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445. Limitations to the Holding of Stock, and in other particulars, may be provided for in by-laws. The corporation may, by its by-laws, limit the number of shares which may be held by any one person, and make such other provisions for the protection of the stockholders and the better security of those dealing with it as to a majority of the stockholders may seem proper, not inconsistent with the provisions of this Title or Part.

As to limitations and scope of by-laws, see notes to §§ 301, 303.

446. Premiums, how payable. All premiums must be payable wholly in cash, or one half or a greater proportion in cash, and the remainder in promissory notes bearing interest, as may be provided for by the by-laws. Agreements and policies of insurance made by the corporation, may be upon the basis of full or partial participation in the profits, or without any participation therein, as may be provided by the by-laws, and agreed between the parties.

447. Insurance Commissioner to be furnished with valuation of Policies Outstanding. Every life insurance corporation organized under the laws of this State, must, on or before the first day of February of each year, furnish the insurance commissioner the necessary data for determining the valuation of all its policies outstanding on the thirty-first day of December then next preceding. And every life insurance company organized under the laws of any other State or country, and doing business in this State, must, upon the written requisition of the commissioner, furnish him, at such time as he may designate, the requisite data for determining the valuation of all of its policies then outstanding. Such valuations must be based upon the rate of mortality established by the American experience life-table and interest, at four and one half per cent. per annum. For the purpose of making the valuations, the insurance commissioner is authorized to employ a competent actuary, whose compensation for such valuations shall be three cents for each thousand dollars of insurance, to be paid by the respective companies whose policies are thus valued.

448. No Stamp required on Accident Insurance Contract. No stamp is required, nor stamp duty exacted on any con

tract of insurance, when such contract insures against accident which may result in injury or death.

449. Valuation of Policies, Retaliatory Provision. When the certificate of the insurance commissioner of this State, of the valuation of the policies of a life insurance company, as provided in section four hundred and forty-seven of the Civil Code of this State, issued to any company organized under the laws of this State, shall not be accepted by the insurance authorities of any other State, in lieu of a valuation of the same, by the insurance officer of such other State, then every company organized under the laws of such other State, doing business in this State, shall be required. to have a separate valuation of its policies made under the authority of the insurance commissioner of this State, as provided in section four hundred and forty-seven of the Civil Code.

450. Policy, to contain what Evidence-Penalty. Every policy of insurance upon life, issued hereafter within the limits of the State of California, whether by a person or corporation, organized under the laws of this State, or under those of any other State or country, or by the agent of such person or corporation, must contain written evidence that it was issued in this State. And any such policy issued in this State, which shall not contain such written evidence, is at the option of the holder, null and void. And the person or corporation issuing such policy, without the evidence hereinbefore required, shall forfeit to the people of the State of California, for each and every policy so issued, the sum of one hundred dollars in United States gold coin, to be collected by the insurance commissioner, as provided by section five hundred and ninety-eight of the Political Code.

§ 598 Political Code reads: "The commissioner may collect the sum of five hundred dollars from any person engaged in the business of insurance for each refusal to give full and truthful information and response in writing by the commissioner relating to the business of insurance as carried on by him; and for that purpose suits may be instituted by the commissioner in the name of the people of the State of California in any court of competent jurisdiction."

451. Payment and Cancellation of Policy. Whenever, during the life of any policy of insurance hereafter issued

in this State, such policy shall be, by the legal holder thereof, presented to the person or corporation issuing the same, or to the agent of such person or corporation, for payment and cancellation, such person or corporation must, within sixty days after such presentation and demand of payment, pay to the holder of such policy, in like currency to that of the policy, a sum equal to seventy-five per cent. of the then present value of such policy, as ascertained and determined in accordance with the provisions of section four hundred and forty-seven of the Civil Code, and such payment shall be a full and complete liquidation of such policy. [Approved March 30, 1874.]

TITLE III.

RAILROAD CORPORATIONS.

CHAPTER I. OFFICERS AND CORPORATE STOCK.

II. ENUMERATION OF POWERS.

III. BUSINESS, HOW CONDUCTED.

CHAPTER I.

OFFICERS AND CORPORATE STOCK.

SECTION 454. Directors to be elected, when.

455. Additional provisions in assessment and transfer of stock.
456. Corporations may borrow money and issue bonds. Limita-
tion of amount.

457. To provide a sinking fund to pay bonds.

458. Capital stock to be fixed.

459. Certificate of payment of fixed capital stock.

454. Directors to be elected, when. Directors of railroad corporations may be elected at a meeting of the stockholders other than the annual meeting, as a majority of the fixed capital stock may determine, or as the by-laws may provide; notice thereof to be given as provided for notices of meetings to adopt by-laws in Article II, Chapter I, Title I, of this part. [See Sec. 301, as to the mode of publication.]

455. Additional provisions in assessment and transfer of stock. No stock in any railroad corporation is transferable until all the previous calls or installments thereon have been fully paid in; nor is any such transfer valid, except as between the parties thereto, unless at least twenty per cent. has been paid thereon and certificates issued therefor, and the transfer approved by the Board of Directors.

456. Corporations may borrow money and issue bonds-Limitation of amount. Railroad corporations may borrow, on the credit of the corporation, and under such regulations and restrictions as the directors thereof, by unanimous concurrence, may impose, such sums of money as may be necessary for constructing and completing their railroad, and may issue and dispose of bonds or promissory notes therefor, in denominations of not less than five hundred dollars, and at a rate of interest not exceeding ten per cent. per annum ; and may also issue bonds or promissory notes of the same. denomination and rate of interest, in payment of any debts or contracts for constructing and completing their road, with its equipments and and all else relative thereto. The amount of bonds or promissory notes issued for such purposes must not exceed, in all, the amount of their capital stock; and to secure the payment of such bonds or notes, they may mortgage their corporate property and franchise.

Power to borrow. The power conferred upon a railroad company to "grant such evidences of debt which may be incurred, as may be by the by-laws thereof directed, to such an amount as shall be deemed necessary for transacting the business of the corporation," does not authorize the company to engage in the business of banking. (People v. River Raisin & Lake Erie R. R. Co., 12 Mich. 389.) Power to borrow money on interest, and give bonds, payable at such times and places as might be agreed, authorizes a contract to pay interest periodically, before payment of principal. (Coe v. Columbus, etc., R.R. Co., 10 Ohio St. 372, 396.) For penalty for an unauthorized contraction of debt, see § 566, Penal Code, in Appendix.

457. To provide a Sinking Fund to pay Bonds. The directors must provide a sinking fund, to be specially applied to the redemption of such bonds on or before, their maturity, and may also confer on any holder of any bond or note issued, for money borrowed, or in payment of any debt or contract for the construction and equipment of such road,

the right to convert the principal due or owing thereon, into stock of such corporation, at any time within eight years from the date of such bonds, under such regulations as the directors may adopt.

458. Capital Stock to be fixed. When, at any time after filing the articles of incorporation, it is ascertained that the capital stock therein set out, is either more or less than actually required for constructing, equipping, operating, and maintaining the road, by a two-third vote of the stockholders the capital stock must be fixed, and a certificate thereof, and of the proceedings had to fix the same, must be made out and filed in the office of the Secretary of State.

459. Certificate of payment of fixed Capital Stock. Within thirty days after the payment of the last installment of the fixed capital stock of any railroad corporation organized under this Title and Part, the president and secretary, and a majority of the directors thereof, must make, subscribe, and file in the office of the Secretary of State a certificate, stating the amount of the fixed capital stock, and that the whole thereof has been paid in. The certificate must be verified by the affidavit of the president and secretary.

CHAPTER II.

ENUMERATION OF POWERS.

SECTION 465. Enumeration of powers:

1. To survey road.

2. May accept real estate.
3. May acquire real estate.

4. Lay out road, how wide.
5. Where may construct road.

6. May cross or connect roads.

7. May purchase land, timber, stone, gravel, etc.

8. Carry persons and freight.

9. Erect necessary buildings.

10. Regulate time and freights, subject to legislation.

11. Regulate force and speed.

466. Map and profile to be filed.
467. May change line of road.
468. Forfeiture of franchise.

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