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the nuiber of shares into whicli it shall be divided, must vote
in favo of having a capital stock, fix the amount thereof, and
the uuiber of shares into which it shall be divided. Notice of
the tin> and place of holding such meeting and its object must
be givt by the Tresident of such corporation by publication
in som.newspaper printed and published in the county, or city
and eonty, in winch the principal place of business of the cor-
poratio is situated, at least once a week for three successive
weeks -ior to the holding of the meeting. A copy of the pro-
ceedin; of this meeting, giving the number of persons present,
the vos taken, the notice calling the meeting, the proof of its
publicion, the amoinit of capital actually subscribed, and by
whom.ll duly certified by the President and Secretary of the
eorpotion, must be filed in the offices of the Secretary of
State d Clerk of the county where the articles of incorporation
are fiK Thereafter such corporation is posses.sed of all the
rights id powers, and is subject to all the obligations, restric-
tions, d limitations, as if it had been oriiiinally created with
a capi stock. And provided, further, tirat no bank in this
State ill ever pay any dividend ujion so-called guaranty notes,
uor up any stock except upon the amount actually paid in
monefltosaid capital upon such stock, and anv payment made
in violon of this provision shall render all officers and direct-
ors canting to the same, jointly and severally liable to th
depos-s to the extent thereof.

t maintain or defend any
New section, approved April


[tie must, witliin one montli
E by-laws for its goverument
this state. Tlie assent of
scribed capital stock, or of a
ck, is necessary to adopt by-
at purpose; and in the event
blie same by advertisement in
\e principal place of business
. therein, then in a paper pub-
rder of the acting- president,
f the stock, or of two thirds
[ be effectual to adopt a code
Amendment, approved March
1, 1874.'''>

be elected annually by the

[In effect Mav _28tji, 1S78.]
stockholders or members, and if no provision is made in the by-laws for the
time of election, the election must be held on the first Tuesday in June. Notice
of such election must be giyen, and the right to vote determined as prescribed
in section 301.

5303. By-larcs, for v:lmt may provide.

Sec. 303. A corporation may, by its bj'-laws, where no other jDrovision is
specialh' made, provide for:

1. The time, place, and manner of calling and conducting its meetings;

2. The nuujber of stockholders or members constituting a quorum;

3. The mode of voting by proxy;

4. The time of the annual election for directors, and the mode and manner of
giving notice thereof;

'). The compensation and duties of officers;

0. The manner of election and the tenure of office of all officers other than
the directors; and

7. Suitable penalties for violations of by-laws, not exceeding, in any case,
one hundred dollars for any one offense. [Amendmeiit, approced 3Iarc}i 30,
1871; Awnidnimfs 1873-4, 20; took effect July 2, 1874. <">

S»c. .',01. Kv<ry <ori«iratlon formed under this title
iiiuht, fit a 111! (fthiK <il ItK Htookholders or incnjljirs, to
1)1 lifld within oin iii-.ntlj nfier tiling arti'les of in-
i<)ri»>riit)"ii. ii.lfii-t a code ..f by-liiwH for Its govf-rn-
ni« ul not iiiroiinhtciit with tbe •onPlitutiou and Iuwh
of tliiH Notlie of KiK-l) nKflliiK. by order of the

('>) Orifednal section :

Sec. 3n:j. A corponition may, by its by-laws, ■whrre
no other provisiou is Hiieeiiilly made, provide: 1. The
time, place, and manner of calling and couduiting
their meetings; ;•. The number of fctoililiolders or
nieiiiljerB, or the quantity of Btock coi/Btituting a quo-
rnni ; 3. The number of gliares which entitles the stock-

n.tiiig i.refcideiit, sperlfylnu its "d.ji.t. iiiunt be pub- holders respectively to one or more votes: 4. The mode
liHh.-,| two week)- In Konie newsi.npei- i.ubliHhed in the of voting by proxy; 5. The time and place of the an
county where the meeting 1h to be h< Id; or if none l8 . - ■ • ^ ■^

I.uldi^bed 111" rein, then In n piiiier].ublish<-.l in an ad-
joining i-ounty. In the adoption of the by-laws, each
rtockholder hns i.s loriny v< tes as he holils shiires of
htock: If tliere Is rjo cai)ifHl stork, each nii uibrr has
one vote. A majority of all the siibscrlbeil
stock, or of the memberH, If there Is no cai>ltal stock,
is oece.sHary to adopt the by-laws, or any one ol them.

nual election for directors, and the mode and manner
of giving notice thereof; 0. The mode of selling shares
for the non-payment of assessmeutB or installments;
7. The i-onipensatiou and <iutie8 of olficern; 8. The
tenureof office of subordinate officers; and. 9. Suitable
penalties for viidations of by-laws, not exceeding, in
any case, one hundred dollars for any one offense.



5304. By-laws to be recorded m "Book of Bij-laws."

Sec. 304. All by-laws adopted must be certified by a iniijority of tlic diicct«jiK
and secretary of the cori)oraiioii, and copied in a legible liiiud in some book
kept in the office of tlie corporation, to be known as the " Book of By-laws,"
and no by-law shall take effect until so copied, and the book shall theu'beoijeu
to the inspection of the public during office hours of each day except holidays.
The by-laws may be repealed or amended, or new by-laws may be adoi)tcd, at
the annual meeting, or at any other meeting of the stockholders or nienibcrs
called for that purpose by the directors, by a vote representing two thirds of
the subscriber's stock, or by two thirds of the members, or the power to repeal
and amend the by-laws, and adopt new by-laws, may, by a similar vote at any
such meeting, be delegated to the board of du-ectors. The power when dele-
gated may be revoked by a similar vote at any regular meeting of the stock-
holders or members. AVhenever any amendment or new by-law is adopted, it
shall be copied in the book of by-laws with the original by-laws, and immedi-
atel}^ after them, and shall not take effect until so copied. If any by-law lie
repealed, the fact of repeal, with the date of the meeting at which the repeal
was enacted shall be stated, in the said book, and until so stated, the repeal
shall not take effect. [Amendment, cqyproved Alarch 30, 1874; Amendments
1873-4, 201.^=^^

5305. How many and. who to be direetors.

Sec. 305. The corporate powers, business, and property of all corporations
formed under this title must be exercised, conducted and controlled by a board
of not less than five nor more than eleven directors, to be elected from among
the holders of stock; or where there is no capital stock, then from the members
of such corporations; except that corporations formed, or to be formed, for the
purpose of erecting and managing halls and buildings for the meetings and
accommodation of several lodges or societies of any benevolent or charitable
order or organization, and in connection therewith the leasing of stores and
offices in such building or buildings for other purposes, the corjiorate jiowers,
business and projDerty thereof may be conducted, exercised, and controlled by
a board of not less than five nor more than fifty directors, to be chosen from
among the stockholders of such cori)oration or from among the members of such
order or organization. A majority of the directors must be in all cases citizens
of this state. Directors of corporations for profit must be holders of stock
therein in an amount to be fixed by the by-laws of the corporation. Directors
of all other corporations must be members thereof. Unless a quorum is present
and acting no business performed or act done is valid as against the corpora-
tion. Whenever a vacancy occurs in the office of director, unless the by-laws
of the corporation otherwise provide, such vacancy must be filled by an ap-
pointee of the board. [Ameiidment, approved January 20, 1876; Amendments
1875-6, 71; took effect from passage. ^"^

5306. Directors to be elected at first meeting.

Sec. 306. At the first meeting at which the by-laws are adopted, or at such

(a) Original section: erty of all corporalious fonuc.l uu.ler tliif title miist be

Sec. 3
the oflic

iu the :

pal phii

by-laws thus adopted must not be altered or ainended, sueh loiijoratiou A inajoruj- oi lu.- «..c. i...- ..„

except at a special meetiu- of the stockholders cr citizeus of this st:tte. /^'rt^^tore of corporations for

members, to be called by the directors for that purpose, profit must be holders of stock therein in »"»"'«""'* »«'

recorded in the same manner as the orig ^j ■ - -^ - - . >,.«;„„ „h,o^«-<q.. ..rr^

J unless the by-laws of the corjioratiou otherwls- pro-

{b) Original section: ■^i^l^^- ^'•"''i vacancy must be filled by an appointee of

Sec. 3u5. The corporate powers, business, and prop- the board.


5306-5310 CIYIi. CODE.

subsequent meeting as may be tlieu designated, directors must be elected, to
bold their offices for one year, and until their successors are elected and quali-
fied. [Amendmrid, approved March 30, 1874; Amendmenls 1873-4, 202; look
effect July 1, 1874/"'
j 307. All elections must be by ballot, and every stock-
holder shall have the right to vote in person or by proxv the lllf 1 r+ fii
number of shares standing: in liis name, as provided iu section DallOt, and a VOte OI StOCK-
three hundred and twelve of this Code, for as many persons as capital stock, or of a majority
there are director8 to be eleete.l, or to cumulate said shares and ^ ^^ capital stock in the COr-
give one candidate as manv votes as the number of directors ^

multiplied by the number of his shares of stock shall equal, or for each share held by him at

to distribute them on the same principle among as many can- er meetings of stockholders,

didates as he shall think fit. In corporations having no capital , -i nr-o * on9. i h fF t

stock, each member of the corporation may cast as many votes entS, 10(0-4:, L\}A', tOOlC effect
for one director as there are directors to be elected, or may dis-
tribute the same among any or all of the candidates. In either
case, the directors receiving the highest number of votes shall

be declared elected. [In ettect, April 2, 1878.] ^ directors must organize by

the election of a president, who must be one of their number, a secretary', and
treasurer. They must perform the duties enjoined on them by law and the
by-laws of the corporation. A majority of the directors is a sufficient number
to form a board for the transaction of business, and every decision of a ma-
jority of the directors forming such board, made when duly assembled, is valid
as a corporate act.

5309. Dividends to he made from su7'plus profits.

Sec 309. The directors of corjDorations must not make dividends, excejjt from
the surplus profits arising from the business thereof; nor must they divide,
withdraw, or pay to the stockholders, or any of them, any Y>^ri of the capital
stock; nor must they create debts beyond their siibscribed capital stock, or
reduce or increase the capital stock, except as hereinafter si^ecially provided.
For a violation of the provisions of this section, the directors under whose
administration the same may have happened (except those who may have caused
their dissent therefrom to be entered at large on the minutes of the directors at
the time, or Avere not present when the same did happen), are, in their indi-
vidual and private capacity, jointly and severally liable to the cor^Doration, and
to the creditors thereof, in the event of its dissolution, to the full amount of
the capital stock so divided, withdrawn, paid out, or reduced, or debt con-
tracted; and no statute of limitations is a bar to any suit against such directors
for any sums for which they are made liable b}' this section. There may, how-
ever, be a division and distribution of the capital stock of any corporation which
remains after the payment of all its debts, upon its dissolution, or the expira-
tion of its term of existence.

5310. Removal from office of directors, etc.

Sfx'. 310. No director shall be removed from office, unless 'by a vote of two
thirds of the members, or of stockholders holding two thirds of the capital
stock, at a general meeting held after previous notice of the time and place, and
of the intention to propose such removal.' Meetings of stockholders for this
puri)ose may be called by the president, or by a majority of the directors, or by
members or stockholders holding at least one half of the votes. Such calls
must Ije in writing, and addressed to the secretary, who must thereupon give
noti(re of the time, place, and object of the meeting, and by whose order it is
called. If the secretary refuse to give the notice, or if there is none, the call

(«) Ori(finalsr-cti(.n: (6) Original section:

>r.<-. :«)!,. M th<- first meeting raHefl. ns rood as the Sec. 3U7. All elections must be by ballot, and unless

by-IawH are aflojited, uiilr hk it in imjvided that theoffl- otherwise prescribed by the by-laws, a majority of the

f< PK UHiix-d in the artideK of incorporation shall con- subscribed capital stock or of the members is ueces-

tinu<- until n < crtaiii other date, directors must be sary to a choice.

elect.-d, B majority i>i the subscriljed capital stock, or
of the jiieiiibers, being necessary to a choice



may be addressed directly to the members or stockholders, and be sen-ed as a
notice, in which case it must specify the time and place of meeting. The notice
must be given in the manner provided in section 301 of this title, unless other
express provision has been made therefor in the by-laws. lu case of removal,
the vacancy may be filled by election at the same meeting.

5311. Justice of peace viay order meeting, when.

Sec. 311. Whenever, from any cause, there is no person authorized to call or
to preside at a meeting of a corporation, any justice of the peace of the county
where such corporation is established, may, on written application of three or
more of the stockholders or of the members thereof, issue a warrant to one of
the stockholders or members, directing him to call a meeting of the corpora-
tion, by giving the notice required, and the justice may in the same warrant
direct such person to jDreside at such meeting until a clerk is chosen and
qualified, if there is no other ofiicer present legally authorized to preside

5312. Majority of stock must be represented, and majority vote at elections.

Sec. 312. At all elections or votes had for any purpose there must be a
Tnaioviiv of the subscribed capital stock, or of the members, represented, either

at^iui,' ■^'"'''^ ''"^iTead "at thp ;ncto„ c ^ ■" acting therein, in person or

* e°'''7A3L': .t'"- ^"l-^ ^i- S' «! elt" :. : -* l^ereof or a boLa fide .lock-

least ten clays pui^x ^^ ._ r election had other than in

accordance with the provisions of this article is voidable at the instance of ab-
sent stockholders or members, and may be set aside by petition to the district
court of the county where the same was held. Any regular or called meeting
of the stockholders or members may adjourn from day to day, or from time to
time, if for any reason there is not present a majority of the subscribed stock
or members, or no election or majority vote had — such adjournment and the
reasons thereof being recorded in the journal of proceedings of the board of

5313. Stock of minors, insane, or deceased, hoio represented.

Sec. 313. The shares of stock of an estate of a minor, or insane person, may
be represented by his guardian, and of a deceased person by his executor or
administrator. [Amendment, apjpjroved Ilarch 30, 187-1; Amendments 1873-4, 203;
took effect July 1, 1874.'^'

5314. Election may he jjostponed.

Sec. 314. If from any cause an election does not take place on the day ap-
pointed in the by-laws, it may be held on any day thereafter as is provided for
in such by-laws, or to which such election may be adjourned or ordered by the
directors. If an election has not been held at the appointed time, and no ad-
journed or other meeting for the purpose has been ordered by the directors, a
Tr.o^+i,-,r>. winv hfi called bv the stockholders, as provided in section 310 of this

§ 315, Upon the application of any person or body cor-
I porate aggrieved by any election held by any corporate body,

I the District Court of the district in which such election is held yarding elections.

j must proceed forthwith to hear the allegations and proofs of . 'body coriiorate a""grieved by
i the parties, or otherwise inquire into the matters of complaint, ,. ,■■ °"/. ,-> -i •

' and thereupon confirm the election, order a new one, or direct proceedings tnereoi, tne Clis-

such other relief in the premises as accords with right and ; held must proceed forthwith

' i"pSf.^' ^^'"^^7'"•'^ f"' ^,^?^''«"' «'"^ ^I'^fo'"^ '^".J further pro- ^^ parties, or otherwise in-

ceedmgs are had under this section, five davs' noUce of the '■ '

hearing must be given, under the direction of the Court, or the a confirm the election, order

I Judge thereof, to the adverse party or those to be affected
thereby. [In effect, April 1, 1878.] ^^^^.^„^ ^, ^^^ corporation by the legal

es of the person holding the same.


5315-5321 CIVIL CODE.

a new one, or dii-ect sucli otLer relief in tlie premises as accords with right and
justice. Before any proceedings are had under this section, five days' notice
thereof must be given to the adverse party, or those to be affected thereby.

5316. Officers liable for false cerlificales, reports or notices.

Sec. 316. Any officer of a corporation who willfully gives a certificate, or
willfully makes an official report, public notice, or entry in any of the records
or books of the corporation, concerning the corporation or its business, which
is false in any material representation, shall be liable for all the damages re-
sulting therefrom to any person injured thereby; and if two or more officers
unite or participate in the commission of any of the acts herein designated,
they shall be jointly and severally liable. [Amendment, approved March 30,
187-4; Amendments 1873-4; 203; took effect Juhj 1, 1874.^'''

5317. Meeting by consent to be valid.

Sec. 317. When all the stockholders or members of a corporation are present
at any meeting, however called or notified, and sign a written consent thereto
on the record of such meeting, the doings of such meeting are as valid as if had
at a meeting legally called and noticed.

5318. Proceedings at meeting to be binding.

Sec. 318. The stockholders or members of such corporation, when so assem-
bled, may elect officers to fill all vacancies then existing, and maj' act upon
such other business as might lawfully be transacted at regular meetings of the

5319. Meetings, ivJiere held.

Sec. 319. The meetings of the stockholders and board of directors of a corpo-
ration must be held at its office or principal place of business.

5320. When no provision in by-laws for regular meetings, special meetings, hoio


Sec. 320. When no provision is made in the by-laws for regular meetings of

the directors and the mode of calling special meetings, all meetings must be

called b}' special notice in writing, to be given to each director by the secretary,

on the order of the president, or if there be none, on the order of two directors.

5321. Book and notice of directors and stockholders of banks.

Sec 321. Every corporation doing a banking business in this state, must keep
in its office, in a place accessible to the stockholders, depositors, and creditors
thereof, and for their use, a book containing a list of all stockholders in such
corporation, and the number of shares of stock held by each; and eveiy such
corporation must keep posted in its office, in a conspicuous place, accessible to
the public generally, a notice signed by the president or secretary, showing:

1. The names of the directors of such corporation;

2. The numl^er and value of shares of stock held by each director. The
entries on such book and such notice shall be made and posted within twei^,ty-
four hours after any transfer of stock, and shall be conclusive evidence against
eadi director and stockholder of the number of shares of stock held by each.
Tlie provisions of this section shall apply to all banking corporations formed or
existing before twelve o'clock noon of the day on which this code took effect,
as well us to tliose formed after such time. [Neiv section, approved January 29,
187G; Amendments 187o-G, 72; took effect sixtirtJi day after passage.

la) Original fWTtlon: or had fuU opportunity to know the same to be false,
Sec. 310. Any >.m(<T of « rorpnratlon wlm iiiakt-s or in liable for all the debts of the corijoratiou con-
given a .•<-itili.«ti-. omcittl rep..rt. public- notice, or traeted while he was a stockholder or officer tlK-n-of;
enlrj- iu any of the re.-onlH or bookH of the <-r)rporn- and if more than on.; violate the provisions of tliis
lion. roiircrnlnK the eon.oration oritn biihini i^h, which B<-ctioa iu concert, they are jointly and severally lia-
is falbe iu any material rcpreiieutatiou, and viLo knew ble.



An Act conceiuiug corporations and porsojis enfjjiged in tlie busiucKH of Ijaiiking.
Approved April 1, 1H7C; 1875-C, 729.

Banks to piihlkh and record semi-anmial slalcmenfs.

Section 1. Every corporation and all persous and every person hereafter doiii;^'
a banking- business in this state shall, in January and July of every year, i)iil)-
lish in at least one newsj^aper published in the county in which the ])riiK-ijial
office of such corporation may be situated, or in which said persons or person
may reside, and also file for record, in the recorder's office of said county, a
sworn statement, verified, in the case of any such corporation, by its i)resident
or manager, and by its secretary or cashier, and in the case of any such indi-
vidual or individuals, by him or them, of the amount of ca])ital actually \m'u\
into such corporation, or into such banking business; provided, that nothing
shall be deemed capital actually paid in except money bona tide paid into the
treasuiy of such bank, and under no circumstances shall the promisson' note,
check, or other obligation of any director or stockholder, or of the proprietors
or proiDrietor of any such bank, be treated, computed, or in any manner con-
sidered any part of such actually paid in capital. If no newspaper of general
circulation be published in the aforementioned county, then and in that case
such publication of said statement shall be made in at least one newspaper of
general circulation published in the city and county of San Francisco, and in
one newspaper of general circulation published in the city and county of Sac-
Assets and liabilities to he described.

Sec. 2. Every corporation and all persons and every person hereafter doing
a banking business in this state shall likewise publish in such newspaper or
newspapers, and shall also file for record, in thfe recorder's office of said county,
in January and July of each year, a like sworn statement of the actual condi-
tion and value of its assets and liabilities, and where said assets are situated.
Liability for making false statement.

Sec. 3. The directors of every such corporation which shall publish or file for
record, as aforesaid, a false statement of the amount of capital actually and
bona fide paid into such corporation, or a false statement of the actual condi-
tion and value of its assets and liabilities, or as to where said assets are situated,
\shall be jointly and severally liable to any person thereafter deaKng with such
sorporation to the full extent of such dealing; and no corporation, and no per-
V)n or persons who fail to comply with the provisions or any of the provisions
\ this law, shall maintain or prosecute any action or proceeding in any of the
c\irts of this state until they shall have first duly filed the statements herein
piVided for, and in all other respects complied with the provisions of this law;
no^sliall any assignee or assignees of any such coi-jioration or person whose
assinnient shall be made subsequent to any such failure to comi)ly with the

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