8 21. Change of number of directors.-The number of directors of any stock corporation may be increased or reduced, but not below the minimum number prescribed by law, when the stockholders owning a majority of the stock of the corporation shall so determine, at a meeting to be held at the usual place of meeting of the directors, on two weeks' notice in writing to each stockholder of record. Such notice shall be served personally or by mail, directed to each stockholder at his last known postoffice address. Proof of the service of such notice shall be filed in the office of the corporation at or before the time of such meeting. The proceedings of such meeting shall be entered in the minutes of the corporation and a transcript thereof verified by the president and secretary of the meeting shall be filed in the offices where the original certificates of incorporation were filed. Such increase or reduction may also be effected by unanimous consent without a meeting, in which case there shall be filed in the offices herein specified, the unanimous consent of the stockholders in writing, signed by them, or their duly authorized proxies, but no such consent shall be valid unless there is annexed thereto an affidavit of the custodian of the stock book of such corporation stating that the persons who have signed such consent, either in person or by proxy, are the holders of record of the entire capital stock of said corporation issued and outstanding.* If a corporation formed under or subject to the banking law, the consent of the superintendent of banks, and if an insurance corporation, the consent of the superintendent of insurance, shall be first obtained to such increase or reduction of the number of directors. This section shall apply to any stock corpor *The provision for the unanimous consent of stockholders increasing or reducing the number of directors without a meeting was added in 1904. ation whether organized under a general or special law, and the number of directors may be increased as hereby provided notwithstanding the maximum number of directors now prescribed by law. If the number of directors be increased, the additional directors authorized by such increase shall be elected by the votes of a majority of the directors in office at the time of the increase. the original or an amended certificate of incorporation of the corporation shall provide that the directors shall be divided into two or more classes, whose terms of office shall respectively expire at different times, the additional directors shall be divided among such classes as nearly as practicable in proportion to the respective numbers of directors constituting each class prior to such in crease. If L. See L. 1848, c. 37; L. 1860, c. 269, § 2; L. 1863, c. 134, § 1; 1867, c. 248, § 2; L. 1875, c. 4, § 1; L. 1875, c. 611, § 10; L. 1878, c. 316, § 2; L. 1879, c. 395, § 1; L. 1881, c. 422; L. 1885, c. 171, § 1; L. 1890, c. 23; L. 1890, c. 564, § 21; L. 1891, c. 57; L. 1892, c. 688, § 21; L. 1903, c. 320; L. 1904, c. 307; L. 1905, c. 750. 125 N. Y. 25; 159 N. Y. 287; 160 N. Y. 500; 183 N. Y. 578; 186 N. Y. 215; 109 App. Div. 49. 22. When acts of directors void.-When the directors of any corporation for the first year of its corporate existence shall hold over and continue to be directors after the first year, because of their neglect or refusal to adopt the by-laws required to enable the stockholders to hold the annual election for directors, all their acts and proceedings while so holding over, done for and in the name of the corporation, designed to charge upon it any liability or obligation for the services of any such director, or any officer, or attorney or counsel appointed by them, and every such liability or obligation shall be held to be fraudulent and void. See L. 1885, c. 489; L. 1890, c. 564, § 22; L. 1892, c. 688, § 22. § 24, General Corporation Law, gives the right to " any member of the corporation" the right in certain cases to call a meeting for the election of directors. See post, page 94. § 23. Liability of directors for making unauthorized dividends. The directors of a stock corporation shall not make dividends, except from the surplus profits arising from the business of such corporation, nor divide, withdraw or in any way pay to the stockholders or any of them, any part of the capital of such corporation, or reduce its capital stock, except as authorized by law. In case of any violation of the provisions of this section, the directors under whose administration the same may have happened, except those who may have caused their dissent therefrom to be entered at large upon the minutes of such directors at the time, or were not present when the same happened, shall jointly and severally be liable to such corporation and to the creditors thereof to the full amount of any loss sustained by such corporation or its creditors respectively by reason of such withdrawal, division or reduction.* But this section shall not prevent a division and distribution of the assets of any such corporation remaining after the payment of all its debts and liabilities upon the dissolution of such corporation or the expiration of its charter; nor shall it prevent a corporation from accepting shares of its capital stock in complete or partial settlement of a debt owing to the corporation, which by the board of directors shall be deemed to be bad or doubtful. * The language, "of any loss sustained by such corporation or its creditors respectively by reason of such withdrawal, division or reduction," was substituted by L. 1901, c. 354, for "of the capital of such corporation so divided, withdrawn, paid out or reduced." See R. S., Part I., c. 18, title 4, § 2, 8th Ed., p. 1728; Birdseye's Ed., p. 678; L. 1848, c. 40, § 13; L. 1854, c. 232, § 14; L. 1857, c. 546, § 13; L. 1875, c. 611, § 19; L. 1890, c. 564, § 23; L. 1892, c. 688, § 23; L. 1901, c. 354. See 160 N. Y. 21, 32. [ 24. Liability of directors for unauthorized debts and over-issue of bonds.]-Repealed. See L. 1848, c. 40, § 23; L. 1853, c. 117, § 23; L. 1875, c. 611, § 22; L. 1890, c. 564, § 24; L. 1892, c. 688, § 24; L. 1898, c. 80; L. 1901, c. 354. § 24 was expressly repealed by § 4 of L. 1901, c. 354. 8 25. Liability of directors for loans to stockholders. -No loan of moneys shall be made by any stock corporation, except a moneyed corporation or by any officer thereof out of its funds to any stockholder therein, nor shall any such corporation or officer discount any note or other evidence of debt, or receive the same in payment of any installment or any part thereof due or to become due on any stock in such corporation, or receive or discount any note, or other evidence of debt, to enable any stockholder to withdraw any part of the money paid in by him on his stock. In case of the violation of any provision of this section, the officers or directors making such loan, or assenting thereto, or receiving or discounting such notes or other evidences of debt, shall, jointly and severally, be personally liable to the extent of such loan and interest, for all the debts of the corporation contracted before the repayment of the sum loaned, and to the full amount of the notes or other evidences of debt so received or discounted, with interest from the time such liability accrued. See L. 1848, c. 40, § 14; L. 1853, c. 117, § 14; L. 1875, c. 611, § 20; L. 1890, c. 564, § 25; L. 1892, c. 688, § 25. See 30 Hun, 314; 62 Hun, 63; 57 N. Y. 133. § 26. Transfers of stock by stockholder indebted to corporation. If a stockholder shall be indebted to the corporation, the directors may refuse to consent to a transfer of his stock until such indebtedness is paid, provided a copy of this section is written or printed upon the certificate of stock. See L. 1875, c. 611, § 12; L. 1890, c. 564, § 26; L. 1892, c. 688, § 26. See 158 N. Y. 576. 827. Officers.-The directors of a stock corporation may appoint from their number a president, and may appoint a secretary, treasurer and other officers, agents and employes, who shall respectively have such powers and perform such duties in the management of the property and affairs of the corporation, subject to the control of the directors, as may be prescribed by them or in the by-laws. The directors may require any such officer, agent or employe to give security for the faithful performance of his duties, and may remove him at pleasure. The policy holders of an insurance corporation shall be eligible to election or appointment as its officers. See L. 1848, c. 40, § 5; L. 1853, c. 117, § 5; L. 1853, c. 135, § û; L. 1854, c. 232, § 5; L. 1857, c. 546, § 6; L. 1874, c. 143, § 5; L. 1875, c. 611, §§ 6, 10; L. 1877, c. 228, § 5; L. 1878, c. 203, § 7; L. 1890, c. 564, § 27; L. 1892, c. 688, § 27. The president, while required to be a director, need not be a stockholder. See § 20, Stock Corporation Law, ante, page 33. The other officers need not be directors. 28. Inspectors and their oath.-The inspectors of election of every stock corporation shall be appointed in the manner prescribed in the by-laws, but the inspectors of the first election of directors and of all previous meetings of the stockholders shall be appointed by the board of directors named in the certificate of incorpora |