The Coconino sun., 1925-01-16

the preceding fiscal year, after re-
serving an amount sufficient to pay
federal and state income taxes for
such preceding fiscal year, shall at
least equal three times the annual
dividend requirements on the first
preferred stock outstanding and that
proposed to be issued, and further
that the net quick assets after pay
ment of the dividends on the out
standing first preferred stock and in
cluding the consideration to be re-
ceived for that proposed to be issued
shall equal at least one hundred fifty
per cent (1509t) Of the par amount
of the first preferred stock out
standing plus that proposed to be is
sued. While any of the first pre-
ferred stock is outstanding no divl-
dends shall be set apart, declared or
paid on any classified common stock,
class A preferred stock or unclassifled
common stock, nor shall there be any
purchase, redemption or retirement by
the corporation of any classified
common stock, class A preferred
stock or unclassified common stock,
unless the net quick assets after pay
ment of such dividends or after any
purchase, redemption or retirement
Of such stock are one hundred flfty
per cent (150ao) of the par amount
of such outstanding first preferred
stock, nor unless the total quick as
sets at the end of the preceding fiscas
wear are one hundred seventy-fiye per
cent (175Ro) of total liabilities, nor
unless net earnings for said preced-
ing fiscal year, after deducting the
amount paid for federal and state
taxes due in said year, are equal to
three times the annual dividend re-
ouirements on the first preferred
stock outstanding either at the time OF
the declaration Of such dividend on
classified common stock, class A pre-
ferred stock or unclassifled common
stock or at the time of any purchase
or retirement of such stock, nor II the
sinking fund provided for IN para
graph (4) of this Article IS IN ar
rears. Quick assets as used IN this
paragraph shall consist Of cash on
hand and in bank, bills, notes and ac-
counts receivable, inventories and
marketable securities, other than Sc
curities Of this corporation. Liabili-
ties shall consist of indebtedness for
borrowed money, bills, notes and ac-
counts payable and taxes accrued. Net
Quick assets shall consist of the excess
of quick assets over liabilities as above
defined.
(3) First preferred stock shall
have no voting power except as in
this paragraph provided In the
event of two (2) consecutive defaults
in the payment of quarterly dividends
on the first preferred stock, the first
preferred stockholders shall have the
privilege Of electing one member OF
the Board of Directors at the next
succeeding annual election; and, In
the event of four az consecutive de-
faults in the payment of quarterly
dividends on the first preferred stock,
the first preferred stockholders shall
have the privilege of electing ma
iority of the Board of Directors at
the next succeeding annual election.
Any such privilege shall be retained,
when once acquired, until all accumu-
lated dividends are paid. The holders
of the first preferred stock shall be
entitled to vote upon the question of
selling, conveying, transferring or
otherwise disposing of the property
and estate of the corporation as an
entirety The corporation shall not
be merged or consolidated with any
other corporation without the vote or
consent of the holders of at least a
majority in amount of the outstanding
first 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 outstanding
first preferred stock; provided, how
ever, that nothing herein shall be
construed to preclude the purchase of
properties subject to existing liens or
the creation of purchase money mort
cages or purchase money liens on
properties hereafter acquired. The
corporation shall not create any
shares of stock having priority over
or parity with the first preferred
stock, either as to dividends or assets,
nor guarantee obligations, stocks or
dividends of any subsidiary or other
corporation, without the consent or
vote of the holders of seventy-five per
cent $3.50 in amount of the out
standing first preferred stock; nor
shall these Articles of Incorporation
be amended so as to change the spe-
cific terms Of the first preferred stock
hereby created without the unanimous
vote or consent of the holders of the
outstanding first preferred stock.
(4) The corporation shall annual
ly, beginning with the fiscal year fol-
lowing any issue of first preferred
stock, set aside as sinking fund for
the retirement and cancellation of the
first preferred stock, out of the sur
plus profits arising from the business
of the corporation and remaining af-
ter the payment of dividends on the
first preferred stock, a sum sufficient
to retire in one of the methods here
matter provided an amount of first
preferred stock equal to five per cent
(5ao) of the largest amount of first
preferred stock at any time outstand-
ing during the year, provided that in
no event shall the sum so set aside
fall below such sum as may be neces-
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