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OF THE LAW OF

PRIVATE CORPORATIONS

By WILLIAM MEADE FLETCHER
Author of "Corporation Forms," "Illinois Corporations,” “Equity

Pleading and Practice,” etc.

VOLUME VI

Credit

received 1933

\

CHICAGO
CALLAGHAN AND COMPANY

260 71

COPYRIGHT 1919

By

CALLAGHAN & COMPANY

PRIVATE CORPORATIONS

VOLUME VI

CHAPTER 56 (Continued)
STOCK AND STOCKHOLDERS

I. GENERAL CONSIDERATIONS (See Vol. 5)
II. CERTIFICATES OF STOCK (See Vol. 5)
III. SHARES OF STOCK AS PROPERTY (See Vol. 5]
IV. LIABILITY OF SHARES OF STOCK TO EXECUTION, ATTACHMENT AND GARNISHMENT

[See Vol. 5]
V. CONVERSION OF SHARES OF STOCK [See Vol. 5)
VI. AMOUNT OF CAPITAL STOCK AND INCREASE AND REDUCTION THEREOF (See Vol. 5]
VII. ISSUE OF STOCK (See Vol. 5]
VIII, ISSUE AND CANCELLATION OF CERTIFICATES OF STOCK [See Vol. 5]
IX. UNAUTHORIZED AND FICTITIOUS STOCK AND CERTIFICATE [See Vol. 5)
X. RIGHTS AND REMEDIES IN CASE OF LOSS OF CERTIFICATE OF STOCK [See Vol. 5]
XI. PAYMENT FOR STOCK (See Vol. 5]
XII, WATERED OR FICTITIOUSLY PAID UP STOCK (See Vol. 5]
XIII. LIEN OF CORPORATION ON SHARES [See Vol. 5]

XIV. PREFERRED STOCK

$3621. Definition, nature and distinctions.
$ 3622. Power to issue preferred or guaranteed stock-In general.
$3623. — Issue of preferred stock under power to borrow money.
$3624. — By-laws authorizing preferred stock.
$3625.

- Extent of power. $3626.

– Remedies in case of unauthorized issue. $3627. - Estoppel; ratification. $ 3628. Preferred stockholders as creditors-General rule. $ 3629. — May be creditors. $3630.

- Relation both as stockholders and creditors. $3631. — Construction and effect of contract. § 3632. Rights and remedies of preferred stockholders—In general. 8 3633.

Change of contract or impairment of rights. $ 3634. — Rights subordinate to those of creditors. $3635. · Right to certificate. $3636. — Right to dividends. $3637. — Rights as to management of corporation. $ 3638. — Right to vote at corporate meetings.

VI Priv. Corp.-1

.

$3639. - Rights on increase or reduction of capital stock. § 3640. — Right to share in distributions of capital. $ 3641. Liabilities of preferred stockholders. $ 3642. Rights of common stockholders with respect to preferred stock. $ 3643. Exchange of preferred stock for common stock, or common stock for pre

ferred. $ 3644. Redemption and retirement-Right of corporation to redeem or retire. § 3645. – Right of stockholders to compel redemption. § 3646.

-- Matters elsewhere considered. & 3647. Interest bearing stock.

xv. CONVERTIBLE STOCK

$3648. Exchange of stock for bonds or property.

XVI. DIVIDENDS

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$3649. Definition and nature of dividends. § 3650. Dividends distinguished from profits. 8 3651. Power to declare dividends. $3652. Stockholders' right to share in profits—Rights before dividend is declared. $3653. – Rights after a dividend is declared. § 3654. Revocation of declaration of dividend. $3655. Effect of insolvency, $3656. Compelling declaration and payment of dividends—In general, $3657. - Jurisdiction and procedure. $3658. Dividends payable out of profits only-General rule. § 3659. - Unconditional agreement to pay dividends. 8 3660. Determination of profits-In general. $ 3661.

- Time of determining profits. $3662. - Deduction of expenses. $ 3663. - Debts and interest. § 3664. - Money due but not received. $ 3665.

- Borrowed money. § 3666. - Creation of reserve fund for repairs, etc. 8 3667. — Valuation of property. $3668. -- Property or money representing capital stock. $3669.

- Insurance companies. $3670. — Corporations whose property is necessarily consumed in use. 8 3671. — Further illustrations. $ 3672. In whom authority to declare dividends is vested. $3673. Formal requisites of declaration. 8 3674. Discrimination between stockholders. § 3675. Time of payment. § 3676. Place of payment. $3677. Cash dividends. $3678. Dividends payable in property. § 3679. Bond or scrip dividends. $ 3680. Interest and interest dividends. $ 3681. Stock dividends—General principles. $3682. - Right to declare stock dividends. $ 3683. — Necessity for surplus profits.

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$3684. - Effect of stock dividends. § 3685. — Recovery of dividend in money. $3686. Dividends for particular purposes. § 3687. Remedies of stockholders to recover dividends-Action at law against cor

poration. $3688.

Remedy in equity. 8 3689. - Mandamus. 8 3690. — Action against other stockholders. $3691.

Action against officers of corporation. § 3692. — Set-off of dividend against debt due to corporation. 8 3693 Statute of limitations. $3694. Laches and estoppel. $3695.

· Recovery of interest. § 3696. - Effect of consolidation. $3697. Set-off of dividends against debts due from stockholders—In general. $3698. — Effect of transfer of stock. 8 3699. Persons entitled to dividends in general. $ 3700. Rights on transfer of stock—General rule. $ 3701. - Executory contracts to sell; sales for future delivery. $ 3702. — Provisions of statute, charter or by-laws. $ 3703. Contract modifications. $ 3704. Rights as between pledgor and pledgee. $ 3705. Rights of legatees and distributees. $ 3706. Rights of trustees. $ 3707. Rights as between husband and wife. $ 3708. Attaching creditors. $ 3709. Interpleader. $ 3710. Assignment or transfer of dividends. $ 3711. Right to dividends as between life tenant and remainderman-Dividends

declared before creation of the trust. $ 3712.

- Ordinary cash dividends earned after creation of trust. $ 3713. — Rule that all cash dividends go to life tenant. $ 3714. – Rule that all stock dividends are capital. $ 3715. – What are stock and what are cash dividends. $ 3716. - Rule that form of dividend is immaterial. $ 3717. — Apportionment according to time when earned-General statement. $ 3718.

- Ordinary and extraordinary dividends. $ 3719. - Method of making apportionment. $ 3720. — Dividends declared out of capital. $ 3721.

Where corporate property is of a wasting nature. $3722 - Accumulations of surplus; invested surplus. $ 3723. — Dividends in bonds or certificates of indebtedness. $ 3724. — Right to subscribe for shares, etc., and proceeds of sale thereof. $3725. — Proceeds of shares sold. $ 3726.

-Method of determining whether dividends represent income or capital.

- Intention of testator or donor. $ 3728. -- Presumptions and burden of proof. $ 3729. — Rights on death of life tenant. $ 3730. Remedies for unlawful payment of dividends—Injunction. $ 3731. — Appointment of receiver. $ 3732. — Bond or note given for illegal dividend.

$ 3727.

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