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Title

11

:
Corporations, Partnerships and Associations






Chapter

001

:
CORPORATIONS GENERALLY






Subchapter

002
:
FORMATION, BYLAWS, AND MEETINGS










 

§

42. Specific purposes

Subject to the

provisions of this title, one or more persons may form a private corporation

for the specific purposes and in the manner following:

(1) To operate a

regional clearinghouse and a cooperative loan plan, commonly called a central

fund, or either, for those banks in the State which become stockholders or

members of the corporation. Such corporations may be organized only with the

consent of the Commissioner of Financial Regulation, with or without capital

stock.

(A) In addition

to the powers conferred by this chapter, they shall have:

(i) All the

powers necessary or convenient for carrying out the purposes herein set forth,

including the power to receive deposits of funds from a member bank and to

administer the same, and to require such deposits from all member banks in

uniform percentages, but not in excess of three percent, of the total deposits

of any one bank;

(ii) to assist

member banks when they are temporarily in need of cash or hold investments

which cannot readily be liquidated;

(iii) to borrow

money and to pledge its assets as security therefor;

(iv) to issue

scrip to the extent and with such security and under such regulations as the

Commissioner of Financial Regulation, with the consent of the Governor, may

approve;

(v) To make

loans to member banks and to guarantee the performance of any obligation of a

member bank;

(vi) to

establish reserves, and to take over from member banks property, securities, or

investments for the purpose of managing, liquidating, exchanging, or adjusting

the same.

(B) Such

corporations shall not be subject to the provisions of 8 V.S.A. chapters 1, 3,

21, 29, and 8 V.S.A. part 3 and 9 V.S.A. chapter 131; but their articles of

association and bylaws shall be subject to the approval of the Commissioner of

Financial Regulation. They shall only invest their funds in securities approved

by the Commissioner of Financial Regulation and shall be subject to inspection

and examination by the Commissioner or his or her representative the same as

State banks.

(C) Any bank

organized under the laws of this State and any national bank in the State, with

the approval of the Comptroller of the Currency, may become a stockholder or

member of such a corporation under the terms and conditions prescribed in its

charter or bylaws. Such bank may subscribe for and hold shares in the capital

stock of such a corporation, may make the required deposits hereinabove

provided for and to the extent the Commissioner of Financial Regulation may

approve, and may invest in and hold debentures or other obligations of such

corporation. A director or executive officer of a bank which is a stockholder

of such corporation shall be eligible to the office of director of such

corporation.

(2) To operate a

corporation for the rehabilitation of individuals and families by enabling them

to secure subsistence and gainful employment from the soil, from coordinate and

affiliated industries and enterprises and otherwise, and to receive and

administer money for that purpose which may become available from any source.

Such corporations shall have all the powers of corporations organized under

this chapter and in addition thereto may loan money and secure the payment

thereof by mortgage, pledge, or lien, insure or guarantee any indebtedness

incurred by others and become secured for so doing by mortgage, pledge or lien.

Such corporations shall not be organized for profit, and shall not be subject

to taxation, nor shall any stock or indebtedness of such corporations or any

evidence thereof be taxable to any holder thereof under any provision of law.

The capital stock of such corporations may be with or without par value and the

amount thereof, notwithstanding the provisions of this title, may be less than

$500.00 and in case the stock has no par value then the number of shares of

such stock may be less than ten, representing less than $500.00. The Governor

may designate any such corporation as his or her agent or an agency of the

State to carry on rehabilitation activities within the State. Such corporations

shall not be subject to the provisions of 8 V.S.A. chapters 1, 3, 21, 29 and 8

V.S.A. part 3 and 9 V.S.A. chapter 131, or to the provisions of section 131 of

this title. (Amended 1969, No. 286 (Adj. Sess.), § 3, ratified 1971, No. 51, §

19; 1989, No. 225 (Adj. Sess.), § 25(b); 1995, No. 180 (Adj. Sess.), § 38(a);

2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012.)