Pennsylvania § 5752 - Organization on a stock share basis.

§ 5752. Organization on a stock share basis.

(a) General rule.--A nonprofit corporation may be organized upon either a nonstock basis or, if so provided in its articles, upon a stock share basis.

(b) Form of certificates; uncertificated shares.--The shares of nonprofit corporations organized upon a stock share basis shall be of the denominations provided in the bylaws and shall be represented by share certificates unless the articles provide that any or all classes and series of shares, or any part thereof, shall be uncertificated shares. A provision of the articles providing for uncertificated shares shall not apply to shares represented by a certificate until the certificate is surrendered to the corporation. Except as otherwise expressly provided by law, the rights and obligations of the holders of shares represented by certificates and the rights and obligations of the holders of uncertificated shares of the same class and series shall be identical. The fact that the corporation is a nonprofit corporation shall be noted conspicuously on the face of each certificate. Within a reasonable time after the issuance or transfer of uncertificated shares, the corporation shall send to the registered owner thereof a written notice stating:

(1) That the corporation is a nonprofit corporation incorporated under the laws of this Commonwealth.

(2) The name of the registered owner.

(3) The denomination and class of shares and the designation of the series, if any, of the shares issued or transferred.

(c) Rights of shareholders.--Unless otherwise provided in a bylaw adopted by the members, each share shall entitle the holder thereof to one vote. No dividends shall be directly or indirectly paid on the shares, nor shall the shareholders be entitled to any portion of the earnings of the corporation derived through increment of value upon its property, or otherwise incidentally made, until the dissolution of the corporation.

(d) Transferability of shares.--Unless otherwise provided in the bylaws, the shares shall not be transferable by operation of law or otherwise.

(e) Power to cancel shares.--A nonprofit corporation shall have power to exclude from further membership any shareholder who fails to comply with the reasonable and lawful bylaws of the corporation, and may cancel the shares of any offending member without liability for an accounting except as may be provided in the bylaws.

(f) Applicability of the Uniform Commercial Code.--The provisions of 13 Pa.C.S. Div. 8 (relating to investment securities) shall not apply in any manner to the shares of a nonprofit corporation.

(g) Cross reference.--See the definition of "member" in section 5103 (relating to definitions).

(Nov. 1, 1979, P.L.255, No.86, eff. Jan. 1, 1980; July 9, 2013, P.L.476, No.67, eff. 60 days)

Cross References. Section 5752 is referred to in sections 5504, 5541 of this title.