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Appointment of custodian of corporation on deadlock or other cause. (a) General rule.--Upon application of any member, the court may appoint one or more persons to be custodians of and for any nonprofit corporation when it appears that: (1) at any meeting for the election of directors or members of an other body, the members are so divided that they have failed to elect successors to those whose terms have expired or would have expired upon the qualification of their successors; or (2) any of the conditions specified in section 5981 (relating to proceedings upon application of member or director), other than that it is beneficial to the interest of the members that the corporation be wound up and dissolved, exist with respect to the corporation. (a.1) Exception.--The court shall not appoint a custodian to resolve a deadlock if the members by agreement or otherwise have provided for the appointment of a provisional director or member of an other body or other means for the resolution of the deadlock, but the court shall enforce the remedy so provided, if appropriate. (b) Power and title of custodian.--A custodian appointed under this section shall have all the power and title of a receiver appointed under Subchapter G of Chapter 59 (relating to involuntary liquidation and dissolution), but the authority of the custodian shall be to continue the business of the corporation and not to liquidate its affairs and distribute its assets except when the court shall otherwise order. 2013 Amendment.
Pages: 100
Publisher: Intl Business Pubns USA (June 2015)
ISBN: 1514509741
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