number of

SEC. 7. In any case other than in the articles in which the To state law requires to be stated in any annual or other report, or shares authorin any certificate or paper, the amount of capital authorized, ized, etc. issued, outstanding or with which the corporation will commence business, the par value of shares, or the amount of the subscriptions of the incorporators thereof, there shall be stated in respect of such nominal or non par value shares, the number of such shares authorized, issued, outstanding or with which the corporation will commence business that such shares are without par value, or the number of such shares subscribed for by the incorporators, as the case may be: Provided, however, That whenever such corporation Proviso. shall have fixed the value of such shares for the purpose of sale or the payment of dividends thereon or for the exchange of other stock, or for any other purpose, the highest value so placed thereon within the period of one year shall be stat ed in lieu of the requirement as to the par value.

of non-par value shares.

SEC. 8. Each share of such stock without nominal or par Voting power value shall have such voting powers as may be determined upon by the corporation and shall be equal to every other share of such stock subject to the preference given to preferred stock if any authorized to be issued. Every stock certificate for such shares without nominal or par value shall have plainly written or printed upon its face the number of such shares which it represents and the number of such shares which the corporation is authorized to issue, and no such certificate shall express any nominal or par value of such shares.

SEC. 9. Such corporation may issue and may sell its sale of. authorized non-par value shares from time to time, for such consideration as may be prescribed in the articles of incorporation, or for such consideration as shall be the fair mar ket value of such shares, and, in the absence of fraud in the transaction, the judgment of the board of directors as to such value shall be conclusive as to creditors and stockholders; or, for such consideration as shall be consented to by the holders of two-thirds of each class of shares then out. standing, at a meeting called for that purpose in such manner as shall be prescribed in the by-laws. Any and all shares Non-assessissued as permitted in this subdivision shall be deemed fully paid and non-assessable and the holder of such shares shall not be liable to the corporation or to its creditors in respect thereto Provided, That nothing in this subdivision con- Proviso. tained shall be construed as relieving or exempting any such corporation or the holders of any such shares or any other person or persons from complying with the provisions of act number forty-six, Public Acts of nineteen hundred fifteen, known as the "securities act," and the Michigan Securities Commission may regulate the price at which any stock may be sold within the state of Michigan.

able.

Capital stock may be decreased, etc.

Proviso.

Subscription,

call in.

Subdivision 3.-Increases and Decreases of Capital Stock and Calling in Subscriptions.

SEC. 10. The amount of the capital stock and number of shares of every corporation may be increased or diminished at any annual meeting of the stockholders, or at a special meeting expressly called for that purpose, by a vote of twothirds of the capital stock of the corporation. In voting upon the increase of the capital stock, the stockholders shall have power, by the same statutory majority, to fix the value of, and the price at which, the increases of capital shall be subscribed and paid for by the stockholders, but not less than par, excepting in the case of stock having no nominal or par value, as well as the time and manner of the subscription and payment, and by the same vote to authorize the directors of the corporation to sell, at not less than the price so fixed, any part of such increase not subscribed by the stockholders, after they have had a reasonable opportunity to make subscription of their proportionate shares thereof; and to make provision for calling in and cancelling the old and issuing new certificates of stock; but nothing herein contained shall in any way operate to discharge any company, which may diminish its capital stock, from any obligation or demand that may be due from said company. When a corporation shall so increase or diminish its capital -stock, the president and the secretary shall make a certificate thereof, which shall be signed by them and filed, as an amendment to the articles as provided herein for filing the original articles, and such increase or diminution shall commence and be operative from the date when such certificate is filed in the office of the Secretary of State: Provided, That in order to entitle such certificate to be filed it must show what amount of the total authorized stock, after such increase, has been subscribed, and that at least ten per cent of the total subscribed capital has been actually paid in.

SEC. 11. The directors may call in the subscription to the directors may capital stock of such corporation by installments, in such proportion and at such times and places as they shall think proper by giving notice thereof, as the by-laws shall prescribe; and in case any stockholder shall neglect or refuse payment of any such installment for the space of thirty days after the same shall have become due and payable, and after he shall have been notified thereof, said corporation may recover the amount of said installment from such negligent stockholder in any proper action for that purpose, or so much of the stock of such delinquent stockholder as may be necessary to pay such installment so due, may be sold by the directors at public auction at the office of the secretary of the corporation, giving at least thirty days' notice of such sale in some newspaper published in the county where said office is located; and in case of a sale of said stock the pro

ceeds thereof shall be first applied in payment of the installment called for and the expenses of the sale, and the residue, if any, shall be refunded to the delinquent stockholder. In case the proceeds of such sale shall be insufficient to pay said installment, said corporation may recover the balance from such negligent stockholder. Such sale shall entitle the purchaser to all the rights of a stockholder to the extent of the shares so purchased.

Subdivision 4.-Power to Borrow Money, Mortgage Property, and Guarantee Bonds of Other Corporations.

sent to.

SEC. 12. Every stock corporation shall have the power to May borrow borrow money and contract debts, when necessary for the money, etc. transaction of its business, or for the exercise of its corpor ate rights, privileges or franchises, or for any other lawful purpose of its incorporation; and it may issue and dispose of its obligations for any amount so borrowed, and may mortgage its property and franchise to secure the payment of such obligations, or of any debt contracted for said purposes. Every such mortgage, except purchase money mortgages, Mortgages, shall be consented to by the holders of not less than two-thirds who to conof the capital stock of the corporation, which consent shall be given either in writing or by vote at a meeting of the stockholders called for that purpose, upon the same notice as that required for the annual meetings of the corporation; and a certificate under the seal of the corporation that such consent was given by the stockholders in writing, or that it was given by vote at a meeting as aforesaid, shall be subscribed and acknowledged by the president or a vice-president and by the secretary or an assistant secretary of the corporation and shall be filed and recorded with the instrument. When authorized by like consent, the directors, under such regulations as they may adopt, may confer on the holder of any debt or obligation, whether secured or unsecured, evidenced by bonds of the corporation, the right to convert the principal thereof, after two and not more than twelve years from the date of such bonds, into stock of the corporation; and if the capital stock shall not be sufficient to meet the conversion when made, the stockholders shall, from time to time, authorize an increase of capital stock sufficient for that purpose in the manner hereinbefore prescribed.

corporations,

SEC. 13. Any stock corporation lawfully owning the entire Bonds of other capital stock of any other domestic stock corporation en- guarantee of. gaged in the same general line of business may in pursuance of a two-thirds vote of its stockholders, voting at a special meeting called for that purpose by notice in writing signed by a majority of the directors of such corporation, stating the time and place and object of the meeting and served upon each stockholder appearing as such upon the books of the corporation personally, or by mail, at his last known

May sell stock to employes.

etc.

postoffice address, at least sixty days prior to such meeting, guarantee the bonds of such other corporation.

Subdivision 5.-Industrial Stock and Welfare.

SEC. 14. Any corporation having capital stock and or ganized for pecuniary gain may sell any portion of its stock, not otherwise subscribed, to its employes upon consideration of such faithful or continued employment as may be fixed by the voting stockholders; and such consideration of faithful or continued service in the employment of the company on the part of such employes shall be deemed valid and effectual to pass the title to such shares of stock. Such stock may be sold to such employes upon contract retaining title thereto and withholding the voting privileges thereof until such consideration shall have been fully executed and upon other Voting power, terms and conditions as the corporation may prescribe. Such stock may have such preference and voting powers as the corporation may declare, and shall be known as "industrial stock." Any such corporation may increase its capital stock for the purpose of providing for such industrial shares to any amount not exceeding ten per cent of its total authorized capital, without being required to have property or other assets to liquidate the same at the time of such authorization, but every such corporation, so issuing industrial stock, shall set aside a reserve fund from year to year sufficient to retire any such industrial stock at its par value at maturity, if preferred as to principal, or to equal the liability of the corporation to such stockholders in the case of other stock being so issued.

Credit certificates, what to show.

Not transferable.

Record of.

Maturity.

SEC. 15. Every corporation authorizing the issuance of such industrial stock shall issue a credit certificate to each person entitled to any portion of the stock, showing the number of shares, the par, or in the case of shares without par value, the assumed value thereof, the preferences, if any, and the conditions upon which and the consideration for which such shares will be issued to the holder of such certificate. Such certificate shall not be assignable or transferable, but any right to the delivery of such shares may be assigned or transferred at maturity of the contract under such rules and regulations as the corporation may enact with respect thereto. Every such corporation shall keep a record of every such certificate, showing the number thereof, the name of the holder, the number of shares so contracted for, and the date of maturity as near as can be estimated and the amount in credits required to complete the purchase. Upon such record shall be entered every credit accruing to the holder thereof, and the holder of any such certificate shall have the right to inspect any such record at reasonable times, and to have its credits entered upon his certificates as they accrue. Such certificate, when matured, shall be exchanged for a stock cer

tificate upon presentation to the proper officers of such corporation in the same manner as other shares of stock of such corporation are issued. Such shares when issued shall be transferable and deemed fully paid to the same extent as any class of stock such corporation may be authorized to issue.

SEC. 16. Any corporation authorizing the issuance of in- Plan of dustrial stock may adopt and put into effect in connection payments. therewith a plan whereby such stock may be paid for partly in cash, to be paid in from time to time, and partly in credits given for continued and faithful service to such corporation, with such conditions of forfeiture for failure to fully pay for or earn such stock as may be equitable: Provided, That Proviso. there shall be no forfeiture of any cash payments made upon such certificate. Nothing in this subdivision contained shall be construed as authorizing any such corporation to do a banking business, but such industrial stock shall, when is sued, be entitled to share in such dividends as have been declared on the common stock during the period of payment therefor in the proportion that the amount credited upon the credit certificate at the time such dividends became effective as to the common stockholders bears to the face of such shares, unless such industrial stock shall be issued with a preference as to principal in which case the dividends shall be at such rate as shall have been stipulated in the creditcertificate and shall be cumulative or not as the corporation may authorize.

etc., provision

SEC. 17. Any such corporation may, by the consent of two- Club-rooms, thirds of the capital stock, authorize the expenditure of not for." to exceed ten per cent per annum of the surplus capital thereof for the purpose of providing for the social, moral, physical or educational welfare of its employes, including relief work among the families of such employes, the establishment of suitable club-rooms, schools, entertainment, gymnasiums, athletic grounds, lecture courses, and medical attendance not otherwise required by law, and all such sums of money, so devoted to the betterment of the employes shall be deemed legitimate expenses of the corporations: Provided, That Proviso. with the consent of all of the capital stock, such amount may be increased to twenty-five per cent of such surplus in any one year.

CHAPTER 3.

Liability of Directors, Stockholders, Etc., for Debts of and
Due the Corporation.

stockholders.

SECTION 1. If the capital stock of any corporation shall Liability of be withdrawn, and refunded to the stockholders before the payment of all the debts of the corporation for which such stock would have been liable, the stockholders of such cor