(H. B. 389.]

CORPORATIONS, PRIVATE: Mutual Savings Fund, Building and Loan Associations.

AN ACT to repeal article VIII of chapter 33; of the Revised Statutes of Missouri, 1909, concerning mutual savings fund, building and loan associations, and to enact the following new sections in lieu thereof, and to provide for the organization and incorporation of mutual savings fund, building and loan associations, and the management and conduct of the business thereof; also to provide upon what conditions foreign building and loan associations of like character may enter and do business in this state, and also providing for a bureau of supervision and inspection of building and loan associations in this state, and providing for the supervisor and special examiners thereof; and also providing for the supervising and collecting of money from said association[s], out of which the expenses of supervisor and inspectors shall be paid, and for other purposes, with an emergency clause.

Be it enacted by the General Assembly of the State of Missouri, as follows: Section 1. Repealing article VIII of chapter 33 and enacting certain sections in lieu thereof. That article VIII of chapter 33, Revised Statutes of Missouri, 1909, concerning mutual savings fund, building and loan associations and foreign building and loan associations, and supervision and inspection of building and loan associations, be and the same is hereby repealed, and in lieu thereof the following new sections are hereby enacted, to be hereafter known and designated according to the numbers of the

sections of the statute herein given to them, respectively, are adopted:

Sec. 1. How incorporated. Any number of persons, not less than twenty-five, who are residents of this state, and who shall have associated themselves together by an agreement in writing, such as is hereinafter described, with the intention to constitute a corporation for the purpose of assisting each other, and all who may afterward become associated with them, in acquiring real estate, making improvements thereon and removing incumbrances therefrom, by advancing to its members out of a fund accumulated by the payment of periodical installments or otherwise, a sum equal to the par value of their shares, and for the further purpose of accumulating the savings of its members to be returned to such of its members who do not obtain advances for any of the purposes above mentioned, when the savings and the profits arising therefrom shall amount to a certain sum per share, to be specified in the articles of agreement, shall become a corporation on complying with the provisions of this article, and shall remain a corporation, with all the powers and privileges, and subject to all the duties, limitations and restrictions, conferred by general laws upon corporations, except as hereinafter otherwise provided.

Sec. 2. What articles of agreement shall set forth. Said articles of agreement mentioned in the foregoing section shall set forth:

First. The name of the proposed corporation, which shall not be the same as the name of any corporation already incorporated in this state for similar purposes and actually carrying on business, nor so nearly the same as to be liable to be mistaken therefor. The words "building and loan association" or "savings and loan association," are to be construed as synonymous terms, and shall form part of the name of every corporation created under this article.

Second. The name of the city or town and county, in which such association is to be located.

Third. The limit of the capital to be accumulated, the number of shares into which it is divided and the par value of each share, the number of shares subscribed for, which shall not be less than thirty in number, and that the first month's dues have been paid thereon.

Fourth. The names and places of residence of the several incorporators, and the number of shares subscribed by each.

Fifth. The number of directors and the names of those agreed upon for the first year.

Sixth. The number of years the corporation is to continue, which in no case shall exceed fifty years.

Seventh. The purposes for which the corporation is formed. The articles of agreement shall be signed and acknowledged, as required by law in the case of deeds conveying real estate, by any

ten of the parties thereto, and shall be recorded in the office of the recorder of deeds in the county or city in which the corporation is to be located; and a copy thereof, certified by the said recorder to be a correct copy of the same as filed, in his office, shall be filed in the office of the secretary of state.

Sec. 3. Adoption of by-laws.-The shareholders of such corporation may make and adopt all necessary by-laws, rules and regulations for the government of the affairs and business of the corporation, provided that the same shall not be inconsistent with the Constitution or laws of the state. A copy of such bylaws, rules and regulations shall be filed in the office of the supervisor of building and loan associations. Unless corporations organized hereunder shall engage in business as provided in this article within two years after the date of the issuing of the certificate of incorporation, such certificate shall be deemed revoked.

Sec. 4. Election and qualification of officers and directors.The number, title and functions of the officers of any corporation created by virtue of this or any previous article, their terms of office, the time of their election, as well as the qualification of electors, and the time of each periodical meeting of the officers and shareholders of such corporation, shall be provided for in the by-laws. No person shall be eligible to become or shall continue a director unless he shall be the owner of at least two shares of the capital stock of such corporation, and not delinquent in any manner upon any payments due from him to said corporation. All officers of any building, loan and savings association (except the president and vice-president) doing business in this state, whether created under this article or any previous laws of this state, who have the custody or handling of any of the funds or securities of such association, or who sign or endorse checks of said association, shall give such security for the faithful performance of their duties as the by-laws may require, and no such officer shall be deemed qualified to enter upon the duties of his office until such security is approved by the board of directors and the supervisor of building and loan associations. All such bonds shall be filed with the supervisor of building and loan associations, or some depository designated by him: Provided, that the supervisor of building and loan associations may require of any officer at any time such additional security, or such increase of said bond, or new bond, as he may, upon sufficient cause shown, deem necessary for the protection of the corporation and its members. The penalty for the failure of any association to file and maintain security furnished by its officers, as required by provisions of this section, shall be a fine of ten dollars for each day such association shall transact business after the time such bond should have been given and deposited under the provisions of this article, which penalty, when collected, shall be paid into the state treasury and credited to the building, loan and savings association fund in the state treasurer's office.

Sec. 5. Corporations not to expire from neglect. No corporation created under this article shall cease or expire from neglect on the part of such corporation to elect officers at the time mentioned in the charter or by-laws, and all officers elected by such corporations shall hold their respective offices until their successors are duly elected.

Sec. 6. Powers. Any corporation heretofore organized or now existing in pursuance of the provisions of article VIII of chapter 33 of the Revised Statutes of Missouri, 1909, concerning “mutual saving fund, building and loan associations," and any corporation organized in pursuance of the provisions of this act shall have all the powers provided for in this act, and the object of such corporation shall be the accumulation of a capital in money, to be derived from payments by its members in periodical installments or otherwise, at such time and in such manner as shall be provided in the by-laws, and from the profits and accumulation arising from the investment of such payments. The capital so accumulated by any corporation created by virtue hereof shall be divided into shares, of equal value; the ultimate value of such shares shall not exceed one thousand dollars. Said capital may be issued in full paid, prepaid or installment shares, in such amounts and at such times and in such manner as may be provided in the by-laws. Payments of dues or installments on shares shall commence and date from the time provided in the by-laws. There shall be issued to every shareholder a certificate signed by the president and secretary of the corporation, and evidenced by its corporate seal, setting forth distinctly and clearly the class of stock for which he has subscribed, the interest which it may draw, and the withdrawal value which it may have at any time, and also the time when the said stock shall be withdrawable. Such certificate shall be deemed in all courts of justice to be a contract between the corporation and the shareholder, and shall determine at all times the liability of the corporation to the holders of its shares. It shall be subject to a lien in favor of the corporation for the payment of unpaid installments, fines and other charges incurred thereon, under the provisions of the charter and by-laws. The by-laws may prescribe the form and manner of enforcing such lien. New shares may be issued in lieu of any shares withdrawn, redeemed, canceled or forfeited. Said capital, as accumulated, shall from time to time be loaned or advanced to members of the corporation, who shall give security for the prompt and continued payment of all dues, interest, premium and fines, until each of the shares so advanced upon shall reach the ultimate and full value thereof. And any building and loan association shall have power and be authorized by majority vote of its board of directors to acquire and own real estate whereon there is or may be erected a building or buildings suitable for the convenient transaction of its business, from portions of which, not required for its own use, a revenue may be derived; and shall have power to accumulate from the earnings a "contingent fund," for the payment of con

tingent losses, and an "undivided profit fund," both of which may be loaned and invested as other funds of the association; and may legally become a member of the land bank of the state of Missouri, that may hereafter be legally incorporated, and may do all things necessary to effectuate such membership, and invest in shares of such land bank of the state of Missouri, not to exceed ten per centum of the resources of such associations at the time of such investment, and at any time any building and loan association has funds in excess of the amount needed for loans to its members and the payment of matured shares and withdrawals, and borrowed money, if any, it may invest in lawfully issued obligation of such land bank of the state of Missouri; also, upon the written permission of the supervisor of building and loan associations first had and obtained, any building and loan association may loan any of its funds on hand not needed for loans to its members, or the payment of matured shares or withdrawals, to other building and loan associations in Missouri.

Sec. 7. Loans or advances, how made. The moneys accumulated from payments on account of stock, interest, premiums and fines, as aforesaid, or from any other source whatsoever, after due allowance made for all necessary and proper expenses, and subject to the provisions hereinafter set forth respecting the withdrawal and cancellation of shares and accumulation of contingent fund, may, at times provided in the by-laws, be offered to such shareholder or shareholders who shall bid the highest premium for the preference or priority of right to have a loan or advance of a sum equal to the ultimate value of one or more of his or their respective shares; and such shareholders so bidding the highest premium as aforesaid shall be entitled to receive a loan or advance of a sum of money equal to the full value of each share held by him, in the method provided for in the by-laws of such association; the said premium bid may be deducted in gross from the amount of the loan, or may be charged, and be required to be paid in proportionate amounts or installments, at such time during the existence of the shares of stock loaned or advanced upon as may be provided in the by-laws of the association: Provided, that where the stock of an association is issued in series, or at different times, in such manner that all said stock will not mature at the same time, then the borrower shall pay only such proportion of the full premium as the number of months his stock lacks of being one hundred and twenty months old, bears to one hundred and twenty months. Said association may provide in its by-laws that the bid for loans at its stated meetings, instead of a premium, shall be a stated rate of annual interest upon the sum desired, payable in periodical installments; such bids shall be the interest to be paid during the whole period of the loan or advance. A shareholder shall be entitled to borrow such fractional part of a share as the by-laws may provide. In case there shall be a balance of money remaining undisposed of at any stated meeting, the directors may, at their discretion, loan the funds so remaining