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[Utah Code Table of Contents]
[TITLE 16. Table of Contents]
16-13-1 Organization of development corporations under Utah Revised Business Corporation Act - Corporate name.
Corporations to conduct a development business as specified
in this act may be formed under the provisions of Title 16,
Chapter 10a, Utah Revised Business Corporation Act, and all
the rights, privileges, and powers and all the duties and
obligations of such corporations and of the officers and
stockholders thereof shall be as provided in Title 16, Chapter
10a, Utah Revised Business Corporation Act, except as otherwise
provided in this act. The name of any corporation organized
in accordance with the provisions of this act shall include
the words "business development corporation."
1992
16-13-2 Definitions.
As used in this act:
(1) The words "financial institution" mean any corporation engaged in a banking business, loan and trust company, or corporation, partnership, foundation, or other institution engaged primarily in lending or investing funds.
(2) The word "lender" means any person, partnership, association, corporation including any financial institution and any corporation, agency or instrumentality organized or authorized by an act of Congress which lends money to a corporation organized in accordance with this act upon its call and in accordance with the provisions of this chapter.
(3) The words "loan limit" mean for any lender the total of the maximum amount prescribed to be outstanding at one time on loans made by such lender to a corporation organized under this act and the amount of the investment in the capital stock of such corporation then held by such lender, as determined under the provisions of this act, and the amount of the investment in the capital stock of such corporation then held by such lender, as determined under the provisions of this act.
(4) The words "development corporation" means a corporation
organized in accordance with the provisions of this act.
1979
16-13-3 Purposes of development corporation.
The purposes of a development corporation shall include the following:
The purposes of a development corporation shall be to
assist, promote, encourage and, through the cooperative efforts
of the institutions and corporations which, from time to
time, shall become lenders thereto, to develop and advance
the business prosperity and economic welfare of the state
and its citizens; to encourage and assist in the location
of new business and industry in the state and to rehabilitate
existing business and industry; to stimulate and assist in
the expansion of all kinds of business activity which will
tend to promote the business development and maintain the
economic stability of the state, provide maximum opportunities
for employment, encourage thrift and improve the standard
of living of the citizens of the state; to cooperate and
act in conjunction with other organizations, public or private,
the objects of which are the promotion and advancement of
industrial, commercial, agricultural and recreational developments
in the state; to furnish either equity capital, debt capital,
or both, to approved and deserving applicants for the promotion,
development and conduct of all kinds of business activity
in the state, thereby establishing a source of capital and
credit not otherwise readily available for such purposes.
1979
16-13-4 General powers of business development corporation.
In furtherance of the purposes of a development corporation, and in addition to the powers conferred on corporations by Title 16, Chapter 10a, Utah Revised Business Corporation Act, such corporation, subject to the restrictions and limitations contained in this act, shall have the following powers:
(a) To borrow money from lenders, and otherwise incur indebtedness for any of its purposes; to issue its bonds, debentures, notes, or other evidences of indebtedness whether secured or unsecured therefor; and to secure the same by mortgage, pledge, deed of trust, or other lien on its property, franchises, rights and privileges of every kind and nature or any part thereof.
(b) To lend money to, and to guarantee, indorse, or act as surety on the bonds, notes, contracts, or other obligations of, or otherwise assist financially, any person, firm, corporation, or association, and to establish and regulate the terms and conditions with respect to any such loans or financial assistance and the charges for interest and service connected therewith; provided, however, that the corporation shall not approve any application for a loan unless and until the applicant shall have shown that the applicant has applied for the loan through ordinary financial channels and that the loan has been refused by at least one financial institution doing business in this state and, in the ordinary course of its business, granting loans similar in amount and kind to the requested loan.
(c) To purchase, receive, hold, lease, or otherwise acquire, and to sell, convey, mortgage, lease, pledge, or otherwise dispose of, upon such terms and conditions as its board of directors may deem advisable, real and personal property, together with such rights and privileges as may be incidental and appurtenant thereto and the use thereof, including, but not restricted to, any real or personal property acquired by such corporation from time to time in the satisfaction of debts or enforcement of obligations.
(d) To acquire the good will, business, rights, real and personal property, and other assets, or any part thereof, of such persons, firms, corporations, joint stock companies, associations, or trusts as may be in furtherance of the corporate purposes provided herein, and to assume, undertake, guarantee, or pay the obligations, debts, and liabilities of any such person, firm, corporation, joint stock company, association, or trust; to acquire improved or unimproved real estate for the purpose of constructing industrial plants or other business establishments thereon or for the purpose of disposing of such real estate to others for the construction of industrial plants or other business establishments, and, in furtherance of the corporate purposes, to acquire, construct, or reconstruct, alter, repair, maintain, operate, sell, lease, or otherwise dispose of industrial plants or business establishments.
(e) To acquire, subscribe for, own, hold, sell, assign, transfer, mortgage, pledge, or otherwise dispose of the stock, shares, bonds, debentures, notes, or other securities and evidences of interest in, or indebtedness of, any person, firm, corporation, joint stock company, association, or trust, and while the owner or holder thereof, to exercise all the rights, powers, and privileges of ownership, including the right to vote thereon, but nothing herein provided shall authorize the holding of securities of or otherwise engaging directly or indirectly in a business where such holding of securities or engaging in business is not authorized for corporations by general law.
(f) To cooperate with and avail itself of the facilities
of state departments and other government agencies; and to
cooperate with and assist, and otherwise encourage, local
organizations in the various communities in the state in
the promotion, assistance, and development of the business
prosperity and economic welfare of such communities and of
the state.
1992
16-13-5 Bonds or securities, capital stock of development corporations - Authority to purchase, hold or dispose of - Rights of holders - Rights of financial institutions.
(1) All persons, firms, partnerships, associations, trusts and domestic and foreign corporations organized or authorized to do business in this state, including, without implied limitation, all financial institutions, public utility corporations and insurance corporations, are hereby authorized to acquire, purchase, hold, sell, assign, transfer, mortgage, pledge, or otherwise dispose of any bonds, securities or other evidences of indebtedness created by a development corporation, and to exercise all the rights, powers and privileges of ownership thereof, all without the approval of any regulatory authority of the state.
(2) All persons, firms, partnerships, associations, trusts, domestic and foreign corporations organized or authorized to do business in this state, including without implied limitation all public utility corporations and insurance corporations, other than financial institutions, are hereby authorized to acquire, purchase, hold, sell, assign, transfer, mortgage, pledge, or otherwise dispose of any of the shares of the capital stock of a development corporation, and while owners of said stock to exercise all the rights, powers and privileges of ownership, including the right to vote thereon, all without the approval of any regulatory authority of the state.
(3) All financial institutions are hereby authorized to become lenders to development corporations and to make loans to the corporations as provided herein, without the approval of any regulatory authority of the state.
(4) A financial institution is authorized to acquire,
purchase, hold, sell, assign, transfer, mortgage, pledge,
or otherwise dispose of, any bonds, securities or other evidences
of indebtedness created by the corporation in accordance
with its provisions for the call of loans, and any of the
shares of the capital stock of the corporation, and while
owners thereof, to exercise all the rights, powers and privileges
of ownership, including the right to vote, all without approval
of any regulatory authority of the state; provided, that
the amount of the capital stock of the corporation which
may be acquired by any lender pursuant to the authority granted
herein shall not exceed ten per cent of the loan limit of
such lender. The amount of capital stock of the corporation
which any lender is authorized to acquire pursuant to the
authority granted herein is in addition to the amount of
capital stock in corporations which such lender may otherwise
be authorized to acquire.
1979
16-13-8 Board of directors - Number and election of members.
The board of directors of a development corporation shall be of such number in multiples of three, but not less than six, as shall be determined in the first instance by the articles of incorporation and thereafter annually by the stockholders of the corporation. The names and addresses of the members of the first board of directors shall be stated in the articles of incorporation. Said persons shall hold office until the first annual meeting of the corporation and until their successors have been elected and qualified. At the first annual meeting of a development corporation and at each annual meeting thereafter, or, if no annual meeting shall be held in any year at the time fixed by the bylaws, at a special meeting held in lieu thereof, the shareholders shall elect the directors. The directors shall hold office until the next annual meeting, after their elections, and until their successors are elected and qualified unless sooner removed.
Any vacancy in the office of a director shall be filled
by the remaining directors.
1979
16-13-9 Requirement before commencing business - Cash consideration for shares - Minimum stated capital.
A development corporation incorporated after July 1, 1979,
shall not transact any business or incur any indebtedness,
except as is incidental to its organization or to obtain
subscriptions to or payment for its shares, until there has
been paid in for the issuance of shares consideration in
cash of at least $300,000. A development corporation shall
have a stated capital of not less than $300,000.
1979
16-13-10 Amount of net earnings set apart as earned surplus.
Each year a development corporation shall set apart as
earned surplus not less than ten per cent of its net earnings
for its preceding fiscal year until such surplus is equal
in value to one-half of the amount paid in on the shares
of the corporation then outstanding. Whenever the amount
of surplus so established shall become impaired, it shall
be restored to the required amount in the manner hereinbefore
provided. Net earnings and surplus shall be determined by
the board of directors, after providing for such reserves
as said directors deem desirable, and the directors' determination
made in good faith shall be conclusive on all persons.
1965
16-13-11 Designation of depository.
A development corporation shall not deposit any of its
funds in any banking institution unless such institution
has been designated as a depository by a vote of a majority
of the directors present at an authorized meeting of the
board of directors, exclusive of any director who is an officer
or director of the depository so designated. A development
corporation shall not receive money on deposit.
1965
16-13-12 Licensing, supervision, and examination by commissioner of financial institutions - Fees.
A development corporation shall be licensed, supervised,
and examined by the commissioner of financial institutions
and shall make such report of its condition from time to
time as the commissioner shall require. A development corporation
shall pay a fee determined by the commissioner pursuant to
Section
63-38-3.2
for a license and for each examination.
1994
