The Vermont Statutes Online

Title 11 : Corporations, Partnerships and Associations

Chapter 001 : Corporations Generally

Subchapter 002 : FORMATION, BYLAWS, AND MEETINGS

• § 42. Specific purposes

  Subject to the provisions of this title, one or more persons may form a private corporation for the specific purposes and in the manner following:

  (1) To operate a regional clearinghouse and a cooperative loan plan, commonly called a central fund, or either, for those banks in the State which become stockholders or members of the corporation. Such corporations may be organized only with the consent of the Commissioner of Financial Regulation, with or without capital stock.

  (A) In addition to the powers conferred by this chapter, they shall have:

  (i) all the powers necessary or convenient for carrying out the purposes herein set forth, including the power to receive deposits of funds from a member bank and to administer the same, and to require such deposits from all member banks in uniform percentages, but not in excess of three percent, of the total deposits of any one bank;

  (ii) to assist member banks when they are temporarily in need of cash or hold investments which cannot readily be liquidated;

  (iii) to borrow money and to pledge its assets as security therefor;

  (iv) to issue scrip to the extent and with such security and under such regulations as the Commissioner of Financial Regulation, with the consent of the Governor, may approve;

  (v) to make loans to member banks and to guarantee the performance of any obligation of a member bank;

  (vi) to establish reserves, and to take over from member banks property, securities, or investments for the purpose of managing, liquidating, exchanging, or adjusting the same.

  (B) Such corporations shall not be subject to the provisions of 8 V.S.A. chapters 1, 3, 21, 29, and 8 V.S.A. part 3 and 9 V.S.A. chapter 131; but their articles of association and bylaws shall be subject to the approval of the Commissioner of Financial Regulation. They shall only invest their funds in securities approved by the Commissioner of Financial Regulation and shall be subject to inspection and examination by the Commissioner or his or her representative the same as State banks.

  (C) Any bank organized under the laws of this State and any national bank in the State, with the approval of the Comptroller of the Currency, may become a stockholder or member of such a corporation under the terms and conditions prescribed in its charter or bylaws. Such bank may subscribe for and hold shares in the capital stock of such a corporation, may make the required deposits hereinabove provided for and to the extent the Commissioner of Financial Regulation may approve, and may invest in and hold debentures or other obligations of such corporation. A director or executive officer of a bank which is a stockholder of such corporation shall be eligible to the office of director of such corporation.

  (2) To operate a corporation for the rehabilitation of individuals and families by enabling them to secure subsistence and gainful employment from the soil, from coordinate and affiliated industries and enterprises and otherwise, and to receive and administer money for that purpose which may become available from any source. Such corporations shall have all the powers of corporations organized under this chapter and in addition thereto may loan money and secure the payment thereof by mortgage, pledge, or lien, insure or guarantee any indebtedness incurred by others, and become secured for so doing by mortgage, pledge, or lien. Such corporations shall not be organized for profit, and shall not be subject to taxation, nor shall any stock or indebtedness of such corporations or any evidence thereof be taxable to any holder thereof under any provision of law. The capital stock of such corporations may be with or without par value and the amount thereof, notwithstanding the provisions of this title, may be less than $500.00 and in case the stock has no par value then the number of shares of such stock may be less than ten, representing less than $500.00. The Governor may designate any such corporation as his or her agent or an agency of the State to carry on rehabilitation activities within the State. Such corporations shall not be subject to the provisions of 8 V.S.A. chapters 1, 3, 21, and 29 and 8 V.S.A. part 3 and 9 V.S.A. chapter 131, or to the provisions of section 131 of this title. (Amended 1969, No. 286 (Adj. Sess.), § 3, ratified 1971, No. 51, § 19; 1989, No. 225 (Adj. Sess.), § 25(b); 1995, No. 180 (Adj. Sess.), § 38(a); 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012.)