State Codes and Statutes

Statutes > New-jersey > Title-14a > Section-14a-17 > 14a-17-13

14A:17-13.  Corporate existence;  corporation to convert to business corporation;  acquisition of shares of disqualified or deceased shareholder
    (a) A professional corporation shall have perpetual existence until dissolved in accordance with the provisions of the Business Corporation Act of New Jersey.

    (b) Whenever all shareholders of a professional corporation shall cease at any one time and for any reason to be duly licensed or otherwise legally authorized to render the same professional service for which such corporation was organized, or if such corporation shall for any reason fail to comply or require compliance with the provisions of this section or of section 11 of this  act, said corporation shall thereupon be treated as converted into and shall  operate thereafter solely as a business corporation under applicable provisions  of the Business Corporation Act of New Jersey, exclusive of this act.

    (c) Within 375 days following the date of death of a shareholder, or within  90 days following his disqualification to own shares in the corporation, all of  the shares of such shareholder shall be transferred to, and acquired by, the  corporation or persons qualified to own such shares. If such transfer and  acquisition is not otherwise effected within said period, the corporation shall  forthwith purchase and redeem all of his shares at the book value thereof,  determined as of the end of the month immediately preceding death or  disqualification.  For this purpose, the book value shall be determined by an  independent certified public accountant employed by the professional  corporation from the books and records of the corporation in accordance with  the regular methods of accounting used by it.  Such determination shall be  conclusive on the professional corporation and its shareholders.  Nothing  contained in this section shall prevent the parties involved from making any  other arrangement or provision in the certificate of incorporation or by-laws,  or by agreement, to transfer the shares of a deceased or disqualified shareholder to the corporation or to persons qualified to own the same, whether  made before or after the death or disqualification of the shareholder, provided  that within the period herein specified, all the stock involved shall have been  so transferred.

     L.1969, c. 232, s. 13, eff. Dec. 16, 1969.