Section 89-H. Transfer of franchises or stocks  


Latest version.
  • 1.  No  water-works
      corporation shall transfer or lease its franchise, works  or  system  or
      any  part  of  such  franchise,  works  or system to any other person or
      corporation or contract for the  operation  of  its  works  and  system,
      without the written consent of the commission.
        2.  The  permission  and approval of the commission to the assignment,
      transfer or lease of  a  franchise  under  this  section  shall  not  be
      construed  to  revive  or validate any lapsed or invalid franchise or to
      enlarge or add to the powers and privileges contained in  the  grant  of
      any franchise or to waive any forfeiture.
        3. No water-works corporation shall directly or indirectly acquire the
      stock or bonds of any other corporation incorporated for, or engaged in,
      the  same  or  a  similar business, or proposing to operate or operating
      under a franchise from  the  same  or  any  other  municipality,  unless
      authorized so to do by the commission.
        4.  Save  where  stock shall be transferred or held for the purpose of
      collateral security only with the consent of the commission empowered by
      this  chapter  to  give  such  consent,  no  stock  corporation  of  any
      description,  domestic  or  foreign, company, including, but not limited
      to, a limited liability company, association, including  a  joint  stock
      association,  partnership, including a limited liability partnership, or
      person, other than a water-works corporation, shall purchase or acquire,
      take or hold, more than ten per  centum  of  the  voting  capital  stock
      issued  by any water-works corporation organized or existing under or by
      virtue of the laws of this state, except that a corporation now lawfully
      holding a majority of  the  voting  capital  stock  of  any  water-works
      corporation  may with the consent of the commission acquire and hold the
      remainder of the voting capital stock of such water-works corporation or
      any portion thereof. Provided, that with the consent of such  commission
      and upon and subject to such terms and conditions as such commission may
      fix  and  impose,  any  such  stock  corporation,  company, association,
      partnership or person may acquire, take  and  hold  more  than  ten  per
      centum  of  the  voting  capital  stock  of any water-works corporation,
      organized or existing under or by virtue of the laws of this state.
        5. No consent shall be given by the commission to the  acquisition  of
      any  stock  in  accordance  with  this section unless it shall have been
      shown that such acquisition is in the public interest. Nothing contained
      in this section shall be construed to prevent the holding of  any  stock
      heretofore  lawfully  acquired,  nor  to  prevent, upon the surrender or
      exchange of such stock pursuant to a reorganization plan, the  purchase,
      acquisition, taking or holding of a proportionate amount of stock of any
      new  corporation  organized  to take over, at foreclosure or other sale,
      the property of any corporation whose stock has been thus surrendered or
      exchanged; but the proportion of the voting capital  stock  of  the  new
      corporation   held   by   a  stock  corporation,  company,  association,
      partnership or person and acquired  by  it  by  any  such  surrender  or
      exchange of stock shall not without the consent of the commission exceed
      the  proportion  of  the  voting  capital stock held by it in the former
      corporation.
        6. Every contract, assignment, transfer or agreement for  transfer  of
      any  stock  by  or through any person or corporation to any corporation,
      company,  association,  partnership  or  person,  in  violation  of  any
      provision  of  this  chapter shall be void and of no effect, and no such
      transfer or assignment  shall  be  made  upon  the  books  of  any  such
      water-works  corporation,  or  shall  be recognized as effective for any
      purpose.