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Articles 1381 - 1410 of 1432

Full-Text Articles in Securities Law

Corporations - Pre-Emptive Rights Of Shareholders In Originally Authorized But Unissued Capital Stock, Everett R. Trebilcock Nov 1941

Corporations - Pre-Emptive Rights Of Shareholders In Originally Authorized But Unissued Capital Stock, Everett R. Trebilcock

Michigan Law Review

Plaintiff, a minority stockholder, brought an action to cancel 58,400 shares of originally authorized but unissued stock which the directors had issued to defendant general manager in payment of his services. Plaintiff contended this violated his pre-emptive right to subscribe to the shares and alleged the transaction was fraudulent in that defendant and the directors conspired to gain voting control. Held, the issue was proper because the stock was part of the first offering of original authorized capital stock to which plaintiff's pre-emptive right did not attach, and plaintiff failed to show collusion between directors and defendant to gain …

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Should Tippecanoe County Commissioners V. Reynolds Be Overruled?, George P. Ryan Aug 1941

Should Tippecanoe County Commissioners V. Reynolds Be Overruled?, George P. Ryan

Indiana Law Journal

No abstract provided.

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Corporations - Reserved Powers - Abrogation Of Preferred Dividend Arrearages By Charter Amendment, Merger, Or Consolidation, William D. Sutton May 1941

Corporations - Reserved Powers - Abrogation Of Preferred Dividend Arrearages By Charter Amendment, Merger, Or Consolidation, William D. Sutton

Michigan Law Review

The "malignant" decision in the Dartmouth College case fathered the passage of reserved-power statutes in virtually all the states. These statutes, in turn, when opposed by the retaliatory fundamental-rights safeguards invoked by the courts for the protection of corporate stockholders, procreated problems which have grown more baffling and incorrigible with age. Not the least among these are proposed changes in the liabilities or rights of stockholders, especially the attempted abolition of unpaid accrued dividends upon cumulative preferred stock where there exists a surplus which might lawfully be applied to the payment of such dividends.

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Corporations - Officers And Directors - Duty To Investigate Purchasers Of Controlling Interest, Michigan Law Review Feb 1941

Corporations - Officers And Directors - Duty To Investigate Purchasers Of Controlling Interest, Michigan Law Review

Michigan Law Review

Plaintiff corporation, an investment trust specializing in shares of small life insurance companies, brought an action against its former officers and directors, referred to as "the management group," who in 1937 owned twenty-seven per cent of the outstanding stock of the corporation. This group sold all their stock at an inflated price to another group, referred to as "the Boston group," who on the resignation of the management group immediately elected themselves to the control of the corporation. By this control the Boston group obtained access to the portfolio and proceeded systematically to rob the corporation of all its securities. …

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Bankruptcy-Corporate Reorganization-Publicly Held Securities As A Test Of Availability Of Relief Under Chapters X And Xi Of The Chandler Act, Edward S. Biggar Nov 1940

Bankruptcy-Corporate Reorganization-Publicly Held Securities As A Test Of Availability Of Relief Under Chapters X And Xi Of The Chandler Act, Edward S. Biggar

Michigan Law Review

Chapter X of the amended Bankruptcy Act of 1938 was mainly the product of the investigation by the Securities and Exchange Commission of reorganization practices under the old equity procedure and under section 77B. The chief aim of the sponsors of this new chapter was to preclude the control of reorganization proceedings by "inside" groups, and thereby more adequately protect the interests of investors. Contemporaneously with the overhauling of section 77B, however, other sections of the old Bankruptcy Act were being revised. Among the changes effected, old sections 12 and 74, dealing with extensions and compositions, were remodelled and combined …

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Taxation - Federal Income Tax - Distinction Between Sale And Tax Exempt Reorganization Under Section 112, Henry J. Merry Mar 1940

Taxation - Federal Income Tax - Distinction Between Sale And Tax Exempt Reorganization Under Section 112, Henry J. Merry

Michigan Law Review

The recent Supreme Court decision in Le Tulle v. Scofield, disapproving the views of four out of five circuit courts of appeals, appears to add a new and more specific requirement to the already complex law on the subject of statutory reorganization under the Revenue Act of 1928 -- that the consideration received by the transferor corporation include some stock of the transferee corporation. In the subject case, the Gulf Coast Irrigation Company transferred substantially all its assets to the Gulf Coast Water Company in exchange for $50,000 in cash and $750,000 in mortgage bonds, four-fifths of which matured …

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Corporations - Transfer Of Stock - Liability To Remainderman For Absolute Transfer At Instance Of Life Tenant, James D. Ritchie Mar 1940

Corporations - Transfer Of Stock - Liability To Remainderman For Absolute Transfer At Instance Of Life Tenant, James D. Ritchie

Michigan Law Review

X, life tenant of certain stock of defendant company under a will, endorsed the certificates as life tenant; Y Company guaranteed his signature and itself endorsed in blank. Defendant, with knowledge of X's limited interest, transferred the stock on the books and issued new certificates to Y Company absolutely. Learning of their interests after X's death, plaintiff-remaindermen demanded certificates for the stock from defendant, which refused. In their action for conversion, held, that defendant breached its fiduciary duty to plaintiffs in making an absolute transfer with knowledge that the transferee had only a life interest and …

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Corporations - Recapitalization By Statutory Merger And Consolidation, Robert Meisenholder Dec 1939

Corporations - Recapitalization By Statutory Merger And Consolidation, Robert Meisenholder

Michigan Law Review

When changes in the capital structure of a corporation are attempted by amendment or by voluntary reorganization plans, such efforts at recapitalization are often blocked by dissenting stockholders. As a result, attempts have been made to recapitalize and force dissenting stockholders to go along by following the procedure of the merger and solidation statutes. The extent to which these statutes governing merger and consolidation can be used in order to change the capital structure of a corporation will be examined here. This discussion will consider, first, the governing rules concerning possible .changes in a stockholder's interest and rights when two …

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Corporations - Modification Provisions Of Corporate Mortgages And Trust Indentures, Charles H. Haines Jr. Nov 1939

Corporations - Modification Provisions Of Corporate Mortgages And Trust Indentures, Charles H. Haines Jr.

Michigan Law Review

As early as the late 1800's it was not uncommon to find included in corporate mortgages and trust indentures provisions looking to the modification of the rights of the bondholders by action of a given majority of such holders. Ordinarily the power conferred could not be exercised by the holders of less than seventy-five per cent in value of the outstanding bonds; the modification authorized might be the alteration of security rights, the deferment of payments of interest or principal, the reduction of interest, or even the reduction of the debt. Inasmuch as the same equitable doctrines limit their use, …

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Bankruptcy - Corporate Reorganization - Section 77b - Chapter X Of The Chandler Act - Boyd Case Rule, Edmund O'Hare Nov 1939

Bankruptcy - Corporate Reorganization - Section 77b - Chapter X Of The Chandler Act - Boyd Case Rule, Edmund O'Hare

Michigan Law Review

A subsidiary of the defendant corporation filed a reorganization petition under Section 77 B of the Bankruptcy Act and defendant presented a claim of over nine million dollars as a creditor, the claim being grounded upon moneys paid by defendant to the subsidiary for its benefit, management and supervision fees, rental and interest charges, and declared but unpaid dividends. Defendant owned about ninety-eight per cent of the common stock of the subsidiary. As the result of objections by the trustee and preferred stockholders of the subsidiary, defendant's claim was compromised at five million dollars. The reorganization plan provided in part …

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Corporations - Restraints On Alienation Of Stock Stipulated In The Charter, Michigan Law Review May 1939

Corporations - Restraints On Alienation Of Stock Stipulated In The Charter, Michigan Law Review

Michigan Law Review

The charter of the defendant corporation provided that the board of directors had authority to purchase its common stock at any time when the holder thereof was not an employee, or the holder had not received his common stock by conversion of the preferred. In accordance with the authority granted by this provision, the directors of the defendant corporation adopted a resolution to purchase the common stock owned by the plaintiff, who was not an employee and had not received his common stock by conversion of preferred shares. Plaintiff asked that an injunction be issued restraining defendant from proceeding further. …

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Corporations - Right Of The Registrant To Withdraw A Registration Statement Under The Securities Act Of 1933, Arthur A. Greene Jr. Apr 1939

Corporations - Right Of The Registrant To Withdraw A Registration Statement Under The Securities Act Of 1933, Arthur A. Greene Jr.

Michigan Law Review

One day after the registration statement filed by the corporation became effective, the Securities and Exchange Commission ordered a hearing to determine whether or not a stop order should be issued to suspend the effectiveness of the registration statement. Various issues of the same stock which registrant proposed to issue had been sold on the market, prior to the filing of the registration statement. During the hearings the corporation filed a motion to withdraw its registration statement. The motion was denied. The Securities and Exchange Commission applied to the district court for an order to compel obedience to its subpoena …

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Corporations - Stockholders' Suits - Federal Courts -Requirement Of Stock Ownership At The Time Of The Injury Complained Of, Robert E. Sipes Mar 1939

Corporations - Stockholders' Suits - Federal Courts -Requirement Of Stock Ownership At The Time Of The Injury Complained Of, Robert E. Sipes

Michigan Law Review

When necessary to protect the interest of a stockholder, a court of equity will entertain an action by the stockholder to enforce a right belonging to the corporation. The suit is a derivative one, the corporation being the party primarily injured and the immediate beneficiary of the proceeds of any judgment. The basis for the suit has been explained in a number of ways. It has been held that in a proper case equity will disregard the corporate fiction and allow the derivative suit in order to protect the right which beneficially belongs to the stockholder although nominally to the …

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Corporations - Negotiability Of Stock Certificates - Uniform Stock Transfer Act, Charles R. Linton Jan 1939

Corporations - Negotiability Of Stock Certificates - Uniform Stock Transfer Act, Charles R. Linton

Michigan Law Review

Plaintiff holding company was incorporated with Murtland and two dummies as shareholders and officers. Murtland pledged a stock certificate, representing shares of another corporation owned by his corporation, with the defendant bank to secure a personal loan; an assignment and power of attorney was executed by the plaintiff through Murtland and one of the dummy shareholders as officers, the other shareholder having knowledge of the transaction. Upon the bankruptcy of Murtland, defendant sought to sell the collateral; plaintiff seeks to enjoin the sale on the ground that the assignment had not been authorized by its board of directors. Held, …

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Taxation - Capital Gains Tax (Revenue Act Of 1928) - Reorganizations - Definition Of A Party To A Reorganization, Milton A. Kramer May 1938

Taxation - Capital Gains Tax (Revenue Act Of 1928) - Reorganizations - Definition Of A Party To A Reorganization, Milton A. Kramer

Michigan Law Review

Although "certainty" is one of the most desirable features of taxation, that quality has been conspicuously absent in regard to the portions of the 1928 Revenue Act which deal with capital gains in corporate reorganizations. In the four situations which the act sets forth as constituting a reorganization, capital gains arising therefrom are exempt from tax computation, the general purpose being to remove any impediment to normal corporate adjustments and to prevent the recognition of gains or losses until they are actually realized. However, this provision soon became an invitation for ingenious counsel to arrange the sales of corporate assets …

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Corporations - Corporate Form Used To Evade Bank Double Liability, Michigan Law Review Jan 1938

Corporations - Corporate Form Used To Evade Bank Double Liability, Michigan Law Review

Michigan Law Review

Plaintiff, the receiver for an insolvent bank, sued the individual stockholders of an investment corporation on an assessment to the amount of the par value of the bank stock as provided by the constitution and statutes of South Carolina. The investment corporation had been organized several years previously to secure control of a group of banks. Its holdings throughout consisted only of bank stock, and finally solely of stock of the closed bank. Plaintiff claimed, since the corporation had no assets, that the stockholders of the investment corporation were individually liable, because the use of a holding company for the …

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Bankruptcy - Corporate Reorganization - Effect Of Release Of Collateral Obligor On Dissenting Creditors, Edward D. Ransom Dec 1937

Bankruptcy - Corporate Reorganization - Effect Of Release Of Collateral Obligor On Dissenting Creditors, Edward D. Ransom

Michigan Law Review

The federal district court confirmed a plan of reorganization of debtor corporation, under section 77B of the Bankruptcy Act, which expressly released defendant from liability as guarantor of bonds of the corporation and provided for cancellation of the bonds and substitution of new certificates of stock. The plaintiff, a bondholder, made no objection when the plan was submitted to the court; objection by other bondholders was overruled. The plaintiff brought suit in municipal court on the defendant's guaranty. Defendant pleaded the confirmation of the plan by the district court as res adjudicata. The trial court denied the plea and entered …

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Corporations - Power Of Attorney To Transfer Stock On The Books Of The Corporation, Royal E. Thompson May 1937

Corporations - Power Of Attorney To Transfer Stock On The Books Of The Corporation, Royal E. Thompson

Michigan Law Review

Although a power of attorney to transfer stock on the books of the corporation is found almost as a matter of course on the reverse side of stock certificates, along with a form for assignment of the certificate, there is surprisingly little to be found in the authorities, as to why it is there. An inquiry into the reasons, if any, for such a provision is the purpose of this discussion. A decision of last summer, by the New York Supreme Court, New York County, lends present emphasis to the query. Three certificates of stock which had been indorsed in …

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Corporations - Ratification Of Unauthorized Withdrawal Of Funds By An Officer Of A Corporation, Walter Probst Jr. May 1937

Corporations - Ratification Of Unauthorized Withdrawal Of Funds By An Officer Of A Corporation, Walter Probst Jr.

Michigan Law Review

The president of a corporation withdrew funds from the corporation with which to purchase stock for his own personal benefit. He used this money so as to save the brokerage cost of his securities. A great deal of the money was repaid a few days after its withdrawal. The board of directors, discovering these activities, approved all past actions and present loans of the president. Held, the attempted ratification by the board of directors did not relieve the president from his duty of accounting for the profits realized on the stock purchased with the funds, since there had not …

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Stockholders' Suits: A Possible Substitute, Harris Berlack Feb 1937

Stockholders' Suits: A Possible Substitute, Harris Berlack

Michigan Law Review

With the rapid expansion in the use of the corporate form of organization for business enterprise which has taken place during the last few decades, increasing attention has been paid by legal scholars to the question of the respective positions, rights and duties of the various components of the corporate structure. The functions, rights, obligations and liabilities of managers, officers, directors and stockholders, both majority and minority, have been analyzed and defined. Mr. Berle's analysis of corporate authority as power held in trust for the benefit of the stockholders has found wide acceptance as a comprehensive synthesis of the conclusions …

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Corporations - Parent's Liability For Subsidiary's Obligations, Michigan Law Review Jan 1937

Corporations - Parent's Liability For Subsidiary's Obligations, Michigan Law Review

Michigan Law Review

A parent corporation owned all the stock of a subsidiary which it had organized to hold real estate, its own business being mercantile. The directors and officers of both corporations were identical. The subsidiary sublet premises for ninety-nine years, in turn leasing them to the parent for ten years. Improvements were made in accordance with the subsidiary's contract, and "leasehold trust certificates" were issued by an assignee of the underlying lease. The parent quit the premises before the expiration of its lease, but paid the rent for the whole period. The subsidiary then defaulted on the ninety-nine year lease, having …

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Corporations - Capital, Capital Stock And Stock, Frederick K. Brown Dec 1936

Corporations - Capital, Capital Stock And Stock, Frederick K. Brown

Michigan Law Review

The recent case of Haggard v. Lexington Utilities Co. is typical of the nominalistic confusion occasioned by the use of the terms "capital" and "capital stock." Whatever progress the courts have made toward making them words of precise signification has not been reflected in the drafting of statutes, where they are employed to represent a bewildering number of connotations. The courts have recognized this and have not sought to make them words of art with a single, definitive meaning but through the mechanics of statutory interpretation have sought to divine the legislative intent.

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Corporations - Significance Of Appreciation And Changing Price Levels In Corporate Dividend Policies, Kenneth K. Luce Dec 1936

Corporations - Significance Of Appreciation And Changing Price Levels In Corporate Dividend Policies, Kenneth K. Luce

Michigan Law Review

The appreciation of assets and the legal and accounting problems involved are largely a product of constant fluctuation in the value of money, and to a lesser degree a prodμct of actual rise in the relative value of isolated pieces of property. In the face of political events such as the devaluation of the dollar, and economic phenomena such as the rising price level which the country has experienced since 1933, such problems are of immediate concern to the accountant and lawyer. We must recognize at the outset that appreciation or depreciation in the price level sense are unrelated to …

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Corporations-Disregard Of Separate Entities-Subsidiary Corporation An Instrumentality Of The Parent Feb 1936

Corporations-Disregard Of Separate Entities-Subsidiary Corporation An Instrumentality Of The Parent

Michigan Law Review

Defendant corporation had an excess of assets over liabilities, but its ratio of current assets to current liabilities had declined below the then normal banking credit requirement of two to one. In order to avoid acknowledgment of commercial insolvency due to inability to meet obligations maturing in the near future, defendant organized a subsidiary corporation to take over the sales end of the enterprise, transferring to the subsidiary sufficient current assets to give it the required banking ratio with regard to the liabilities assumed by the subsidiary consisting of bank obligations and some of the current bills payable of the …

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Corporations-Validity Of Option To Convert Preferred Stock Into Mortgage Bonds Jan 1936

Corporations-Validity Of Option To Convert Preferred Stock Into Mortgage Bonds

Michigan Law Review

A corporation issued preferred stock, with a fixed dividend rate, power to elect a director voting as a class, and an option in the holder to convert, at his election, into mortgage bonds which were issued at the same time. After a substantial indebtedness had been incurred by the corporation, the stockholders exercised their option to convert into bonds. The corporation then went into bankruptcy, and in reorganization proceedings, the bondholders claim a preference over general creditors. Held, that the former holders of the preferred stock were stockholders and not creditors of the corporation and that, in the absence …

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Corporations -Liability Of Broker On Misleading Circulars Apr 1935

Corporations -Liability Of Broker On Misleading Circulars

Michigan Law Review

The possibilities of civil and criminal liability under the recent Securities Act of 1933 and the Securities Exchange Act of 1934 have caused considerable fear to those business groups which take part in the business of issuing and transferring corporate securities. The federal acts do subject the vendor of securities who induces sales by means of false or misleading prospectuses and circulars to a possibility of civil liability which was not present under the common law. In a recent Michigan case, the court reached substantially the objectives sought by these acts by applying the existing rules of common law in …

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Corporations - Right Of Preferred Stockholders To Participate In Dividends Beyond Specified Amount Apr 1935

Corporations - Right Of Preferred Stockholders To Participate In Dividends Beyond Specified Amount

Michigan Law Review

The holders of a minority of the preferred stock of a foundry company petitioned for receivership and repayment of part of the dividends which had been paid to common stockholders, contending that after payment of the stipulated 6 per cent dividend on the preferred stock and a like percentage on the common stock, preferred and common stockholders should participate alike in all further dividends declared. There was no provision in the articles or by-laws of the corporation concerning such participation in dividends. Held, that in the absence of express provision, preferred stockholders are entitled to receive only their guaranteed …

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Corporations - Depreciation And Net Profits For Dividend Purposes Mar 1935

Corporations - Depreciation And Net Profits For Dividend Purposes

Michigan Law Review

This discussion will deal only with cash dividends on par value stock. It proceeds on the assumption that dividends in a particular jurisdiction may be paid only from "net profits," but it is not the writer's purpose to interpret "net profits" except so far as that term is affected by depreciation. The discussion will consist of a short examination of the economic nature of depreciation; a consideration of accounting techniques for handling depreciation in the accounts, with an evaluation of these techniques from the point of view of analytical jurisprudence; and a discussion of the case law.

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Corporations-Trust Indenture-Notice To Security Holders Of Contents Of Indenture Feb 1935

Corporations-Trust Indenture-Notice To Security Holders Of Contents Of Indenture

Michigan Law Review

Ever since corporate bonds made their appearance more than a century ago, there has been a steady increase in difficult problems relating thereto. Not the least interesting of these problems pertains to the matter of notice to holders of the bonds and other securities of the contents of the indenture under which they are generally issued. The question becomes acute when one of these bondholders starts suit in law or in equity, and is met by the proposition that his right to so sue is limited by the trust indenture. There are two aspects to the matter, and it is …

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Corporate Reorganizations-Can Securities Of The New Corporation Be Forced On Recalcitrant Creditors? Apr 1934

Corporate Reorganizations-Can Securities Of The New Corporation Be Forced On Recalcitrant Creditors?

Indiana Law Journal

No abstract provided.

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