§ 5510. Certain specifically authorized debt terms.

279 words·~1 min read·/pa/title-15/chapter-55/5510

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)Interest rates.-- A nonprofit corporation shall not plead or set up usury, or the taking of more than the lawful rate of interest, or the taking of any finance, service or default charge in excess of any maximum rate therefor provided or prescribed by law, as a defense to any action or proceeding brought against it to recover damages on, or to enforce payment of, or to enforce any other remedy on, any obligation executed or effected by the corporation.

(b)Yield maintenance premiums.-- A prepayment premium determined by reference to the approximate spread between the yield at issuance, or at the date of amendment of any of the terms, of an obligation of a corporation and the yield at or about such date of an interest rate index of independent significance and contingent upon a change in the ownership of or memberships in the corporation or a default by or other change in the condition or prospects of the corporation or any affiliate of the corporation shall be deemed liquidated damages and shall not constitute a penalty.

(c)Definitions.-- As used in this section, the following words and phrases shall have the meanings given to them in this subsection:

"Affiliate." An affiliate or associate as defined in section 102 (relating to definitions).

"Obligation." Includes an installment sale contract.

(d)Cross reference.-- See section 6146 (relating to provisions applicable to all foreign corporations).

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(June 22, 2001, P.L.418, No.34, eff. 60 days; July 15, 2024, P.L.728, No.59, eff. 60 days)

2024 Amendment. Act 59 amended subsec. (c).

Cross References. Section 5510 is referred to in section 6146 of this title.

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