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Surplus Account, nor until (if subsequent to July 1, 1913) there shall have been first set apart for such year in said Special Surplus Account a sum sufficient to acquire, and there shall have been acquired, out of said Special Surplus Account an amount of preferred stock equal to three per cent. (3%) of the largest amount in par value of said preferred stock that shall have been at any one time issued and outstanding, nor so long as there shall be any arrears in respect of said Special Surplus Account or in the acquisition of preferred stock therefor.

No dividend whatever shall be paid or declared upon the common stock until there shall have been first accumulated and set apart in said Special Surplus Account at least the sum of $250,000 (such sum being either in the form of cash or its equivalent, or of preferred stock theretofore acquired and cancelled by the Company), nor shall any dividend be paid or declared upon the common stock which would reduce said Special Surplus Account below $250,000. No dividend in excess of 4% per annum in and for any one year shall be paid or declared on the common stock until and unless there shall have been first accumulated and set apart in said Special Surplus Account at least the sum of $1,000,000 (such sum being either in the form of cash or its equivalent, or of preferred stock theretofore acquired and cancelled by the Company), nor shall any dividend in excess of 4% per annum in and for any one year be paid or declared on the common stock which would reduce said Special Surplus Account below $1,000,000.

The Special Surplus Account may be used for the payment of dividends on the preferred stock, provided there are no other funds of the Company applicable for that purpose, and provided further that all encroachments upon or arrears in said fund shall be first made good before any dividend shall thereafter at any time be paid or declared on the common stock.

(f) Subject to the foregoing provisions, and not otherwise, dividends at such rate as may be determined by the Board of Directors, may be declared and paid on the common stock from time to time out of the remaining surplus or net profits of the Company.

(g) From time to time the preferred stock and the common stock may be increased according to law, and may be issued in such amounts and proportions as shall be determined by the Board of Directors, and as may be permitted by law, but the preferred stock by this certificate authorized shall not be increased unless such increase shall have been . previously authorized by the consent of at least three-fourths in interest of the issued and outstanding stock of the Company of each class, preferred and common, given separately, in person or by proxy.

at a meeting regularly called for that purpose, or by the unanimous consent of all the stockholders in writing.

(h) Upon any dissolution or liquidation of said corporation or in the event of its insolvency, or upon any distribution of capital, there shall be paid to the holders of the preferred stock the par value thereof and the amount of all unpaid accrued dividends thereon, before any sum shall be paid, or any assets distributed, among the holders of the common stock; and after the payment to the holders of the preferred stock of its par value, and the unpaid accrued dividends thereon, the remaining assets and funds of the corporation shall be divided among and paid to the holders of the common stock according to their respective shares.

(i) The entire voting power for the election of directors shall be vested in the common stock, except as in this paragraph otherwise provided. The preferred stock shall have no voting power in the elections for directors, unless and until two quarterly dividends payable thereon shall be in default. Immediately upon the happening of such event and thereafter until such defaults, and all defaults subsequent thereto, shall have been made good, the common stock shall have no voting power of the corporation for directors, and the entire voting power in the elections for directors shall become and remain vested exclusively in the holders of the common stock.

At all stockholders' meetings, except as expressly otherwise provided in this certificate of incorporation, each share of stock of the corporation, both preferred and common, shall be entitled to one vote.

TRANSFERS OF CERTIFICATES AND SHARES
OF STOCK.1

§ 162. How title to certificates and shares may be transferred. Title to a certificate and to the shares represented thereby can be transferred only,

(a) By delivery of the certificate indorsed either in blank or to a specified person by the person appearing by the certificate to be the owner of the shares represented thereby, or

(b) By delivery of the certificate and a separate document containing a written assignment of the certificate or a power of attorney to sell, assign or transfer the same or the shares represented thereby, signed by the person appearing by the certificate to be the owner of the shares represented thereby. Such assignment or power of attorney may be either in blank or to a specified person.

The provisions of this section shall be applicable although the charter or articles of incorporation or code of regulations or by-laws of the corporation issuing the certificate and the certificate itself provide that the shares represented thereby shall be transferable only on the books of the corporation or shall be registered by a registrar or transferred by a transfer agent.

§ 163. Powers of those lacking full legal capacity and of fiduciaries not enlarged. Nothing in this article shall be construed as enlarging the powers of an infant or other person lacking full legal capacity, or of a trustee, executor or administrator, or other fiduciary, to make a valid indorsement, assignment or power of attorney.

§ 164. Corporation not forbidden to treat registered holder as owner. Nothing in this article shall be construed as forbidding a corporation,

(a) To recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, or

(b) To hold liable for calls and assessments a person registered on its books as the owner of shares.

§ 165. Title derived from certificate extinguishes title derived from a separate document. The title of a transferee of a certificate under a power of attorney or assignment not written upon the certificate, and the title of any person claiming under such transferee, shall cease and determine if, at any time prior to the surrender of the certificate to the corporation issuing it, another person, for value 1 From the Personal Property Law of New York State as amended by Laws 1913. This is the uniform Stock Transfer Law, adopted in Massachusetts, Pennsylvania and New York.

in good faith, and without notice of the prior transfer, shall purchase and obtain delivery of such certificate with the indorsement of the person appearing by the certificate to be the owner thereof, or shall purchase and obtain delivery of such certificate and the written assignment or power of attorney of such person, though contained in a separate document.

§ 166. Who may deliver a certificate. The delivery of a certificate to transfer title in accordance with the provisions of section one hundred and sixty-two is effectual, except as provided in section one hundred and sixty-eight, though made by one having no right of possession and having no authority from the owner of the certificate or from the person purporting to transfer the title.

§ 167. Indorsement effectual in spite of fraud, duress, mistake, revocation, death, incapacity or lack of consideration or authority. The indorsement of a certificate by the person appearing by the certificate to be the owner of the shares represented thereby is effectual, except as provided in section one hundred and sixty-eight, though the indorser or transferor1

(a) Was induced by fraud, duress or mistake to make the indorsement or delivery, or

(b) Has revoked the delivery of the certificate, or the authority given by the indorsement or delivery of the certificate, or

(c) Has died or become legally incapacitated after the indorsement, whether before or after the delivery of the certificate, or (d) Has received no consideration.

§ 168. Rescission of transfer. If the indorsement or delivery of a certificate,

(a) Was procured by fraud or duress, or

(b) Was made under such mistake as to make the indorsement or delivery inequitable; or

If the delivery of a certificate was made

(c) Without authority from the owner, or

(d) After the owner's death or legal incapacity, the possession of the certificate may be reclaimed and the transfer thereof rescinded, unless:

1. The certificate has been transferred to a purchaser for value in good faith without notice of any facts making the transfer wrongful, or

2. The injured person has elected to waive the injury, has been guilty of laches in endeavoring to enforce his rights.

Any court of appropriate jurisdiction may enforce specifically such right to reclaim the possession of the certificate or to rescind the 1 So in original.

transfer thereof and, pending litigation, may enjoin the further transfer of the certificate or impound it.

§ 169. Rescission of transfer of certificate does not invalidate subsequent transfer by transferee in possession. Although the transfer of a certificate or of shares represented thereby has been rescinded or set aside, nevertheless, if the transferee has possession of the certificate or of a new certificate representing part or the whole of the same shares of stock, a subsequent transfer of such certificate by the transferee, mediately or immediately, to a purchaser for value in good faith, without notice of any facts making the transfer wrongful, shall give such purchaser an indefeasible right to the certificate and the shares represented thereby.

§ 170. Delivery of unindorsed certificate imposes obligation to indorse. The delivery of a certificate by the person appearing by the certificate to be the owner thereof without the indorsement requisite for the transfer of the certificate and the shares represented thereby, but with intent to transfer such certificate or shares, shall impose an obligation, in the absence of an agreement to the contrary, upon the person so delivering, to complete the transfer by making the necessary indorsement. The transfer shall take effect as of the time when the indorsement is actually made. This obligation may be specially enforced.

§ 171. Ineffectual attempt to transfer amounts to a promise to transfer. An attempted transfer of title to a certificate or to the shares represented thereby without delivery of the certificate shall have the effect of a promise to transfer and the obligation, if any, imposed by such promise shall be determined by the law governing the formation and performance of contracts.

§ 172. Warranties on sale of certificate. A person who for value transfers a certificate, including one who assigns for value a claim secured by a certificate, unless a contrary intention appears, warrants:

(a) That the certificate is genuine,

(b) That he has a legal right to transfer it, and

(c) That he has no knowledge of any fact which would impair the validity of the certificate.

In the case of an assignment of a claim secured by a certificate, the liability of the assignor upon such warranty shall not exceed the amount of the claim.

§ 173. No warranty implied from accepting payment of a debt. A mortgagee, pledgee or other holder for security of a certificate who in good faith demands or receives payment of the debt for which such certificate is security, whether from a party to a draft drawn

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