2010 Pennsylvania Code
Title 15 - CORPORATIONS AND UNINCORPORATED ASSOCIATIONS
Chapter 15 - Corporate Powers, Duties and Safeguards
1525 - Stock rights and options.

     § 1525.  Stock rights and options.
        (a)  General rule.--Except as otherwise provided in its
     articles prior to the creation and issuance thereof, a business
     corporation may create and issue (whether or not in connection
     with the issuance of any of its shares or other securities)
     option rights or securities having conversion or option rights
     entitling the holders thereof to purchase or acquire shares,
     option rights, securities having conversion or option rights, or
     obligations, of any class or series, or assets of the
     corporation, or to purchase or acquire from the corporation
     shares, option rights, securities having conversion or option
     rights, or obligations, of any class or series, owned by the
     corporation and issued by any other person. Except as otherwise
     provided in its articles, the shares, option rights, securities
     having conversion or option rights, or obligations shall be
     evidenced in such manner as the corporation may determine and
     may be offered without first offering them to shareholders of
     any class or classes.
        (b)  Specifically authorized provisions.--The securities,
     contracts, warrants or other instruments evidencing any shares,
     option rights, securities having conversion or option rights, or
     obligations of a corporation may contain such terms as are fixed
     by the board of directors, including, without limiting the
     generality of such authority:
            (1)  Restrictions upon the authorization or issuance of
        additional shares, option rights, securities having
        conversion or option rights, or obligations.
            (2)  Provisions for the adjustment of the conversion or
        option rights price.
            (3)  Provisions concerning rights or adjustments in the
        event of reorganization, merger, consolidation, sale of
        assets, exchange of shares or other fundamental changes.
            (4)  Provisions for the reservation of authorized but
        unissued shares or other securities.
            (5)  Restrictions upon the declaration or payment of
        dividends or distributions or related party transactions.
            (6)  Conditions relating to the exercise, conversion,
        transfer or receipt of such shares, option rights, securities
        having conversion or option rights, or obligations.
     There shall be no authority under this subsection to include a
     provision authorized by section 2513 (relating to disparate
     treatment of certain persons).
        (c)  Standard of care unaffected.--The provisions of
     subsections (a) and (b) and section 2513 shall not be construed
     to effect a change in the fiduciary relationship between a
     director and a business corporation or to change the standard of
     care of a director provided for in Subchapter B of Chapter 17
     (relating to fiduciary duty).
        (d)  Pricing and payment.--The provisions of this subchapter
     applicable to the pricing of and payment for shares shall be
     applicable to the pricing of and payment for rights and options
     except that the rights and options may be issued to
     representatives of the corporation or any of its affiliates as
     an incentive to service or continued service with the
     corporation and its affiliates or for such other purpose and
     upon such other terms as its directors, who may benefit by their
     action, deem advantageous to the corporation.
        (e)  Shares subject to preemptive rights.--Authorized but
     unissued shares subject to preemptive rights may be issued and
     sold pursuant to a plan providing for the issuance of rights or
     options entitling the holders thereof to purchase shares of the
     same class or series as the shares subject to such preemptive
     rights upon the exercise of such rights or options if the plan
     is approved by the affirmative vote of a majority of the votes
     cast by the shareholders entitled to exercise such preemptive
     rights.
     (Dec. 19, 1990, P.L.834, No.198, eff. imd.; Dec. 18, 1992,
     P.L.1333, No.169, eff. 60 days)

        1992 Amendment.  Act 169 amended subsec. (a).
        1990 Amendment.  Act 198 amended subsecs. (c) and (e).
        Cross References.  Section 1525 is referred to in sections
     1530, 2513 of this title.