§ 89-H — Transfer of franchises or stocks

§ 89-h. Transfer of franchises or stocks. 1. No water-works\ncorporation shall transfer or lease its franchise, works or system or\nany part of such franchise, works or system to any other person or\ncorporation or contract for the operation of its works and system,\nwithout the written consent of the commission.\n 2. The permission and approval of the commission to the assignment,\ntransfer or lease of a franchise under this section shall not be\nconstrued to revive or validate any lapsed or invalid franchise or to\nenlarge or add to the powers and privileges contained in the grant of\nany franchise or to waive any forfeiture.\n 3. No water-works corporation shall directly or indirectly acquire the\nstock or bonds of any other corporation incorporated for, or engaged in,\nthe same or a similar business, or proposing to operate or operating\nunder a franchise from the same or any other municipality, unless\nauthorized so to do by the commission.\n 4. Save where stock shall be transferred or held for the purpose of\ncollateral security only with the consent of the commission empowered by\nthis chapter to give such consent, no stock corporation of any\ndescription, domestic or foreign, company, including, but not limited\nto, a limited liability company, association, including a joint stock\nassociation, partnership, including a limited liability partnership, or\nperson, other than a water-works corporation, shall purchase or acquire,\ntake or hold, more than ten per centum of the voting capital stock\nissued by any water-works corporation organized or existing under or by\nvirtue of the laws of this state, except that a corporation now lawfully\nholding a majority of the voting capital stock of any water-works\ncorporation may with the consent of the commission acquire and hold the\nremainder of the voting capital stock of such water-works corporation or\nany portion thereof. Provided, that with the consent of such commission\nand upon and subject to such terms and conditions as such commission may\nfix and impose, any such stock corporation, company, association,\npartnership or person may acquire, take and hold more than ten per\ncentum of the voting capital stock of any water-works corporation,\norganized or existing under or by virtue of the laws of this state.\n 5. No consent shall be given by the commission to the acquisition of\nany stock in accordance with this section unless it shall have been\nshown that such acquisition is in the public interest. Nothing contained\nin this section shall be construed to prevent the holding of any stock\nheretofore lawfully acquired, nor to prevent, upon the surrender or\nexchange of such stock pursuant to a reorganization plan, the purchase,\nacquisition, taking or holding of a proportionate amount of stock of any\nnew corporation organized to take over, at foreclosure or other sale,\nthe property of any corporation whose stock has been thus surrendered or\nexchanged; but the proportion of the voting capital stock of the new\ncorporation held by a stock corporation, company, association,\npartnership or person and acquired by it by any such surrender or\nexchange of stock shall not without the consent of the commission exceed\nthe proportion of the voting capital stock held by it in the former\ncorporation.\n 6. Every contract, assignment, transfer or agreement for transfer of\nany stock by or through any person or corporation to any corporation,\ncompany, association, partnership or person, in violation of any\nprovision of this chapter shall be void and of no effect, and no such\ntransfer or assignment shall be made upon the books of any such\nwater-works corporation, or shall be recognized as effective for any\npurpose.\n