pal place of business is located, for four weeks successively; 3. The notice must also contain the amount to which it is proposed to increase or diminish the capital stock; 4. The capital stock must in no case be diminished to an amount less than the indebtedness of the corporation or the estimated cost of the works which it may be the object or purpose of the corporation to construct; 5. At least four fifths of all the capital stock must be represented at such meeting, and at least two thirds of the entire capital stock must vote in favor of such increase or diminution before the same is effected; 6. A certificate, signed and verified by the Chairman and Secretary of the meeting, must be made, showing a strict compliance with all the requirements of this section, the amount to which the capital stock has been increased or diminished, the amount of stock (and by whom held) represented at the meeting, the vote by which the object was accomplished, the amount of capital stock actually paid in, and the amount of all debts and liabilities of the corporation, and how secured; 7. This certificate must be subscribed by a majority of the Directors, and duplicates made, one to be filed in the office of the County Clerk and one in the office of the Secretary of State, as provided for original articles of incorporation, and thereupon the capital stock is so increased or diminished. NOTE.-The preceding sections of this Article were taken from Stats. 1850, p. 347, Secs. 1, 2, 3, 4, 5, 6. See, also, Stats. 1853, p. 88; 1861, p. 85; 1862, pp. 540, 199, 110; 1866, p. 747; 1868, p. 325. 360. No corporation shall acquire or hold any more real estate than may be absolutely necessary for the use of the business conducted or the construction of their works, except as specially provided. A corpora tion organized for any purpose specified in Subdivis- Same. NOTE.-Whitman Mining Co. vs. Baker, 3 Nevada, ARTICLE II. RECORDS. SECTION 377. Records-of what, and how kept. 378. Other records to be kept by corporations for profit, and of what, and how kept. 377. All corporations for profit are required to keep Recordsa record of all their business transactions; a journal of all meetings of their Directors, members, or stockholders, with the time and place of holding the same, whether regular or special, and if special, its object, how authorized, and the notice thereof given. The record must embrace every act done or ordered to be done; who were present, and who absent; and, if requested by any Director, member, or stockholder, the time shall be noted when he entered the meeting or obtained leave of absence therefrom. On a similar request, the ayes and noes must be taken on any proposition, and a record thereof made. On similar request, the protest of any Director, member, or stockholder, to any action or proposed action, must be entered in full-all such records to be open to the inspection of any Director, member, stockholder, or creditor of the corporation. NOTE.-Stats. 1853, pp. 90, 169; 1861, p. 607. Other records to be kept by protit, and corporations for others. 378. In addition to the records required to be kept by the preceding section, corporations for profit must keep a book, to be known as the "Stock and Transfer Book," in which must be kept a record of all stock; the names of the stockholders or members, alphabetically arranged; installments paid or unpaid; assessments levied and paid or unpaid; a statement of every alienation, sale, or transfer of stock made, the date thereof, and by and to whom; and all such other records as the by-laws prescribe. Corporations for religious and benevolent purposes must provide in their by-laws for such records to be kept as may be necessary. Such Stock and Transfer Book must be kept open to the inspection of any stockholder, member, or creditor. NOTE.-The People vs. Crockett, 9 Cal., p. 112; Smith vs. Forty-nine and Fifty-six Quartz Mining Co., 14 Cal., p. 242. Examination into affairs of corporation, how made by officers of State. ARTICLE III. EXAMINATION OF CORPORATIONS, ETC. SECTION 382. Examination into affairs of corporation, how made by 383. Examination made by the Legislature. 382. The Attorney General or District Attorney, whenever and as often as required by the Governor, must examine into the affairs and condition of any corporation in this State, and report such examination, in writing, together with a detailed statement of facts, to the Governor, who must lay the same before the Legislature; and for that purpose the Attorney General or District Attorney may administer all necessary oaths to the Directors and officers of any corporation, and may examine them on oath in relation to the affairs and condition thereof, and may examine the NOTE. This Article was from the Stats. 1850, p. 350, tion made Legisla ture. 383. The Legislature, or either branch thereof, Examinamay examine into the affairs and condition of any cor- by the poration in this State at all times; and, for that purpose, any committee appointed by the Legislature, or either branch thereof, may administer all necessary oaths to the Directors, officers, and stockholders of such corporation, and may examine them on oath in relation to the affairs and condition thereof; and may examine the safes, books, papers, and documents belonging to such corporation, or pertaining to its affairs and condition, and compel the production of all keys, books, papers, and documents by summary process, to be issued on application to any Court of record or any Judge thereof, under such rules and regulations as the Court may prescribe. 384. The Legislature may at any time amend or repeal this Part, or any Title, Chapter, Article, or section thereof, and dissolve all corporations created thereunder; but such amendment or repeal does not, nor does the dissolution of any such corporation, take away or impair any remedy given against any such corporation, its stockholders or officers, for any liability which has been previously incurred. NOTE.-Sec. 31, Art. IV, of the Cal. State Constitution, is as follows: "Corporations may be formed under general laws, but shall not be created by special Act except for municipal purposes. All general laws and special Acts passed pursuant to this section may be altered from time to time, or repealed." Under that provision in the tenth section of the first Article of the Constitution of the United States which prohibits a State from enacting any law "impairing the obligation Chapter and Article may be repealed. of contracts," it has been settled that the charter of a private corporation is an executed contract between the Government and the corporators, and that the Legislature cannot repeal, impair, or alter it against the consent or without the default of the corporation, judicially ascertained and declared.-Fletcher vs. Peck, 6 Cranch, p. 88; Dartmouth College vs. Woodward, 4 Wheat., p. 518; Wales vs. Stetson, 2 Mass., p. 143; Regents of the University of Md. vs. Williams, 9 Gill. & J., p. 402; Payne vs. Baldwin, 3 Smedes & M., p. 661; Aberdeen Female Academy vs. Aberdeen, 3 Smedes & M., p. 645; Bush vs. Shipman, 4 Scam., p. 190; 2 Kent's Com., pp. 305, 306; Angell & Ames on Corporations, Sec. 767. In consequence of this construction, it has become usual for Legislatures, in acts of incorporation, either to make the duration of the charter conditional, or to reserve the power to alter, modify, or repeal the charter at pleasure; "and as the power of modification and repeal is thus made a qualifying part of the grant of franchises, the exercise of that power cannot of course impair the obligation of the grant."-Angell & Ames on Corporations, Sec. 767; 2 Kent's Com., pp. 306, 307. And to the same effect are the following cases: Dartmouth College vs. Woodward, 4 Wheat., 708; Enfield Toll Bridge Co. vs. Connecticut River Co., 7 Conn., p. 53; Miners' Bank of Dubuque vs. United States, 1 Morris, p. 482; in the matter of the Reciprocity Bank, 29 Barb., p. 369. Section 384 was inserted in this Code out of an abundance of caution, and not because it was deemed necessary, for there can be but little doubt that the constitutional provision quoted at the head of this note enters into and becomes part of the contract, thereby reserving to the Legislature the right to repeal, impair, or alter any law relative to the formation of corporations, even though the result reached would be the dissolution of every corporation organized within the State. ARTICLE IV. JUDGMENT AGAINST AND SALE OF CORPORATE PROPERTY. SECTION 388. Franchise may be treated as property, and sold under execution. 389. Purchaser to transact business of corporation. 390. Purchaser may recover penalties, etc. 391. Corporation to retain powers after sale. |