Illinois § 39

§ 39.

Limitation upon issuance of stock and mortgages. (1) A Neighborhood Redevelopment Corporation may issue shares and certificates of shares, both common and preferred, and Mortgages, both senior and junior, in an amount, all securities in all, not to exceed the Development Cost of the Neighborhood Redevelopment Corporation, determined as provided by Section 37 of this Act. For the purpose of the enforcement of this provision, prior to the issuance of securities the Neighborhood Redevelopment Corporation shall make application to the Redevelopment Commission for an order approving the issuance and stating the amount thereof and the purpose or purposes to which the securities or the proceeds thereof are to be applied; Provided, that the securities shall be issued for the following purposes and for no others, namely: For the defrayment of Development Cost, or for the discharge or refunding of securities originally issued to defray such Development Cost. Upon the approval of the application, the Neighborhood Redevelopment Corporation may proceed to issue the securities described in the application in the amount and for the purpose or purposes so approved; provided, that the prior approval of the Redevelopment Commission shall not be requisite to the issuance of the common shares of Neighborhood Redevelopment Corporation issued upon pre-incorporation subscription as provided in paragraph 9 of Section 7 of this Act; provided, further, that nothing herein contained shall be taken as exempting such securities from the provisions of the Illinois Securities Law, unless by the terms of that law the securities shall be so exempt. (2) The provisions of paragraph 1 of this Section shall apply, as far as pertinent, to any change in the capital structure of a Neighborhood Redevelopment Corporation, whether effected by increase or decrease of capital stock, by amendment to the articles of incorporation, or otherwise. (3) No Neighborhood Redevelopment Corporation shall apply the securities, or any part thereof, or any of the proceeds thereof, to any purpose not specified in the order of the Redevelopment Commission or to any purpose specified in the order of the Redevelopment Commission in excess of the amount authorized for that purpose. No Neighborhood Redevelopment Corporation shall issue or dispose of the securities on any terms less favorable than those specified in the order of the Redevelopment Commission. The Redevelopment Commission shall have the power to require Neighborhood Redevelopment Corporations to account for the disposition of the proceeds of the securities in such form and detail as it may find to be advisable, and to establish such administrative rules and regulations as it may find to be reasonable and necessary to insure the disposition of those proceeds for the purpose or purposes specified in the Act. (4) The fact that the Redevelopment Commission has approved the issuance of the securities shall not be held to mean that the Redevelopment Commission has in any way endorsed their merits, and it shall be unlawful for any person or corporation so to represent. (Source: Laws 1941, vol. 1, p. 431.)