um'a

1901

C.354

CHAPTER XXXVI

OF THE GENERAL LAWS.

[CHAP. 688 OF 1892.]

THE STOCK CORPORATION LAW.

ARTICLE I. General powers; reorganization (§§ 1-7).

II. Directors and officers; their election, duties and liabilities (§§ 20-34).

III. Stock; stockholders, their rights and liabilities (§§ 40-60).

ARTICLE I.

GENERAL POWERS; REORGANIZATION.

SECTION 1. Short title, and application of chapter.

2. Power to borrow money and mortgage property.

3. Reorganization upon sale of corporate property and franchises. 4. Contents of plan or agreement.

5. Sale of property; possession of receiver and suits against him. 6. Assent of stockholders to plan of readjustment.

7. Combinations abolished.

SECTION 1. Short title and application of chapter. This chapter shall be known as the stock corporation law, but article one shall not apply to monied corporations.

§ 2. Power to borrow money and mortgage property.-In addition to the powers conferred by the general corporation law, every stock corporation shall have power to borrow money or contract debts, when necessary for the transaction of its business, or for the exercise of its corporate rights, privileges or franchises, or for any other lawful purpose of its incorporation; and may issue and dispose of its obligations for any amount so borrowed, and may mortgage its property and franchises to secure the payment of such obligations or of any debt contracted for the purposes herein specified; and the amount of the obligations issued and outstanding at any one time secured by such mortgages, excepting mortgages given as a consideration for the purchase of real estate, and mortgages authorized by contracts made prior to May first, eighteen hundred and ninety-one, shall not exceed the amount of its paid up capi

tal stock, or an amount equal to two-thirds of the value of its corporate property at the time of issuing the obligations secured by such mortgages, in case such two-thirds value shall be more than the amount of such paid up capital stock. No such mortgages, except purchase-money mortgages shall be issued without the consent, of the stockholders owning at least two-thirds of of * the stock of the corporation, which consent shall be in writing and shall be filed and recorded in the office of the clerk or register of the county where it has its principal place of business, or shall be given by vote at a special meeting of the stockholders called for that purpose; and a certificate of the vote at such meeting, signed and sworn to by the chairman and secretary of such meeting, shall be filed and recorded as aforesaid. When authorized by such consent, the directors, under such regulations as they may adopt, may confer on the holder of any debt or obligation secured by such mortgage the right to convert the principal thereof, after two and not more than twelve years from the date of the mortgage, into stock of the corporation; and if the capital stock shall not be sufficient to meet the conversion when made, the stockholders shall, in the manner herein provided, authorize an increase of capital stock sufficient for that purpose.

chises. When the property and franchises of any domestic stock C. 354 § 3. Reorganization upon sale of corporate property and fran- am'd 1901

corporation shall be sold by virtue of a mortgage or deed of trust, duly executed by it, or pursuant to the judgment or decree of a court of competent jurisdiction, or by virtue of any execution issued thereon, and the purchaser at such sale shall acquire title to the same in the manner prescribed by law, he may associate with him any number of persons, not less than the number required by law for the incorporation of such corporation, a majority of whom shall be citizens and residents of this state, and they may become a corporation, and take and possess the property and franchises thus sold, and which were at the time of sale possessed by the corporation whose property shall have been so sold, upon making, acknowledging and filing in the offices where certificates of incorporation are required by law to be filed, a certificate in which they shall describe by name and reference to the law under which it was organized, the corporation whose property and franchises they have acquired, and the court by whose authority the sale had been made, with the date of the judgment *So in the original.