When disapproved.

Failure to make report.

Dividends, how paid.

Appraisal, when may cause to be made.

Accounts charged off.

state treasurer, then the same shall be approved and notice of approval given such company. If such report is not approved, the state treasurer shall advise said company of that fact and his reasons for disapproval, upon which said company shall have sixty days in which to restore its affairs to a safe and sound condition or to discontinue its illegal practices and comply with the order made by the state treasurer. If such company shall not comply with the order of the state treasurer so made, proceedings shall be taken by the state treasurer, as hereinafter provided. Any company failing to make and file with the state treasurer any of the reports required by this act shall be subject to a penalty of one hundred dollars per day for each day after the time mentioned for making such reports, which may be collected by the state treasurer in an action brought in his name in any court having jurisdiction and all moneys so collected shall be paid into the general fund of the state treasury.

SEC. 6. Dividends shall be paid only from the actual earnings, profits or surplus of any finance company, and in computing earnings, profits and surplus, no discounts shall be considered unless the same are actually earned; nor shall there be considered as earnings, profits or surplus, any sum equal to the difference between the cost price and the selling price of shares of stock of said company purchased and held by said company; nor shall there be considered as earnings, profits or surplus, any sum equal to the difference between the cost of any property real or personal owned by said company and the amount at which it is carried on its books if at an increase over its cost, except when approved by the state treasurer. No dividends shall be authorized or paid until a reserve fund shall be created by the board of directors to cover all expenses of organization and a reasonable amount of obsolescence which shall be amortized over a period of not more than ten years and a proper proportion thereof deducted from earnings, profits and surplus annually.

SEC. 7. If at any time the state treasurer shall consider that any property owned by any finance company is carried on the books of said company at a sum in excess of the true cash value thereof, he may cause an appraisal of such property to be made and the value so found shall, upon the order of the state treasurer, be set as the sum at which said property shall be carried on the books of the company for the purposes of this act. For the purpose of making such appraisals the state treasurer may employ professional appraisers, real estate boards, bank appraisal committees, or any other persons capable of making true and fair appraisals. All necessary expense occasioned thereby shall be paid by the company or companies whose property is appraised.

SEC. 8. If at any time the state treasurer shall determine that any account or debt due any finance company is worthless or uncollectible, he may order the same charged off and such sums so ordered charged off shall not thereafter be

carried as an asset upon the books of said company, except by the consent of the state treasurer.

stock

SEC. 9. Every finance company authorized to do business Report to under this act shall issue to each of its stockholders of record holders. on June thirtieth and December thirty-first, a report of its affairs and conditions as of said dates on a form to be prescribed by the state treasurer, and within ten days after the semi-annual reports for said dates have been approved. No person shall cause to be printed or published in any way any statement with regard to the assets, liabilities, earnings or losses of any finance company which are false or calculated to deceive.

not to buy,

erty.

SEC. 10. No officer or director of any finance company Officers, etc., shall sell to or buy from said company any property, real or etc., compersonal of any nature whatsoever, or any interest therein, pany propnor shall any officer or director sell to or buy from any subsidiary finance company or holding company of the finance company of which any such person is an officer or director, except by the consent of the state treasurer, nor shall any such officer or director borrow money from or enter into any contract creating a fixed or contingent liability to said company as a principal, guarantor or indemnifier, except such loan or contract be secured by ample collateral and the same authorized by the board of directors.

deemed

SEC. 11. Whenever it shall appear to the state treasurer When upon examination or from the reports of any finance com- unsound. pany that such company is in an unsound or unsafe financial condition to transact the business for which it is authorized, so that it is unsafe and inexpedient to continue same, or that its officers or agents refuse to submit to examination or perform any legal obligation under this act, the state treasurer Notice shall cause a notice to be served on the president or secretary given. of such company showing such facts, and that a failure to do or perform anything required by law or by the order of the state treasurer under this act as set forth in said notice within a period of thirty days from the service of such notice, will result in a revocation of the certificate of authority theretofore granted. If at the end of said thirty day period May revoke said company shall not have complied with the notice so given, the state treasurer may immediately cancel and revoke the certificate of authority, and no business shall thereafter be done by it while such disability continues nor until its certificate of authority is restored by the state treasurer, except as hereinafter provided. He shall forthwith notify the company of such revocation and shall specify in the notice the cause thereof: Provided, however, That if said Proviso. finance company shall within the said thirty day period request a hearing before the state treasurer upon the facts set forth in said notice, it shall be granted and no notice of revocation shall be issued by the state treasurer until after such hearing. The state treasurer may at any time, after giving the thirty day notice as aforesaid, designate a com

certificate of authority.

Application for receiver.

Bill of complaint,

etc.

petent examiner who shall have authority to take possession of the office or offices of such company, its books, records and assets of every description and hold and retain possession of the same pending further proceedings herein specified. No business of any character shall be transacted by such company while such examiner shall be in charge, except the same shall be under the supervision of such examiner and be approved by him.

SEC. 12. Upon the issuance of an order revoking the certificate of authority the state treasurer may immediately communicate to the attorney general such facts showing the condition of affairs of such company, and, with his concurrence, application may be made by the attorney general in behalf of the state treasurer for a receiver and for an injunction restraining the company, its officers and agents, from further proceeding with its business in whole or in part. Such application shall be a bill of complaint addressed to where filed, the court of chancery of the county where the office of such company is located, or in the discretion of the attorney general may be filed and prosecuted in the circuit court for Ingham county in chancery. Upon presentation of said bill of complaint verified by the oath of the state treasurer, or otherwise, and the court being satisfied that such company is in an unsound or unsafe financial condition to transact the business for which it is authorized, so that it would be unsafe or inexpedient to continue same, or that it has refused to submit to examination or perform any legal obligations under this act, the said court may immediately issue its injunction restraining the company, its officers and agents, from transacting the business of said company in whole or in part, and may immediately appoint a receiver, and shall determine his bond and prescribe his duties, and make such further order as shall seem proper.

Application for sale of

filed.

SEC. 14. Any finance company holding a certificate of stock, where authority under this act desiring to apply to the Michigan securities commission for permission to sell its stock or any bonds, securities or other evidences of indebtedness enforceable against the property of such company, shall at the time of filing its application with the Michigan securities commission file with the state treasurer a copy of said application. The state treasurer shall make such investigation of the facts set forth in said application as he deems necessary and shall report to the Michigan securities commission his findings thereon together with such other information as he may possess concerning such application and his recommendation of the approval or disapproval thereof.

When assets liquidated.

SEC. 15. The property and assets in this state of any finance company engaging or continuing in the business as defined in this act without securing the certificate of authority required by section two shall be liquidated, and the proceeds distributed and divided as provided in section thirteen. The state treasurer shall, through the attorney general, apply for

the appointment of a receiver and for an injunction setting forth the fact that such company has engaged in or is continuing in the business of a finance company as defined in this act and that it has not secured the certificate of authority required, and the court being satisfied of the allegations therein shall issue its injunction and appoint a receiver, liquidate its assets, and distribute the proceeds in the same manner as hereinbefore provided.

Approved May 7, 1927.

[No. 122.]

AN ACT to amend section five of act number two hundred forty-one of the public acts of nineteen hundred three, as amended, entitled "An act for the establishment of county normal training classes and for the maintenance and control of the same," being section five thousand nine hundred forty-seven of the compiled laws of nineteen hundred fifteen, as amended.

The People of the State of Michigan enact:

SECTION 1. Section five of act number two hundred forty- Section one of the public acts of nineteen hundred three, as amended, amended. entitled "An act for the establishment of county normal training classes and for the maintenance and control of the same," being section five thousand nine hundred forty-seven of the compiled laws of nineteen hundred fifteen, as amended, is hereby amended to read as follows:

nance of

Provide

SEC. 5. For the purpose of maintaining such normal train- Mainteing classes as are herein prescribed, it is further provided: training First, That the district receiving permission to establish classes. a county normal training class shall provide teachers, and teachers, rooms with heating and equipment satisfactory to the super. etc. intendent of public instruction, and said board shall include in the expense budget of the district such sum as may be necessary for these purposes;

state.

Second, That the auditor general annually, on or before Reimbursethe thirtieth day of June, upon the certificate of the superin ment by tendent of public instruction that the equipment and instruc tion of any county normal training class has been satisfactory, shall draw his warrant on the state treasurer in favor of the treasurer of the district board of the board of education of the district maintaining such normal training class to the amount of one thousand five hundred dollars for each teacher employed in the training school, to be paid out of the general fund: Provided, That in no case shall the total of such ap- Proviso. propriation exceed three thousand dollars in any county during any school year;

Estimate cost of instruction.

Third, In any district establishing a county normal training class, the board of education shall, previous to the first day of October in each year, estimate the cost of instruction for the current year in the county normal training class, and, deducting therefrom the amount appropriated by the foregoing provisions of this act, report the balance to the county clerk on or before the first day of October;

Fourth, At its October session, the board of supervisors shall appropriate out of the general fund of the county, onehalf of the balance due for instruction, as shown by the aforesaid report to the county clerk, which amount shall be assessed and collected at the same time and in the same manner as the other county taxes.

This act is ordered to take immediate effect.
Approved May 7, 1927.

Act repealed.

[No. 123.]

AN ACT to repeal act number two hundred ninety-nine of the public acts of nineteen hundred seven, entitled "An act authorizing the withdrawal from sale of the agricultural college lands in the counties of Iosco and Alcona, such lands to be held as a forest reserve for the benefit of the same college; and defining the permanent use thereof," approved June twenty-seventh, nineteen hundred seven.

The People of the State of Michigan enact:

SECTION 1. Act number two hundred ninety-nine of the public acts of nineteen hundred seven, entitled "An act authorizing the withdrawal from sale of the agricultural college lands in the counties of Iosco and Alcona, such lands to be held as a forest reserve for the benefit of the same college; and defining the permanent use thereof," approved June twenty-seventh, nineteen hundred seven, is hereby repealed. Approved May 7, 1927.