Of subscriptions to capital s'ock.

Election of di

rectors.

a copy of the affidavit aforesaid endorsed thereon or annexed thereto, and certified to be a copy by the secretary of this territory, shall be presumptive evidence of the incorporation of such company and of the facts therein stated.

SEC. 4. When such articles of association and affidavit are filed and recorded in the office of the secretary of the territory, the directors named in such articles of association may, in case the whole of the capital stock is not before subscribed, open books of subscription to fill up the capital stock of the company in such places, and, after giving such notice as they may deem expedient, may continue to receive subscriptions until the whole capital stock is subscribed. At the time of subscribing, every subscriber shall pay to the directors two per centum on the amount subscribed by him, in money, and no subscription shall be received or taken without such payment.

SEC. 5. There shall be a board of not less than five nor over thirteen directors, of every corporation formed under this act, to manage its affairs; said directors shall be chosen annually by a majority of the votes of the stockholders voting at such election, in such manner as may be prescribed in the by-laws of the corporation, and they may and shall continue to be directors until others are elected in their places. In the election of directors, each stockholder shall be entitled to one vote for each share of stock held by him. Vacancies in the board of directors shall be filled in such manner as shall be prescribed by the by-laws of the corporation. The inspectors of the first election of directors shall be appointed by the board of directors named in the articles of association. No person shall be a director unless he is a stockholder, owning stock absolutely in his own right, qualified to vote for directors at the election at which he shall be chosen. Every corporation formed under this act shall be subject to the following regulations concerning the election of directors, viz: 1. At every election for directors, three persons shall be chosen by the persons entitled to vote for directors, as inspectors at the next succeeding election, whose duty it shall be to act as such, and any two of whom shall be competent to act; and no person who has been a director of any railroad within twelve months last preceding, or any person holding any office under or being in the employment of any board of directors, shall act as proxy for any stockholder at any election of directors. Each acting inspector shall be entitled to a reasonable compensation for his services, to be

paid by the corporation by which he is chosen. 2. The directors of the corporation shall supply any vacancy that may occur by the death or removal from the city or cities, county or counties, in which the corporation shall be situated, of any such inspector, or by his refusal to serve, or neglect to attend on the day of election. 3. No person shall be chosen or appointed an inspector of an election of directors in a corporation of which he shall be a director or officer. 4. Every such inspector, before he shall enter on the duties of his office, shall take and subscribe the following oath, before any officer authorized by law to administer oaths: "I do solemnly swear that I will execute the duties of an inspector of the election now to be held, with strict impartiality and according to the best of my ability." 5. At every election of directors, the transfer books of the corporation shall be produced to test the qualification of the voters, and no person shall be admitted to vote directly, or by proxy, except those in whose names the shares of the stock of the corporation shall stand on such books, and shall have so stood for at least thirty days previous to the election. 6. No person shall be admitted to vote on any shares of stock belonging or hypothecated to the corporation in which the election is held, nor shall any person be admitted to vote on any shares. of stock which shall then be hypothecated or pledged as collateral security to any other person or company. 7. No person shall be admitted to vote on any shares which shall have been transferred to him for the sole purpose of enabling him to vote thereon at the election then to be held, nor upon any shares which he shall have previously contracted to sell or transfer after the election upon any condition, agreement or understanding in relation to his manner of voting at such election. 8. Every person offering to vote may be challenged by any other person authorized to vote at the same election, and to every person so challenged one of the inspectors shall administer the following oath "You do swear (or affirm, as the case may be) that the shares on which you now offer to vote do not belong and are not hypothecated to the corporation for which the election is held, and that they are not hypothecated or pledged to any other person or corporation whatever; that such shares have not been transferred to you for the purpose of enabling you to vote thereon at this election, and that you have not contracted to sell and transfer them upon any condition, agreement or understanding in relation to your manner of voting at this election."

9. No person shall be permitted to vote upon the proxy of a stockholder unless he shall produce, annexed to his proxy, an affidavit of such stockholder stating the same facts to which the oath of such stockholder might have been required upon the challenge had he offered to vote in person on the shares mentioned in the proxy. 10. If any person offering to vote upon a proxy shall be challenged by an elector, he shall be required to take the following oath, to be administered to him by one of the inspectors: "You do swear (or affirm) that the facts stated in the affidavit annexed to the proxy upon which you now offer to vote are true according to your belief, and that you have made no contract or agreement whatever for the purchase or transfer of the shares, or any portion of the shares mentioned in such proxy." 11. If any person duly challenged shall refuse to take the proper oath, his vote shall be rejected, and shall not afterwards be received at the same election; if he shall take the oath, his vote shall be received. 12. If any election for directors in any such corporation shall not be held on the day appointed, it shall be the duty of the directors to notify and cause such election to be held within sixty days after the day so appointed; and on the day so notified no persons shall be admitted to vote except those who would have been entitled had the election taken place on the day when it ought to have been held. 13. No by-law of any such corporation regulating the election of its directors shall be valid unless it shall be made at least sixty days before the day appointed for the election to be held. 14. Every such corporation shall keep a book in which the transfer of shares of its stock shall be registered, and another book containing the names of its stockholders, which books shall at all times during the usual hours of business, for thirty days previous to an election of directors, be open to the examination of the stockholders. 15. If any officers having charge of such books shall, upon the demand of a stockholder, refuse or neglect to exhibit and submit them to examination, he shall for each offence forfeit the sum of two hundred and fifty dollars. 16. If any person shall conceive himself aggrieved by an election, or any proceeding concerning an election of directors or officers in any such corporation, he may apply to the district court for redress, giving a reasonable notice of his intended application to the party to be affected thereby. 17. It shall be the duty of the district court, upon such application, to proceed forthwith, in a summary way, to hear

the proofs and allegations of the parties, or otherwise to inquire into the causes of complaint, and thereupon to make such order and grant such relief as the circumstances and justice of the case shall seem to require. If the election complained of shall be set aside, the district court may order a new election at such time and place as they shall appoint. 18. The district court, if they can not otherwise arrive at a satisfactory result, may order an issue between the parties, to be made up in such manner and form, and to be tried in such court, as they shall select; or may permit or direct the attorney general to file an information in the nature of a quo warranto, if the case be one in which that proceeding would be competent and effectual. 19. If any such issue shall be ordered, or information permitted or directed to be filed, it shall be the duty of the district court to make such further orders in relation to the time and mode of pleading, the examination of witnesses or the parties, the production of books and papers, and the time and place of trial or hearing, as shall in their judgment be effectual for expediting the proceedings, saving expense to the parties, and causing a final determination to be had, with as little delay as the nature of the controversy will permit; and the court may adjudge the costs according to equity.

Directors may appoint their off

SEC. 6. The directors shall appoint one of their number president; they may also appoint a treasurer and secretary, and such cers. other officers and agents as shall be prescribed by the by-laws.

SEC. 7. The directors may require the subscribers to the capital stock of the company to pay the amounts by them respectively subscribed, in such manner and in such instalments as they may deem proper. If any stockholder shall neglect to pay any instalment as required by a resolution of the board of directors, the said board shall be authorized to declare his stock, and all previous payments thereon, forfeited for the use of the company; but they shall not declare it so forfeited until they shall have caused a notice in writing to be served on him personally, or by depositing the same in the post office, properly directed to him at the post office nearest his usual place of residence, stating that he is required to make such payment at the time and place specified in said notice, and that, if he fails to make the same, his stock and all previous payments thereon will be forfeited for the use of the company, which notice shall be served as aforesaid at least sixty days previous to the day on which such payment is required to be made.

Of the payment of subscriptions.

Stock of compa

nies formed under

real estate.

SEC. 8. The stock of every company formed under this act this act considered shall be deemed personal estate, and shall be transferable in the manner prescribed by the by-laws of the company; but no shares shall be transferred until all previous calls thereon shall have been fully paid in; and it shall not be lawful for such purchase of stock company to use any of its funds in the purchase of any stock other corporation. in its own or any other corporation.

Not lawful to use

its funds in the

in its own or any

Power to increase the capital stock.

Liabilities of stockholders.

No guardian,

SEC. 9. In case the capital stock of any company formed under this act is found to be insufficient for constructing and operating its road, such company may, with the concurrence of two-thirds in amount of all its stockholders, increase its capital stock from time to time to any amount required for the purposes aforesaid. Such increase must be sanctioned by a vote, in person or by proxy, of two-thirds in amount of all the stockholders of the company, at a meeting of such stockholders called by the directors of the company for that purpose, by a notice in writing to each stockholder, to be served personally, or by depositing the same, properly folded and directed to him at the post office nearest his usual place of residence, in the post office, at least twenty days prior to such meeting. Such notice must state the time and place of meeting and its object, and the amount to which it is proposed to increase the capital stock. The proceedings of such meeting must be entered on the minutes of the proceedings of the company, and thereupon the capital stock of the company may be increased to the amount sanctioned by a vote of two-thirds in amount of all the stockholders of the company as aforesaid.

SEC. 10. Each stockholder of any company formed under this act shall be individually liable to the creditors of such company to an amount equal to the amount unpaid on the stock held by him for all the debts and liabilities of such company, until the whole amount of the capital stock so held by him shall have been paid to the company; and all the stockholders of every such company shall be jointly and severally liable for all the debts due or owing to any of its laborers and servants for services performed for such corporation; but shall not be liable to an action thereby before an execution shall be returned unsatisfied, in whole or in part, against the corporation, and then the amount due on such execution shall be the amount recoverable with costs against such stockholder.

SEC. 11. No person holding stock in any such company as sonally' subject to executor, administrator, guardian or trustee, and no person

trustee, &c., per