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[Utah Code Table of Contents]
[TITLE 16. Table of Contents]
16-4-4 Assessments - Provision by statute or in articles of incorporation necessary.
The stock of any corporation organized after March 8,
1894 and prior to January 1, 1962 under the laws of this
state shall not be assessable for any purpose whatever, except
to such extent and in such manner as may be expressly provided
by statute or in the articles of incorporation; provided,
that, if such stock is made assessable and the manner of
levying the assessment is not provided for, it shall be levied
in the manner and form hereinafter prescribed. The stock
of any corporation for profit organized under the laws of
this state after December 31, 1961, shall not be assessable
for any purpose except as expressly provided by statute and
except that water companies, water users associations, irrigation
companies, canal companies, ditch companies, reservoir companies
and other corporations of like character and purpose whose
articles of incorporation provide for the assessment of shares
may levy assessments at the times and in the amounts as may
be prescribed by its articles of incorporation, or, if not
so prescribed, then as provided in this chapter.
1961
16-4-5 Procedure applicable in absence of provision in articles or bylaws.
Unless otherwise provided in the articles of incorporation
or bylaws, assessments when authorized shall be levied and
collected in the manner provided in this chapter.
1961
16-4-6 Limit on right to levy assessments.
No assessment shall be levied while a portion of a previous one remains unpaid, unless:
(1) The power of the corporation has been exercised in accordance with the provisions of this chapter for the purpose of collecting such previous assessment; or,
(2) The collection of such previous assessment has been
enjoined or restrained.
1961
16-4-7 Equal assessments required.
In the case of full-paid stock, all stock subject to assessment
must be assessed equally.
1961
16-4-8 Order levying assessment - Contents.
Every order levying an assessment must specify the amount
thereof on each share, when, to whom and where payable, fix
a day subsequent to the full term of the notice of assessment
on which the unpaid assessment shall be delinquent, not less
than thirty nor more than sixty days from the time of making
the order levying, and a day for the sale of delinquent stock,
not less than fifteen nor more than sixty days from the day
the stock is declared delinquent.
1961
16-4-9 Notice of order of assessment - Form and contents.
Upon making the order the secretary shall cause to be issued a notice thereof in the following form:
(Name of corporation in full; location of principal place
of business). Notice is hereby given that at a meeting of
the board of directors held on the (date) an assessment of
(amount) per share was levied on the stock (here insert the
description of the class or classes of stock assessed) of
the corporation, payable (when, to whom and where). Any stock
upon which this assessment may remain unpaid on the (day
fixed) will be delinquent and advertised for sale at public
auction, and unless payment is made before will be sold on
the (day appointed) to pay the delinquent assessment, together
with the cost of advertising and expense of sale. (Signature
of secretary, with location of office).
1961
16-4-10 Service and publication of notice of order.
The notice must be served personally on each stockholder,
or in lieu of personal service must be sent through the mail
addressed to each stockholder at his place of residence,
if known, or if not known, at the place where the principal
place of business of the corporation is situated, and must
be published once a week for four successive weeks in some
newspaper of general circulation in the place designated
in the articles of incorporation as the principal place of
business; provided, that corporations formed for irrigation
purposes may omit publication of the notice, but in other
respects must comply with the provisions of this chapter
relating to assessments.
1961
16-4-12 Notice of delinquency - Form.
If any portion of the assessment mentioned in the notice remains unpaid on the day specified therein when the stock shall be delinquent, the secretary shall, unless otherwise ordered by the board of directors, cause to be published in the same newspapers in which the notice hereinbefore provided for shall have been published a notice in the following form:
(Name of corporation in full; location of principal place
of business). Notice. There are delinquent upon the following
described stock, on account of assessment levied on __________(month/day/year),
(and assessment levied previously thereto, if any) the several
amounts set opposite the names of the respective shareholders
as follows: (Names, number of certificate, number of shares,
and amount) and in accordance with law (and an order of the
board of directors made on __________(month/day/year), if
any such order shall have been made) so many shares of each
parcel of the stock as may be necessary will be sold at the
(particular place) on __________(month/day/year), at the
hour of ____, to pay the delinquent assessments thereon,
together with the cost of advertising and expenses of the
sale. (Name of secretary, with location of office).
2001
16-4-13 Delinquency notice - Contents.
The notice must specify every certificate of stock, the
number of shares it represents and the amount due thereon,
except where certificates may not have been issued, in which
case the number of shares and amount due thereon, together
with the fact that certificates for such shares have not
been issued, must be stated.
1953
16-4-14 Publication of notice of delinquency.
The notice when published in a daily newspaper must be
published for ten days previous to the day of sale; when
published in a weekly or semiweekly paper it must be published
in each issue thereof for two weeks previous to the day of
sale. The first publication of all delinquent sales must
be at least fifteen days prior to the day of sale.
1953
16-4-15 Jurisdiction acquired by publication.
By the publication of the notice the corporation acquires
jurisdiction to sell and convey a perfect title to all of
the stock described in the notice of sale upon which any
portion of the assessment or expenses of advertising remains
unpaid at the hour appointed for the sale, subject however
to assessments subsequently levied, but the corporation must
sell no more of such stock than is necessary to pay the assessments
due and expenses of advertising and sale.
1961
16-4-16 Amount of stock to be sold.
On the day, at the place and at the time appointed in
the notice of sale the secretary shall, unless otherwise
ordered by the board of directors, sell or cause to be sold
at public auction to the highest bidder for cash so many
shares of each parcel of the described stock as may be necessary
to pay the assessment and charges thereon according to the
terms of sale; if payment is made before the time fixed for
sale, the party paying shall only be required to pay the
actual expenses of advertising in addition to the assessment.
1961
16-4-17 "Highest bidder" defined.
The person offering at such sale to pay the assessment
and expenses for the smallest number of shares or fraction
of a share is the highest bidder, and the stock purchased
must be transferred to him on the stock books of the corporation
on payment of the assessment and expenses.
1961
16-4-18 Purchase by corporation.
If at the sale of stock no bidder offers the amount of
the assessment and expenses due, the same may be bid in and
purchased by the corporation through the secretary, president
or any director thereof at the amount of the assessment and
expenses due, and the amount of the assessment and expenses
shall be credited as paid in full on the books of the corporation,
and entry of the transfer of the stock to the corporation
shall be made on the books thereof. While the stock remains
the property of the corporation it is not assessable, nor
shall any dividends be declared thereon, but all assessments
and dividends shall be apportioned upon the stock held by
the stockholders of the corporation.
1961
16-4-19 Status of stock purchased by corporation.
All purchases of its own stock by the corporation for
delinquent assessments vest the legal title to the same in
the corporation, and the stock so purchased shall be treated
as treasury stock and shall be held and disposed of in such
manner as may be expressly provided in Title 16, Chapter
10a, Utah Revised Business Corporation Act.
1992
16-4-20 Extension of time specified in notices.
The dates fixed in any notice of assessment or notice
of delinquent sale published according to the provisions
hereof may be extended from time to time by order of the
board of directors entered on the records of the corporation
for any period or periods aggregating not more than six months,
but no order extending the time for the performance of any
act specified in any notice shall be effective unless notice
of such extension or postponement is appended to and published
with the notice to which the order relates.
1961
16-4-21 Errors or omissions in proceedings - Effect.
No assessment is invalidated by a failure to make publication
of the notices herein provided for, nor by the nonperformance
of any act required in order to enforce payment of the same,
but in case of any substantial error or omission in the course
of proceedings for collection all previous proceedings, except
the levying of the assessment are void, and publication must
be begun anew.
1961
16-4-22 Actions to recover stock sold - Tender - Limitation of action.
No action shall be sustained to recover stock sold for
delinquent assessment upon the ground of irregularity or
defect of the notice of the sale or defect or irregularity
in the sale, unless the person seeking to maintain such action
first pays or tenders to the corporation or to the person
holding the stock sold the sum for which the same was sold,
together with all subsequent assessments which may have been
paid thereon, or in the case of stock sold to the corporation,
all subsequent assessments levied upon the outstanding stock
of the corporation, and interest on such sums from the time
they were paid or payable; and no such action shall be sustained
unless the same is commenced by the filing of a complaint
within six months after such sale was made.
1961
16-4-23 Affidavit of posting notice - Who may make - Evidence.
Affidavits made by the secretary of the mailing of notices
shall be prima-facie evidence thereof. The publication of
notices relating to assessments may be proved by the affidavit
of the printer foreman or principal clerk of the newspaper
in which the same were published; and the affidavit of the
secretary or auctioneer shall be prima-facie evidence of
the time and place of sale, of the quantity and particular
description of the stock sold, and to whom and for what price,
and of the fact of the purchase money being paid. The affidavits
shall be filed in the office of the corporation and copies
of the same certified by the secretary thereof shall be prima-facie
evidence of the facts therein stated.
1961
16-4-24 Irrigation companies - Assessments - Other than pro rata basis.
Any irrigation company, canal company, ditch company, reservoir company or water users' association hereafter organized under the laws of this state shall have the power to make assessments against its shares of stock on other than a pro rata basis for the purpose of raising funds to accomplish the purpose or purposes for which organized or to pay its debts or obligations when the articles of incorporation so permit.
The provisions of this section shall also apply to any
irrigation company, canal company, ditch company, reservoir
company or water users' association heretofore organized
the articles of incorporation of which now expressly so permit
assessments to be made on other than a pro rata basis or
to any irrigation company, canal company, ditch company,
reservoir company, or water users' association heretofore
or hereafter organized when required to make assessments
on other than a pro rata basis under existing or future contract
or contracts between the United States and any such company
or water users' association or between the United States
and stockholders of any such company or water users' association
or between any such company or water users' association and
its stockholders or when required by any contract of subscription
for shares of stock to any such company or water users' association
so contracting with the United States or under present or
future laws or regulations of the United States.
1953
