Ayres, Ira B. Prudden, Barnabas K. Stickle, Samuel W. Corwin, Francis Lindsly, Courtland S. Hulse, James Holmes. and Henry C. Pitney, at present directors of said association, shall be the first directors of the corporation created by this act, and shall hold their offices until their successors are duly elected.

Election of di

5. And be it enacted, That the first election for directors of the said corporation created by this act shall be held on rectors. the second Tuesday of October next, and on the same day annually thereafter, at the banking house of said corporation, in Morristown, at such hour in the day as the directors shall appoint, of which election at least fourteen days' notice shall be given by the cashier, in a newspaper printed at Morristown; for the well ordering of which election the board of directors shall previously thereto appoint three stockholders, not being directors, to be judges thereof, who shall conduct the election and determine upon the legality of votes, the eligibility of persons voted for, and who are elected; that the said election shall be by ballot, and be made by such of the stockholders as shall attend for that purpose, either in person or by proxy, and each stockholder shall be entitled to one vote for each share of stock held in his, her or their names, at least one month next before the election; and the persons to the number to be elected, who shall have the greatest number of votes, shall be directors; and if it shall happen that two or more persons have an equal number of votes, so that the proper number of persons of those voted for cannot be chosen, who have received a majority or plurality of votes, then the directors of the preceding year, or a majority of them, shall proceed by ballot and plurality of votes to determine which of the persons so having an equal number of votes shall be the director or directors, so as to complete the whole number; and the directors so elected, as soon as may be thereafter, shall proceed to elect by ballot, and by a majority of votes, one of their number for president; and whenever any vacancy or vacancies shall happen among the directors by death, resignation or otherwise, such vacancy or vacancies

shall be filled for the remainder of the year by such person or persons as the other directors for the time being, or a majority of them, shall appoint; and if at any time it shall happen that an election of directors shall not take place on the day herein prescribed, the said corporation shall not for that reason be deemed to be dissolved, but an election shall be had as soon as conveniently may be thereafter, upon like notice, and at the place and in the mode before specified.

6. And be it enacted, That the capital stock of said corporation shall be deemed personal property, and shall be transferable on the books of the corparation, in the manner prescribed by the by-laws of said corporation, and no stockholder from whom any debt is due to the said bank, or who is drawer or endorser upon any bill of exchange or note discounted by said bank, and not yet due, shall be allowed to transfer his said stock without the consent of the said board of directors, but all such stock shall be and remain liable for the payment of such notes or bills of exchange when they

mature.

7. And be it enacted, That the said corporation shall not issue bills or notes of a less denomination than one dollar; and the bills or notes which may be issued by said corporation, signed by the president and countersigned by the cashier, and when so signed and issued, promising the payment of money to any person or to his order, or to the bearer, shall be binding and obligatory upon said corporation, in all respects as if made by a natural person or persons, but that the bills or notes issued by said corporation shall not at any time exceed double the amount of its capital stock actually paid in; and if the president or cashier thereof shall knowingly or wilfully issue, or cause or suffer to be issued, bills or notes of said corporation exceeding double the amount of its capital stock actually paid in, such president or cashier shall be deemed guilty of a misdemeanor, shall be liable to indictment therefor, and upon conviction thereof shall be punished by imprisonment in the state prison of not less than one year, nor more than five years, at the discretion of the court.

8. And be it enacted, That there shall be a cashier of said bank appointed annually, liable however to be removed and another appointed in his stead, at the pleasure of said board of directors, such appointment or removal only to be made by a majority of the directors; and every cashier, upon such appointment, and before he enters upon the duties of his office, shall be required to give bond, with good and sufficient security to be approved by the board of directors, in a sum not less than twenty thousand dollars, with condition for the faithful performance of his duties as cashier of said bank.

Cashier to

give bond.

9. And be it enacted, That it shall be the duty of the Dividends. board of directors of the said corporation to make semiannual dividends of so much of the profits of the business of said corporation as the board shall deem advisable, but no dividend shall be made of any part of the capital stock.

count.

10. And be it enacted, That the rate of discount at which Rates of disloans may be made by said corporation shall not exceed the legal rate of interest in this state for the time being; pro-Proviso. vided, that nothing herein contained shall be construed to prohibit the said corporation from dealing in bills of exchange, and the purchase and sale thereof.

void

11. And be it enacted, That if at any time the said corpo-Chorter root ration shall neglect or refuse, on demand being made at their redeemed. banking house during the regular hours of business, to redeem in lawful money any of the bills or notes issued by said corporation, and which may then be due and payable, the said corporation shall thereupon, under the pain of forfeiting its charter, wholly discontinue and cease from banking operations, and shall until such bills or notes shall be fully paid, be deemed and considered insolvent.

Assets liable for redemp

12. And be it enacted, That if the said corporation shall at any time hereafter become insolvent, the whole assets of tion of notes. the said corporation, at the time of its becoming insolvent, shall be first liable for its bills and notes then in circulation, and shall be first applied to the payment thereof; and in case of a distribution of the assets of said corporation among the creditors thereof, under the order or decree of the court

Liability of directors.

Proviso.

Amount of

assets to be distributed pro rata.

Liability of stockholders.

of chancery, or other court, the holders of such bills or notes shall be equal in priority, and shall have a preference over all the other creditors.

13. And be it enacted, That all the directors of said corporation shall be residents of this state, and shall be jointly and severally liable for the payment of all the bills of said corporation which may be in circulation at the time of its becoming insolvent, and may be jointly or severally prosecuted at law or in equity by any receiver or receivers that shall or may be appointed, for the payment of any such bills or notes as if the same were their joint and several bills or notes, executed by them in their individual capacity; and it shall not be lawful for any director of said corporation to resign his office to avoid such liability; and if any director shall so attempt to resign his office he shall be and continue liable the same as if no such resignation had been attempted; and such liability of directors shall continue after they cease to be directors, either by resignation or otherwise, if said corporation was insolvent when they ceased to be directors; and it shall not be lawful for any director to assign or transfer his stock or other property to avoid such liability; and if in the case of payment of any such bills or notes by any of said directors, the other directors who may be liable thereon shall account to them in the same way as other joint debtors are accountable to each other; provided, that no property that shall or may be levied upon or taken in execution under or by virtue of any judgment or decree in favor of any receiver under the provisions of this act, shall be sold until after the expiration of four months from the date of said judgment or decree.

14. And be it enacted, That if the assets of said corporation and the property of said directors shall prove insufficient to redeem the whole of said bills and notes, then the amount that shall or may be realized from said assets and property shall be distributed ratably among the holders of the said bills and notes.

15. And be it enacted, That the stockholders of said cor

poration at the time of its becoming insolvent, other than said directors, shall be jointly and severally liable to any receiver or receivers that shall or may be appointed as aforesaid, to any amount sufficient to redeem the said bills or notes after the assets of said corporation and the property of said directors shall have been distributed as aforesaid; provided, Proviso. that no stockholder other than said directors shall be made liable to an amount exceeding the par value of the stock held by him at the time said corporation may become insolvent; and if that amount shall not be required for the full redemption of said bills and notes, then the said stockholders shall be liable in the ratio of the said stock so held by them; and it shall not be lawful for any such stockholder to assign or otherwise transfer his stock or other property to avoid such liability.

against direc

holders.

16. And be it enacted, That in case of an action or suit at Actions law against any director or directors, stockholder or stock-tors or stockholders, under any of the preceding sections of this act, the receiver or receivers may declare generally for money had and received; provided, that a schedule shall be annexed to Proviso. the said declaration, setting forth that the said action or suit is under and by virtue of the provisions of this act, specifying the aggregate amount claimed, the names of the president and cashier subscribed to the bills or notes declared on, and the number and denominations thereof.

statements to

17. And be it enacted, That it shall be the duty of said Quarterly corporation, on the first Mondays in the months of January, be made. April, July and October in every year, to make the statements required to be made by the other banks of this state, by the act entitled "A supplement to an act entitled 'An act to punish frauds committed on the incorporated banks of this state, and for the better regulation of said banks,' approved April sixteenth, eighteen hundred and forty-six."

18. And be it enacted, That three-fourths of the stock-Limitation. holders in value of said corporation shall be residents of this state, and that this act shall continue in force for twenty years, but it shall be lawful for the legislature at any time