(2.) Consideration,-Stock may be issued in fulfillment of any contract of subscription or purchase, subject to payment in money, property, services, or expenditures, as hereinafter provided; but if otherwise than in money provision must be made therefor in the Agreement of Association.

§ 46. Payment. Every share shall be deemed to, and shall, be held subject to the payment of its par value in cash, unless before the issuance thereof a contract shall be filed in the registered office of the corporation which shall truly and fully disclose in detail the real parties in interest, the parties to whom such stock is issued or to be issued, and the consideration therefor, whether the same be property, services, expenditures or otherwise. Such contract shall be open during regular hours to the inspection of any one, and a copy thereof shall be furnished by the registered agent to any one requesting who advances the cost of copying at a rate not exceed ing ten cents per one hundred words.

§ 47. Issue of Stock and Bonds for Overvalued Property. Contracts of subscription to, or purchase of, stock, bonds or debentures, from the corporation or its representatives, before or after incorporation, whereby stock, bonds or debentures are to be issued at less than par value in exchange for money, property, services, or expenditures, or are to be paid in overvalued property, services or expenditures, shall be void, and such stock, bonds, and debentures, shall be deemed to be issued to such subscriber or purchaser, subject to the payment by him of the full par value in cash less the reasonable value of such property, services or expenditures, or other consideration received by the corporation. Such subscriber or purchaser, and the officers who authorize or issue the same shall be liable to the corporation, or any creditor, or the receiver, or a bona fide purchaser thereof for any damage sustained thereby.

§ 48. Judgment of Directors to Control. The judgment of the directors, acting in good faith, after full investigation, and exercised with the reasonable care of prudent business men, as to the fair value of such property, services, expenditures, or other consideration, received by such corporation, if all the provisions of this Act relating to such issue are fully complied with, shall be final and conclusive upon all parties; but not otherwise.

§ 49. Bonds with Voting Power. Any such corporation may issue bonds and debentures secured by mortgage or otherwise, with voting powers to the holders thereof equal to those of stockholders, if pro

vision is made therefor, and the conditions, circumstances, and manner of issuing the same are fully set forth in the Agreement of Association and are not otherwise inconsistent with the provisions of this Act.

9. Shares.

§ 50. Nature of Shares. The shares of stock in every such corpora tion shall be personal property, in the nature of choses in action, and be considered goods, wares and merchandise within the provisions of statutes of frauds, but not otherwise. They shall be deemed to represent an interest in the franchise to be a corporation and to engage in national commerce under the provisions of this Act, granted by the government of the United States, and shall be subject to the control thereof, and exempt, except as herein provided, from any burden, control, or modification by the government of any other state.

§ 51. Transferable. Unless otherwise provided in this Act or in the Agreement of Association, or amendments thereof, expressly making limitations upon the transferability of shares, such shares shall be transferable as hereinafter provided in section 158.

§ 52. Certificates of Stock. (1.) Recitals in general,-Shares of stock shall be evidenced by a certificate of stock. Such certificate, shall specify the amount of the capital stock authorized to be issued by said corporation, the amount of each class, the amount of each class issued for cash, the amount of each class issued for other consideration, the par value of each share, the location of the registered office, and shall have written, printed, or stamped thereon the provisions as to the voting powers and preferences, and any limitation upon the right to transfer the same, contained in the Agreement of Association.

(2.) As to consideration,-Each certificate shall state whether it is issued for money, property, services, expenditures or other consideration, and whether it is fully paid or not. If not issued for money, such certificate shall have written, printed or stamped on its face a statement that it has been issued in accordance with a contract filed in the registered office open to inspection as provided in section 46.

(3.) As to payment,-If the stock is not fully paid at the time of its issue, there shall be written, printed or stamped upon each certificate thereof, per cent paid up, balance payable as demanded by the directors," or otherwise, in accordance with the

facts and terms of issue; and as further payments are made, the certificate shall be stamped accordingly.

(4.) Execution,-Each certificate shall be executed by the corporation in its corporate name, under the corporate seal, and signed by the President and Secretary, and certify the number of shares which it represents.

5.) Forgery of,-The provisions of section 5415 of the Revised Statutes of the United States relating to forging and counterfeiting national bank notes shall apply to the forging or counterfeiting of the certificates, bonds, debentures, or other securities of corporations formed under this Act.

10. By-laws.

§ 53. Necessity. Such corporation shall, subject to the provisions of section 71 of this Act, at the organization meeting, adopt bylaws for the management of its property and the regulation of its affairs.

§ 54. Subjects that may be Regulated. The by-laws must be reasonable, consistent with this Act, and the laws of the United States, and may provide for the location of offices other than the registered office; the form, description, and custody of the corporate seal; the order of the issue, and the numbering of the certificates, and the record thereof; the registration and transfer of shares, and the surrender and cancellation of the old certificates; the issue of new certificates, including those issued in place of others lost or destroyed; the making of calls, the time of payment thereof, and the forfeiture or sale of shares for non-payment; the disposition of treasury stock; the books and records to be kept and the custodians thereof; the time, place, calling, notice, quorum, conduct, parliamentary rules, order of business, and minutes of, and lists of shareholders, voting, and proxies at, stockholders' meetings; number, qualifications, classes, term, election, meetings, quorum, order of business, powers, duties, compensation, records, removals, resignations, and vacancies of directors; standing or executive committees and their duties; the enumeration, title, qualifications, selection, term, duties, compensation, removal, and vacancies, of officers and agents; the closing of books before dividend and election days; the manner of declaring, notifying, and paying of dividends; the amount of working capital; the limits of indebtedness; the establishment of reserve or sinking funds; the disposition of surplus; the place of deposit of funds; penalties, not exceeding twenty dollars,

for the violation of such by-laws; and method of amending by-laws. § 55. Effect. The shareholders and officers shall be bound by the provisions of the by-laws properly adopted, and shall be deemed to have knowledge of their contents. Third parties not having knowledge thereof shall not be affected thereby.

§ 56. Power to Make. shall be vested in the and 101.

The power to adopt and amend by-laws shareholders as provided in sections 71,

IV. FORMATION.

§ 57. Steps to be Taken. The steps in the formation of such corporation include, or may include, the Preliminary Association, the Promotion, the Organization, the Incorporation, and Commencing Business.

1. Association.

§ 58. Incorporators. Any number, not less than seven, of natural persons, at least three of whom reside within the United States, and who are under no legal disability by the law of their domicile, may form a corporation under the provisions of this Act, for the purpose of engaging in national commerce.

§ 59. Agreement of Association. Such persons undertaking to form such a corporation shall make and execute a written Agreement of Association which shall state

(1.) Agreement,-That the subscribers thereto associate themselves with the intention of forming such a corporation.

(2.) Name,-The name assumed by such corporation.

(3.) Location,-The location by state, county, city, street and number if any, of the registered office.

(4.) Stock,-The total authorized amount of capital stock which shall not be less than shall, together with the bonds, debentures or other obligations proposed to be issued, be reasonably sufficient to accomplish the purposes for which the corporation is to be formed; and the Commissioner of Corporations shall not approve, nor shall the Secretary of Commerce and Labor issue a Certificate of Incorporation, upon organization papers in which the amount of authorized stock stated shall appear altogether inadequate to accomplish the purposes of said corporation.

(5.) Stock to be issued,-The amount of capital stock which is then to be issued, with which to commence business and which shall not be less than fifty per cent of the amount authorized.

(6.) Minimum subscription,-The minimum amount of stock to which subscription or purchase then is, or is to be, invited, and which shall be reckoned exclusively of any amount payable otherwise than in money. If no amount is named, it shall be presumed to be the amount with which it is proposed to commence business. (7.) Number of shares,-The number of shares into which the authorized capital stock is to be divided, and the par value thereof. (8.) Classes of stock,-If there are to be two or more classes of shares, or bonds or debentures with voting power are to be issued, the amount and description of each, with a statement of the terms, conditions and preferences, upon which they are to be created, issued, held or voted upon.

(9.) Restrictions on transfer,-If any restrictions are to be placed upon the transfer of any shares or any class of shares, other than herein provided, the same shall be fully set forth.

(10.) Redemption of stock,—What, if any, class of stock shall be subject to redemption, and if any, the amount, method, and date thereof.

(11.) Directors,―The number of directors; and if they are to be classified as to their terms of office, or any of them are to be elected by particular shareholders or bondholders, the classification and the conditions thereof shall be specified.

(12.) Nature of business,-The nature of the national commerce in which such company proposes to engage, specifying whether the same is to be a transportation, transmission, or trading corporation, or more than one of these, subject to section 85 (8).

(13.) Transportation,-If the same is to be a transportation, or transmission corporation, there shall also be stated the nature and character of the work to be constructed, purchased, leased, owned, maintained, operated, or controlled, in any way directly or indirectly, together with the names of the terminal places thereof, the states and counties into or through which it passes or is to pass, and the principal cities reached thereby. Also, whether or not such corporation proposes to exercise the power of eminent domain. Also the method or methods, or the means of propulsion, or forces or devices used or to be used in conducting or carrying on such transportation or transmission business. Also whether or not such corporation proposes to engage in or carry on, domestic transportation or transmission, within the states through which its lines may be constructed, subject to the laws of such states.