Corporations § 283. The requirement that a majority of all the stock issued and outstanding be present in person or by proxy as a condition to the election of directors of the corporation, remaining stockholders, after the breaking of a quorum, who controlled less than the majority of the stock issued and outstanding, could not hold a valid election of directors, though the adjournment, upon which occurred the departure of stockholders by which the quorum was broken, was illegally voted.-Bridgers v. Staton, 150 N. C. 216, 63 S. E. 892.

108. Failure to hold election. If the election for directors of a corporation is not held on the day designated by the charter or by-laws, the directors shall cause the election to be held as soon thereafter as is convenient. No failure to elect directors at the designated time shall work any forfeiture or dissolution of the corporation; and if the directors fail or refuse for thirty days after receiving a written request for such election from those owning one-tenth of the outstanding stock, to call a meeting for the election, the judge of the district, or the judge presiding in the courts of the district, in which the principal office of the corporation is located, may, upon the application of any stockholder, and on notice to the directors, order an election or make such other order as justice requires. The proceedings governing the issuance and hearing of injunctions shall, as far as applicable, govern such hearing.

C. S., s. 1176; Rev., s. 1188; 1901, c. 2, s. 46.

Corporations § 283. Where no directors had been elected at the corporation's regular meeting and the old directors fail or refuse for thirty days to call a meeting for that purpose after receipt of a written request therefor from the owners of one-tenth of the outstanding stock, the court upon application of any stockholder and on notice to the directors may order an election, or make any other order that justice may require.-Bridgers v. Staton, 150 N. C., 216, 63 S. E. 892.

109. Jurisdiction of superior court over elections. The superior court judge, upon application of any person who may complain of any election, or any proceeding, act on matter pertaining to the same, ten days notice having been given to the adverse party, or to those who are to be affected thereby, of such intended application, shall proceed forthwith, at chambers, in any county in the district in which the principal office of the corporation is situated, to hear the affidavits, proofs and allegations of the parties, or otherwise inquire into the matter or causes of complaint, and thereupon establish the election complained of, or order a new election, or make any order and give any relief in the premises as right and justice require. The proceedings shall, as far as applicable, be the same as in injunctions.

C. S., s. 1177; Rev., s. 1189; 1901, c. 2, s. 47.

See Bridgers v. Staton, 150 N. C. 216, 63 S. E. 892.

110. When dividend declared. The directors of every corporation created under this chapter shall, in January of each year, unless some specific time for that purpose is fixed in its charter, or by-laws, and in that case at the time so fixed, after reserving, over and above its capital stock paid in, as a working capital for the corporation, whatever sum has been fixed by the stockholders, declare a dividend among its stockholders of the whole of its accumulated profits exceeding the amount reserved, and pay it to the stockholders on demand. The corporation may, in its certificate of incorporation or by-laws, give the directors power to fix the amount to be reserved as a working capital.

C. S., s. 1178; Rev., s. 1191; 1901, c. 2, s. 52.

Corporations § 155. Where the word "dividend" is used without qualification and without explanation, it signifies dividends payable in money.Lancaster Trust Company v. Mason, 152 N. C. 660, 68 S. E. 235.

Corporations § 157. The sale of stock with reservation of dividends of certain dates reserves only cash dividends and a stock dividend would not be included.-Ibid.

111. Dividends from profits only; directors' liability for impairing capital. No corporation may declare and pay dividends except from the surplus or net profits arising from its business, or when its debts, whether due or not, exceed two-thirds of its assets, nor may it reduce, divide, withdraw, or in any way pay to any stockholder any part of its capital stock except according to this chapter. In case of a violation of any provision of this section, the directors under whose administration the same occurs are jointly and severally liable, at any time within six years after paying such dividend, to the corporation and its creditors, in the event of its dissolution or insolvency, to the full amount of the dividend paid, or capital stock reduced, divided, withdrawn, or paid out, with interest on the same from the time such liability accrued. Any director who was absent when the violation occurred, or who dissented from the act or resolution by which it was effected, may exonerate himself from such liability by causing his dissent to be entered at large on the minutes of the directors at the time the action was taken or immediately after he has had notice of it.

C. S., s. 1179; Rev., s. 1192; Code, s. 681; 1901, c. 2, ss. 33, 52.

Bankruptcy § 145. Corporate officers, who paid dividends when the debts exceeded two-thirds of the assets of the corporation, are liable to the trustee in bankruptcy for debts.-Claypoole v. McIntosh, 182 N. C. 109, 108 8. E. 433.

Corporations § 67. Where the capital stock of a bank has been impaired, although called a division of profits, a division of funds among stockholders, is a dividend of capital. Atty. Gen. v. Bank, 21 N. C. 545.

Corporations § 67. A corporation cannot settle with its members by the application of assets to the retirement or redemption of the stock of the shareholders until it had first settled and discharged all its liabilities, and any agreement among the shareholders looking to such arrangement will be void as to creditors.-Heggie v. Peoples Building & Loan Ass'n., 107 N. C. 581, 12 S. E. 275.

Corporations § 623. A corporation purchasing from the officers and stockholders of another corporation almost its entire assets, without provi sion for the creditors, is, with such officers and directors, jointly and severally liable to the receiver of defunct selling corporation for the amount necessary to pay the claims existing against it, interest and costs.-McIver v. Young Hardware Co., 144 N. C., 478, 57 S. E. 169.

Corporations § 67. The requirement of notice of the reduction of capital stock necessary to afford stockholders protection against creditors, a reduction without notice, if otherwise valid, is enforceable by the corporation against its members.-Misenheimer v. Alexander, 162 N. C. 227, 78 S. E. 161.

ART. 7. FOREIGN CORPORATIONS.

112. Powers existing independently of permission to do business. A corporation created by another state of the United States, or by any foreign state, kingdom, or government may acquire by devise or otherwise, and may hold, mortgage, lease, and convey real estate in this state for the purpose of prosecuting its business or objects, or such real estate as it may acquire by way of mortgage or otherwise in the payment of debts due to it, but is not eligible or entitled to qualify in this state as executor, administrator, guardian, or trustee under the will of any person domiciled in this state at the time of his death. The right to acquire, hold and convey real estate exists only where at the time of the acquisition, the foreign state, government, or kingdom under whose laws the corporation was created is not at war with the United States.

C. S., s. 1180; Rev., s. 1193; 1901, c. 2, s. 93; 1915, c. 196, s. 1.

Corporations § 661. A foreign corporation, incorporated to do business in North Carolina, and domesticated in that state by compliance with its laws, may sue therein, though it has no power to do business in the state of its incorporation.-Troy & North Carolina Gold Mining Company v. Snow Lumber Company, 173 N. C. 593, 92 S. E. 494; Barcello v. Hapgood, 118 N. C. 712, 24 S. E. 124.

Corporations § 635. Articles of incorporation of company organized under the general incorporation laws of New York to conduct mining business in North Carolina were not void on their face because New York gave company no authority to do business in New York.-Ibid.

Corporations § 631. In the absence of any prohibitive statute, a corpo

ration having its domicile of origin or creation in one state has, as a matter of comity, the right to carry on its corporate business and perform its corporate functions in any other state.-Blackwell's Durham Tobacco

Company v. American Tobacco Company, 145 N. C. 367, 59 S. E. 123.

Corporations § 654. So long as foreign corporations are permitted to be within the state either by compliance with the laws or as a matter of comity, they are entitled to have the laws of the land administered so that they have equal protection and equal justice done them.-Ibid.

See Fisher v. Traders' Mutual Life Insurance Co., 136 N. C. 217, 48 S. E. 667; Shields v. Union Central Life Ins. Co., 119 N. C. 380, 25 S. E. 951.

113. Requisites for permission to do business. Every foreign corporation before being permitted to do business in this state, insurance companies excepted, shall file in the office of the secretary of state a copy of its charter or articles of agreement, attested by its president and secretary, under its corporate seal, and a statement attested in like manner of the amount of its capital stock authorized, the amount actually issued, the principal office in this state, the name of the agent in charge of such office, the character of the business which it transacts, and the names and post office addresses of its officers and directors. And such corporation shall pay to the secretary of state, for the use of the state, twenty cents for every one thousand dollars of the total amount of the capital stock authorized to be issued by such corporation, but in no case less than twenty-five dollars nor more than two hundred and fifty dollars; and also a filing fee of five dollars. Such corporation may withdraw from the state upon filing in the office of the secretary of state a statement signed by its president and secretary and attested by its corporate seal, setting forth the fact that such corporation desires to withdraw, and upon payment to the secretary of state of a fee of five dollars. Every corporation failing to comply with the provisions of this section shall forfeit to the state five hundred dollars, to be recovered, with costs, in an action to be prosecuted by the attorney-general, who shall prosecute such actions whenever it appears that this section has been violated. This section does not apply to railroad, banking, express or telegraph companies which, prior to March 9, 1915, had been licensed to do business in this state, or were engaged in business in this state, having a regularly appointed agent upon whom service of process could be made, located in this state.

C. S., s. 1181; Rev., s. 1194; 1901, c. 2, s. 57; 1903, c. 76; 1915, c. 263. Corporations § 657. A foreign corporation's contract of sale is not invalidated, nor its right to recover the price lost, by its failure to file papers, as required by section above, before being permitted to do business in the state; the statute merely imposing a penalty for such failure.-G. Ober & Sons v. Katzenstein, 160 N. C. 439, 76 S. E. 476.

Corporations § 636. The legislature has the power to prescribe the terms on which foreign corporations may come into the state, and may pass statutes for the protection of its own citizens doing business with them, as against the objection that such statutes discriminate against nonresidents.Williams v. Mutual Reserve Fund Life Ass'n, 145 N. C. 128, 58 S. E. 802. Corporations § 636. There is nothing in either the federal or state constitution which prohibits the state, in the exercise of its police power, in order to prevent fraud and imposition, from requiring a license from foreign corporations for doing business in the state.-State v. Agey, 171 N. C. 831, 88 S. E. 726.

Corporations § 636. The State can impose burdens on foreign corporation as a condition of its conducting business within the state, subject to restriction that tax laws must not interfere with foreign or interstate commerce, or unjustly discriminate between different foreign corporations of the same class.-Pittsburgh Life & Trust Co. v. Young, 172 N. C. 470, 90 S. E. 568.

Corporations § 640. Corporation can exercise in jurisdiction other than that in which it is incorporated only such powers as are set forth in its articles of incorporation. Troy & North Carolina Gold Mining Co. v. Snow Lumber Co., 173 N. C. 593, 92 S. E. 494.

ART. 8. DISSOLUTION.

114. Voluntary, generally. When in the judgment of the board of directors, it is deemed advisable and for the benefit of a corporation that it be dissolved, the board, within ten days after the adoption of a resolution to that effect by a majority of the whole board, at a meeting called for that purpose, of which meeting every director shall have received three days notice, shall cause notice of adoption of such resolution to be mailed to each stockholder residing in the United States, to his last known postoffice address, and also, beginning within said ten days, cause a like notice to be published in a newspaper published in the county wherein the corporation has its principal office, at least once a week for four successive weeks, next preceding the time appointed for the same, of a meeting of the stockholders to be held at the office of the corporation, to take action upon the resolution. The stockholders' meeting thus called may, on the day appointed, by consent of a majority in interest of the stockholders present, be adjourned from time to time for not less than eight days at one time, of which adjourned meeting notice by advertisement in said newspaper shall be given. If at such meeting two-thirds in interest of all the stockholders consent in writing that a dissolution take place, their consent, together with the list of the names and residences of the directors and officers, certified by the president and the secretary or treasurer, shall be filed in the office of the secretary of state, who, upon being satisfied by due proof