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or the by-laws of such corporations. The directors, except Term of ing in such particular cases as are hereinafter provided for, shall hold office for one year, and until their successors shall be chosen in their stead. The directors of any corporation may require bonds of such of its officers or employes and in such amount as may be fixed and determined by such board.

directors.

SEC. 4. If an election of directors or trustees in any cor- Election of poration shall not take place at the annual meeting thereof, in any year, such corporation shall not thereby be dissolved, but an election may be had at any time to be fixed upon, notice whereof to be given by the directors: Provided, That Proviso. in case the directors shall refuse or neglect so to do, any three of the stockholders may call a meeting of the stockholders for the election of directors or trustees by giving the notice prescribed in section twelve of this chapter.

SEC. 5. Unless otherwise prescribed in the articles, the officers, etc. directors shall elect one of their number to be president or chairman of the corporation and board, and one or more of their number to be vice-president or vice-chairman, and shall also choose a secretary and a treasurer, and assistants if deemed necessary. The secretary and treasurer shall reside at the place where the corporation transacts its business within this state, unless the articles provide for the location of the principal office without this state. The directors shall appoint such other officers and agents as the articles or the by-laws of the corporation shall prescribe. If the stockholders so direct, the same person may hold any two offices excepting those of president and vice-president. Unless Executive otherwise prescribed in the articles, the directors shall have committee. authority to enact and enforce the by-laws of the corporation, and such directors, if more than five in number, may appoint an executive committee of such board, to have the active management of the business affairs of such corporation in the interim between full board meetings, subject to such restrictions and limitations as the board may impose upon such executive committee.

SEC. 6. A majority of the directors of every corporation Quorum. convened according to the by-laws, shall constitute a quorum for the transaction of business; and the stockholders holding a majority of stock, or a majority of the members of a nonstock corporation, shall be capable of transacting the business of a stockholders' or members' meeting, except as herein otherwise provided; and at all such meetings of stockholders each share shall be entitled to one vote, and at all meetings of non-stock corporations each member shall be entitled to one vote, unless otherwise provided in the articles. Excepting as hereinafter otherwise provided, stockholders and members of non-stock corporations may appear and vote in person or by proxy duly made and filed, under such rules and regulations as may be provided in the by-laws. Any non

Vacancies, how filled.

May vote in

proxy.

Directors elected annually.

stock corporation may declare in its articles or by-laws what number of members less than a majority of all the membership present at a regularly called meeting, may transact the business of such meeting.

SEC. 7. The directors shall have power to fill any vacancy which may happen in their board by death, resignation, or otherwise, and such appointees shall hold office until their successors are appointed at the next succeeding election. Vacancies in the trustees of any trustee corporation shall be filled as hereinafter provided.

SEC. 8. In all elections for directors of stock corporations, including corporations under the jurisdiction of the Michigan Public Utilities Commission, every stockholder holding voting stock shall have the right to vote in person or by proxy the number of shares of stock owned by him for as many persons as there may be directors to be elected, or to cumulate said shares and give one candidate as many votes as will equal the number of directors multiplied by the number of shares of his stock; or to distribute them on the same principle among as many candidates as he shall think fit. All such corporations shall elect their directors annually, and the entire number of directors shall be balloted for at one and the same time and not separately: Provided, That the arti cles and by-laws of any such corporation shall not be so amended as to reduce the number of directors of such corporation in case the votes of a sufficient number of shares are recorded against such proposed amendment, which if cumulatively voted as herein provided would elect one or more directors, where the same number of shares if cumulatively voted would not be sufficient to elect the same number of directors of the reduced board: Provided further, That profit corpor- any non-profit or co-operative corporation may elect its directors for a longer term than one year as hereinafter provided.

Proviso.

Further proviso, non

ations.

May amend articles.

Removal.

SEC. 9. Every corporation may at any annual meeting or at any special meeting called for that purpose, by a resolution adopted by a vote of a majority in interest of its outstanding capital stock, or by a majority vote of the members in non-stock corporations, amend its articles, including a change in name and location of its principal office, and as to any other matter for which a different vote is not required by law. Any corporation, for pecuniary profit, formed under any law of this state, may, unless prohibited by law, amend its articles to provide for the enlarging of its corporate purposes to include the carrying on of any other lawful business or businesses in connection with its original purpose. Such amendment shall become operative when a certificate containing the resolution and amendment, signed by the president and secretary of the corporation, has been filed as is provided herein for the filing of original articles.

SEC. 10. In case of a removal from one county to another,

the president and secretary of such corporation shall attach to their articles a certificate that such corporation has thus removed, and said articles, together with said certificate, shall be left for filing immediately on such removal, in the office of the county clerk of the county to which such corporation shall remove. Such corporation officers shall immediately upon such removal also cause a certificate thereof to be filed in the office of the Secretary of State, and also in the office of the county clerk of the county from which it

removes.

kept.

inspection.

stock.

SEC. 11. Every corporation formed under the laws of this Stockholders, state is hereby required to keep a correct list of all its stock list of, to be holders who are residents of this state, together with a statement of the number of shares held by each stockholder, at their agency or office in this state, and if there be more than one, then at some one of such agencies or offices to be designated by the officers of such corporation. Such list of stock- Open to holders shall at all times be open to the inspection of the Secretary of State, or any state or local assessing officer for the purpose of obtaining copies thereof, or other information required in public business. The failure to keep such list of stockholders, together with statement of the number of shares of stock held by each, shall be deemed a misuser of the charter of such corporation. Any person holding Transfer of stock in any such corporation may have the same transferred upon the books of such agency within this state, upon the same terms, conditions, and restrictions as is provided by law, or the rules of such corporation, for such transfer at the principal office of such corporation, wherever it may be situated. The books of every corporation containing its accounts shall be kept, and shall at all reasonable times be open in the city, village or town where such corporation is located, or at the office of the treasurer of such corporation within this state, for inspection by any of the stockholders of said corporation, and said stockholders shall have access to the books and statements of said corporation and shall have the right to examine the same in the said city, village or town or at said office; and as often as once in each year a true statement of the accounts of such corporation shall be made and exhibited to the stockholders.

ing, when held.

SEC. 12. The annual meeting of all corporations shall be Annual meetheld prior to June thirtieth in each year on such date as shall be fixed in the by-laws. Any corporation heretofore organized whose fiscal year ends in any month between the first day of July and the thirty-first day of December may continue to have its annual meeting within such period, but such exemption from the general provision herein made shall not relieve or excuse such corporation from making and preparing a report of its condition and fiscal standing, as required in chapter two, part five of this act. Special meet- Special ings of the stockholders or members of any such corporations meetings.

may be held pursuant to the call of the directors at any time. At least three days' notice of any such meeting shall be given in such manner as the by-laws may prescribe. Meetings of the stockholders or members of such corporations shall be conducted in such manner as the by-laws may direct.

Certificates of

Proviso, re

CHAPTER 2.

Capital Stock and Finances.

Subdivision 1.-Preferred and Common Stock.

SECTION 1. Any stock corporation shall have power to stock, issue of. create and issue certificates for such kinds of stock, viz.: General or common stock, and preferred stock with such preferences as it may deem advisable, which preferred stock, if preferred as to principal, shall at no time exceed twothirds of the authorized capital stock, and shall, if preferred as to principal, be redeemed by the corporation at par at a certain time to be fixed in the articles and to be expressed to the certificates therefor: Provided, That such corporation demption, etc. may, by a provision clearly expressed in its articles, and in the certificates therefor, reserve the right to redeem or retire at a premium any or all of such stock preferred as to principal prior to the time when the same must be redeemed as above provided, and upon reasonable notice to be given to the stockholder in a manner to be fixed by the by-laws. None of said preferred stock shall, however, be redeemed or retired at a premium unless at the time of such redemption or retirement the assets of the corporation taken at a fair valuation over and above all the indebtedness of the company, both matured and unmatured, are equal to the outstanding stock, both common and preferred, plus the premium proposed to be paid upon such redemption. Shares of stock, whether common or preferred, shall be of denomination of ten dollars or some multiple of ten dollars, or of twenty-five dollars; but not more than one hundred dollars, and unless otherwise described in the articles the value of such shares as therein stated shall be deemed to be the par value. The amount of total authorized stock shall not be less than one thousand dollars, and the amount of capital stock, which must be subscribed and paid in before it actually begins business, must be definitely stated in its articles.

Shares, de

nomination of.

Capital stock paid in.

SEC. 2. The amount of capital stock of any stock corporation paid in at the time of executing the articles shall not be less than ten per cent of the subscribed capital, and in no case less than one thousand dollars, except in the case of a capitalization of two thousand dollars or under, when it shall be not less than twenty-five per cent thereof, and the amount so paid in shall not be reduced below such per cent

of its capital. Such capital may be paid in, either in cash or in other property, real or personal; but where payment is made otherwise than in cash there shall be included in the articles an itemized description of the property in which such payment is made, with the valuation at which each item is taken, which valuation shall be conclusive in the absence of fraud: Provided, That only such property shall be so taken Proviso. in payment for capital stock as the purposes of the corporation shall require, and only such property as can be sold and transferred by the corporation, and as shall be subject to levy and sale on execution, or other process issued out of any court of competent jurisdiction for satisfaction of any judg ment or decree against such corporation: And provided Further prefurther, That there shall be made and attached to any such viso, affidavit. articles an affidavit by at least three of the incorporators, that they know the property described in such articles and that the same has been actually transferred to such corporation, and that such property is of the actual value therein stated.

stock convert

ible.

SEC. 3. The preferred stock may be made convertible at the Preferred option of the holder into common stock or any other class of stock, bonds or other securities on terms clearly set forth in the articles and expressed in the certificates therefor. In case provision for such conversion is so made, such corporation shall at all times have on hand in its treasury sufficient shares of its common stock or such other stock as may be stipulated for, to carry such conversion into effect. In providing for the issuance of preferred stock, the corporation may further provide that such stock shall, in addition to the dividend fixed therein, also participate with the common stock, in such proportions as the stockholders may agree upon and provide for in the articles, in any dividends which the corporation may at any time declare after there shall be declared and paid upon the common stock for the then current year a rate equal to that paid upon the preferred stock. SEC. 4. In no event shall the holder of such preferred stock, Holder not preferred as to principal, be individually or personally liable for the debts or other liabilities of said corporation, excepting debts for labor. Every corporation issuing preferred stock shall be controlled by a board of directors elected by such preferred and common stockholders voting according to their respective holdings, excepting when otherwise provided in the articles: Provided always, If at any time upon Proviso. a fair valuation of the assets of the corporation the common stock shall be impaired in an amount equal to ten per cent thereof or any dividend due on the preferred stock shall remain unpaid for sixty days, then holders of such preferred stock shall have an equal right with the common stock, share and share alike and notwithstanding any provision in the articles to the contrary, to participate in the election of directors and control of said corporation. If for any reason

liable.

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