§ 7-A — Incorporation of joint-stock association

New York § 7-A

• Jurisdiction: New York
• Law GAS: General Associations
• Art. 2: Joint-stock Associations

Text

§ 7-a. Incorporation of joint-stock association. 1. Any joint-stock\nassociation transacting business within this state under this chapter\nand created by or under the laws of this state on or before January\nfirst, nineteen hundred sixty-four may be incorporated under the\nbusiness corporation law for a purpose or purposes for which a\ncorporation may be formed under such law, in accordance with the\nfollowing provisions of this section.\n 2. (a) The certificate of incorporation of a joint-stock association\nto be incorporated pursuant to this section shall be entitled\n"Certificate of incorporation of .................... (name of\ncorporation) under section four hundred two of the business corporation\nlaw and section seven-a of the general associations law," shall be\nsigned by the president of the joint-stock association as the\nincorporator, with his name and address stated beneath or opposite his\nsignature, acknowledged by him and delivered to the department of state,\nand shall set forth the matters required or permitted to be set forth in\na certificate of incorporation under section four hundred two of the\nbusiness corporation law and shall also set forth:\n (1) The name and date of organization of the joint-stock association\nto be incorporated.\n (2) The number of outstanding shares of each class and series of the\njoint-stock association, specifying the classes and series entitled to\nvote and further specifying each class and series, if any, entitled to\nvote as a class, and a statement of the basis upon which and the manner\nin which such shares shall be converted into, or exchangeable for, the\nshares or other securities of the corporation, or the cash or other\nconsideration which is to be paid or delivered in exchange for shares of\nthe joint-stock association, or a combination thereof.\n (3) A statement that the signer of the certificate of incorporation is\nthe president of the joint-stock association and that he has been\nauthorized by the stockholders of the joint-stock association, in\naccordance with the provisions of subdivision three of this section, to\nsign, acknowledge and deliver the certificate to the department of state\nfor the purpose of incorporating the joint-stock association.\n (b) (1) Notwithstanding the provisions of section three hundred one of\nthe business corporation law, the corporation may have the same name as\nthe joint-stock association to be incorporated, and shall not be\nrequired to add to, modify or otherwise change such name, if the\njoint-stock association has transacted business in this state under such\nname continuously since January first, nineteen hundred twelve.\n (2) Subject to the requirements of the business corporation law, the\ncertificate of incorporation approved in accordance with the provisions\nof subdivision three of this section may make any change in the purpose\nor purposes of the joint-stock association, in the shares which it shall\nhave authority to issue and in its duration and may contain any\nprovision, not inconsistent with law, which is permitted to be set forth\nin a certificate of incorporation under section four hundred two of the\nbusiness corporation law.\n 3. The incorporation of a joint-stock association as provided in this\nsection shall be authorized in the following manner:\n (a) The board of directors of the joint-stock association shall call a\nmeeting of its stockholders for the following purposes:\n (1) To authorize the incorporation of the joint-stock association\npursuant to this section, to approve the certificate of incorporation\nproposed to be made and delivered for such purpose and to authorize the\npresident of the joint-stock association to sign, acknowledge and\ndeliver to the department of state such certificate of incorporation for\nfiling pursuant to this section; and\n (2) To adopt by-laws of the corporation to take effect upon the filing\nof the certificate of incorporation by the department of state, which\nby-laws may contain any provisions permitted to be contained in the\nby-laws of a corporation formed under the business corporation law.\n (b) Notice of such meeting of stockholders shall be given to each\nstockholder of record of the joint-stock association, whether or not\nentitled to vote, in the manner provided in its articles of association\nfor special meetings of stockholders or, in the absence of any such\nprovision, in conformity with the provisions of section six hundred five\nof the business corporation law as to special meetings of shareholders\nof a corporation subject to such law. A copy of the proposed certificate\nof incorporation, except for any information not available at the time\nof the notice, and a copy of the proposed by-laws of the corporation\nshall accompany such notice. Except as otherwise required by this\nsection or as otherwise provided in the articles of association or\nby-laws of the joint-stock association, the provisions of sections six\nhundred four to six hundred twelve, inclusive, of the business\ncorporation law shall govern the conduct of such meeting.\n (c) At such meeting of stockholders the matters specified in paragraph\n(a) of subdivision three of this section shall be authorized, adopted\nand approved by vote of the holders of that proportion of the\noutstanding shares of the joint-stock association entitled to vote which\nis required by its articles of association to amend such articles, the\nholders of shares of a class or series voting as a class if the articles\nso provide, or, in the absence of any provision in the articles as to\nthe amendment thereof, by vote of the holders of two-thirds of all the\noutstanding shares of the joint-stock association entitled to vote in\nthe election of any of its directors.\n 4. Minutes of the proceedings of such meeting shall be kept, and a\ncopy of the certificate of incorporation authorized at such meeting and\na copy of the by-laws adopted at such meeting shall be filed with the\nminutes. After the certificate of incorporation shall have been filed,\nsuch minutes shall be deemed minutes of proceedings of the shareholders\nof the corporation for all purposes of section six hundred twenty-four\nof the business corporation law.\n 5. The provisions of subparagraphs one, two, three, four and six of\nparagraph (b) of section eight hundred six of the business corporation\nlaw shall apply to any changes in the shares of the joint-stock\nassociation or in the rights, preferences or limitations of any such\nshares made by the certificate of incorporation authorized by this\nsection as if such certificate were a certificate of amendment.\n 6. Upon the filing by the department of state of the certificate of\nincorporation authorized by this section:\n (a) The joint-stock association shall no longer be governed by this\nchapter but shall become and be a corporation within the meaning of the\nbusiness corporation law possessing, consistently with its certificate\nof incorporation, the business corporation law, and any other applicable\nstatute of this state, all the rights, privileges, immunities, powers\nand purposes of the joint-stock association and having, without being\ndeemed a new or different legal person or entity, all the rights and\npowers, subject to all the limitations thereon and qualifications\nthereof, which pertain to a corporation formed under the business\ncorporation law, and the shareholders, directors and officers of the\ncorporation shall have all the rights and privileges, and be subject to\nall the duties and obligations, and limitations thereon, which pertain\nto shareholders, directors and officers of a corporation formed under\nthe business corporation law. The certificate of incorporation of the\ncorporation may thereafter be amended or changed in any respect as\npermitted, and in the manner authorized, by said law.\n (b) No further action by the incorporator shall be required for the\norganization of the corporation. The by-laws adopted in accordance with\nsubdivision three of this section shall be the by-laws of the\ncorporation and, for all purposes of the business corporation law, shall\nbe deemed by-laws adopted by the shareholders of the corporation. The\ndirectors of the joint-stock association in office at the time of\nincorporation shall continue to hold office as directors of the\ncorporation for their respective terms in accordance with the by-laws\nand the provisions of article seven of the business corporation law.\n (c) Subject to the provisions of subdivision five of this section, the\ninitial capital, capital surplus and earned surplus of the corporation\nshall be the capital, capital surplus and earned surplus, respectively,\nof the joint-stock association as existing at the time of incorporation,\nprovided that prior to the declaration by the board of directors of the\nfirst dividend after incorporation, the board may determine the amount\nof the corporation's earned surplus as provided in subparagraph one (A)\nof paragraph (a) of section five hundred seventeen of the business\ncorporation law in respect of corporations formed before the effective\ndate of said law, and such determination if made in good faith shall be\nconclusive.\n (d) All property, real and personal, of the joint-stock association,\nincluding real property held in the name of the president, as such\npresident, subscriptions to shares, causes of action, licenses, permits\nand every other asset of the joint-stock association shall vest in the\ncorporation without further act or deed.\n (e) No liability or obligation due or to become due, claim or demand\nfor any cause existing against the joint-stock association, or any\nstockholder, officer or director thereof shall be released or impaired\nby such incorporation. The corporation shall assume and be liable for\nall the liabilities, obligations and penalties of the joint-stock\nassociation without further act or instrument, and an action or\nproceeding may be maintained thereon against the corporation in lieu of\nan action or proceeding against an officer of the joint-stock\nassociation under article three of this chapter.\n (f) No action or proceeding, whether civil or criminal, then pending\nby or against the joint-stock association, or any stockholder, officer\nor director thereof, shall abate or be discontinued by such\nincorporation, but may be enforced, prosecuted, settled or compromised\nas if such incorporation had not occurred, or the corporation may be\nsubstituted in any such action or proceeding brought pursuant to article\nthree of this chapter by or against an officer of the joint-stock\nassociation, in place of such officer.\n (g) The personal liability, if any, of any stockholder of the\njoint-stock association, as such stockholder, existing at the time of\nincorporation shall not thereby be extinguished but shall remain\npersonal to such stockholder and shall not become the liability of any\nother shareholder of the corporation or of any subsequent transferee of\nany share of the corporation, and an action or proceeding may be\nmaintained thereon against such stockholder in accordance with the\nprovisions of article three of this chapter, provided that such an\naction or proceeding could have been maintained under said article three\nif the incorporation of the joint-stock association had not occurred,\ntreating the corporation as an officer of the joint-stock association\nfor such purpose.\n 7. After the filing of the certificate of incorporation by the\ndepartment of state pursuant to this section, the corporation shall\ncause a copy of the certificate of incorporation, certified by the\ndepartment of state, to be filed in the office of the official who is\nthe recording officer of each county in this state in which real\nproperty of the joint-stock association is located.\n 8. The provisions of section ninety-six of the executive law\nprescribing the fee to be collected by the department of state for\nfiling a certificate of incorporation under the business corporation law\nshall apply to the certificate of incorporation to be filed pursuant to\nthis section.\n