2005 Nevada Revised Statutes - Chapter 670A — Corporations for Economic Revitalization and Diversification

CHAPTER 670A - CORPORATIONS FOR ECONOMICREVITALIZATION AND DIVERSIFICATION

NRS 670A.010 Definitions.

NRS 670A.020 Boardof directors defined.

NRS 670A.030 Corporationdefined.

NRS 670A.040 Financialinstitution defined.

NRS 670A.050 Loanlimit defined.

NRS 670A.060 Regulations.

NRS 670A.070 Formation.

NRS 670A.080 Articlesof incorporation: Contents.

NRS 670A.090 Articlesof incorporation: Approval of Commissioner prerequisite to filing withSecretary of State.

NRS 670A.100 Articlesof incorporation: Filing.

NRS 670A.110 Articlesof incorporation: Prerequisites to authorization to commence business.

NRS 670A.120 Articlesof incorporation: Amendment.

NRS 670A.130 Licenseto conduct business: Requirement; form; fee; regulations; withdrawal ofapplication.

NRS 670A.140 Firstmeeting of corporation: Notice; duties of incorporators; quorum.

NRS 670A.150 Powersof corporation.

NRS 670A.160 Corporationto be operated in manner consistent with State Plan for Economic Development.

NRS 670A.170 Generalpowers of stockholders of corporation.

NRS 670A.180 Officersand board of directors to manage corporation; number, powers, election andterms of directors; vacancies; responsibility for losses.

NRS 670A.190 Eligibilityfor membership in corporation; membership effective upon acceptance by board ofdirectors.

NRS 670A.200 Membersrequired to loan money to corporation; limits.

NRS 670A.210 Callsfor money to be prorated.

NRS 670A.220 Withdrawalfrom membership.

NRS 670A.230 Stockof corporation: Minimum required to transact business; acquisition.

NRS 670A.240 Requiredamount of earned surplus; limits on obligations; restrictions on deposits andloans.

NRS 670A.250 Licensefees; regulations.

NRS 670A.260 Examinationby Commissioner; annual reports by corporations; costs of examination; authorityof Commissioner.

NRS 670A.270 Creditof state not to be pledged.

NRS 670A.280 Taxexemptions, credits and privileges granted to corporation.

NRS 670A.290 Statusof corporation as state development company under federal legislation.

NRS 670A.300 Dissolutionof corporation.

NRS 670A.310 Failureto submit required report; fees; regulations.

NRS 670A.320 Administrativefines.

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NRS 670A.010 Definitions. As used in this chapter, unless the context otherwiserequires, the words and terms defined in NRS670A.020 to 670A.050, inclusive,have the meanings ascribed to them in those sections.

(Added to NRS by 1983, 1271)

NRS 670A.020 Boardof directors defined. Board of directorsmeans the board of directors of a corporation created under this chapter.

(Added to NRS by 1983, 1271)

NRS 670A.030 Corporationdefined. Corporation means a Nevada corporation for economic revitalization and diversification created under this chapter.

(Added to NRS by 1983, 1271)

NRS 670A.040 Financialinstitution defined. Financial institutionmeans any banking corporation, credit union or trust company, savings and loanassociation, insurance company or related corporation, partnership, foundationor other institution engaged primarily in lending or investing money.

(Added to NRS by 1983, 1272; A 1999, 1545)

NRS 670A.050 Loanlimit defined. Loan limit means the maximumamount permitted to be outstanding for any member at one time on loans by themember to a corporation as determined under the provisions of this chapter.

(Added to NRS by 1983, 1272)

NRS 670A.060 Regulations. The Commissioner shall adopt such regulations as may benecessary to carry out the purposes and provisions of this chapter.

(Added to NRS by 1983, 1272; A 1983, 1644; 1987,1949)

NRS 670A.070 Formation. Five or more persons, a majority of whom are residents ofthis state, may create a corporation for economic revitalization and diversificationby filing articles of incorporation in the office of the Secretary of State inaccordance with the provisions of this chapter.

(Added to NRS by 1983, 1272)

NRS 670A.080 Articlesof incorporation: Contents. The articles ofincorporation of the corporation must contain:

1. The name of the corporation, which must include thewords corporation for economic revitalization and diversification.

2. The location of the principal office of thecorporation, but the corporation may have other offices as the board ofdirectors deems necessary.

3. The purposes for which the corporation is founded,which must be to:

(a) Assist, promote, encourage, develop and advance theeconomic welfare and diversification of the State in accordance with the StatePlan for Economic Development;

(b) Facilitate and assist in the location of newbusiness, commerce and industry in the State, and to rehabilitate andrevitalize existing business, commerce and industry;

(c) Stimulate and assist in the expansion of businessactivity which will tend to promote business development and diversificationthat would result in the economic stability of the state;

(d) Provide new opportunities for employment;

(e) Cooperate and act in conjunction with public orprivate organizations and governmental agencies, the objectives of which arethe support and advancement of business, commercial, industrial, agriculturaland recreational activity that would advance the economic welfare of the State,promote economic diversification, and effectuate any state or local plan foreconomic development; and

(f) Furnish money and credit to approved and deservingapplicants who would assist in achieving or carrying out any of the purposesdescribed in this subsection.

4. The names and post office addresses of the membersof the first board of directors, who, unless otherwise provided by the articlesof incorporation or the bylaws, shall hold office for the first year ofexistence of the corporation or until their successors are elected and havequalified.

5. Any provision which the incorporators may choose toinsert for the regulation of the business and for the conduct of the affairs ofthe corporation and any provision creating, dividing, limiting and regulatingthe powers of the corporation, the directors, stockholders or any class of thestockholders, including, but not limited to, a list of the officers, andprovisions governing the issuance of stock certificates to replace lost ordestroyed certificates, except that no provision may be included for cumulativevoting for directors.

6. The amount of authorized stock and the number ofshares into which it is divided and, if there is more than one class of stock,a description of the different classes.

7. The names and addresses of the preorganizationsubscribers of stock and the number of shares subscribed by each.

8. Any provision consistent with the laws of thisstate for the regulation of the corporation.

9. A recitation that the corporation is organizedunder the provisions of this chapter.

(Added to NRS by 1983, 1272; A 1997, 1011)

NRS 670A.090 Articlesof incorporation: Approval of Commissioner prerequisite to filing withSecretary of State. Before the articles ofincorporation or any amendment to them are filed with the Secretary of Statethey must be approved by the Commissioner.

(Added to NRS by 1983, 1273; A 1983, 1644; 1987,1949)

NRS 670A.100 Articlesof incorporation: Filing. The articles ofincorporation of the corporation must be in writing, subscribed by or on behalfof each of the incorporators and acknowledged by each of the subscribers beforea notary public and filed in the Office of the Secretary of State for approval.A duplicate copy so subscribed and acknowledged may also be filed.

(Added to NRS by 1983, 1273)

NRS 670A.110 Articlesof incorporation: Prerequisites to authorization to commence business. When the articles of incorporation have been approved bythe Commissioner and filed in the Office of the Secretary of State and approvedby the Secretary of State, and all application, licensing and filing fees andtaxes prescribed by law have been paid, the subscribers, their successors andassigns constitute a corporation, and the corporation is then authorized tocommence business, and stock of the corporation to the extent authorized bythis chapter may from time to time be issued.

(Added to NRS by 1983, 1273; A 1983, 1644; 1987,1949)

NRS 670A.120 Articlesof incorporation: Amendment.

1. The articles of incorporation may be amended by theaffirmative vote of stockholders representing not less than two-thirds of theissued and outstanding stock entitled to vote. No amendment of the articles ofincorporation which is inconsistent with the general purposes expressed in thischapter or which eliminates or curtails the right of the commissioner toexamine the corporation or the obligation of the corporation to make reports asprovided in NRS 670A.260, may be made.

2. The amendment must then be approved by theCommissioner before it is submitted to the Secretary of State.

3. Within 30 days after any meeting at which anamendment of the articles of incorporation has been adopted, articles ofamendment signed and sworn to by the president, treasurer and a majority of thedirectors, setting forth the amendment and due adoption of it, must besubmitted to the Secretary of State who shall examine them, and if he findsthat they conform to the requirements of this chapter, shall so certify andendorse his approval on them. Then the articles of amendment must be filed inthe Office of the Secretary of State, and no amendment may take effect untilthe articles of amendment have been filed.

(Added to NRS by 1983, 1273; A 1983, 1644; 1987,1949)

NRS 670A.130 Licenseto conduct business: Requirement; form; fee; regulations; withdrawal ofapplication.

1. A corporation for economic revitalization anddiversification shall obtain a license from the Commissioner before conductingany business. The application for the license must be on a form and beaccompanied by a nonrefundable application fee of not more than $2,000.

2. The Commissioner shall adopt regulationsestablishing the amount of the application fee required pursuant to thissection.

3. The Commissioner shall consider an application tobe withdrawn if the Commissioner has not received all information and feesrequired to complete the application within 12 months after the date theapplication is first submitted to the Commissioner or within such later periodas the Commissioner determines in accordance with any existing policies ofjoint regulatory partners. If an application is deemed to be withdrawn pursuantto this subsection or if an applicant otherwise withdraws an application, theCommissioner may not issue a license to the applicant unless the applicantsubmits a new application and pays any required fees.

(Added to NRS by 1983, 1274; A 1983, 1645; 1987,1949; 2005, 1853)

NRS 670A.140 Firstmeeting of corporation: Notice; duties of incorporators; quorum.

1. The first meeting of the corporation must be calledby a notice signed by three or more of the incorporators, stating the time,place and purpose of the meeting. A copy of the notice must be mailed ordelivered to each incorporator at least 5 days before the day appointed for themeeting. The first meeting may be held without notice upon agreement in writingto that effect, signed by all the incorporators. A copy of the notice or of theunanimous agreement of the incorporators must be recorded in the minutes of themeeting.

2. At the first meeting, the incorporators shall electa temporary clerk, adopt bylaws, elect a board of directors and take such otheraction upon matters within the powers of the corporation as the incorporatorsmay see fit. The temporary clerk must be sworn and shall make and attest arecord of the proceedings.

3. A majority and not less than three of theincorporators constitutes a quorum for the transaction of business.

(Added to NRS by 1983, 1274)

NRS 670A.150 Powersof corporation. In furtherance of its purposesand in addition to the powers conferred on business corporations by law, thecorporation may, subject to the restrictions and limitations contained in thischapter:

1. Elect, appoint and employ officers, agents andemployees, make contracts, including without limitation, contracts to sharepersonnel and services with other public or private entities to carry out theState Plan for Economic Development, and may incur liabilities for any of thepurposes of the corporation. The corporation shall not incur any secondaryliability by way of guaranty or endorsement of the obligations of any naturalperson, firm, corporation, joint-stock company, association or trust, or in anyother manner, except that the corporation may guarantee or endorse industrialrevenue bonds, individually or in groups, issued under the laws of this stateand the obligations of borrowers.

2. Borrow money and negotiate guarantees from federalagencies for any of the purposes of the corporation, issue its bonds, debentures,notes or other evidences of indebtedness, whether secured or unsecured, and maysecure them by mortgage, pledge, deed of trust or other lien on its property,franchises, rights and privileges of every kind and nature, or any part of themor interest in them, without securing stockholder approval.

3. Make loans to any natural person, firm,corporation, joint-stock company, association or trust, and may establish andregulate the terms and conditions with respect to those loans and the chargesfor interest and service connected therewith, except that the corporation shallnot approve any application for a loan unless the person applying for the loanshows that he has applied for the loan through ordinary banking channels andthat the loan has been refused by at least one bank or other financial institution.

4. Purchase, receive, hold, lease or otherwiseacquire, and to sell, convey, transfer, lease or otherwise dispose of real andpersonal property, together with such rights and privileges as may beincidental and appurtenant to the property and the use of it, including but notrestricted to any real or personal property acquired by the corporation fromtime to time in the satisfaction of debts or enforcement of obligations.

5. Acquire the goodwill, business, rights, real andpersonal property and other assets, or any part of them, or interest in them,of any natural person, firm, corporation, joint-stock company, association ortrust, and assume, undertake or pay the obligations, debts and liabilities ofthat natural person, firm, corporation, joint-stock company, association ortrust; to acquire improved or unimproved real estate to construct industrialplants or other business establishments on it or to dispose of that real estateto others for the construction of industrial plants or other business establishments;and may acquire, construct or reconstruct, alter, repair, maintain, operate,sell, convey, transfer, lease or otherwise dispose of industrial plants orbusiness establishments.

6. 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 orindebtedness of any natural person, firm, corporation, joint-stock company,association or trust, and while the owner or holder thereof may exercise allthe rights, powers and privileges of ownership including the right to votethereon.

7. Mortgage, pledge or otherwise encumber anyproperty, right or thing of value acquired pursuant to the powers contained insubsection 4, 5 or 6 as security for the payment of any part of the purchaseprice of them.

8. Cooperate with and avail itself of the facilitiesof the United States Department of Commerce, the Commission on EconomicDevelopment and any other similar state or federal governmental agencies andmay cooperate with and assist, and otherwise encourage organizations in thevarious communities of the State in the promotion, assistance and developmentof the business prosperity and economic welfare of those communities or of thisstate.

9. Do all acts and things necessary or convenient tocarry out the powers expressly granted in this chapter.

(Added to NRS by 1983, 1274; A 1987, 732)

NRS 670A.160 Corporationto be operated in manner consistent with State Plan for Economic Development. The purposes, powers and operation of the corporation mustbe effectuated, exercised and conducted in a manner consistent with the StatePlan for Economic Development.

(Added to NRS by 1983, 1275)

NRS 670A.170 Generalpowers of stockholders of corporation. Thestockholders of the corporation may:

1. Determine the number of and elect directors asprovided in NRS 670A.180.

2. Make, amend and repeal bylaws.

3. Amend its charter as provided in NRS 670A.120.

4. Dissolve the corporation as provided in NRS 670A.300.

5. Exercise such other of the powers of thecorporation consistent with this chapter as may be conferred on thestockholders by the bylaws.

(Added to NRS by 1983, 1275)

NRS 670A.180 Officersand board of directors to manage corporation; number, powers, election andterms of directors; vacancies; responsibility for losses.

1. The business and affairs of the corporation must bemanaged and conducted by a board of directors, a president, a vice president, asecretary, a treasurer and such other officers and agents as the corporation byits bylaws may authorize. The board of directors must consist of a number notless than 9 nor more than 15 as may be determined in the first instance by theincorporators and after that annually by the stockholders of the corporation.The Director of the Department of Business and Industry and the ExecutiveDirector of the Commission on Economic Development shall serve ex officio asnonvoting directors, but without any liability as such, except for grossnegligence or willful misconduct.

2. The board of directors may exercise all the powersof the corporation except those conferred by law or by the bylaws of thecorporation upon the stockholders and shall choose and appoint all the agentsand officers of the corporation and fill all vacancies except vacancies in theoffice of director, which must be filled as provided in this section.

3. The voting directors must be elected in the firstinstance by the incorporators and after that at least five directors must beelected by the members of the corporation and at least two directors must beelected by the stockholders at the annual meeting. The annual meeting must beheld during the month of January or, if no annual meeting is held in the yearof incorporation, then within 90 days after the approval of the articles ofincorporation at a special meeting as provided in this chapter.

4. The voting directors shall hold office until thenext annual meeting of the corporation or special meeting held in lieu of theannual meeting after the election and until their successors are elected andqualified, unless sooner removed in accordance with the provisions of thebylaws.

5. Any vacancy in the office of a voting director mustbe filled by the directors.

6. Directors and officers are not responsible forlosses unless the losses have been occasioned by the willful misconduct ofthose directors and officers.

(Added to NRS by 1983, 1276; A 1987, 734; 1993, 1896)

NRS 670A.190 Eligibilityfor membership in corporation; membership effective upon acceptance by board ofdirectors. Any bank, savings and loanassociation, thrift company or credit union licensed under this title or title56 of NRS, any insurer licensed under title 57 of NRS and any Nevadacorporation not licensed under those titles whose gross assets are more than$20 million may apply for membership in the corporation. Membership becomeseffective upon the acceptance of the application by the board of directors.

(Added to NRS by 1983, 1276)

NRS 670A.200 Membersrequired to loan money to corporation; limits.

1. Each member shall lend money to the corporation asand when called upon by it to do so, but the total amount on loan by any memberat any one time must not exceed the limits described in subsections 2 and 3, tobe determined as of the time the financial institution or insurer becomes amember. The amount may thereafter be readjusted annually if any change in thebase of the loan limit of the member occurs.

2. The loan limits are, for:

(a) Banks and stock insurance companies, 2 percent ofthe stockholders equity of the bank or company.

(b) Savings and loan associations, 2 percent of thesurplus account.

(c) Mutual insurance companies, 2 percent of surplus topolicyholders.

(d) Other financial institutions and insurancecompanies, and Nevada corporations described in NRS 670A.190, an amount established bythe board of directors.

3. Except as otherwise provided in this subsection,the total amount on loan by any member at any one time must not exceed$250,000. Any member who has a loan limit in excess of $250,000, may elect thatits total amount on loan at any one time to the corporation equal its loanlimit, but in no event may it exceed $500,000.

4. All loan limits must be established at the thousanddollar figure nearest to the amount computed on an actual basis.

(Added to NRS by 1983, 1276; A 1997, 1012)

NRS 670A.210 Callsfor money to be prorated. All calls for moneywhich members are committed to lend to the corporation must be prorated by thecorporation among the members in the same proportion that the maximum loanlimit of each member bears to the aggregate loan limits of all members of thecorporation.

(Added to NRS by 1983, 1277)

NRS 670A.220 Withdrawalfrom membership. Upon 6 months written noticeto the board of directors, a member of the corporation may withdraw frommembership, and, after the date of the withdrawal, the member is free ofobligations under this chapter, except those accrued or committed by thecorporation before the effective date of the withdrawal.

(Added to NRS by 1983, 1277)

NRS 670A.230 Stockof corporation: Minimum required to transact business; acquisition.

1. The stock of the corporation must be 20,000 sharesof no par value, which must be issued for $100 per share in cash. At least 5percent of the initial stockholders equity of the corporation must be paidinto its treasury in cash before it may transact any business other thanbusiness relating to its organization.

2. At least a majority of the stock of the corporationmust at all times be held by residents of the State or by persons engaged indoing business in Nevada.

3. A financial institution which does not become amember of a corporation established under this chapter may not acquire anyshares of the stock of the corporation.

4. Except as otherwise provided in this subsection,any financial institution which becomes a member of a corporation establishedunder this chapter may acquire, purchase, hold, sell, assign, transfer,mortgage, pledge or otherwise dispose of any shares of the stock of thecorporation and, while the owner of those shares, may exercise all the rights,powers and privileges of ownership, including the right to vote thereon, allwithout the approval of any regulatory authority of this state. The amount ofthe stock of the corporation which may be acquired by any member under thissection may not exceed 10 percent of the loan limit of the member. The amountof stock of the corporation which any member may acquire under this section isin addition to the amount of stock in corporations which the member isotherwise authorized to acquire.

5. The holders of stock of the corporation do not, assuch, have any preemptive or preferential right to purchase or subscribe forany part of the unissued or new issue of stock of the corporation, whether nowor hereafter authorized or issued, or to purchase or subscribe for any bonds orother obligations, whether or not convertible into stock of the corporation,now or hereafter authorized or issued.

(Added to NRS by 1983, 1277; A 1997, 1012)

NRS 670A.240 Requiredamount of earned surplus; limits on obligations; restrictions on deposits andloans.

1. The corporation shall set apart as an earnedsurplus all of its net earnings in each year until the earned surplus equals 50percent of the stockholders equity then outstanding. The earned surplus mustbe held in cash, invested in United States government bonds, or as provided inthe corporations bylaws, and be kept and used to meet losses and contingenciesof the corporation, and whenever the amount of earned surplus becomes impaired,it must be built up again to the required amount in the manner provided for itsoriginal accumulation.

2. At no time may the total obligations of thecorporation exceed ten times the amount of its stockholders equity, notincluding therein the earned surplus, or $50 million, whichever is greater.

3. The corporation shall not deposit any of its moneyin any financial institution unless the financial institution has beendesignated as a depository by a vote of the majority of all of the directors ofthe corporation, exclusive of any director who is an officer or director of thedesignated depository. The corporation shall not receive money on deposit ormake any loans directly or indirectly to any of its officers or to any firms inwhich any of its officers is a member or officer.

(Added to NRS by 1983, 1278; A 1997, 1013)

NRS 670A.250 Licensefees; regulations.

1. Every corporation organized and engaged in businessunder the provisions of this chapter shall pay an annual state license fee ofnot more than $200. The Commissioner shall adopt regulations establishing theamount of the fee required pursuant to this subsection.

2. The county and city in which the corporationmaintains a place of business may also levy a license fee which does not exceed$50.

(Added to NRS by 1983, 1278; A 2005, 1853)

NRS 670A.260 Examinationby Commissioner; annual reports by corporations; costs of examination;authority of Commissioner.

1. The Commissioner shall examine the corporation asoften as he deems necessary.

2. The corporation shall make reports of its conditionat least annually to the Commissioner and more frequently upon the order of theCommissioner. The Commissioner shall furnish copies of these reports to theCommissioner of Insurance and the Governor. The corporation shall also furnishsuch other information as may be required by the Commissioner or the Secretaryof State.

3. The corporation shall pay a fee for conducting theexamination and preparing the report of the examination at the rate establishedpursuant to NRS 658.101.

4. The Commissioner shall exercise the samesupervisory authority over corporations organized under this chapter as heexercises over banks and trust companies chartered by the State.

(Added to NRS by 1983, 1278; A 1983, 1645; 1987,1949, 2224)

NRS 670A.270 Creditof state not to be pledged. Under nocircumstances may the credit of the State be pledged to any corporationorganized under the provisions of this chapter.

(Added to NRS by 1983, 1279)

NRS 670A.280 Taxexemptions, credits and privileges granted to corporation. Any tax exemptions, tax credits or tax privileges grantedto banks, savings and loan associations, trust companies and other financialinstitutions by any general laws are granted to corporations organized pursuantto this chapter.

(Added to NRS by 1983, 1279)

NRS 670A.290 Statusof corporation as state development company under federal legislation. Any corporation organized under the provisions of thischapter is a state development company, as defined in the Small BusinessInvestment Act of 1958, Public Law 85-699, 85th Congress, or any other similarfederal legislation, and may operate on a statewide basis.

(Added to NRS by 1983, 1279)

NRS 670A.300 Dissolutionof corporation. A corporation may dissolveupon the affirmative vote of stockholders representing not less than two-thirdsof the issued and outstanding stock.

(Added to NRS by 1983, 1279)

NRS 670A.310 Failureto submit required report; fees; regulations.

1. If a corporation fails to submit any reportrequired pursuant to this chapter or any regulation adopted pursuant theretowithin the prescribed period, the Commissioner may impose and collect a fee ofnot more than $10 for each day the report is overdue.

2. The Commissioner shall adopt regulationsestablishing the amount of the fee that may be imposed pursuant to thissection.

(Added to NRS by 2005, 1853)

NRS 670A.320 Administrativefines. In addition to any other remedy orpenalty, the Commissioner may impose an administrative fine of not more than$10,000 upon a person who:

1. Without a license, conducts any business oractivity for which a license is required pursuant to the provisions of thischapter; or

2. Violates any provision of this chapter or anyregulation adopted pursuant thereto.

(Added to NRS by 2005, 1853)

 

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