[Form 4.]

By-Laws of the

ARTICLE I.-OFFICERS.

The officers shall consist of a President, Vice-President, Treasurer, and Secretary, who shall, with the exception of the Secretary, be chosen by the Directors from among themselves."

ARTICLE II.-DIRECTORS.

1. A Board of Directors shall be elected at the annual meeting of the stockholders. (2) The Directors elect shall serve for one year from the first day of the next month following their election, and until their successors are elected and qualified."

(3)

2. No stockholder shall be eligible for election as a member of the Board of Directors unless he is a bona fide owner of at least shares of the capital stock of the

company at the time of his election.(4)

ARTICLE III.-DUTIES OF OFFICERS.

21. PRESIDENT. The President shall preside at all meetings of the directors or stockholders. He shall sign, as President, all certificates of stock, and all contracts, and other instruments in writing which have been first approved by the Board of Directors. He shall draw all checks and warrants upon the treasury. He shall have the casting vote at all meetings of the stockholders or directors. He shall call the Directors together whenever he deems it necessary;

(1) It is merely superfluous to insert, as is sometimes done, the amount of capital stock, the number of shares, and their par value-this is all determined in the articles of incorporation. The directors are not included in this first article as officers, though in a general sense they are such. The officers so named in the article are officers in a special sense. It is not obligatory to elect the treasurer from the directors; some companies appoint a bank as treasurer, the secretary being ordered to perform the mere clerical duties of such officer.

(2) It is unnecessary to name the number of the Board of Directors, as the number is fixed in the articles of incorporation, or in a subsequent certificate filed; and it is useless to insert a provision as to the corporate powers being vested in a Board of Directors; for the Code gives them this power in Section 305, where it provides for a board of not less than five nor more than eleven in certain corporations. And the Code also provides as to who can vote (see § 312 and note); and the manner of voting in § 307.

(3) Some companies provide that the directors shall begin their term of office as soon as elected.

(4) By Section 305 of the Code, it is allowed to provide in a by-law how many shares a stockholder must own to qualify him for a director. I have not inserted a provision as to vacancies in the Board of Directors. These can be filled by the directors until the next annual meeting (§ 305).

and he shall have, subject to the advice and control of the Directors, the general superintendence of the affairs of the company. In the absence of the President, the Vice-President shall perform his duties.

2. TREASURER. It shall be the duty of the Treasurer to keep safely all moneys and bullion belonging to the company, and disburse the same under the direction of the Board of Directors, or warrant signed by the President and Secretary. At each annual meeting of the stockholders, he shall submit a complete statement of his accounts for the past year, with the proper vouchers for their information. He shall discharge such other duties pertaining to his office as shall be prescribed by the Board of Directors.

? 3. SECRETARY. The Secretary shall be appointed by the Board of Directors. It shall be his duty to keep a record of the meetings of the Board of Directors and of the stockholders. He shall keep the book of blank certificates of stock, fill up and countersign all the certificates issued, and make the corresponding entries on the margin of each book, on such issuance. He shall keep a proper transfer book, and a stock ledger in debit and credit form, showing the number of shares issued to and transferred by any stockholder, and the dates of such issuance and transfer. He shall countersign all checks, keep proper account books, and discharge such other duties as pertain to his office, and are prescribed by the Board of Directors.

ARTICLE IV.-POWERS OF DIRECTORS.(1)

The Board of Directors shall have power: 1. To call meetings of the stockholders when they deem necessary, giving not less than two weeks' notice thereof, in manner as hereinafter provided; and they shall call meetings of the stockholders at any time, upon a written request for that purpose, of persons representing one half of all the capital stock. 2. To make rules and regulations not inconsistent

(1) As to the powers of the Directors, it is almost unnecessary to enumerate them. These powers are necessarily given to them, as Directors, by the Code, and under it they could be exercised, even if the by-laws were silent on the subject. The by-laws may enlarge, but cannot abridge these powers. It has, however, been decided that the Directors could not make a sale of the entire corporate property, in the exercise of any powers vested in them. Under our Code, Directors have entrusted to them larger and fuller powers than are elsewhere given; probably too much power, and properly in the interest of the stockholders, might be more circumscribed.

with the laws of

or the by-laws of the company, for the guidance of the officers and management of the affairs of the company. 3. To declare dividends out of the surplus profits, whenever they shall deem it expedient. 4. To incur such indebtedness as they may deem necessary; provided, however, that no indebtedness over shall at any time be incurred by the company, and to authorize the execution, by the President and Secretary, of any note for such indebtedness.(1)

ARTICLE V.-DUTIES OF DIRECTORS.

It shall be the duty of the Board of Directors: 1. To cause to be kept a complete record of all their meetings and acts, and also of the proceedings of the stockholders; present a full statement at the regular annual meeting of the stockholders, showing in detail the assets and liabilities of the company, and generally the condition of its affairs. A similar statement shall be presented at any other meeting of the stockholders, when thereto required by persons representing at least one half of the capital stock of the company. 2. To supervise all the acts of the officers and employees, require the Secretary and Treasurer to keep full and accurate books and accounts, and to prescribe the form and mode of keeping such books. 3. To cause to be issued to the stockholders, in proportion to their several interests, certificates of stock, not to exceed in the aggregate the capital stock of the company. 4. To cause the moneys of the company to be safely kept, directing, from time to time, where they shall be kept or deposited.

ARTICLE VI.-SUPERINTENDENT.(2)

A General Superintendent shall be appointed by the Board of Directors, and be removable at their pleasure. It shall be his duty: 1. To take charge of all the property belonging to the company, and to control and direct all labor and business pertaining to the interests, objects and operations of the company, at the mines, but entirely subject

(1) In regard to the amount of indebtedness a Board of Directors of a railroad can incur, see § 456. And as to declaring dividends out of the surplus profit, the Directors are forbidden to declare them otherwise. (See 309 Code, and § 560 Penal Code.)

(2) This article is applicable to mining companies; but if there be any other special employee in the case of other companies, as, for instance, a bank cashier, his duties may in the same manner be prescribed.

to the direction and control of the Board of Directors, or of the President of the company. 2. To make monthly returns to the Board of Trustees, of all persons hired or employed at the mines and works, and a statement of all expenditures, accompanying the same with the necessary vouchers, and a similar statement of ore extracted, and the disposition of the same, and report the general condition of the mines and works. 3. To make requisition upon the Board of Directors for necessary funds, stating the precise objects for which they are required, and if approved by the board, the money shall be transmitted to him in such mode as they may direct; but he shall not have the power to sign notes or contracts for the company; neither shall he have the power to incur any indebtedness, unless so especially authorized by the President or Board of Directors.

ARTICLE VII.-COMPENSATION OF OFFICERS.

The members of the Board of Directors shall receive no compensation for their services as such, nor shall the company be held liable for any services rendered, except it is so expressly provided; but members of the board shall be allowed their reasonable traveling expenses, when actually engaged in the business of the company, to be audited and allowed as in other cases of demands against the company. The Secretary and Superintendent shall receive such compensation for their services as the Board of Directors shall determine.")

ARTICLE VIII.-CONTRACTS.

1. No contract by any officer of the company shall be valid without previous authorization or subsequent ratification of the Board of Directors.

ARTICLE IX.-MEETINGS.

The regular annual meeting of the stockholders shall be held on the of each year, at the office of

of

the company, in the A representation of a majority of the capital stock, shall be

(1) This article is intended to avoid claims by its officers against the company, on an implied contract for services rendered. It frequently happens that suits are brought on such contracts; but except there is an understanding that compensation shall be paid, no contract will be implied. I have discussed this subject in a note to § 354.

necessary for the transaction of the business of all meetings of stockholders.) At such meetings a representation by proxy, duly appointed, shall be allowed, such proxy to be in writing, and filed with the Secretary of the company. 2. A regular quarterly meeting of the Board of Directors shall be held on the in each year, and special meetings of the Board may be called by the President, whenever he may deem it expedient. (2) A majority of the Board of Directors shall constitute a quorum for the transaction of business.

3. All meetings of stockholders shall be called by a notice published at least three times a week for two weeks in a daily newspaper in the also in (3)

ARTICLE X.-CERTIFICATES.

and

Certificates of stock shall be of such form and device as the Board of Directors may direct, and such certificates shall be signed by the president and secretary, and express on their face their number, dates of issuance, number of shares for which, and the persons to whom issued. Several certificates may be issued to the same person or persons, provided that in the aggregate they do not exceed the number of shares belonging to such person or persons. The certificate book shall contain a margin, on which shall be entered the number, date, number of shares, and the name or names of the person or persons expressed in the corresponding certificates.

ARTICLE XI.-TRANSFERS.

Shares in the company may be transferred at any time by the holder thereof, or by attorney legally constituted, or by legal representative. (4) But no transfer shall be valid, except between the parties thereto, in the proper form, on the books of the company. The surrendered certificates shall be cancelled before a new certificate shall be issued in lieu

(1) By the second subdivision, of § 303, power is given to prescribe by a by-law the number of stockholders forming a quorum.

(2) See note to § 320 as to" Special meeting" and "Notice."

(3) In one case the mode of giving notice is pointed out in the Code, in § 301, in case of the adoption of by-laws; and in case of a meeting called for the removal of a director, the same notice must be given, if no other is provided. (See § 310.)

(4) For a form of power of attorney for transfer of stock, see Form 6, Appendix.