v. Carter, 71 Mich. 608.

That directors must act as a board, see also Finley Shoe & Leather Co. v. Kurtz, 34 Mich. 89; Audenreid v. Milling Co., 68 N. J. Eq. 450.

§163. Powers of Board of Directors.

Under this act, the following may be mentioned as among the powers of the board of directors.

(a) Power to purchase property, both real and personal, for corporate purposes.-Act, Sec. 14.

(b) Power to call in subscriptions.—Act, Sec. 11.

(c) Power to make all lawful contracts relating to the corporate business.-Cook's Corp. Sec. 712; Marshall's Corp., p. 936.

(d) Power to sell corporate property in regular course of business, or as necessity may require.-McElroy v. Minnesota Percheron Horse Co., 96 Wis. 317; Knight v. Mich. Female Seminary, 152 Mich. 616-618.

(e) Power to make an assignment for the benefit of corporate creditors. -Covert v. Rogers, 38 Mich. 363; Boynton v. Roe, 114 Mich. 401-407.

(f) Power to borrow money for corporate purposes and to issue evidences of indebtedness, such as notes or bonds, and to secure the same by pledge or mortgage of the corporate property.-Detroit v. Mutual Gas Light Co., 43 Mich. 594; Joy v. Plank Road, 11 Mich. 155-164; Bank v. Lumber Co., 122 Mich. 573; Crossette v. Jordan, 132 Mich. 78-80.

(g) Power to sue, compromise, arbitrate and settle claims for or against the corporation.-Whitaker v. Grummond, 68 Mich. 249-257; Marshall Corp., p. 937; Thomp. Corp., Sec. 7754; Cook Corp., Sec. 750.

Directors may apply the assets of a corporation to payment of their unsecured claims against it, although other creditors remain unpaid.-Nappanee Canning Co. v. Reid, Murdock & Co., 59 L. R. A. 199.

(h) Power to pass or to declare dividends upon any and all classes of stock.-Lockhart v. Van Alstyne, 31 Mich. 75-82; Marshall Corp. p. 938; Hunter v. Roberts, 83 Mich. 63; Crane v. Bayley, 126 Mich. 323-326.

(i) Power to appoint other officers and agents and to fix the salaries thereof.-Act, Sec. 6.

The right to fix salaries is terminated by the appointment of a receiver. -Lenoir v. Linville, 51 L. R. A. 146.

(j) Power to fill vacancies on the board.-Act, Sec. 7.

§164. Number of Directors.

The act provides that the number of directors of "every manufacturing or mercantile" company shall not be less than three. No maximum limit is provided for these companies, and neither a maximum nor a minimum number of directors is specified for corporations other than manufacturing and mercantile. Since a president and vice-president must be chosen by the directors "of their number," it is evident that the board cannot be composed of fewer than two members in any case. The minimum number

is, in practice, not less than three. No matter how large the board, its number should always be uneven, so that tie voting may be avoided.

$165. Stock Qualifications.

Directors must continue to hold stock during the term of their office. A director who sells and transfers all of his stock, or who, in any other manner ceases to be a stockholder, ipso facto ceases to be a director.Cook's Corp., Sec. 623.

One to whom stock has been transferred for the sole purpose of qualifying him to act as a director, may be lawfully elected to that office, unless the transfer was in furtherance of some fraudulent purpose.-Faulkner v. Edwards, 12 L. R. A. 781.

$166. Powers of Directors Holding Over.

Directors holding over after the expiration of the term for which they were elected, for want of successors, have the same powers that they enjoyed during their regular term.-Preston National Bank v. Purifier Co., 84 Mich. 364-378; Kimball v. Goodburn, 32 Mich. 10.

$167. Consolidated Corporation Law-Section Relating to Special Meeting for Election.

Section 5. If an election of directors in any such corporation shall not take place at the annual meeting thereof, in any year, such corporation shall not thereby be dissolved, but an election may be had at any time thereafter to be fixed upon, and notice thereof to be given by the directors: Provided, that in case the directors shall refuse or neglect so to do, any three of the stockholders may call a meeting of the stockholders for the election of directors, by giving notice as prescribed by section three of this act.

$168. Special Meeting for Election of Officers.

If the duty to call the annual meeting is definitely enjoined upon the directors by the articles of association or by-laws, mandamus will lie to compel them, if they refuse. In case the refusal is in furtherance of fraudulent design, equity has power to require the call to be made.-Marshall's Corp. p. 897.

$169. Consolidated Corporation Law-Section Relating to Officers.

Section 6. The board of directors shall elect one of their number to be president of the corporation and board, and one or more of their number to be vice-president, and shall also

choose a secretary and treasurer, and assistants if deemed necessary. The secretary and treasurer shall reside and transact the corporation's business at its office within this state, unless the articles, or an amendment thereof duly made, provide for the location of the principal office of the corporation without this state. The directors shall appoint such other officers and agents as the by-laws of the corporation shall prescribe, who shall hold their offices according to their contracts, or until others are appointed in their stead. If the stockholders so direct, the same person may hold the office of secretary and treasurer.

$170. Residence of Officers.

The secretary and treasurer are the only officers required to reside in this State, and this only in cases where the corporation's principal office is in Michigan. Violation of the provision by removal from the State, would not ipso facto vacate the office. The tenure would continue until determined through a proceeding brought by the State, or by some nonassenting stockholder.

§171. Executive Committee.

Under the provision of the act authorizing appointment of "other officers and agents as the by-laws of the corporation shall prescribe," the board of directors may appoint an executive committee from its own membership (Cook's Corp., 715, note 1) and a majority of such executive committee, properly convened, will possess power to bind the corporation by its acts. McNeil v. Chamber of Commerce, 13 L. R. A. 559.

§172. Removal of Appointees.

In the absence of time contracts, appointed officers may be removed at the pleasure of the board.-Marshall's Corp., 924.

An agreement by directors to reimburse an employee out of their private funds in case of his discharge before the termination of his contract is against public policy and void, unless assented to by all the stockholders. Such contracts would have a tendency to influence directors to retain incompetent employees, to the injury of the company.—Wulbur v. Stoepel, 82 Mich. 244.

$173. United Offices.

It is competent for one and the same person to act as president, treasurer and general superintendent of a corporation, in the absence of any express restriction to the contrary.-Preston National Bank v. Purifier Co., 84 Mich. 364-377.

$174. Consolidated Corporation Law.-Section Relating to Vacancies.

Section 7. The directors of such corporation shall have power to fill any vacancy which may happen on their board, by death, resignation or otherwise, for the current year.

$175. Vacancies.

If the number of directors is increased by amendment of the by-laws, the newly created directorships are not vacancies within the meaning of the act.-Dill's Corp., p. 32, citing State v. Messmore, 14 Wis. 177. Such directorships should be filled by election.

If the vacancies reduce the board below a quorum, the remaining members, being less than a quorum, cannot fill the vacancies.-Cook's Corp., Sec. 713, citing State v. Curtis, 9 Nev. 325.

$176. Consolidated Corporation Law.-Section Relating to Place of Business.

Section 8. It shall be lawful for any corporation organized or existing under the provisions of this act to conduct its business, in whole or in part, at any place or places within the United States, or any foreign country.

$177. Business Anywhere in the United States or Any Foreign Country.

By preponderance of authority, in the absence of charter restrictions, a corporation may carry on its business wholly outside the state where it was organized. It preserves its corporate character in the foreign jurisdiction, but it cannot exercise there powers denied it by its home sovereignty. -People v. Howard, 50 Mich. 239; Home Ins. Co. v. Davis, 29 Mich. 238; Thompson v. Waters, 25 Mich. 214; Marshall Corp., p. 1178.

$178. Consolidated Corporation Law.-Section Relating to Recording.

Section 9. Before any corporation, organized under this act to operate in this state, shall commence business, the president shall cause the articles of association to be recorded, at the expense of said corporation, in the office of the Secretary of State of this state, and in the office of the County Clerk of the county in which such operations are to be carried on, and before any corporation organized hereunder, to operate outside this state shall commence business, the president shall cause the articles of association to be recorded at the expense of the cor

poration, in the office of the Secretary of State and in the office of the County Clerk of the county in this state where the office of the corporation is located. The Secretary of State and the County Clerk, in whose office such articles of association shall be recorded, shall each certify upon every such articles of association recorded by him, the time when it was received, with a reference to the book and page where the same is recorded, and the record, or transcript of the record, certified by the Secretary of State of this state, and under the seal thereof, shall be received in all the courts of this state as prima facie evidence of the due formation, existence and capacity of such corporation in any suit or proceedings brought by or against the same. And in case of companies organized under act number forty-one, laws of eighteen hundred and fifty-three, and amendments thereto, and whose original articles of association and amendments are filed in the office of the Secretary of State, copies of such articles of association or amendments, duly authenticated by the Secretary of State under the seal of the state, shall be received in all courts of this state as prima facie evidence of the things therein stated.

$179. Commence Business.

The expression "commence business" refers to such general business as the corporation is especially authorized to transact.-Detroit Transp. Co. v. Assessors, 91 Mich. 382. Clearly it does not refer to the purchase of property taken in payment of subscriptions, since description of this and a statement of the valuation at which, it is accepted must be set forth in the articles themselves.-Act, Sec. 2.

By C. L. 1897, Sec. 8574, it is provided that, “All contracts made in this State..... ..by any corporation which has not first complied with the provisions of this act (i. e. that has not paid the statutory franchise fee) shall be wholly void."-Rough v. Breitung, 117 Mich. 48-53..

$180. Fees.

The franchise fee is 50c per $1,000; minimum fee $5. The recording fee is 20c per folio.

The recording fee to be sent the County Clerk is in all cases the same as the recording fee payable to the Secretary of State.

§181. Refusal to Record.

The Secretary of State has no arbitrary power to refuse to record articles of association, and if he does so wrongfully, mandamus will lie to compel him.-Isle Royale, etc., v. Osmun, 76 Mich. 163. But if the