N.Y. General Associations Law § 7-a: Incorporation of joint-stock association

§ 7-a. Incorporation of joint-stock association. 1. Any joint-stock

association transacting business within this state under this chapter

and created by or under the laws of this state on or before January

first, nineteen hundred sixty-four may be incorporated under the

business corporation law for a purpose or purposes for which a

corporation may be formed under such law, in accordance with the

following provisions of this section.

2. (a) The certificate of incorporation of a joint-stock association

to be incorporated pursuant to this section shall be entitled

"Certificate of incorporation of .................... (name of

corporation) under section four hundred two of the business corporation

law and section seven-a of the general associations law," shall be

signed by the president of the joint-stock association as the

incorporator, with his name and address stated beneath or opposite his

signature, acknowledged by him and delivered to the department of state,

and shall set forth the matters required or permitted to be set forth in

a certificate of incorporation under section four hundred two of the

business corporation law and shall also set forth:

(1) The name and date of organization of the joint-stock association

to be incorporated.

(2) The number of outstanding shares of each class and series of the

joint-stock association, specifying the classes and series entitled to

vote and further specifying each class and series, if any, entitled to

vote as a class, and a statement of the basis upon which and the manner

in which such shares shall be converted into, or exchangeable for, the

shares or other securities of the corporation, or the cash or other

consideration which is to be paid or delivered in exchange for shares of

the joint-stock association, or a combination thereof.

(3) A statement that the signer of the certificate of incorporation is

the president of the joint-stock association and that he has been

authorized by the stockholders of the joint-stock association, in

accordance with the provisions of subdivision three of this section, to

sign, acknowledge and deliver the certificate to the department of state

for the purpose of incorporating the joint-stock association.

(b) (1) Notwithstanding the provisions of section three hundred one of

the business corporation law, the corporation may have the same name as

the joint-stock association to be incorporated, and shall not be

required to add to, modify or otherwise change such name, if the

joint-stock association has transacted business in this state under such

name continuously since January first, nineteen hundred twelve.

(2) Subject to the requirements of the business corporation law, the

certificate of incorporation approved in accordance with the provisions

of subdivision three of this section may make any change in the purpose

or purposes of the joint-stock association, in the shares which it shall

have authority to issue and in its duration and may contain any

provision, not inconsistent with law, which is permitted to be set forth

in a certificate of incorporation under section four hundred two of the

business corporation law.

3. The incorporation of a joint-stock association as provided in this

section shall be authorized in the following manner:

(a) The board of directors of the joint-stock association shall call a

meeting of its stockholders for the following purposes:

(1) To authorize the incorporation of the joint-stock association

pursuant to this section, to approve the certificate of incorporation

proposed to be made and delivered for such purpose and to authorize the

president of the joint-stock association to sign, acknowledge and

deliver to the department of state such certificate of incorporation for

filing pursuant to this section; and

(2) To adopt by-laws of the corporation to take effect upon the filing

of the certificate of incorporation by the department of state, which

by-laws may contain any provisions permitted to be contained in the

by-laws of a corporation formed under the business corporation law.

(b) Notice of such meeting of stockholders shall be given to each

stockholder of record of the joint-stock association, whether or not

entitled to vote, in the manner provided in its articles of association

for special meetings of stockholders or, in the absence of any such

provision, in conformity with the provisions of section six hundred five

of the business corporation law as to special meetings of shareholders

of a corporation subject to such law. A copy of the proposed certificate

of incorporation, except for any information not available at the time

of the notice, and a copy of the proposed by-laws of the corporation

shall accompany such notice. Except as otherwise required by this

section or as otherwise provided in the articles of association or

by-laws of the joint-stock association, the provisions of sections six

hundred four to six hundred twelve, inclusive, of the business

corporation law shall govern the conduct of such meeting.

(c) At such meeting of stockholders the matters specified in paragraph

(a) of subdivision three of this section shall be authorized, adopted

and approved by vote of the holders of that proportion of the

outstanding shares of the joint-stock association entitled to vote which

is required by its articles of association to amend such articles, the

holders of shares of a class or series voting as a class if the articles

so provide, or, in the absence of any provision in the articles as to

the amendment thereof, by vote of the holders of two-thirds of all the

outstanding shares of the joint-stock association entitled to vote in

the election of any of its directors.

4. Minutes of the proceedings of such meeting shall be kept, and a

copy of the certificate of incorporation authorized at such meeting and

a copy of the by-laws adopted at such meeting shall be filed with the

minutes. After the certificate of incorporation shall have been filed,

such minutes shall be deemed minutes of proceedings of the shareholders

of the corporation for all purposes of section six hundred twenty-four

of the business corporation law.

5. The provisions of subparagraphs one, two, three, four and six of

paragraph (b) of section eight hundred six of the business corporation

law shall apply to any changes in the shares of the joint-stock

association or in the rights, preferences or limitations of any such

shares made by the certificate of incorporation authorized by this

section as if such certificate were a certificate of amendment.

6. Upon the filing by the department of state of the certificate of

incorporation authorized by this section:

(a) The joint-stock association shall no longer be governed by this

chapter but shall become and be a corporation within the meaning of the

business corporation law possessing, consistently with its certificate

of incorporation, the business corporation law, and any other applicable

statute of this state, all the rights, privileges, immunities, powers

and purposes of the joint-stock association and having, without being

deemed a new or different legal person or entity, all the rights and

powers, subject to all the limitations thereon and qualifications

thereof, which pertain to a corporation formed under the business

corporation law, and the shareholders, directors and officers of the

corporation shall have all the rights and privileges, and be subject to

all the duties and obligations, and limitations thereon, which pertain

to shareholders, directors and officers of a corporation formed under

the business corporation law. The certificate of incorporation of the

corporation may thereafter be amended or changed in any respect as

permitted, and in the manner authorized, by said law.

(b) No further action by the incorporator shall be required for the

organization of the corporation. The by-laws adopted in accordance with

subdivision three of this section shall be the by-laws of the

corporation and, for all purposes of the business corporation law, shall

be deemed by-laws adopted by the shareholders of the corporation. The

directors of the joint-stock association in office at the time of

incorporation shall continue to hold office as directors of the

corporation for their respective terms in accordance with the by-laws

and the provisions of article seven of the business corporation law.

(c) Subject to the provisions of subdivision five of this section, the

initial capital, capital surplus and earned surplus of the corporation

shall be the capital, capital surplus and earned surplus, respectively,

of the joint-stock association as existing at the time of incorporation,

provided that prior to the declaration by the board of directors of the

first dividend after incorporation, the board may determine the amount

of the corporation's earned surplus as provided in subparagraph one (A)

of paragraph (a) of section five hundred seventeen of the business

corporation law in respect of corporations formed before the effective

date of said law, and such determination if made in good faith shall be

conclusive.

(d) All property, real and personal, of the joint-stock association,

including real property held in the name of the president, as such

president, subscriptions to shares, causes of action, licenses, permits

and every other asset of the joint-stock association shall vest in the

corporation without further act or deed.

(e) No liability or obligation due or to become due, claim or demand

for any cause existing against the joint-stock association, or any

stockholder, officer or director thereof shall be released or impaired

by such incorporation. The corporation shall assume and be liable for

all the liabilities, obligations and penalties of the joint-stock

association without further act or instrument, and an action or

proceeding may be maintained thereon against the corporation in lieu of

an action or proceeding against an officer of the joint-stock

association under article three of this chapter.

(f) No action or proceeding, whether civil or criminal, then pending

by or against the joint-stock association, or any stockholder, officer

or director thereof, shall abate or be discontinued by such

incorporation, but may be enforced, prosecuted, settled or compromised

as if such incorporation had not occurred, or the corporation may be

substituted in any such action or proceeding brought pursuant to article

three of this chapter by or against an officer of the joint-stock

association, in place of such officer.

(g) The personal liability, if any, of any stockholder of the

joint-stock association, as such stockholder, existing at the time of

incorporation shall not thereby be extinguished but shall remain

personal to such stockholder and shall not become the liability of any

other shareholder of the corporation or of any subsequent transferee of

any share of the corporation, and an action or proceeding may be

maintained thereon against such stockholder in accordance with the

provisions of article three of this chapter, provided that such an

action or proceeding could have been maintained under said article three

if the incorporation of the joint-stock association had not occurred,

treating the corporation as an officer of the joint-stock association

for such purpose.

7. After the filing of the certificate of incorporation by the

department of state pursuant to this section, the corporation shall

cause a copy of the certificate of incorporation, certified by the

department of state, to be filed in the office of the official who is

the recording officer of each county in this state in which real

property of the joint-stock association is located.

8. The provisions of section ninety-six of the executive law

prescribing the fee to be collected by the department of state for

filing a certificate of incorporation under the business corporation law

shall apply to the certificate of incorporation to be filed pursuant to

this section.