2684. Articles of association. 1. Any number of persons, not less than five, may form themselves into a corporation, as a bank of discount and deposit, with such rights and powers as are named in this Act, by complying with the following requirements: They shall unite in articles of association setting forth

First. The name assumed by such association.

Second. The place where it is to be located and its operations as a bank of discount and deposit are to be carried on and its business conducted, designating the county, and city or town.

Third. The amount of its capital-stock; which shall not be less than twenty-five thousand dollars, and which shall be divided into shares of one hundred dollars each.

Fourth. The names and places of residence of the shareholders, and the number of shares held by each.

Fifth. The number of directors of the association, which shall not be less than three.

The articles of association shall be signed by the shareholders.

2685. Directors. 2. After the articles of association are completed and signed by the shareholders representing the amount of the capital-stock designated therein, said shareholders may proceed to the election of the number of directors named in said articles of association by ballot; who shall serve one year and until their successors are elected and qualified: And the directors so elected shall, before entering upon their duties, take an oath or affirmation that they will faithfully and honestly discharge their duties as such.

2686. President and cashier. 3. The directors shall elect one of their number president, and shall also elect or appoint a cashier. The president and cashier shall each take an oath or affirmation that he will faithfully and honestly discharge his duties. And the board of directors shall require of the president and cashier to execute separate bonds, with sureties, in such sums as they may deem proper, conditioned that they will

honestly and faithfully discharge their several duties as such officers (which said bond shall be filed in the office of Secretary of State for the benefit of stockholders and creditors of such bank) during their continuance in office. A copy of the articles of association, certified by the president and cashier to be a full, true, and correct copy of the original, shall be filed in the office of the Secretary of State of the State of Indiana, who shall file and carefully preserve the same in his office. Copies of such articles of association and certificates, duly certified by the Secretary of State, and authenticated by his seal of office, shall be legal and sufficient evidence in all Courts of the existence of such association, and of every matter or thing which could be proved by the production of the original.

1. The cashier is, prima facie, the agent of the bank, to manage its funds and securities; and a purchaser in good faith of a negotiable security held by the bank, and indorsed by the cashier, as such, can hold the bank as indorser.- Bank v. Wheeler, 21 Ind. 90.

2687. Corporate powers. 4. Every association formed pursuant to the provisions of this Act shall, from the date of filing of such certified copy of its articles of association in the office of the Secretary of State, be a body corporate, but shall transact no business except such as shall be preliminary and incident to its organization, until at least fifty per cent. of its whole capital-stock has been actually paid in, and a certificate of that fact by the president and cashier, under oath or affirmation, filed in the office of the Secretary of State. Such association shall have power to adopt a corporate seal, and shall have succession by the name designated in its articles of association; and by such name it may make contracts, sue, and be sued, complain and defend in any Court of law and equity, as fully as natural persons; and may exercise, under this Act, all the powers incidental and proper, or which may be necessary and usual in carrying on the business of banking as a bank of discount and deposit; may receive deposits, buy and sell exchange, gold and silver coin and bullion; and may loan money, negotiate, sell, and guaranty such loans, and promissory notes, bonds, drafts, bills of exchange, and other evidences of debt, and any securities thereof; and may become and act as the trustee for the same as fully as private persons may; but no such association shall issue notes, bills, or other evidences of indebtedness in the form or similitude of bank-notes, and intended to circulate as bank-notes or bills or as money. And such association may contract for, charge, take, reserve, and receive on loans and discounts the highest rates of interest allowed by the law of this State to be contracted for, taken, and received by individuals.

1. A bank may, but is not bound to, pay a deposit or upon oral direction or request. --McEwen v. Davis. 39 Ind. 109.

2. A bank can only apply a special deposit to the purpose directed by the depos itor.-Wilson v. Dawson, 52 Ind. 513.

5. A bank receiving a claim for collection is liable for any neglect by which indorsers are discharged.-Am. Ex. Co. v. Haire, 21 Ind. 4.

4. A bank check need not be protested on non-payment, but notice should be given to drawer.- Griffin v. Kemp, 46 Ind. 172.

5. A certificate of deposit is assignable under the statute, if "payable in current funds"; it is not negotiable as an inland bill of exchange.- National State Bank v. Ringel, 51 Ind. 393.

6. There can be no recovery upon a certificate of deposit, without proof of an actual demand and refusal of payment before suit.- Brown v. McElroy, 52 Ind. 404.

2688. Election and duties of directors.

5. Every such association

shall elect a board of directors, annually, at such time as may be designated by the first board of directors thereof or specified in its by-laws; and at all elections of directors each shareholder shall be entitled to one vote for each share of stock held by him. Each director so elected shall serve one year and until his successor is elected and qualified; and, before entering upon his duties, shall take an oath or affirmation that he will honestly and faithfully discharge his duties as such during his continuance in office. Shareholders may vote by proxies duly authorized in writing; but no officer, clerk, teller, or book-keeper of such association shall act as proxy. The board of directors may make and establish, from time to time, such bylaws as may be deemed proper, not inconsistent with this Act, for the regulation and transaction of its business, holding elections for directors, the manner in which its stock shall be transferred on the books of the association, and the manner of appointing officers and agents thereof. Such association may, from time to time, appoint, beside the president and cashier, such other officers, tellers, clerks, and agents as may be deemed proper for the transaction of its business, and define their powers and duties, and remove them at pleasure. The directors shall meet at least once a month, and shall keep a record of their acts and proceedings. The general business of the association shall be under the control and management of the board of directors, who shall cause all proper books to be kept of the transactions and business of the association such as are used in banks; and such books shall at all times be subject to examination and inspection by any stockholders of the association.

2689. Who ineligible as directors. 6. No person who is not the owner, in his own right, of at least five shares of the capital-stock of such association shall be eligible to serve as a director; and if any person, while holding the office of director, shall transfer his stock, and thereby become the owner of less than five shares, his office as director shall, from the date thereof, terminate, and the vacancy may be filled by the remaining directors by appointment, and the person so appointed shall serve until his successor is elected and qualified. At least ten days' notice of the time and place of holding all elections of directors, except the first, shall be given to the stockholders, either by personal notice in writing or by publication in a weekly newspaper, if any be published in the county in which the association is located.

2690. Stock payments. 7. At least fifty per cent. of the whole capitalstock of the association shall be paid in before commencing business, as provided in section four [§ 2687], and the residue shall be paid within six months thereafter, and may be required in such installments, within that period, as the directors may determine. If any person shall fail to pay any installment due on his capital-stock when so required, the board of directors may proceed to collect the same by suit in any Court of competent jurisdiction; or they may sell the stock of such delinquent stockholders at public auction, having given three weeks' notice of the time and place of such sale by publication in a newspaper published in the city, town, or county in which the association is located (and if no newspaper be published in such county, then in a newspaper published nearest thereto), to any person who will pay the highest price therefor, and not less than the amount due thereon, with the expenses of advertising and sale; and the excess, if any, shall be paid

to the delinquent shareholder. The capital-stock of such association shall be deemed personal property, and treated as such.

[1881, p. 88. In force April 6, 1881.]

2691. Stock-Increase and reduction. 8. The capital-stock of such association may be increased by a vote of the shareholders owning twothirds of the capital, a certificate of which shall be made and recorded on the records of the board of directors; and a certified copy thereof, with the signatures of the president and cashier of the association, shall be filed in the office of the Secretary of State; but such increased stock shall be paid in at the time it is subscribed. And whenever such association proposes to reduce its capital-stock, notice thereof must first be given to the shareholders and depositors, by publication for three weeks successively in some weekly newspaper of general circulation, printed and published in the county where the business of such association is conducted. Such notice shall name a time and place when and where the matter of reduction shall be acted upon. At the time and place named, such capital-stock may be reduced by a vote of two-thirds of the shareholders present (representing two-thirds of the capital-stock) at such meeting voting in favor thereof, and by the written assent of a majority of all the directors. No such reduction shall be made until the Auditor of State has been notified, before the call for such meeting, by such association, of the proposed reduction; and when so notified, he shall cause an examination to be made, immediately, of the books, property, effects, and liabilities of such association, and may also examine its officers under oath. From the result of such examination, he shall determine the value, in his judgment, of such property and effects above the debts and liabilities, and certify the same in writing; and the amount so certified shall be presented and read to the shareholders present at such called meeting. No reduction shall be allowable which will reduce the capital of the association below the amount so certified by the Auditor of State; neither shall the capital-stock be reduced at any time below the amount fixed by this Act.

[1873, p. 21. In force February 7, 1873.]

2692. Surplus-Dividends. 9. It shall be the duty of the board of directors to set apart and retain ten per centum of the annual net profits of the business of such association as a surplus fund, until the same shall amount to twenty-five per centum of its capital-stock. The directors of any association may semi-annually declare a dividend of so much of the net profits of the association as they shall judge expedient, first deducting therefrom the one-tenth part thereof, to be carried to the surplus fund. But neither the association nor any member thereof shall, during the time it shall continue its banking operations, withdraw, or permit to be withdrawn, any portion of its capital, either in the form of dividends or otherwise. And if losses shall, at any time, have been sustained by any such association, equal to or exceeding its undivided profits then on hand, no dividend shall be made; and no dividend shall ever be made by any association while it shall continue its banking operations to an amount greater than its net profits then on hand, deducting therefrom its losses and bad debts. And all debts due to any association, on which interest is past due for a period of six months, unless the same shall be well secured, shall be considered bad debts within the meaning of this Act.

2693. List of stockholders. 10. The president and cashier of every such association shall cause to be kept, at all times, a full and correct list of the names and residences of all shareholders in the association, and the number of shares held by each, in the office where its business is transacted; and such list shall be subject to the inspection of all the shareholders and creditors of the association and the officers authorized to assess taxes under the authority of the State.

2694. Liquidation. 11. Any such association may go into liquidation and be closed, by a vote of its shareholders owning two-thirds of its stock. And when such vote shall be taken, it shall be recorded on the record-book of the association, and notice thereof given by publication for at least three successive weeks in a weekly newspaper published in the city, town, or county where the association is located, if any; and if there be no such newspaper published in the county, then the notice shall be published in a weekly newspaper nearest thereto. And after such vote shall be taken, no dividend of profits or of the capital shall be made to the stockholders, nor any part of the capital withdrawn by nor paid to the shareholders, in any manner whatever, until all the debts and liabilities of the association of every kind are fully paid.

2695. Purchase of real estate.

12. It shall be lawful for any associa

tion organized under this Act, to purchase, hold, and convey real estate as follows:

First. Such as shall be necessary for its immediate accommodation in the transaction of its business.

Second. Such as shall be mortgaged to it in good faith, by way of security for debts.

Third. Such as shall be conveyed to it in satisfaction of debts previously contracted in the course of its dealings.

Fourth. Such as it shall purchase at sales under judgments, decrees, or mortgages held by such association, or shall purchase to secure debts due. to said association.

Such association shall not purchase or hold real estate in any other case or for any other purpose than as specified in this section, nor shall it hold the possession of any real estate under mortgage, nor hold the title and possession of any real estate purchased to secure any debts to it, for a longer period than five years.

2696. Liability of stockholders. 13. The share-holders of each association formed under the provisions of this act shall be individually responsible to an amount over and above their stock, equal to the par value of their respective shares of stock, for all debts or liabilities of the association and which may be collectible by suit and also as herein provided. Those holding shares only in a fiduciary capacity shall not be individually liable, but the assets of the estate, trust or person for whom they are acting shall be liable as herein provided. Whenever the Auditor of State shall have reason to believe that the capital stock of any of said associations is reduced by impairment or otherwise, below the amount required by law or by its articles of association and certificate of increase or decrease of capital, as the case may be, the Auditor shall require the deficiency to be made good and the Board of Directors shall immediately give notice of said requisition to each stockholder and of the amount of assessment which he must pay, by notice made