THE GREEN BAG
defined by the charter, and is a part of the "profit-sharing certificates," payable in in corporate organism of the society, which stalments, the holders of whichTare entitled their policies, like certificates of stock, at the end of a period of years, first to the evidence, but do not abridge. Any policy amount paid in, then to share with the which does not express this interest in the "stock" in the accumulated profits, dollar assets would as a contract be ultra vires. for dollar on the par value of their invest Another illustration is the case of a ment. The interest of the stock in the railroad company which until recently was ' capital and profits is apparently about onecontrolled by the exclusive voting power of fortieth. But in the meanwhile its holders some $13,000 preferred stock, the substantial control the offices, management, and oper capital being represented by several millions ations of the company — in other words the use of the certificate-holders' moneys in of common stock, without a voting power. A somewhat similar result has been the business of buying and selling real attempted in the case of a well-known estate. These cases are taken as illustra land company, operating in 'New York City, tions: it is not intended to suggest that which, with a "capital stock" of $100,000, there has been any wrong connected with operates on a capital of several millions of their manag:ment. There is of course a distinction between dollars obtained from the sale of so-called divided into one thousand shares of one hundred dollars each; which shall be personal property, transferable only on the books of tHe Company, in conformity with its by-laws. The holders of the said capital stock may receive a semi-annual dividend on the stock so held by them, not to exceed three and one-half per cent of the same, such dividends to be paid at the times, and in the manner designated by the directors of said Company. The earnings and receipts of said Com pany, over and above the dividends, losses, and, expenses, shall be accumulated. "Article 4. The corporate powers of said Company shall be vested in a Board of Directors and shall be exercised by them, and by such officers and agents as they may appoint, and from time to time empower. The Board of Di rectors shall consist of fifty-two persons, a major ity of whom shall be citizens of the State of New York, each of whom shall be a proprietor of at least five shares of the said capital stock. . . . "In the election of directors, every stock holder in the Company shall be entitled to one vote for every share of stock held by him, and such vote may be given in person or by proxy. At any time hereafter, the Board of Directors, after giving notice at the two previous stated meetings, may, by a vote of three-fourths of all the directors, provide that each life policy/wider, who shall be insured in not less than five thousand dollars, shall be entitled to one vole at the annual election of directors, but such vote shall be given personally, and not by proxy. . . . "Article 6. The insurance business of the Com pany shall be conducted upon the Mutual Plan.
All premiums snail be payable in cash. In case any policyholt er shall omit to pay any premium due from him to the Company, or violate any other condition of the policy of insurance, the Board of Directors may forfeit his policy, and apply all previous payments to the benefit of the Company. The officers of the Company, within sixty days from the expiration of the first five years from December 3 ist, 1859, and within the first sixty days of every subsequent period of five years, shall cause a balance to be struck of the affairs of the Company, which shall exhibit its assets and liabilities, both present and contingent, and also the net surplus, after deducting a sufficient amount to cover all outstanding risks and other obligations. Each policyholder shall be credited with an equitable share of the said surplus. Said equitable share, after being ascertained, shall be applied to the purchase of an additional amount of insur ance (payable at death or with the policy itself), expressing the reversionary value of such equit able share at such interest as the directors mav designate; or if any policyholder so direct, such equitable share of surplus shall be applied to the purchase of an annuity, at such rate of interest as the directors shall designate, to be applied in the reduction of his or her future premiums. In case of death, the amount standing to the credit of the party insured at the last preceding striking of balance as aforesaid, shall be paid over to the person entitled to receive the same; and the pro portion of surplus equitably belonging to him or her, at the next subsequent striking of balance, shall also be paid, when the same shall have been ascertained and declared."
