COMPILED CODE - Iowa Legislature - State of Iowa

348
5 5331. CORPORATIONS FOR PECUNIARY PROFIT. Tit. XVII, Ch. 1.
TITLE XVII.
CORPORATIONS.
CHAPTER 1.
CORPORATIONS FOR PECUNIARY PROFIT.
SECTION 5831. Limit of indebtedness.
1 Such articles must fix the highest amount of indebtedness or lia-
2 bility to which the corporation is at any one time to be subject, which
3 in no case, except risks of insurance companies, and liabilitiesof banks
4 not in excess of their available assets, not including their capital, shall
5 exceed two-thirds of its capital stock.
6 But the provisions of this section shall not apply to the bonds or
7 other railway or street railway securities, issued or guaranteed by
8 railway or street railway companies of the state, in aid of the loca-
9 tion, construction and equipment of railways or street railways, to
10 an amount not exceeding sixteen thousand dollars per mile of single
11 track, standard gauge, or eight thousand dollars per mile of single
12 track, narrow gauge, lines of road for each mile of railway or street
13 railway actually constructed and equipped.
14 Nor shall the provisions of this section apply to the debentures
15 or bonds of any company incorporated under the provisions of this
16 chapter, the payment of which shall be secured by an actual transfer
17 of real estate securities for the benefit and protection of purchasers
18 thereof; such securities to be at least equal in amount to the par value
19 of such bonds or debentures, and to be first liens upon unincumbered
20 real estate worth at least twice the amount loaned thereon; nor to
21 debentures or bonds issued by any corporation organized under this
22 chapter for the purpose of manufacturing or selling gas, heat, steam
23 or electricity, or constructing or operating interurban or street rail-
24 ways, or for any one or more of said purposes, when such debentures
25 or bonds are not issued in an amount exceeding twice the amount
26 of the paid-up capital stock of such corporation.
27 Nor shall the provisions of this section apply to the debentures
28 or bonds of any company organized under the provisions of this chap-
29 ter, provided said company shall have not less than one million dollars
30 paid in and outstanding capital stock, the payment of which debentures
31 and bonds shall be secured by the actual transfer of the obligations
32 of individuals, partnerships, associations or corporations, for the bene-
33 fit and protection of purchasers thereof; provided that where such
34 pbligations are secured by the actual transfer of warehouse receipts
35 of bonded warehouses as security collateral thereto, said obligation
36 to represent not exceeding seventy-five per cent of market value of
37 the commodity represented by such warehouse receipt, debentures or
38 bonds may be issued to an amount not in excess of one hundred per