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"No corporation chartered or licensed to do business in this State shall own, hold, or control, in any manner whatever, the stock of any competitive corporation or corporations engaged in the same kind of business, in or out of the State, except such stock as may be pledged in good faith to secure bona fide indebtedness acquired upon foreclosure, execution sale, or otherwise for the satisfaction of debt. In all cases where any corporation acquires stock in any other corporation, as herein provided, it shall be required to dispose of the same within twelve months from the date of acquisition; and during the period of its ownership of such stock it shall have no right to participate in the control of such corporation, except when permitted by order of the Corporation Commission. *** Same, $41.

"It shall be unlawful for any public service company—

"(c). To purchase, acquire, take or hold, either in absolute ownership or in pledge, or as collateral security, directly or indirectly, any controlling right, title, or interest, legal or equitable, in the capital stock, bonds, trust certificates, or other evidences of indebtedness or other securities, issued by, or other controlling right, title, or interest whatsoever in, any other public service company, conducting business within this Commonwealth, without the consent and approval of the commission; but the purchase, taking and holding, aforesaid, of any right, title, or interest in any such capital stock, bonds, trust certificates, or other evidences of indebtedness or other securities, or of any other right, title, or interest in any other public service company, which shall amount to less than the aforesaid controlling right, title, or interest, of any nature or kind, shall be lawful without the approval of the commission, so far as the same may be lawful under existing laws: Provided, however, That nothing in this act shall be construed to affect the holding of stock, bonds, trust certificates, or other evidences of indebtedness or other securities, heretofore legally ac quired and held; or in any way diminish, lessen, or impair the rights of any public service company, in virtue of the holding by said company of such stocks, trust certificates, bonds, notes, or other evidences of indebtedness or other securities, heretofore acquired and held; or to prevent the future acquisition of such stocks, trust certificates, bonds, notes, or other evidences of indebtedness or other securities of a public service company, where the major interest therein has been acquired and held by a public service company prior to the date when this act shall become effective; or to prevent the future acquisition, holding, or cancellation by a public service company of trust certificates, bonds, notes, or other evidences of indebtedness or other securities secured by stock, theretofore legally acquired and owned by a public service company and pledged as security therefor." Laws 1913, No. 854,1 Art. III, § 6.

when application shall be made to the commission by any public service company for the approval by the commission of the purchase, acquisition, taking, or holding, either in absolute ownership or in pledge or as collateral security, directly or indirectly, of any controlling right, title, or interest, legal or equitable, to or in the capital stock, trust certificates, bonds, or other evidences of indebtedness or other securities, or other controlling right, title, or interest whatsoever, in any other public service company; *** such ap

Effective January 1, 1914.

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(Pa.)

proval, in each and every such case, or kind of application, shall be
given only if and when the said commission shall find or determine.
that the granting or approval of such application is necessary or
proper for the service, accommodation, convenience, or safety of
the public." Same, Art. V, § 18.

District of
Columbia.

Arizona.

California.

[Colorado.

Idaho.

Kansas.

[Maine.

21. DIVIDENDS.

A public utility may, with the consent of the commission, provide

"a sliding scale of rates and dividends according to what is commonly known as the Boston sliding scale, or other financial device that may be practicable and advantageous to the parties interested." District Appropriation Act, March 4, 1913, § 8, par. 18.

"That no public utility shall declare any stock, bond, or scrip dividend or divide the proceeds of the sale of any stock, bond, or scrip among its stockholders." Same, par. 75.

§§ 20, 21 of the Arizona law (Laws 1912, c. 90) are practically identical with §§ 20, 21 of the California law, referred to below.

Companies may, with permission of commission, distribute as dividends profits resulting from "economies, efficiencies or improvements.' Stats. 1911, 1st ex. sess., c. 14, § 20. (Quoted on p. 53.)

Arrangements for the automatic adjustment of charges in relation to dividends may be made with approval of commission. Same, § 21. (Quoted on p. 53.)

Arrangements for the automatic adjustment of charges in relation to dividends may be made with the approval of commission. Laws 1913, c. 127, § 18. (See note p. 3.)

Companies may, with permission of commission distribute as dividends profits resulting from " economies, efficiencies or improvements." Laws 1913, c. 61, § 19. Arrangements for the automatic adjustment of charges in relation to dividends may be made with the approval of the commission. Same, § 20.

"No *** public utility governed by the provisions of this
act shall declare any stock, bond or scrip dividend or divide the pro-
ceeds of the same of any stocks, bond or scrip among its stock-
holders unless authorized by the commission so to do."
Laws 1911,
c. 238, § 35.

"No public utility shall declare any stock, bond or scrip dividend or divide the proceeds of the sale of its own or any stock, bond or scrip among stockholders without the consent of the commission." Laws 1913, c. 129, § 37.

(See note p. 3.)

Gas and electrical companies may establish a sliding scale for the automatic Maryland. adjustment of charges and dividends. Ann. Code 1911, Art. 23, § 444. This may apply to telephone and telegraph companies by virtue of § 455.

§ 99 of the Missouri law contains a provision practically identical with § 35 of Missouri. the Kansas law, quoted above. Laws 1913, p. 556, § 99.

“*** (d) No public utility shall declare or pay any dividend except out of net corporate income, and except after setting aside such depreciation reserve if any as it may carry in compliance with the provisions of paragraph (b); provided, however, that this paragraph shall not be construed to prevent the payment of dividends in any year out of any undistributed balance of such net corporate income previously accumulated." Laws 1911, c. 164, § 6, as am'd 1913, c. 98.

New
Hampshire.

A provision similar to that in Kansas (§ 35) is found in Laws 1911, p. 549, § 61 Ohio. [614-58]; continued in force by Laws 1913, p. 804, § 20 [499-7].

"It shall be lawful for every public service company

“*** To establish, with the consent of the commission, a scale of charges, subject to automatic adjustment, in relation to the dividends to be paid to the stockholders of such public service company, or the profit to be realized by any person engaged in like business." Laws 1913, No. 854,1 Art. III, § 1.

"No public service corporation shall declare any stock or bond dividend, or divide the proceeds of the sale of any stock or bonds among its stockholders; provided that where stocks, certificates of stock, bonds, notes or other evidences of indebtedness shall be issued for the purposes authorized in subsection 4 of section 1753-5, such new stocks, certificates of stock, bonds, notes, or other evidences of indebtedness, or any part thereof, or the proceeds or any part of the proceeds derived therefrom, may be distributed equally, share for share, among the holders of stock or certificates of stock of such corporation already issued." Stats. 1911, § 1753-14, as am'd 1913, c. 598.

Preferred stock may bear dividends at a rate not to exceed eight per cent before dividends are paid upon common stock, and provision may be made for the accumulation of said dividends. Same, § 1753-20.

22. LEASE, CONSOLIDATION, MERGER.

"That no franchise nor any right to or under any franchise to own or operate any public utility as defined in this section or to use the tracks of any street railroad shall be assigned, transferred, or leased, nor shall any contract or agreement with reference to or affecting any such franchise or right be valid or of any force or effect whatsoever unless the assignment, transfer, lease, contract, or agreement shall have been approved by the commission in writing. The permission and approval of the commission to the assignment, transfer, or lease of a franchise under this paragraph shall not be construed to revive 'Effective January 1, 1914.

Pennsylvania.

Wisconsin.

District of
Columbia.

(D. C.)

Arizona.

California.

or validate any lapsed or invalid franchise or to enlarge or add to the
powers and privileges contained in the grant of any franchise or to
waive any forfeiture. It shall be unlawful for any street railroad cor-
poration, gas corporation, electric corporation, telephone corpora-
tion, telegraph corporation, or other public utility corporation,
directly or indirectly, to acquire the stock or bonds of any other
corporation incorporated for or engaged in the same or similar busi-
ness as it is, unless authorized in writing to do so by the commission,
and every contract, transfer, agreement for transfer, or assignment of
any such stock or bonds without such written authority shall be void
and of no effect." District Appropriation Act, March 4, 1913, § 8,
par. 54.

"That no public utility shall issue any stocks, certificates of stock, bonds, or other evidences of indebtedness secured on its property in the District of Columbia for the purpose of any reorganization or consolidation in excess of the total amount of the stocks, certificates of stock, bonds, or other evidences of indebtedness then outstanding against the public utilities so reorganizing or consolidating, and no such public utility shall purchase the property of any other public utility for the purpose of effecting a consolidation until the commission shall have determined and set forth in writing that said consolidation will be in the public interest, nor until the commission shall have approved in writing the terms upon which said consolidation shall be made." Same, par. 76.

§§ 26, 51 (a), 52 (b) of the Arizona law (Laws 1912, c. 90) differ only in unimportant details of phraseology from the similarly numbered sections of the California law, quoted or referred to below.

"* * * nor shall any license, permit or franchise to own,
control, operate or manage any public utility business or any part
or incident thereof be henceforth granted or transferred, directly
or indirectly, to any foreign corporation which is not at present
lawfully transacting within this state a public utility business of
like character;
Stats. 1911, 1st ex. sess., c. 14, § 26.

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(a) No

* * *

* *

telephone corporation, telegraph corpora-
tion * * * shall henceforth sell, lease, assign, mortgage or
otherwise dispose of or encumber the whole or any part of its
* * * line, plant or system, necessary or useful in the perform-
ance of its duties to the public, or any franchise or permit or any
right thereunder, nor by any means whatsoever, direct or indirect,
merge or consolidate its
* line, plant or system, or fran-
chises or permits or any part thereof, with any other public utility,
without having first secured from the commission an order author-
izing it so to do. Every such sale, lease, assignment, mortgage,
disposition, encumbrance, merger or consolidation made other than
in accordance with the order of the commission authorizing the
same shall be void. The permission and approval of the commis-
sion to the exercise of a franchise or permit under section fifty of
this act, or the sale, lease, assignment, mortgage or other disposition
or encumbrance of a franchise or permit under this section shall not
be construed to revive or validate any lapsed or invalid franchise
or permit, or to enlarge or add to the powers or privileges contained
in the grant of any franchise or permit, or to waive any forfeiture.

Nothing in this subsection contained shall be construed to prevent
the sale, lease or other disposition by any public utility of a class
designated in this subsection of property which is not necessary or
useful in the performance of its duties to the public, and any sale
of its property by such public utility shall be conclusively presumed
to have been of property which is not useful or necessary in the
performance of its duties to the public, as to any purchaser of such
property in good faith for value." Same, § 51.

No contract for consolidation or merger shall be capitalized. Same, § 52 (b). (Quoted on p. 306.)

[

(Cal.)

§ 36 (a) of the Colorado law differs only in minor details of phraseology from Colorado.

§ 51 (a) of the California law, quoted above. Laws 1913, c. 127, § 36 (a).

For a provision restricting capitalization in case of merger, etc., see Same, 37 (b).

(See note p. 3.)

"*** whenever any public service company doing business in this state shall merge with any other company or companies, * * * the secretary of any such company shall, within ten days from the date thereof, notify the public utilities commission of the action of such company or companies on blanks to be furnished by the commission on request." P. A. 1913, c. 192, § 1.

Penalty prescribed. Same, § 2.

“*** nor shall any contract for consolidation or lease be capitalized, nor shall any public utility hereafter issue any bonds, notes or other evidences of indebtedness against or as a lien upon any contract for consolidation or merger." Laws 1913, p. 459,1 § 21.

Detailed provision is made for capitalization in case of merger, consolidation and reorganization. Quoted on p. 311. Same, § 22.

"Unless the consent and approval of the commission is first obtained:

(a) No two or more public utilities may enter into contracts with each other that will enable such public utilities to operate their lines or plants in connection with each other;

(b) No public utility may purchase, lease, or in any other manner acquire, control, direct or indirect, over the franchises, licenses, permits, plants, equipment, business, or other property of any other public utility;

(c) No public utility may assign, transfer, lease, mortgage, sell, or otherwise dispose of or encumber the whole or any part of its franchises, licenses, permits, plant, equipment, business, or other property; but this shall not be construed to prevent the sale, lease,

'Effective January 1, 1914.

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