The Coconino sun., 1919-11-21

common stock, nor shall there be any purchase or retirement by the corporation of any common stock of any class, either as provided in paragraph numbered (2) of Arti- cle VIII or otherwise, unless the net quick assets after payment of such dividends or after any pur- chase or retirement of common stock are One Hundred Fifty per cent (150%) of the par amount of such outstanding preferred stock nor unless the total quick assets at the end of the preceding fiscal year are One Hundred Sev- enty-five per cent (175%6) of the total liabilities, nor unless the net earnings for said preceding fiscal year, after deducting the amount paid for federal and state taxes due in said year, are equal to three times the annual dividend requirements on the preferred stock outstanding at the time of the declaration of such common stock dividend or at the time of any purchase or retirement of common stock, nor if the sinking fund provided for in paragraph numbered (9) of this Article is in arrears. Quick assets as used in this paragraph shall consist of cash on hand and in bank, bills, notes and accounts receivable, in- ventories and marketable securi- ties, other than securities of this corporation. Liabilities shall con- sist of indebtedness for borrowed money, bills, notes and accounts payable and taxes accrued. Net quick assets shall consist of the excess of quick assets over liabili- ties as above defined.
 "(S) The preferred stock shall have no voting power except as in this paragraph provided. In the event ot two (z) consecutive defaults in the payment of quar- terly dividends on the preferred stock, the preferred stockholders shall have the privilege of elect ing one member of the Board of Directors at the next succeeding annual election; and, in the event of four (4) consecutive defaults in the payment of quarterly divi- dends on the preferred stock, the preferred stockholders shall nave the privilege of electing majori- ty of the Board of Directors at the next succeeding annual cleo tion. Any such privilege shall be retained, when once acquired, un- til all accumulated dividends are paid. The holders of the prefer red stock shall be entitled to vote upon the question of selling, con- veying, transferring or otherwise disposing of the property and es- tate of the corporation as an en- tirety. The corporation shall not be merged or consolidated with any other corporation without the vote or consent of the holders of at least majority in amount of the outstanding preferred stock. No notes or funded debt maturing later than one year from the date of issue shall be created by the corporation without the vote or consent of the holders of sixty six and two-thirds per cent (66 2-3%) in amount of the out standing preferred stock; provid- ed, however, that nothing herein shall be construed to preclude the purchase of properties subject to existing liens or the creation of purchase money mortgages or purchase money liens on proper ties hereafter acquired. The cor poration shall not create any shares of stock having priority over or parity with the preferred stock, either as to dividends or assets, nor guarantee obligations, stocks or dividends of any sub sidiary or other corporation, with out the consent or vote of the holders of seventy-five per cent (75%o) in amount of the outstand- ing preferred stock; nor shall these Articles of Incorporation be amended so as to change the spe- cific terms of the preferred stock hereby created without the unani nous vote or consent of the hold CTS of the outstanding preferred stock.
 "(9) The corporation shall an- nually, beginning with the fiscal year following any issue of pre- ferred stock, set aside as a sink ing fund for the retirement and cancellation of the preferred stock, out of the surplus profits arising from the business of the corporation and remaining after the payment of dividends on the preferred stock, sum sufficient to retire in one of the methods hereinafter provided an amount of preferred stock equal to five per cent (5@o) of the largest amount of preferred stock at any time outstanding during the year, provided that in no event shall the sum so set aside fall below such sum as may be necessary to re- tire preferred stock of the par value of One Hundred Fifty Thousand Dollars (S150,000). If the sum set aside in any year shall exceed the annual amount hereby required the excess may be deducted from the sum to be set aside in a succeeding year. All moneys so set aside as sink ing fund shall be applied as fol- lows:
 "(a) At the option of the cor poration to purchase during the