothing in this] This section shall not
28be construed to authorize the conversion or exchange of property
29or assets in fraud of corporate creditors or in violation of
30law.
1§ 5951. Division authorized.
2(a) Division of domestic corporation.--Any domestic
3nonprofit corporation may, in the manner provided in this
4subchapter, be divided into two or more domestic nonprofit
5corporations incorporated or to be incorporated under this
6article, or into one or more [such] domestic nonprofit
7corporations and one or more foreign nonprofit corporations
8[not-for-profit] to be incorporated under the laws of another
9jurisdiction or jurisdictions, or into two or more [of such]
10foreign nonprofit corporations [not-for-profit], if the [law or]
11laws of [such] the other jurisdictions [authorized such]
12authorize the division.
13(b) Division of foreign corporation.--Any foreign nonprofit
14corporation [not-for-profit] may, in the manner provided in this
15subchapter, be divided into one or more domestic nonprofit
16corporations to be incorporated under this [article] subpart and
17one or more foreign nonprofit corporations [not-for-profit]
18incorporated or to be incorporated under the laws of another
19jurisdiction or jurisdictions, or into two or more [of such]
20domestic nonprofit corporations, if [such foreign] the foreign
21nonprofit corporation [not-for-profit] is authorized under the
22laws of the jurisdiction under which it is incorporated to
23effect [such] a division.
24(c) Surviving and new corporations.--The corporation
25effecting a division, if it [shall survive] survives the
26division, is [hereinafter] designated in this subchapter as the
27surviving corporation. All corporations originally incorporated
28by a division are [hereinafter] designated in this subchapter as
29new corporations. The surviving corporation, if any, and the new
30corporation or corporations are [hereinafter] collectively
1designated in this subchapter as the resulting corporations.
2§ 5956. Effective date of division.
3Upon the filing of articles of division in the [Department of
4State,] department or upon the effective date specified in the
5plan of division, whichever is later, the division shall become
6effective. The division of a domestic nonprofit corporation into
7one or more foreign nonprofit corporations [not-for-profit] or
8the division of a foreign nonprofit corporation [not-for-profit]
9shall be effective according to the laws of the jurisdictions
10where [such] the foreign corporations are or are to be
11incorporated and, in the case of a foreign domiciliary
12corporation, the provisions of this subpart to the extent
13provided by section 6145 (relating to applicability of certain
14safeguards to foreign domiciliary corporations), but not until
15articles of division have been adopted and filed[,] as provided
16in this subchapter.
17§ 5957. Effect of division.
18* * *
19(b) Property rights; allocations of assets and
20liabilities.--
21(1) Except as otherwise provided by order, if any,
22obtained pursuant to section 5547(b) (relating to
23nondiversion of certain property):
24* * *
25(ii) Upon the division becoming effective, the
26resulting corporations shall each thenceforth be
27responsible as separate and distinct corporations only
28for such liabilities as each corporation may undertake or
29incur in its own name, but shall be liable for the
30liabilities of the dividing corporation in the manner and
1on the basis provided in [paragraphs (4) and (5)]
2subparagraphs (iv) and (v).
3* * *
4(iv) [To] Except as provided in section 5952(f)
5(relating to proposal and adoption of plan of division),
6to the extent allocations of liabilities are contemplated
7by the plan of division, the liabilities of the dividing
8corporation shall be deemed without further action to be
9allocated to and become the liabilities of the resulting
10corporations on such a manner and basis and with such
11effect as is specified in the plan; and one or more, but
12less than all, of the resulting corporations shall be
13free of the liabilities of the dividing corporation to
14the extent, if any, specified in the plan, if in either
15case:
16(A) no fraud on members without voting rights or
17violation of law shall be effected thereby; and
18(B) the plan does not constitute a fraudulent
19transfer under 12 Pa.C.S. Ch. 51 (relating to
20fraudulent transfers).
21* * *
22(h) Conflict of laws.--It is the intent of the General
23Assembly that:
24(1) The effect of a division of a domestic [business]
25nonprofit corporation shall be governed solely by the laws of
26this Commonwealth and any other jurisdiction under the laws
27of which any of the resulting corporations is incorporated.
28* * *
29(3) The validity of any allocations of assets or
30liabilities by a plan of division of a domestic [business]
1nonprofit corporation, regardless of whether [or not] any of
2the new corporations is a foreign [business] nonprofit
3corporation, shall be governed solely by the laws of this
4Commonwealth.
5* * *
6§ 5972. Proposal of voluntary dissolution.
7* * *
8(b) Submission to members.--The board of directors or other
9body or the petitioning members shall direct that the [question
10of] resolution recommending dissolution be submitted to a vote
11of the members of the corporation entitled to vote thereon at a
12regular or special meeting of the members.
13* * *
14§ 5973. Notice of meeting of members.
15(a) General rule.--[Written notice] Notice in record form of
16the meeting of members that will consider the [advisability of
17voluntarily dissolving a] resolution recommending dissolution of
18the nonprofit corporation shall be given to each member of
19record entitled to vote thereon [and the purpose shall be
20included]. The purpose of the meeting shall be stated in the
21notice [of the meeting].
22* * *
23§ 5975. Predissolution provision for liabilities.
24* * *
25(c) Winding up and distribution.--The corporation shall, as
26speedily as possible, proceed to collect all sums due it,
27convert into cash all corporate assets the conversion of which
28into cash is required to discharge its liabilities and, out of
29the assets of the corporation, discharge or make adequate
30provision for the discharge of all liabilities of the
1corporation, according to their respective priorities. Except as
2otherwise provided in a bylaw adopted by the members or in this
3subpart or by any other provision of law, any surplus remaining
4after paying or providing for all liabilities of the corporation
5shall be distributed to the shareholders, if any, pro rata, or
6if there be no shareholders, among the members per capita. See
7section [1972(a)] 5972(a) (relating to proposal of voluntary
8dissolution).
9§ 5976. Judicial supervision of proceedings.
10(a) General rule.--A nonprofit corporation that has elected
11to proceed under section [1975] 5975 (relating to predissolution
12provision for liabilities), at any time during the winding up
13proceedings, may apply to the court to have the proceedings
14continued under the supervision of the court and thereafter the
15proceedings shall continue under the supervision of the court as
16provided in Subchapter G (relating to involuntary liquidation
17and dissolution).
18* * *
19§ 5977. Articles of dissolution.
20(a) General rule.--Articles of dissolution and the
21certificates or statement required by section 139 (relating to
22tax clearance of certain fundamental transactions) shall be
23filed in the [Department of State] department when:
24(1) all liabilities of the nonprofit corporation have
25been discharged, or adequate provision has been made
26therefor, in accordance with section 5975 (relating to
27predissolution provision for liabilities), and all of the
28remaining assets of the corporation have been distributed as
29provided in section 5975 or in case its assets are not
30sufficient to discharge its liabilities, when all the assets
1have been fairly and equitably applied, as far as they will
2go, to the payment of such liabilities; or
3(2) an election to proceed under Subchapter H (relating
4to postdissolution provision for liabilities) has been made.
5[See section 134 (relating to docketing statement).]
6* * *
7§ 5978. Winding up of corporation after dissolution.
8* * *
9(b) Standard of care of directors, members of an other body
10and officers.--The dissolution of the corporation shall not
11subject its directors, members of an other body or officers to
12standards of conduct different from those prescribed by or
13pursuant to Chapter 57 (relating to officers, directors and
14members). Directors and members of an other body of a dissolved
15corporation who have complied with section 5975 (relating to
16predissolution provision for liabilities) or Subchapter H
17(relating to postdissolution provision for liabilities) and
18governing persons of a successor entity who have complied with
19Subchapter H shall not be personally liable to the creditors or
20claimants of the dissolved corporation.
21Section 43. Section 5979(a) of Title 15 is amended and the
22section is amended by adding a subsection to read:
23§ 5979. Survival of remedies and rights after dissolution.
24(a) General rule.--The dissolution of a nonprofit
25corporation, either under this subchapter or under Subchapter G
26(relating to involuntary liquidation and dissolution) or by
27expiration of its period of duration or otherwise, shall not
28eliminate nor impair any remedy available to or against the
29corporation or its directors, members of an other body, officers
30or members for any right or claim existing, or liability
1incurred, prior to the dissolution, if an action thereon is
2brought on behalf of:
3(1) the corporation within the time otherwise limited by
4law; or
5(2) any other person before or within two years after
6the date of the dissolution or within the time otherwise
7limited by this subpart or other provision of law, whichever
8is less. See sections 5987 (relating to proofs of claims),
95993 (relating to acceptance or rejection of matured claims)
10and 5994 (relating to disposition of unmatured claims).
11[The actions or proceedings may be prosecuted against and
12defended by the corporation in its corporate name.]
13* * *
14(e) Conduct of actions.--An action or proceeding may be
15prosecuted against and defended by a dissolved corporation in
16its corporate name.
17Section 44. Title 15 is amended by adding a section to read:
18§ 5980. Dissolution by domestication.
19Whenever a domestic nonprofit corporation has domesticated
20itself under the laws of another jurisdiction by action similar
21to that provided under section 6161 (relating to domestication)
22and has authorized that action by the vote required by this
23subchapter for the approval of a proposal that the corporation
24dissolve voluntarily, the corporation may surrender its charter
25under the laws of this Commonwealth by filing in the department
26articles of dissolution under this subchapter containing the
27statements specified under section 5977(b)(1) through (4)
28(relating to articles of dissolution). If the corporation as
29domesticated in the other jurisdiction qualifies to do business
30in this Commonwealth either prior to or simultaneously with the
1filing of the articles of dissolution under this section, the
2corporation shall not be required to file with the articles of
3dissolution the tax clearance certificates that would otherwise
4be required under section 139 (relating to tax clearance of
5certain fundamental transactions).
6Section 45. Sections 5981, 5982, 5983, 5984, 5986, 5987,
75988, 5992(c)(2), 5997(d) and 6101(c) of Title 15 are amended to
8read:
9§ 5981. Proceedings upon [petition] application of member[,
10etc.] or director.
11[The court may, upon petition] Upon application filed by a
12member or director of a nonprofit corporation, the court may
13entertain proceedings for the involuntary winding up and
14dissolution of the corporation[,] when any of the following [are
15made to appear] occur:
16(1) [That the] The objects of the corporation have
17wholly failed[;], or are entirely abandoned, or [that] their
18accomplishment is impracticable.
19(2) [That the] The acts of the directors, or those in
20control of the corporation, are illegal, oppressive[,] or
21fraudulent[, and that] and it is beneficial to the interests
22of the members that the corporation be wound up and
23dissolved.
24(3) [That the] The corporate assets are being misapplied
25or wasted[, and that] and it is beneficial to the interests
26of the members that the corporation be wound up and
27dissolved.
28(4) [That the] The directors or other body are
29deadlocked in the direction of the management of the
30[corporate] business and affairs of the corporation and the
1members are unable to break the deadlock[, and that] and
2irreparable injury to the corporation is being suffered or is
3threatened by reason thereof. The court shall not appoint a
4receiver or grant other similar relief under this paragraph
5if the members by agreement or otherwise have provided for
6appointment of a provisional director or member of an other
7body or other means for the resolution of a deadlock, but the
8court shall enforce the remedy provided by the members, if
9appropriate.
10§ 5982. Proceedings upon [petition] application of creditor.
11[The court may, upon petition] Upon application filed by a
12creditor of a nonprofit corporation whose claim has either been
13reduced to judgment and an execution thereon returned
14unsatisfied[,] or whose claim is admitted by the corporation,
15the court may entertain proceedings for the involuntary winding
16up and dissolution of the corporation when, in either case, it
17is made to appear that the corporation is unable to [pay its
18debts and obligations] discharge its liabilities in the regular
19course of business, as they mature, or is unable to afford
20reasonable security to those who may deal with it.
21§ 5983. Proceedings upon petition of superior religious
22organization.
23The court may, in the case of any nonprofit corporation
24organized for the support of public worship, upon [petition
25filed by] application of the diocesan convention, presbytery,
26synod, conference, council, or other supervising or controlling
27organization of which the corporation is a member or with which
28it is in allegiance and to which it is subordinate, entertain
29proceedings for the involuntary winding up and dissolution of
30the corporation when it is made to appear that by reason of
1shifting population, withdrawal of membership[,] or any other
2cause whatsoever, the corporation has ceased to support public
3worship within the intent and meaning of its articles[,] and the
4dissolution of the corporation may be effected without prejudice
5to the public welfare and the interests of the members of the
6corporation.
7§ 5984. Appointment of receiver pendente lite and other interim
8powers.
9Upon the filing of [a petition] an application under this
10subchapter, the court [shall have all the ordinary powers of a
11court of equity to] may issue injunctions, [to] appoint a
12receiver [or receivers,] pendente lite[,] with such powers and
13duties as the court from time to time may direct[, to take such
14other proceedings] and proceed as may be requisite to preserve
15the corporate assets wherever situated and carry on the business
16of the corporation until a full hearing can be had.
17§ 5986. Qualifications of receivers.
18A receiver shall in all cases be a [resident of this
19Commonwealth,] natural person of full age or a corporation
20authorized to act as receiver, which corporation, if so
21authorized, may be a domestic corporation for profit or not-for-
22profit or a foreign corporation for profit or not-for-profit
23authorized to do business in this Commonwealth, and shall give
24such bond, if any, as the court may direct, with such sureties,
25if any, as the court may require.
26§ 5987. Proofs of claims.
27(a) General rule.--In a proceeding under this subchapter,
28the court may require all creditors of the nonprofit corporation
29to file with the [prothonotary] office of the clerk of the court
30of common pleas, or with the receiver, in such form as the court
1may prescribe, verified proofs[, under oath,] of their
2respective claims. If the court requires the filing of claims,
3it shall fix a date, which shall not be less than [four months]
4120 days from the date of the order, as the last day for filing
5of claims[,] and shall prescribe the notice that shall be given
6to creditors and claimants of the date so fixed. Prior to or
7after the date so fixed, the court may extend the time for the
8filing of claims. Creditors and claimants [failing to] who do
9not file proofs of claim on or before the date so fixed may be
10barred, by order of court, from participating in the
11distribution of the assets of the corporation.
12(b) Cross reference.--See section 5979 (relating to survival
13of remedies and rights after dissolution).
14§ 5988. Discontinuance of proceedings; reorganization.
15[The proceedings under this subchapter may be discontinued at
16any time during the winding up proceedings, in the following
17manner:
18(1) If the proceedings shall have been instituted by a
19member or director and it is made to appear to the court that
20the deadlock in the corporate affairs has been broken or the
21management or control of the corporation has been changed,
22the court, in its discretion, may dismiss the proceeding and
23direct the receiver to redeliver to the corporation all its
24remaining assets.
25(2) If the proceedings shall have been instituted by a
26creditor and it is made to appear that the debts of the
27corporation have been paid or provided for, and that there
28remain or can be obtained sufficient funds to enable the
29corporation to resume its business, the court, in its
30discretion, may dismiss the proceeding and direct the
1receiver to redeliver to the corporation all its remaining
2assets.
3(3) When a compromise or reorganization of the
4corporation is proposed, whether the proceedings shall have
5been instituted by a member or director or by a creditor, the
6court, upon the summary application of any member, director,
7creditor, or receiver, may order a meeting of the creditors,
8or members to be summoned in such manner as the court may
9direct. If a majority in number, representing 75% in value of
10the creditors or if 75% of the members present in person, or
11if a majority in number, representing 75% in value of any
12class of creditors, or if 75% of the members of any class
13present in person, as the case may be, agree to any
14compromise or reorganization of the corporation, such
15compromise or reorganization, if approved by the court as
16fair and feasible, shall be binding on all creditors or on
17all members, or both, or on the class of creditors or class
18of members, or both, as the case may be, and also on the
19corporation and its receiver, if any.
20(4) If the proceedings shall have been instituted by a
21superior religious organization and it is made to appear that
22appropriate arrangements for the conduct of the affairs of
23the corporation have been made, the court, in its discretion,
24may dismiss the proceedings and direct the receiver to
25redeliver to the corporation its remaining assets.]
26The proceedings under this subchapter may be discontinued at
27any time if it is established that cause for liquidation no
28longer exists, in which event the court shall dismiss the
29proceedings and direct the receiver to redeliver to the
30nonprofit corporation all its remaining property and assets.
1§ 5992. Notice to claimants.
2* * *
3(c) Publication and service of notices.--
4* * *
5(2) Concurrently with or preceding the publication, the
6corporation or successor entity shall send a copy of the
7notice by certified or registered mail, return receipt
8requested, to each:
9(i) known creditor or claimant;
10(ii) holder of a claim described in subsection (b);
11and
12(iii) municipal corporation in which [the registered
13office or principal] a place of business of the
14corporation in this Commonwealth was located at the time
15of filing the articles of dissolution in the department.
16* * *
17§ 5997. Payments and distributions.
18* * *
19[(d) Liability of directors.--Directors or members of an
20other body of a dissolved corporation or governing persons of a
21successor entity that has complied with this section shall not
22be personally liable to the claimants of the dissolved
23corporation.]
24§ 6101. Application of article.
25* * *
26(c) Admitted foreign fraternal benefit society exclusion.--
27This article shall not apply to any foreign corporation not-for-
28profit qualified to do business in this Commonwealth under
29section [603 of the act of July 29, 1977 (P.L.105, No.38) known
30as the Fraternal Benefit Society Code.] 2455 of the act of May
117, 1921 (P.L.682, No.284), known as The Insurance Company Law
2of 1921.
3Section 46. Title 15 is amended by adding sections to read:
4§ 6102. Foreign domiciliary corporations.
5A foreign nonprofit corporation is a foreign domiciliary
6corporation if it is a corporation:
7(1) which derived more than one-half of its revenues for
8the preceding three fiscal years, or such portion thereof as
9the corporation was in existence, from sources in this
10Commonwealth and was at any time during that period doing
11business in this Commonwealth on the basis of the most
12minimal contacts with this Commonwealth permitted under the
13Constitution of the United States; or
14(2) at least a majority of the bona fide members of
15which are residents of this Commonwealth.
16§ 6103. Acquisition of foreign domiciliary corporation status.
17(a) General rule.--A foreign nonprofit corporation shall
18become a foreign domiciliary corporation under section 6102
19(relating to foreign domiciliary corporations) on the first day
20of the month following the month in which the corporation first
21has knowledge that either test has been met or upon entry of an
22order by any court of competent jurisdiction declaring that
23either test has been met.
24(b) Newly incorporated corporations.--Where the test or
25tests under section 6102 are met at the time of the admission of
26the first members of the corporation and continuously
27thereafter, foreign domiciliary corporation status when
28established shall be retroactive to the incorporation of the
29corporation.
30§ 6104. Termination of foreign domiciliary corporation status.
1A foreign domiciliary corporation shall cease to have that
2status on the first day of the month following the month in
3which the corporation first has knowledge that it no longer
4meets either test under section 6102 (relating to foreign
5domiciliary corporations) or upon entry of an order of any court
6of competent jurisdiction declaring that the corporation no
7longer meets either test.
8Section 47. Sections 6122(b)(3), 6123(b), 6141, 6142, 6143,
96145 and, 8911(a)(1) <-and 8925(a) of Title 15 are amended to
10read:
11§ 6122. Excluded activities.
12* * *
13(b) Exceptions.--The specification of activities in
14subsection (a) does not establish a standard for activities that
15may subject a foreign corporation to:
16* * *
17(3) The provisions of section 6145 (relating to
18applicability of certain safeguards to foreign domiciliary
19corporations).
20§ 6123. Requirements for foreign corporation names.
21* * *
22(b) Exceptions.--
23(1) The provisions of section 5303(b) (relating to
24duplicate use of names) shall not prevent the issuance of a
25certificate of authority to a foreign nonprofit corporation
26setting forth a name that is [confusingly similar to] not
27distinguishable upon the records of the department from the
28name of any other domestic or foreign corporation for profit
29or [corporation] not-for-profit, [or of any domestic or
30foreign limited partnership that has filed a certificate or
1qualified under Chapter 85 (relating to limited partnerships)
2or corresponding provisions of prior law,] or of any
3corporation or other association then registered under 54
4Pa.C.S. Ch. 5 (relating to corporate and other association
5names) or to any name reserved or registered as provided in
6this part, if the foreign nonprofit corporation applying for
7a certificate of authority files in the department [one of
8the following:
9(i) A] a resolution of its board of directors or
10other body adopting a fictitious name for use in
11transacting business in this Commonwealth, which
12fictitious name is [not confusingly similar to]
13distinguishable upon the records of the department from
14the name of the other corporation or other association
15[or to] and from any name reserved or registered as
16provided in this part [and] that is otherwise available
17for use by a domestic nonprofit corporation.
18[(ii) The written consent of the other corporation
19or other association or holder of a reserved or
20registered name to use the same or confusingly similar
21name and one or more words are added to make the name
22applied for distinguishable from the other name.]
23(2) The provisions of section 5303(c) (relating to
24required approvals or conditions) shall not prevent the
25issuance of a certificate of authority to a foreign nonprofit
26corporation setting forth a name that is prohibited by that
27subsection if the foreign nonprofit corporation applying for
28a certificate of authority files in the department a
29resolution of its board of directors or other body adopting a
30fictitious name for use in transacting business in this
1Commonwealth that is available for use by a domestic
2nonprofit corporation.
3§ 6141. Penalty for doing business without certificate of
4authority.
5(a) Right to bring actions suspended.--[No] A nonqualified
6foreign nonprofit corporation doing business in this
7Commonwealth within the meaning of Subchapter B [of this
8chapter] (relating to qualification) shall not be permitted to
9maintain any action or proceeding in any court of this
10Commonwealth until [such] the corporation [shall have] has
11obtained a certificate of authority. [Nor, except] Except as
12provided in subsection (b) [of this section, shall any action],
13an action or proceeding may not be maintained in any court of
14this Commonwealth by any successor or assignee of [such] the
15corporation on any right, claim or demand arising out of the
16doing of business by [such] the corporation in this Commonwealth
17until a certificate of authority [shall have] has been obtained
18by [such] the corporation or by a corporation [which] that has
19acquired all or substantially all of its assets.
20(a.1) Contracts, property and defense against actions
21unaffected.--The failure of a foreign nonprofit corporation to
22obtain a certificate of authority to transact business in this
23Commonwealth shall not impair the validity of any contract or
24act of [such] the corporation [and], shall not prevent [such]
25the corporation from defending any action in any court of this
26Commonwealth and shall not render escheatable any of its real or
27personal property.
28[(b) Title to real property.--The title to any real estate
29situate in this Commonwealth which is derived through any
30nonqualified foreign corporation not authorized under the laws
1of this Commonwealth to hold the same, and which has vested or
2vests in any foreign corporation for profit or not-for-profit
3authorized to hold such real estate or in any citizen or
4citizens of the United States or domestic corporation for profit
5or not-for-profit shall be good and valid and free and clear of
6any right of escheat by the Commonwealth; and the holder thereof
7may convey an estate indefeasible as to any right of escheat
8which the Commonwealth might otherwise have by reason of the
9unauthorized holding and conveyance by such nonqualified foreign
10corporation.]
11§ 6142. General powers and duties of qualified foreign
12corporations.
13(a) General rule.--A qualified foreign nonprofit
14corporation, so long as its certificate of authority [shall] is
15not [be] revoked, shall enjoy the same rights and privileges as
16a domestic nonprofit corporation, but no more, and, except as in
17this [part] subpart otherwise provided, shall be subject to the
18same liabilities, restrictions, duties and penalties now in
19force or hereafter imposed upon domestic nonprofit corporations,
20to the same extent as if it had been incorporated under this
21[part to transact the business set forth in its certificate of
22authority] subpart.
23(b) Agricultural lands.--Interests in agricultural land
24shall be subject to the restrictions of, and escheatable as
25provided by, the act of April 6, 1980 (P.L.102, No.39), referred
26to as the Agricultural Land Acquisition by Aliens Law.
27§ 6143. General powers and duties of nonqualified foreign
28corporations.
29(a) Acquisition of real and personal property.--Every
30nonqualified foreign nonprofit corporation[, the activities of
1which in this Commonwealth do not constitute doing business in
2this Commonwealth for the purposes of Subchapter B of this
3chapter (relating to qualification),] may acquire, hold,
4mortgage, lease and transfer real and personal property in this
5Commonwealth, in the same manner and subject to the same
6limitations as [domestic] a qualified foreign nonprofit
7[corporations] corporation.
8(b) Duties.--[A] Except as provided in section 6141(a)
9(relating to penalty for doing business without certificate of
10authority), a nonqualified foreign nonprofit corporation doing
11business in this Commonwealth within the meaning of Subchapter B
12[of this chapter] (relating to qualification) shall be subject
13to the same liabilities, restrictions, duties and penalties now
14or hereafter imposed upon a qualified foreign nonprofit
15corporation.
16§ 6145. Applicability of certain safeguards to foreign
17domiciliary corporations.
18[(a) Application.--This section shall be applicable to any
19qualified or nonqualified foreign corporation:
20(1) which derived more than one-half of its revenues for
21the preceding three fiscal years, or such portion thereof as
22the corporation was in existence, from sources within this
23Commonwealth and was at any time during such period doing
24business within this Commonwealth on the basis of the most
25minimal contacts with this Commonwealth permitted under the
26Constitution of the United States; or
27(2) at least a majority of the bona fide members of
28which are residents of this Commonwealth.]
29(b) Internal affairs doctrine not applicable.--The General
30Assembly hereby finds and determines that [the] foreign
1domiciliary corporations [to which this section applies]
2substantially affect this Commonwealth. [No court] The courts of
3this Commonwealth shall [hereafter] not dismiss or stay any
4action or proceeding brought by a member[, director, officer or
5agent of such a] or representative of a foreign domiciliary
6corporation, as such, against [such] the corporation or any one
7or more of the members[, directors, officers or agents] or
8representatives thereof, as such, on the ground that [such] the
9corporation is a foreign corporation not-for-profit or that the
10cause of action relates to the internal affairs thereof, but
11every such action shall proceed with like effect as if [such]
12the corporation were a domestic corporation. Except as provided
13in subsection (c) [of this section], the court having
14jurisdiction of the action or proceeding shall apply the law of
15the jurisdiction under which the foreign domiciliary corporation
16was incorporated.
17(c) Minimum safeguards.--The following provisions of this
18subpart shall be applicable to foreign domiciliary corporations
19[to which this section applies], except that nothing in this
20subsection shall require the filing of any document in the
21[Department of State] department as a prerequisite to the
22validity of any corporate action or the doing of any corporate
23action by the foreign domiciliary corporation which is
24impossible under the laws of its domiciliary jurisdiction:
25[(1)] Section 5504(b) (relating to adoption and contents
26of bylaws).
27[(2)] Section 5508 (relating to corporate records;
28inspection by members).
29[(3)] Section [5553] 5554 (relating to annual report of
30directors or other body).
1[(4)] Section 5743 (relating to mandatory
2indemnification).
3[(5)] Section 5755 (relating to time of holding meetings
4of members).
5[(6)] Section 5758(e) (relating to [voting lists] voting
6rights of members).
7[(7)] Section [5759(b) (relating to minimum
8requirements)] 5759(c) (relating to voting and other action
9by proxy).
10[(8)] Section [5762] 5765 (relating to judges of
11election).
12[(9)] Section [5764] 5767 (relating to appointment of
13custodian of corporation on deadlock or other cause).
14[(10)] Section [5766(b)] 5769(b) (relating to
15[expulsion] termination and transfer of membership).
16[(11) Subchapter G of Chapter 57 (relating to judicial
17supervision of corporate action).]
18[(12)] Chapter 59 (relating to fundamental changes).
19For the purposes of this subsection, corporate action shall not
20be deemed to be impossible under the laws of the domiciliary
21jurisdiction of a foreign corporation merely because prohibited
22or restricted by the terms of the articles, certificate of
23incorporation, bylaws or other organic law of the corporation,
24but the court may require the corporation to amend such organic
25law so as to be consistent with the minimum safeguards
26prescribed by this subsection.
27(d) Section exclusive.--[No provision of this article] The
28provisions of this subpart, other than the provisions of this
29section, shall not be construed to regulate the incorporation or
30internal affairs of a foreign corporation not-for-profit.
1§ 8911. Purposes.
2(a) General rule.--Limited liability companies may be
3organized under this chapter for any lawful purpose, except for
4the purpose of [banking or] insurance. Unless otherwise
5restricted in its certificate of organization, every limited
6liability company has as its purpose the engaging in all lawful
7business for which limited liability companies may be organized
8under this chapter. Nothing in this section shall prohibit the
9following:
10(1) A banking institution organized under this chapter
11or a limited liability company organized by one or more
12[banks or a banking organization for the sole purposes of]
13banking institutions, savings associations or credit unions
14from engaging in the marketing and [selling] sale of title
15insurance.
16* * *
<-17§ 8925. Taxation of limited liability companies.
18(a) General rule.--For the purposes of the imposition by the
19Commonwealth of any tax or license fee on or with respect to any
20income, property, privilege, transaction, subject or occupation,
21a domestic or foreign limited liability company that is not a
22domestic or qualified foreign restricted professional company
23shall be deemed to be a corporation organized and existing under
24Part II (relating to corporations), and a member of such a
25company, as such, shall be deemed to be a shareholder of a
26corporation. Such a company may elect to be treated as a
27Pennsylvania S corporation, and its members shall be deemed
28shareholders of such a corporation, only if the company
29satisfies the conditions for electing that status. For purposes
30of the corporate net income tax and the capital stock and
1franchise tax, such a company shall be considered a
2"corporation" and an "entity" as defined in Articles IV and VI
3of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
4Reform Code of 1971, and, if such a company is not required to
5file a Federal corporate income tax return, these taxes shall be
6computed as if such a Federal return had been filed. For
7purposes of the bank shares tax and the mutual thrift
8institutions tax, a bank, bank and trust company, trust company,
9savings bank, building and loan association, savings and loan
10association or savings institution that is a domestic or foreign
11limited liability company shall be considered an "institution"
12as defined by Article VII or Article XV of the Tax Reform Code
13of 1971. Nothing in this subsection shall impair or preempt the
14ability of a political subdivision to levy, assess or collect
15any applicable taxes or license fees authorized pursuant to the
16act of December 31, 1965 (P.L.1257, No.511), known as The Local
17Tax Enabling Act, on any company which elects limited liability
18company status in accordance with the provisions of this
19chapter.
20* * *
21Section 48. Chapter 91 heading of Title 15 is amended to
22read:
23CHAPTER 91
24[UNINCORPORATED ASSOCIATIONS GENERALLY]
25UNINCORPORATED NONPROFIT
26ASSOCIATIONS
27Section 49. Sections 9101, 9102 and 9103 of Title 15 are
28repealed:
29[§ 9101. Customary parliamentary law applicable.
30Except as otherwise provided by statute or by the organic
1documents under which an unincorporated association is
2constituted, each unincorporated association shall be governed
3by customary usages and principles of parliamentary law and
4procedure.
5§ 9102. Funeral and similar benefits.
6Members of unincorporated associations paying periodic or
7funeral benefits shall not be individually liable for the
8payment of periodic or funeral benefits or other similar
9liabilities of the association. The liabilities shall be payable
10only out of the treasury of the association.
11§ 9103. Nontransferable membership interests.
12(a) General rule.--For the purpose of encouraging lawful
13associational activity among agricultural and industrial workers
14through the organization of unincorporated associations for
15mutual benefit insurance, saving or other lawful objects where
16the persons so organizing derive benefits from the preservation
17and continuance of the membership and interest among persons
18engaged in a common calling, labor or enterprise, the
19unincorporated association may provide, in its organic
20documents, that membership in the association or interest in its
21funds or property shall be nontransferable without the consent
22of the association.
23(b) Assignments and pledges.--No attempted assignment,
24transfer or pledge of a membership or interest made in violation
25of a transfer restriction adopted pursuant to subsection (a)
26shall pass any right or interest, legal or equitable, to the
27person to whom it is attempted to be made if the transfer
28restriction is brought to the knowledge of that person.
29(c) Knowledge of nontransferability.--Whenever the interest
30of a member in the funds or property of any unincorporated
1association subject to subsection (a) is evidenced by a
2certificate, an endorsement thereon that the certificate is
3nontransferable shall be conclusive evidence that the person to
4whom any attempted assignment, transfer or pledge of the
5certificate is made has knowledge of the nontransferable
6character of the interest of the member.]
7Section 50. Title 15 is amended by adding sections to read:
8§ 9111. Short title and application of chapter.
9(a) Short title.--This chapter shall be known and may be
10cited as the Pennsylvania Uniform Unincorporated Nonprofit
11Association Law.
12(b) Transitional provisions concerning property.--
13(1) If, before {the Legislative Reference Bureau shall
14insert here the effective date of this section}, an interest
15in property was by the terms of a transfer purportedly
16transferred to a nonprofit association but under the law of
17this Commonwealth the interest did not vest in the nonprofit
18association, or in one or more persons on behalf of the
19nonprofit association under paragraph (2), on {the
20Legislative Reference Bureau shall insert here the effective
21date of this section}, the interest vests in the nonprofit
22association, unless the parties to the transfer have treated
23the transfer as ineffective.
24(2) If, before {the Legislative Reference Bureau shall
25insert here the effective date of this section}, an interest
26in property was by the terms of a transfer purportedly
27transferred to a nonprofit association but the interest was
28vested in one or more persons to hold the interest for the
29nonprofit association, its members or both, on or after {the
30Legislative Reference Bureau shall insert here the effective
1date of this section}, the persons, or their successors in
2interest, may transfer the interest to the nonprofit
3association in its name; or the nonprofit association may
4require that the interest be transferred to it in its name.
5(c) Savings provisions.--
6(1) This chapter supplements the law of this
7Commonwealth that applies to nonprofit associations operating
8in this Commonwealth, but if a conflict exists between this
9chapter and another statute, the other statute applies.
10(2) Nothing in this chapter shall be deemed to repeal or
11supersede any provision in section 7 of the act of April 26,
121855 (P.L.328, No.347), entitled "An act relating to
13Corporations and to Estates held for Corporate, Religious and
14Charitable uses."
15(d) Cross reference.--See section 5331 (relating to
16unincorporated associations).
17§ 9112. Definitions.
18The following words and phrases when used in this chapter
19shall have the meanings given to them in this section unless the
20context clearly indicates otherwise:
21"Established practices." The practices used by a nonprofit
22association without material change during:
23(1) the most recent five years of its existence; or
24(2) if it has existed for less than five years, its
25entire existence.
26"Governing principles." The agreements, whether oral, in
27record form or implied from its established practices, that
28govern the purpose or operation of a nonprofit association and
29the rights and obligations of its members and managers. The term
30includes any amendment or restatement of the agreements
1constituting the governing principles.
2"Manager." A person that is responsible, alone or in concert
3with others, for the management of a nonprofit association.
4"Member." A person that, under the governing principles, may
5participate in the selection of persons authorized to manage the
6affairs of the nonprofit association or in the development of
7policies and activities of the nonprofit association.
8"Nonprofit association." An unincorporated organization
9consisting of two or more members joined together under an
10agreement that is oral, in record form or implied from conduct
11for one or more common, nonprofit purposes. The term does not
12include:
13(1) a trust;
14(2) a marriage, domestic partnership, common law
15domestic relationship, civil union or other domestic living
16arrangement;
17(3) an organization formed under any other statute that
18governs the organization and operation of unincorporated
19associations;
20(4) a joint tenancy, tenancy in common or tenancy by the
21entireties, even if the co-owners share use of the property
22for a nonprofit purpose; or
23(5) a relationship under an agreement in record form
24that expressly provides that the relationship between the
25parties does not create a nonprofit association.
26"Property." Includes:
27(1) real property;
28(2) personal property which is tangible or intangible;
29(3) mixed real and personal property; and
30(4) a right or interest in property.
1"Transfer." Includes:
2(1) an assignment;
3(2) a conveyance;
4(3) a sale;
5(4) a lease;
6(5) an encumbrance, including a mortgage or security
7interest;
8(6) a gift; and
9(7) a transfer by operation of law.
10§ 9113. Governing law.
11(a) Operations.--Except as provided in subsection (b), the
12law of this Commonwealth governs the operation in this
13Commonwealth of a nonprofit association formed or operating in
14this Commonwealth.
15(b) Internal affairs.--Unless the governing principles
16specify a different jurisdiction, the law of the jurisdiction in
17which a nonprofit association has its main place of activities
18governs the internal affairs of the nonprofit association.
19§ 9114. Entity status.
20(a) Legal entity.--A nonprofit association is a legal entity
21distinct from its members and managers.
22(b) Perpetual duration.--A nonprofit association has
23perpetual duration unless the governing principles specify
24otherwise.
25(c) Powers.--A nonprofit association has the same powers as
26an individual to do all things necessary or convenient to carry
27on its purposes.
28(d) Profits.--A nonprofit association may engage in profit-
29making activities, but profits from any activities must be used
30or set aside for the nonprofit purposes of the nonprofit
1association.
2§ 9115. Ownership and transfer of property.
3(a) General rule.--A nonprofit association may acquire, hold
4or transfer, in its name, an interest in property.
5(b) Testamentary and fiduciary dispositions.--A nonprofit
6association may be a beneficiary of a trust or contract, a
7legatee or a devisee.
8§ 9116. Statement of authority as to real property.
9(a) General rule.--An interest in real property held in the
10name of a nonprofit association may be transferred by a person
11authorized to do so in a statement of authority recorded by the
12nonprofit association in the office of the recorder of deeds for
13the county in which a transfer of the property would be
14recorded.
15(b) Contents of statement.--The statement of authority must
16set forth:
17(1) the name of the nonprofit association;
18(2) the address in this Commonwealth, including the
19street and number, if any, of the nonprofit association or,
20if the nonprofit association does not have an address in this
21Commonwealth, its address outside of this Commonwealth;
22(3) that the association is a nonprofit association; and
23(4) the name, title or position of a person authorized
24to transfer an estate or interest in real property held in
25the name of the nonprofit association.
26(c) Execution.--A statement of authority must be executed in
27the same manner as a deed by a person other than the person
28authorized in the statement to transfer the interest.
29(d) Recording fee.--The recorder of deeds may collect a fee
30for recording a statement of authority in the amount authorized
1for recording a transfer of real property, but the mere
2recording of a statement of authority does not constitute a
3transfer of an interest in the real property for the purpose of
4the taxation of real property transfers.
5(e) Changes.--A document amending, revoking or canceling a
6statement of authority or stating that the statement is
7unauthorized or erroneous must meet the requirements for
8executing and recording an original statement.
9(f) Cancellation by operation of law.--Unless canceled
10earlier, a recorded statement of authority and its most recent
11amendment expire five years after the date of the most recent
12recording.
13(g) Effect of filing.--If the record title to real property
14is in the name of a nonprofit association and a statement of
15authority is recorded in the office of the recorder of deeds for
16the county in which a transfer of the property would be
17recorded, the authority of the person named in the statement to
18transfer is conclusive in favor of a person that gives value
19without notice that the person lacks authority.
20§ 9117. Liability.
21(a) Scope.--
22(1) A debt, obligation or other liability of a nonprofit
23association, whether arising in contract, tort or otherwise,
24is solely the debt, obligation or other liability of the
25nonprofit association.
26(2) A member or manager is not personally liable,
27directly or indirectly, by way of contribution or otherwise,
28for a debt, obligation or other liability of the nonprofit
29association solely by reason of being or acting as a member
30or manager.
1(3) This subsection applies regardless of the
2dissolution of the nonprofit association.
3(b) Liability for conduct.--A person's status as a member or
4manager does not prevent or restrict law other than this chapter
5from imposing liability on the person or the nonprofit
6association because of the person's conduct.
7(c) Agents.--A person that makes a contract or incurs an
8obligation on behalf of a nonprofit association after {the
9Legislative Reference Bureau shall insert here the effective
10date of this section} is not liable for performance or breach of
11the contract or other obligation if the fact that the person was
12acting for the nonprofit association was disclosed to, was known
13by or reasonably should have been known by the other party to
14the contract or to the party owed performance.
15(d) Observation of formalities.--The failure of a nonprofit
16association to observe formalities relating to the exercise of
17its powers or the management of its activities and affairs is
18not a ground for imposing liability on a member or manager of
19the nonprofit association for a debt, obligation or other
20liability of the nonprofit association.
21§ 9118. Assertion and defense of claims.
22(a) General rule.--A nonprofit association may sue or be
23sued in its own name.
24(b) Permissible claims.--A member or manager may assert a
25claim the member or manager has against the nonprofit
26association. A nonprofit association may assert a claim it has
27against a member or manager.
28(c) Representational status.--A nonprofit association may
29assert a claim in its name on behalf of its members if one or
30more members of the nonprofit association have standing to
1assert a claim in their own right, the interests the nonprofit
2association seeks to protect are germane to its purposes and
3neither the claim asserted nor the relief requested requires the
4participation of a member.
5§ 9119. Effect of judgment or order.
6A judgment or order against a nonprofit association is not by
7itself a judgment or order against a member or manager.
8§ 9120. Appointment of agent to receive service of process.
9(a) Statement.--A nonprofit association may deliver to the
10department for filing a statement appointing an agent to receive
11service of process.
12(b) Contents.--A statement appointing an agent to receive
13service of process must state:
14(1) the name of the nonprofit association;
15(2) the address, if any, in this Commonwealth; and
16(3) the name of the person in this Commonwealth
17authorized to receive service of process and the person's
18address, including street and number, in this Commonwealth.
19(c) Signature and effect.--
20(1) A statement appointing an agent to receive service
21of process must be signed by:
22(i) a person authorized to manage the affairs of the
23nonprofit association; and
24(ii) the person appointed as the agent.
25(2) The signing of the statement is an affirmation:
26(i) by the person authorized to manage the affairs
27of the nonprofit association that the person has that
28authority; and
29(ii) by the person appointed as agent that the
30person consents to act as agent.
1(d) Amendment or cancellation.--An amendment to or
2cancellation of a statement appointing an agent to receive
3service of process must meet the requirements for signature of
4an original statement. An agent may resign by delivering a
5resignation to the department for filing and giving notice to
6the nonprofit association.
7(e) Rejection of statement.--A statement appointing an agent
8to receive service of process may not be rejected for filing
9because the name of the nonprofit association signing the
10statement is not distinguishable on the records of the
11department from the name of another association appearing in
12those records. The filing of such a statement does not make the
13name of the nonprofit association signing the statement
14unavailable for use by another association.
15(f) Effectiveness.--A statement appointing an agent to
16receive service of process:
17(1) takes effect on filing by the department; and
18(2) is effective for five years after the date of filing
19unless canceled or terminated earlier.
20(g) Duty of agent.--The only duty under this chapter of an
21agent to receive service of process is to forward to the
22nonprofit association at the address most recently supplied to
23the agent by the nonprofit association any process, notice or
24demand pertaining to the nonprofit association which is served
25or received by the agent.
26(h) Cross references.--See section 135 (relating to
27requirements to be met by filed documents).
28§ 9121. Action or proceeding not abated by change of members or
29managers.
30An action or proceeding against a nonprofit association does
1not abate merely because of a change in its members or managers.
2§ 9122. Member not agent.
3A member is not an agent of the nonprofit association solely
4by reason of being a member.
5§ 9123. Approval by members.
6(a) General rule.--Except as provided in the governing
7principles, a nonprofit association must have the approval of
8its members to:
9(1) admit, suspend, dismiss or expel a member;
10(2) select or dismiss a manager;
11(3) adopt, amend or repeal the governing principles;
12(4) transfer all, or substantially all, of the property
13of the nonprofit association, with or without its goodwill,
14outside the ordinary course of its activities;
15(5) dissolve under section 9134 (relating to
16dissolution);
17(6) undertake any other act outside the ordinary course
18of the activities of the nonprofit association; or
19(7) determine the policy and purposes of the nonprofit
20association.
21(b) Other actions.--A nonprofit association must have the
22approval of the members to do any other act or exercise a right
23that the governing principles require to be approved by members.
24§ 9124. Action by members.
25(a) General rule.--Except as provided in the governing
26principles:
27(1) approval of a matter by the members requires the
28affirmative vote of at least a majority of the votes cast at
29a meeting of members; and
30(2) each member is entitled to one vote on each matter
1that is submitted for approval by the members.
2(b) Procedural matters.--The governing principles may
3provide for the:
4(1) calling, location and timing of member meetings;
5(2) notice and quorum requirements for member meetings;
6(3) conduct of member meetings;
7(4) taking of action by the members by consent without a
8meeting or by ballot;
9(5) participation by members in a meeting of the members
10by telephone or other means of electronic communication; and
11(6) taking of action by members by proxy.
12(c) Absence of governing principles.--If the governing
13principles do not provide for a matter described in subsection
14(b), customary usages and principles of parliamentary law and
15procedure apply.
16§ 9125. Duties of member.
17(a) No fiduciary duties generally.--A member does not have a
18fiduciary duty to a nonprofit association or to another member
19solely by being a member.
20(b) Discharge of duties and exercise of rights.--A member
21shall, consistent with the governing principles and the
22contractual obligation of good faith and fair dealing:
23(1) discharge duties under the governing principles to
24the nonprofit association and the other members; and
25(2) exercise any rights under the governing principles
26and this chapter.
27§ 9126. Membership.
28(a) Admission, suspension, dismissal and expulsion of
29member.--
30(1) A person becomes a member and may be suspended,
1dismissed or expelled in accordance with the governing
2principles. If there are no applicable governing principles,
3a person may become a member or be suspended, dismissed or
4expelled only with the approval of the members. A person may
5not be admitted as a member without the person's consent.
6(2) Except as provided in the governing principles, the
7suspension, dismissal or expulsion of a member does not
8relieve the member from any unpaid capital contribution,
9dues, assessments, fees or other obligation incurred or
10commitment made by the member before the suspension,
11dismissal or expulsion.
12(b) Resignation of member.--
13(1) A member may resign as a member in accordance with
14the governing principles. In the absence of applicable
15governing principles, a member may resign at any time.
16(2) Except as provided in the governing principles,
17resignation of a member does not relieve the member from any
18unpaid capital contribution, dues, assessments, fees or other
19obligation incurred or commitment made by the member before
20resignation.
21§ 9127. Member's interest not transferable.
22(a) General rule.--Except as set forth in subsection (b) or
23the governing principles, a member's interest or any right under
24the governing principles is not transferable.
25(b) Certain nonprofit associations formed prior to effective
26date.--
27(1) This subsection applies to a nonprofit association:
28(i) which was formed before {the Legislative
29Reference Bureau shall insert here the effective date of
30this section};
1(ii) which was formed for the purpose of encouraging
2lawful associational activity among agricultural and
3industrial workers through the organization of a
4nonprofit association for mutual benefit insurance,
5saving or other lawful objects; and
6(iii) in which the persons that organized the
7nonprofit association derive benefits from the
8preservation and continuance of the membership and
9interest among persons engaged in a common calling, labor
10or enterprise.
11(2) For a nonprofit association subject to paragraph
12(1), the following apply:
13(i) Except as set forth in subparagraph (ii), a
14member's interest or any right under the governing
15principles is transferable.
16(ii) A member's interest or any right under the
17governing principles is nontransferable if the governing
18principles so provide.
19(c) Assignments and pledges.--No legal or equitable right or
20interest shall pass as a result of an attempted transfer in
21violation of:
22(1) subsection (a); or
23(2) a transfer restriction under subsection (b)(2)(ii).
24(d) Knowledge of nontransferability.--Whenever the interest
25of a member in a nonprofit association is evidenced by a
26certificate, an endorsement on the certificate that the
27certificate is nontransferable shall be conclusive evidence that
28the person to whom any attempted transfer of the certificate is
29made has knowledge of the nontransferable character of the
30interest of the member.
1§ 9128. Selection and management rights of managers.
2Except as provided in this chapter or the governing
3principles:
4(1) if there is no manager selected and serving, all
5members are managers;
6(2) only the members may select a manager;
7(3) a manager may be a member or a nonmember;
8(4) each manager has equal rights in the management and
9conduct of the activities of the nonprofit association;
10(5) all matters relating to the activities of the
11nonprofit association are decided by its managers except for
12matters reserved for approval by the members in section 9123
13(relating to approval by members); and
14(6) a difference among the managers is decided by a
15majority of the managers.
16§ 9129. Duties of managers.
17(a) Duty of care.--
18(1) A manager shall manage the nonprofit association:
19(i) in good faith;
20(ii) in a manner the manager reasonably believes to
21be in the best interests of the nonprofit association;
22and
23(iii) with such care, including reasonable inquiry,
24as a prudent person would reasonably exercise in a
25similar position and under similar circumstances.
26(2) A manager may rely in good faith on any opinion,
27report, statement or other information provided by another
28person that the manager reasonably believes is a competent
29and reliable source for the information.
30(b) Conflicts of interest.---
1(1) A manager owes a fiduciary duty of loyalty to the
2nonprofit association with respect to the responsibilities of
3the manager.
4(2) After full disclosure of all material facts, a
5specific act or transaction that would otherwise violate the
6duty of loyalty by a manager may be authorized or ratified by
7a majority of the members that are not interested directly or
8indirectly in the act or transaction.
9(c) Presumption.--A manager that makes a judgment in good
10faith satisfies the duties specified in subsection (a) if the
11manager:
12(1) is not interested, directly or indirectly, in the
13subject of the judgment and is otherwise able to exercise
14independent judgment;
15(2) is informed with respect to the subject of the
16judgment to the extent the manager reasonably believes to be
17appropriate under the circumstances; and
18(3) believes that the judgment is in, or not opposed to,
19the best interests of the nonprofit association.
20(d) Limitation of liability.--
21(1) Except as set forth in paragraph (2), the governing
22principles in record form may provide that a manager shall
23not be personally liable, as a manager, for monetary damages
24for any action taken unless:
25(i) the manager has breached or failed to perform
26the manager's duties under this chapter; and
27(ii) the breach or failure to perform constitutes
28self-dealing, willful misconduct or recklessness.
29(2) Paragraph (1) shall not apply to:
30(i) the responsibility or liability of a manager
1under a criminal statute; or
2(ii) the liability of the manager for the payment of
3taxes under Federal, State or local law.
4§ 9130. Action by managers.
5(a) General rule.--Except as provided in the governing
6principles:
7(1) approval of a matter by the managers requires the
8affirmative vote of at least a majority of the votes cast at
9a meeting of managers; and
10(2) each manager is entitled to one vote on each matter
11that is submitted for approval by the managers.
12(b) Procedural matters.--The governing principles may
13provide for the:
14(1) delegation to a manager of authority to act without
15a meeting of the managers;
16(2) creation and authority of committees of the
17managers;
18(3) calling, location and timing of meetings of the
19managers or a committee of the managers;
20(4) notice and quorum requirements for meetings of the
21managers or a committee of the managers;
22(5) conduct of meetings of the managers or a committee
23of the managers;
24(6) taking of action by the managers or a committee of
25the managers by consent without a meeting or by ballot;
26(7) participation by managers in a meeting of the
27managers or a committee of the managers by telephone or other
28means of electronic communication; and
29(8) taking of action by a manager by proxy.
30(c) Absence of governing principles.--If the governing
1principles do not provide for a matter described in subsection
2(b), customary usages and principles of parliamentary law and
3procedure apply.
4§ 9131. Right of member or manager to information.
5(a) Inspection.--On reasonable notice, a member or manager
6of a nonprofit association may inspect and copy, at a reasonable
7time and location specified by the nonprofit association, any
8record maintained by the nonprofit association regarding its
9activities, financial condition and other circumstances, to the
10extent the information is material to the rights and duties of
11the member or manager under the governing principles.
12(b) Restrictions.--A nonprofit association may impose
13reasonable restrictions on access to and use of information to
14be furnished under this section, including designating the
15information confidential and imposing on the recipient
16obligations of nondisclosure and safeguarding.
17(c) Costs.--A nonprofit association may charge a person that
18makes a demand under this section reasonable copying costs.
19(d) Former member or manager.--A former member or manager is
20entitled to information to which the member or manager was
21entitled while a member or manager if:
22(1) the information pertains to the period during which
23the person was a member or manager;
24(2) the former member or manager seeks the information
25in good faith; and
26(3) the former member or manager satisfies subsections
27(a), (b) and (c).
28§ 9132. Distributions prohibited; compensation and other
29permitted payments.
30(a) General rule.--Except as provided in subsection (b), a
1nonprofit association may not pay dividends or make
2distributions to a member or manager.
3(b) Permitted payments.--A nonprofit association may:
4(1) pay reasonable compensation or reimburse reasonable
5expenses to a member or manager for services rendered;
6(2) confer benefits on or make contributions to a member
7or manager in conformity with its nonprofit purposes;
8(3) repurchase a membership and repay a capital
9contribution made by a member to the extent authorized by its
10governing principles;
11(4) repay indebtedness to a member or manager; and
12(5) make distributions of property to members upon
13winding up and termination to the extent permitted by section
149135 (relating to winding up).
15§ 9133. Reimbursement, indemnification and advancement of
16expenses.
17(a) Reimbursement.--Except as provided in the governing
18principles, a nonprofit association shall reimburse a member or
19manager for authorized expenses reasonably incurred in the
20course of the activities of the member or manager on behalf of
21the nonprofit association.
22(b) Indemnification and advancement of expenses.--
23(1) A nonprofit association is subject to Ch. 57 Subch.
24D (relating to indemnification).
25(2) For purposes of applying Ch. 57 Subch. D, references
26to the "articles" or "bylaws," "directors" and "members"
27shall mean the "governing principles," "managers" and
28"members," respectively.
29§ 9134. Dissolution.
30(a) General rule.--A nonprofit association may be dissolved
1as follows:
2(1) if the governing principles provide a time or method
3for dissolution, at that time or by that method;
4(2) if the governing principles do not provide a time or
5method for dissolution, upon approval by the members;
6(3) if no member can be located and the operations of
7the nonprofit association have been discontinued for at least
8three years, by:
9(i) the managers; or
10(ii) if the nonprofit association has no current
11manager, its last manager;
12(4) by court order; or
13(5) under law other than this chapter.
14(b) Continuation during winding up.--After dissolution, a
15nonprofit association continues in existence until its
16activities have been wound up under section 9135 (relating to
17winding up).
18§ 9135. Winding up.
19Winding up of a nonprofit association must proceed in
20accordance with the following rules:
21(1) All known debts and liabilities shall be paid or
22adequately provided for.
23(2) Any property subject to a condition requiring return
24to the person designated by the donor shall be transferred to
25that person.
26(3) Any property subject to a trust shall be distributed
27in accordance with the trust agreement.
28(4) Any property committed to a charitable purpose shall
29be distributed in accordance with that purpose unless the
30nonprofit <-association obtains a court order under 20 Pa.C.S.
1Ch. 77 (relating to trusts) specifying the disposition of the
2property.
3(5) Any remaining property shall be distributed as
4follows:
5(i) Distribution shall be made:
6(A) in accordance with the governing principles
7of the nonprofit association; or
8(B) in the absence of applicable governing
9principles, to the members of the nonprofit
10association:
11(I) per capita; or
12(II) as the members direct.
13(ii) If subparagraph (i) does not apply,
14distribution shall be made under Article XIII.1 of the
15act of April 9, 1929 (P.L.343, No.176), known as The
16Fiscal Code.
17§ 9136. Subordination of chapter to canon law.
18If and to the extent canon law or similar principles
19applicable to a nonprofit association organized for religious
20purposes sets forth provisions relating to the government and
21regulation of the affairs of the nonprofit association that are
22inconsistent with the provisions of this chapter on the same
23subject, the provisions of canon law or similar principles shall
24control except to the extent prohibited by the Constitution of
25the United States or the Constitution of Pennsylvania.
26Section 51. Section 9503(e) of Title 15 is amended and the
27section is amended by adding a subsection to read:
28§ 9503. Documentation of trust.
29* * *
30(d.1) Bearer certificates prohibited.--A business trust may
1not issue a certificate of beneficial interest in bearer form.
2This subsection may not be varied by the instrument or other
3documentation of the business trust.
4(e) Cross [reference] references.--See [section] sections
5134 (relating to docketing statement) and 135 (relating to
6requirements to be met by filed documents).
7Section 52. The definition of "domestic corporation not-for-
8profit" in section 101 of Title 54 is amended to read:
9§ 101. Definitions.
10Subject to additional definitions contained in subsequent
11provisions of this title which are applicable to specific
12provisions of this title, the following words and phrases when
13used in this title shall have, unless the context clearly
14indicates otherwise, the meanings given to them in this section:
15* * *
16"Domestic corporation not-for-profit." A domestic
17corporation [not-for-profit as defined in 15 Pa.C.S. § 1103
18(relating to definitions).] not incorporated for a purpose or
19purposes involving pecuniary profit, incidental or otherwise.
20* * *
21Section 53. Section 501(a)(5) and (7) of Title 54 are
22amended to read:
23§ 501. Register established.
24(a) General rule.--A register is established by this chapter
25which shall consist of such of the following names as are not
26deleted therefrom by operation of section 504 (relating to
27effect of failure to make filings) or 506 (relating to voluntary
28termination of registration by corporations and other
29associations):
30* * *
1(5) In the case of a business trust which exists subject
2to 15 Pa.C.S. Ch. 95 (relating to business trusts), the name
3of the trust as set forth in the:
4(i) instrument filed in the department under 15
5Pa.C.S. § 9503 (relating to documentation of trust); or
6(ii) application for registration filed under 15
7Pa.C.S. § 9507 (relating to foreign business trusts).
8* * *
9[(7) In the case of a business trust which exists
10subject to 15 Pa.C.S. Ch. 95 (relating to business trusts),
11the name of the trust as set forth in the instrument filed in
12the department under 15 Pa.C.S. § 9503 (relating to
13documentation of trust), or in the application for
14registration filed pursuant to 15 Pa.C.S. § 9507 (relating to
15foreign business trusts).]
16* * *
17Section 54. Repeals are as follows:
18(1) The General Assembly declares as follows:
19(i) The repeal under paragraph (2)(i) is necessary
20because the material is supplied by 15 Pa.C.S. § 1511.
21(ii) The repeal under paragraph (2)(ii) is necessary
22to effectuate the amendment of 15 Pa.C.S. §§ 153(a) and
23155(a).
24(iii) The repeal under paragraph (2)(iii) is
25necessary because the material is supplied by 40 Pa.C.S.
26§ 6322(f).
27(iv) The repeal under paragraph (2)(iv) is necessary
28because the material is supplied by 40 Pa.C.S. § 6301.
29(v) The repeal under paragraph (2)(v) is necessary
30because the material is supplied by 15 Pa.C.S. § 1106(b)
1(2).
2(vi) The repeal under paragraph (2)(vi) is necessary
3because the material is supplied by 40 Pa.C.S. § 6322(f).
4(vii) The repeal under paragraph (2)(vii) is
5necessary because the material is supplied by 1 Pa.C.S. §
61978.
7(2) The following acts and parts of acts are repealed:
8(i) Act of April 27, 1855 (P.L.365, No.383),
9entitled "An act extending the right of Trial by Jury to
10certain cases."
11(ii) Sections 618-A(2) and 814 of the act of April
129, 1929 (P.L.177, No.175), known as The Administrative
13Code of 1929.
14(iii) Act of April 18, 1949 (P.L.583, No.123),
15entitled "An act to further amend the act, approved the
16fifth day of May, one thousand nine hundred thirty-three
17(Pamphlet Laws 289), entitled 'An act relating to
18nonprofit corporations; defining and providing for the
19organization, merger, consolidation, and dissolution of
20such corporations; conferring certain rights, powers,
21duties, and immunities upon them and their officers and
22members; prescribing the conditions on which such
23corporations may exercise their powers; providing for the
24inclusion of certain existing corporations of the first
25class within the provisions of this act; prescribing the
26terms and conditions upon which foreign nonprofit
27corporations may be admitted or may continue to do
28business within the Commonwealth; conferring powers and
29imposing duties on the courts of common pleas,
30prothonotaries of such courts, recorders of deeds, and
1certain State departments, commissions, and officers;
2authorizing certain local public officers and State
3departments to collect fees for services required to be
4rendered by this act; imposing penalties; and repealing
5certain acts and parts of acts relating to corporations,'
6by making further provisions relating to nonprofit
7medical service corporations; by extending the provisions
8of said act relating to the furnishing of medical
9services by nonprofit medical service corporations so as
10to include the furnishing of osteopathic services by
11doctors of osteopathy to subscribers and their
12dependents, and by providing that the articles of
13incorporation of existing nonprofit medical service
14corporations are amended by the provisions of this act so
15as to authorize the furnishing of such osteopathic
16services by doctors of osteopathy."
17(iv) Act of December 9, 1955 (P.L.818, No.238),
18entitled "An act amending the act of May five, one
19thousand nine hundred thirty-three (Pamphlet Laws 289),
20entitled 'An act relating to nonprofit corporations;
21defining and providing for the organization, merger,
22consolidation, and dissolution of such corporations;
23conferring certain rights, powers, duties, and immunities
24upon them and their officers and members; prescribing the
25conditions on which such corporations may exercise their
26powers; providing for the inclusion of certain existing
27corporations of the first class within the provisions of
28this act; prescribing the terms and conditions upon which
29foreign nonprofit corporations may be admitted or may
30continue to do business within the Commonwealth;
1conferring powers and imposing duties on the courts of
2common pleas, prothonotaries of such courts, recorders of
3deeds, and certain State departments, commissions, and
4officers; authorizing certain local public officers and
5State departments to collect fees for services required
6to be rendered by this act; imposing penalties; and
7repealing certain acts and parts of acts relating to
8corporations,' providing for the incorporation and
9regulation of nonprofit dental service corporations
10furnishing dental services only to certain subscribers
11and their dependents."
12(v) Act of September 30, 1965 (P.L.570, No.294),
13entitled "An act amending the act of May 5, 1933 (P.L.
14289), entitled 'An act relating to nonprofit
15corporations; defining and providing for the
16organization, merger, consolidation, and dissolution of
17such corporations; conferring certain rights, powers,
18duties, and immunities upon them and their officers and
19members; prescribing the conditions on which such
20corporations may exercise their powers; providing for the
21inclusion of certain existing corporations of the first
22class within the provisions of this act; prescribing the
23terms and conditions upon which foreign nonprofit
24corporations may be admitted or may continue to do
25business within the Commonwealth; conferring powers and
26imposing duties on the courts of common pleas,
27prothonotaries of such courts, recorders of deeds, and
28certain State departments, commissions, and officers;
29authorizing certain local public officers and State
30departments to collect fees for services required to be
1rendered by this act; imposing penalties; and repealing
2certain acts and parts of acts relating to corporations,'
3requiring approval by the State Registration Board for
4Professional Engineers prior to the use of certain words
5in corporate names."
6(vi) Act of December 27, 1965 (P.L.1250, No.507),
7entitled "An act amending the act of May 5, 1933 (P.L.
8289), entitled 'An act relating to nonprofit
9corporations; defining and providing for the
10organization, merger, consolidation, and dissolution of
11such corporations; conferring certain rights, powers,
12duties, and immunities upon them and their officers and
13members; prescribing the conditions on which such
14corporations may exercise their powers; providing for the
15inclusion of certain existing corporations of the first
16class within the provisions of this act; prescribing the
17terms and conditions upon which foreign nonprofit
18corporations may be admitted or may continue to do
19business within the Commonwealth; conferring powers and
20imposing duties on the courts of common pleas,
21prothonotaries of such courts, recorders of deeds, and
22certain State departments, commissions, and officers;
23authorizing certain local public officers and State
24departments to collect fees for services required to be
25rendered by this act; imposing penalties; and repealing
26certain acts and parts of acts relating to corporations,'
27making further provisions relating to nonprofit medical,
28dental and osteopathic service corporations; extending
29the provisions of said act relating to the furnishing of
30medical, dental and osteopathic services by nonprofit
1medical, dental and osteopathic service corporations so
2as to include the furnishing of optometric services to
3subscribers and their dependents, and providing that the
4articles of incorporation of existing nonprofit medical,
5dental and osteopathic service corporations are amended
6by the provisions of this act so as to authorize the
7furnishing of optometric services by doctors of
8optometry."
9(vii) Section 2 of the act of November 15, 1972
10(P.L.1063, No.271), entitled "An act amending the act of
11November 25, 1970 (No.230), entitled 'An act codifying
12and compiling a part of the law of the Commonwealth,'
13adding provisions relating to burial grounds,
14corporations, including corporations not-for-profit,
15educational institutions, private police, certain
16charitable or eleemosynary institutions, certain
17nonprofit insurers, service of process on certain
18nonresident persons, names, prescribing penalties and
19making repeals."
20Section 55. When the Department of State is ready to provide
21expedited services under the addition of 15 Pa.C.S. § 153(a)
22(16), it shall transmit notice of that fact to the Legislative
23Reference Bureau for publication as a notice in the Pennsylvania
24Bulletin.
25Section 56. Notwithstanding 1 Pa.C.S. § 1957, it is declared
26to be the intent of the former act of December 21, 1988
27(P.L.1444, No.177), known as the General Association Act of
281988, the act of December 19, 1990 (P.L.834, No.198), known as
29the GAA Amendments Act of 1990, the act of December 18, 1992
30(P.L.1333, No.169), known as the GAA Amendments Act of 1992, the
1act of June 22, 2001 (P.L.418, No.34), known as the GAA
2Amendments Act of 2001, and this act cumulatively to restore all
3provisions of 15 Pa.C.S. added by the act of November 15, 1972
4(P.L.1063, No.271), entitled "An act amending the act of
5November 25, 1970 (No.230), entitled 'An act codifying and
6compiling a part of the law of the Commonwealth,' adding
7provisions relating to burial grounds, corporations, including
8corporations not-for-profit, educational institutions, private
9police, certain charitable or eleemosynary institutions, certain
10nonprofit insurers, service of process on certain nonresident
11persons, names, prescribing penalties and making repeals," to
12their status prior to the partial repeal effected by section 905
13of the former act of July 29, 1977 (P.L.105, No.38), known as
14the Fraternal Benefit Society Code, except as otherwise
15expressly provided by such provisions as reenacted and amended
16by the former General Association Act of 1988, the GAA
17Amendments Act of 1990, the GAA Amendments Act of 1992, the GAA
18Amendments Act of 2001, and this act.
19Section 57. Section 56 of this act shall apply retroactively
20to January 30, 1978.
21Section 58. This act shall take effect as follows:
22(1) The following provisions shall take effect
23immediately:
24(i) Section 55 of this act.
25(ii) This section.
26(2) The addition of 15 Pa.C.S. § 153(a)(16) shall take
27effect upon publication of the notice under section 55 of
28this act.
29(3) The remainder of this act shall take effect in 60
30days.