certain its condition and ability to fulfill its engagements, and that it has complied with all the provisions of law applicable to its insurance transactions.

Every company examined, under the provisions of this section, must open its books and papers for the inspection of the commissioner, and otherwise facilitate such examination; and the commissioner may administer oaths and examine under oath any person relative to the business of such company; and if he finds the books to be carelessly or improperly kept or posted he must employ sworn experts to rewrite, post, and balance the same at the expense of such company. Such examination must be conducted in the county where such company has its principal office, and must be private, unless the commissioner deems it necessary to publish the result of such investigation, in which case he may publish the same in two of the public newspapers of this state, one of which must be published in the city of San Francisco. All examinations must be at the expense of the company, such expense to be paid in advance, and if any such company refuses to pay such expenses in advance the insurance commissioner may refuse to issue any such certificate of authority and must revoke any existing certificate of authority authorizing such company to do business. [Amendment approved March 10, 1911; Stats. 1911, p. 334.]

Papers to be filed with insurance commissioner.

§ 607. The commissioner must cause every company, before engaging in the business of insurance, to file in his office as follows:

1. A certified copy of the last annual statement or a verified finaneial statement exhibiting the condition and affairs of such company.

2. If incorporated under the laws of this state, a copy of the articles of incorporation and certificate of any increase or diminution of the capital stock, certified by the secretary of state to be a copy of that which is filed in his office.

3. If incorporated under the laws of any other state or country, a copy of the articles of incorporation, if organized or formed under any law requiring articles to be filed, duly certified by the officer having the eustody of such articles, or if not so organized, a copy of the law, charter, or deed of settlement under which the deed of organization is made, duly certified by the proper custodian thereof, or proved by affidavit to be a copy; also, a certificate under the hand and seal of the proper officer of such state or country having supervision of insurance business therein, if any there be, that such corporation or company is organized under the laws or such state or country, with the amount of capital stock or assets required by this article.

4. If not incorporated, a certificate setting forth the nature and character of the business, the location of the principal office, the names of the persons and of those composing the company, firm, or association, the amount of actual capital employed or to be employed therein, and the names of all officers and persons by whom the business is or may

be managed. The certificate must be verified by the affidavit of the chief officer, secretary, agent, or manager of the company; and if there are any written articles of agreement or company, a copy thereof must accompany such certificates; provided, however, when the number of persons composing such company shall exceed ten, such certificate need not state the names of any greater number of persons than ten, who shall be the largest owners; and if such company be formed out of the United States, the said certificate need not contain the names of any officers or managers other than those resident within the United States, nor any statement of capital not employed within the United States, and the affidavit must be made by the chief executive officer or manager in the United States.

5. When, after such filing, any change is made in respect to any of the particulars set forth in any of the papers so filed as hereinabove required by either subdivisions 2, 3, or 4 of this section, copy of the instrument or record of the action making such change, proved by certificate of custodian of the original or by affidavit must be filed with the insurance commissioner. [Amendment approved May 1, 1911; Stats. 1911, p. 1351.]

Citations. App. (subd. 2) 8/419.

§ 608.

Citations. App. 8/416, 418.

Publication of statements of insurance companies.

§ 611. All insurance companies doing business in this state must make and file with the insurance commissioner, on or before the first day of March of each year, statements which must exhibit the condition and affairs of every such company, on the thirty-first day of December then next preceding, a synopsis of which statements, as adjusted by the commissioner upon a proper examination of the same, must be published by such company in the city or city and county where the principal office in this state is located, said publication to be daily for the period of one week in some daily newspaper of general circulation or four consecutive times in some weekly newspaper of general circulation. [Amendment approved May 1, 1911; Stats. 1911, p. 1274.] Citations. App. 8/419.

§ 612.

Citations. App. 8/419.

§ 616.

Citations. App. 8/419, 420; 12/448.

§ 623.

Citations. App. 8/419.

Investment company defined. § 635a. Every person, corporation, company, association, copartnership or individual in the state of California now engaged in or that shall hereafter engage in the business of placing or selling bonds, debentures or certificates of investment by whatsoever name said bonds, debentures or certificates of investment may be known or designated, when such business is conducted on the partial payment or installment payment plan, or in placing or selling any species of bonds, debentures or certificates of investment, on the partial payment or installment plan, wherein or whereby the holder or holders of said bond, debentures or certificates of investment are or may become entitled to claim and receive from such person, corporation, company or association a return, either at a definite or indefinite time, in cash, or in merchandise, or any property, for the partial payments or installments of money so paid, and wherein or whereby the holder may be subject to a fine or forfeiture as a penalty for nonpayment of said partial payments or installments, is hereby declared to be an investment company under the provisions of this act. [New section approved March 18, 1905; Stats. 1905, p. 156.]

This and the following eleven sections relating to investment companies were added to the code March 18, 1905, Statutes 1905, page 156. Although they related to a new subject matter, these sections were not added as a new article. Ordinarily, therefore, they would become a part of article XVI, this being the only article to which they could be added. The whole of article XVI was repealed in 1907, Statutes 1907, page 141, and a new article XVI was substituted in its place. If these sections were part of the original article XVI, it follows that they were repealed when the original article XVI was repealed. As it was believed that these sections were a part of the original article XVI and were repealed when it was repealed, they were omitted from the code of 1909. It appears, however, that there was no § 635 in the original article XVI, and as the new sections began with § 635a, the numbering of the new sections was not consecutive with the numbering in the original article XVI. In addition, the original article related to insurance commissioner, while the new sections related to investment companies. On this account it has been claimed that these sections were not repealed and they were incorporated as being in force by C. F. Curry, former secretary of state, in his book containing the corporation laws of California. Owing to the uncertainty regarding these sections and the doubt that has arisen as to whether they are in force or not, they have been inserted here.-Ed.

Investment companies not licensed by bank or other commissioners. Deposit with state treasurer cash or securities.

§ 625b. Every corporation, company, association, copartnership or individual now engaged in, or that shall hereafter engage in business in this state as an investment company as herein before defined, and not licensed by nor under the supervision of the bank commissioners, building and loan commissioners or insurance commissioner, that shall place or sell any bond or bonds, debenture or debentures, certificate or certificates of investment on the partial payment plan whereby the

holder or holders of such bond or bonds, debenture or debentures, or certificate or certificates of investment are or may become entitled to claim and receive from such corporation, company or association, a return, either at a definite or indefinite time, in cash, or in merchandise, or in property, for the partial payments or installments of money so paid, and wherein or whereby the holder may be subject to a fine, or penalty of forfeiture for nonpayment of said partial payments or installments, is hereby required to deposit within sixty days after the passage of this act, in cases of corporations, persons, companies or associations now existing and doing business, or before commencing business in cases of persons, corporations, companies or associations not now engaged in business, for the security of the holder or holders of the bonds, debentures or certificates issued by it, with the treasurer of the state of California, in cash, or in securities to be approved by said treasurer, the sum of five thousand dollars ($5,000), and in addition thereto shall deposit semi-annually, with the treasurer of the state of California, in cash, or securities to be approved by said officer, in the manner aforesaid, ten per cent of all premiums received on the sale of such bonds, debentures or certificates, until the sum so deposited shall amount to the sum of one hundred thousand dollars. [New section approved March 18, 1905; Stats. 1905, p. 157.]

See note to § 635a.

Articles of incorporation to be filed with secretary of statc. What to contain.

§ 635c. Every investment company as herein defined now doing business in the state of California shall, within sixty days after the approval of this act, and every investment company hereafter organized to carry on the business of an investment company as herein before defined, shall, prior to engaging in such business, in addition to making such deposit, file with the secretary of state a duly authenticated copy of its articles of incorporation, charter or other instrument authorizing it to do business, and shall pay to the secretary of state the fees provided by law to be paid such officer for filing articles of incorporation within this state for a capital stock of like amount, the same to be accompanied with a statement showing

(a) The name of the corporation, company, association, copartnership or individual;

(b) The place where the principal business of the company, corporation, association, copartnership or individual within this state is or is to be carried on;

(c) The amount of capital stock of the corporation, association or company, and the amount of paid-up capital stock;

(d) The names and residences of the incorporators and its stockholders at the time when said statement is filed, and the name of its officers and date when their terms will expire;

(e) The name and address of the officers or representative within the state upon whom process can be served;

(f) A statement of the premiums received from the sale of bonds, debentures or certificates of investment during the preceding six months; which statement shall remain a public record in said office. [New section approved March 18, 1905; Stats. 1905, p. 157.]

See note to § 635a.

Duty of state treasurer. Duty of attorney general.

§ 635d. The treasurer of the state of California shall whenever such fact is brought to his knowledge notify the attorney general of the noncompliance of any person, company, corporation or association doing business as an investment company as herein before defined in the state of California with the provisions of this act, and the attorney general shall immediately after receiving such notification commence an action against such corporation, company or association in the name of the people of the state of California:

(a) To dissolve such corporation, company or association, if incorporated or organized under the laws of the state of California;

(b) To enjoin and restrain such person, corporation, company or association from doing business within the state of California, if an individual or if incorporated and organized at any place without this state. [New section approved March 18, 1905; Stats. 1905, p. 158.] See note to § 635a.

Withdrawal of deposit upon ceasing to do business.

§ 635e. Every corporation, company, association, copartnership or individual that has made a deposit with the treasurer of the state of California in conformity with and under the provisions of this act, may, upon ceasing to do business within the state, maintain an action against the treasurer of the state of California to withdraw its deposit. It shall be the duty of the attorney general to defend such action and if upon judgment being rendered therein, it shall be found that said corporation, company or association has no liabilities within the state, the treasurer of the state of California shall return to said corporation, company or association, or to its order, the cash or securities deposited by it under the provisions of this act, but all expenses of such suit shall in any event be paid by such corporation, company or association. [New section approved March 18, 1895; Stats. 1895, p. 158.]

See note to § 635a.

Right to substitute securities for cash deposit.

§ 635f. Every corporation, company, association, copartnership or in. dividual depositing cash or securities with the treasurer of the state of California, in conformity with the provisions of this act, shall have the right to substitute securities in equal value for cash deposited, or other securities of like value for those on deposit upon securing the approval of the treasurer of the state of California, to said exchange, and