CHAPTER 352

An Act to amend and reenact §§ 18.1-8, and 18.1-17 as amended, of the
Code of Virginia, relating, respectively, to the powers of corporations
generally and to the consideration for shares, bonds and options, as
determined by the boards of directors of corporations. ¢ a4

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Approved March 31, 1964

Be it enacted by the General Assembly of Virginia:

1. That §§ 13.1-3 and 13.1-17, as amended, of the Code of Virginia, be
amended and reenacted as follows:

§ 13.1-38.—Each corporation shall have power:

(a) To have perpetual succession by its corporate name.

(b) To sue and be sued, complain and defend, in its corporate name.

(c) To have a corporate seal which may be altered at pleasure, and to
use the same by causing it, or a facsimile thereof, to be impressed or affixed
or in any other manner reproduced.

(d) To purchase, take by gift, devise or bequest, receive, lease, or
otherwise acquire, own, hold, improve, use and otherwise deal in and with,
real or personal property, or any interest therein, wherever situated.

(e) To sell, convey, mortgage, pledge, lease, exchange, transfer and
otherwise dispose of all or any part of its property and assets.

(f) To lend money to its employees, officers and directors, and other-
wise assist them.

(g) To purchase, take, receive, subscribe for, or otherwise acquire,
own, hold, vote, use, employ, sell, mortgage, lend, pledge, or otherwise
dispose of, and otherwise use and deal in and with, stock, securities or
other interests in, or obligations of, other domestic or foreign corporations
organized for any purpose, associations, partnerships or individuals, or
direct or indirect obligations of the United States or of any other govern-
ment, state, territory, governmental district or municipality or of any
instrumentality thereof; and to guarantee the payment of any bonds or
other obligations of any other domestic or foreign corporations organized
for any purpose.
(h) To make contracts and incur liabilities, borrow money at such
rates of interest as the corporation may determine, issue its notes, bonds,
and other obligations, and secure any of its obligations by mortgage or
pledge of all or any of its property, franchises and income.

(i) To lend money for its corporate purposes, invest and reinvest its
funds, and take and hold real and personal property as security for the pay-
ment of funds so loaned or invested.

(j) To conduct its business, carry on its operations, hold property,
Hare peice and exercise the powers granted by this Act in any part of the
world.

(k) To elect or appoint officers and agents of the corporation, and
define their duties and fix their compensation.

(1) To make and alter by-laws, not inconsistent with its articles of
incorporation or with the laws of this State, for the administration and
regulation of the affairs of the corporation.

(m) Unless otherwise provided in the articles of incorporation or by
resolution of the stockholders and within any limits so prescribed, to make
by action of its board of directors donations for the public welfare or for
religious, charitable, scientific, literary or educational purposes; except
that corporations subject to regulation as to rates by the Commission shall
not have power to make donations in excess of five per centum of net in-
come computed before federal and state taxes on income and without
taking into account any deduction for gifts.

(n) To indemnify any director or officer or former director or officer
of the corporation, or any person who may have served at its request
as a director or officer of another corporation in which it owns shares of
capital stock or of which it is a creditor, against expenses actually and
reasonably incurred by him in connection with the defense of any claim,
action, suit or proceeding against him by reason of being or having been
such director or officer, except in relation to matters as to which he shall
be finally adjudged in such action, suit or proceeding to be liable for negli-
gence or misconduct in the performance of duty; and to make any other
or further indemnity to any such persons that may be authorized by the
articles of incorporation or any by-law made by the stockholders or any
resolution adopted, before or after the event, by the stockholders.

(o) To pay pensions and establish pension plans, pension trusts, profit-
sharing plans, stock option plans, stock purchase plans, and other incentive
plans for * directors, officers and employees of the corporation or of its
subsidiaries.

(p) To insure the life of any director, officer, agent or employee and
to continue such insurance after the relationship terminates, and no such
director, officer, agent or employee shall be deemed disqualified by interest
from acting in respect thereof.

(q) To cease its corporate activities and surrender its corporate
franchise.

(r) To have and exercise all powers necessary or convenient to effect
any or all of the purposes for which the corporation is organized.

Each corporation other than a railroad or other public service com-
pany, a banking corporation, an insurance corporation, a building and loan
association, a credit union or an industrial loan association shall have power,
but only where authorized by the articles of incorporation or by the
affirmative vote of the holders of more than two-thirds of the outstanding
shares of each class, whether or not entitled to vote thereon by the pro-
visions of the articles of incorporation, to enter into partnership agree-
ments with other corporations, whether organized under the laws of this
State or otherwise, or with any individual or individuals.

Privileges and powers conferred and restrictions and requirements
imposed by other Titles of the Code on railroads or other public service
companies, banking corporations, insurance corporations, building and loan
associations, credit unions, industrial loan associations or other special
types of corporations shall not be deemed repealed or amended by any pro-
vision of this Act except where specifically so provided.

§ 138.1-17. The consideration for the issuance of shares or bonds
may be paid, in whole or in part, in money, in other property, tangible or
intangible, or in labor or services. Future services shall not constitute
payment or part payment for shares or bonds.

Shares, whether with or without par value, may, subject to any re-
striction at the time provided in the articles of incorporation or in a reso-
lution of the stockholders, be issued from time to time by the board of
directors for such consideration expressed in dollars as shall be fixed by
the board of directors.

That part of the surplus of a corporation which is transferred to
stated capital upon the issuance of shares as a stock dividend shall be
deemed to be the consideration for the issuance of such stock.

A determination by the board of directors of the value in dollars of
services or property received or to be received by a corporation as con-
sideration for the issuance of stock or bonds shall, when shown by a stock
statement or bond statement on file with the Commission, be conclusive
in the absence of fraud participated in by both parties.

Treasury shares and treasury bonds may be disposed of by the cor-
poration for such consideration as may be fixed from time to time by the
board of directors.

Options for the purchase of shares, whether unissued or treasury
shares, may be granted upon such terms and conditions and for such con-
sideration as may be approved by the board of directors, but when offered
to officers or employees of the corporation or of its subsidiaries only in
accordance with authorization in the articles of incorporation or by reso-
lution of the stockholders. In the absence of fraud participated in by both
parties the judgment of the board of directors as to such terms and condi-
tions and the sufficiency of such consideration shall be conclusive.