13.1-627 - General powers. - Virginia Statutes

§ 13.1-627. General powers.

A. Unless its articles of incorporation provide otherwise, every corporationhas perpetual duration and succession in its corporate name and has the samepowers as an individual to do all things necessary or convenient to carry outits business and affairs, including, without limitation, power:

1. To sue and be sued, complain and defend in its corporate name;

2. To have a corporate seal, which may be altered at will, and to use it, ora facsimile of it, by impressing or affixing it or in any other mannerreproducing it;

3. To make and amend bylaws, not inconsistent with its articles ofincorporation or with the laws of the Commonwealth, for managing the businessand regulating the affairs of the corporation;

4. To purchase, receive, lease, or otherwise acquire, and own, hold, improve,use and otherwise deal with, real or personal property, or any legal orequitable interest in property, wherever located;

5. To sell, convey, mortgage, pledge, lease, exchange, and otherwise disposeof all or any part of its property;

6. To purchase, receive, subscribe for, or otherwise acquire, own, hold,vote, use, sell, mortgage, lend, pledge, or otherwise dispose of, and deal inand with shares or other interests in, or obligations of, any other entity;

7. To make contracts and guarantees, incur liabilities, borrow money, issueits notes, bonds, and other obligations, which may be convertible into orinclude the option to purchase other securities or property of thecorporation, and secure any of its obligations by mortgage or pledge of anyof its property, franchises, or income;

8. To lend money, invest and reinvest its funds, and receive and hold realand personal property as security for repayment;

9. To conduct its business, locate offices, and exercise the powers grantedby this chapter within or without the Commonwealth;

10. To elect directors and appoint officers, employees, and agents of thecorporation, define their duties, fix their compensation, and lend them moneyand credit;

11. To pay pensions and establish pension plans, pension trusts, profitsharing plans, share bonus plans, share option plans, share purchase plansand benefit and incentive plans for any or all of the current or formerdirectors, officers, employees, and agents of the corporation or any of itssubsidiaries;

12. To make donations for the public welfare or for religious, charitable,scientific, literary or educational purposes, except that corporationssubject to regulation as to rates by the Commission shall not have power tomake donations in excess of five percent of net income computed beforefederal and state taxes on income and without taking into account anydeduction for gifts;

13. To make payments or donations, or do any other act, not inconsistent withthis section or any other applicable law, that furthers the business andaffairs of the corporation;

14. To pay compensation, or to pay additional compensation, to any or alldirectors, officers and employees on account of services previously renderedto the corporation, whether or not an agreement to pay such compensation wasmade before such services were rendered;

15. To insure for its benefit the life of any of its directors, officers oremployees, to insure the life of any shareholder for the purpose of acquiringat his death shares owned by such shareholder and to continue such insuranceafter the relationship terminates;

16. To cease its corporate activities and surrender its corporate franchise;and

17. To have and exercise all powers necessary or convenient to effect any orall of the purposes for which the corporation is organized.

B. Each corporation other than a public service company, a bankingcorporation, an insurance corporation, a savings institution or a creditunion shall have power to enter into partnership agreements, joint venturesor other associations of any kind with any person or persons. The foregoinglimitations on public service companies, banking corporations, insurancecorporations, savings institutions, and credit unions shall not apply to thepurchase by any such entity of any security of a limited liability company.The term "public service company" as used in this subsection shall notapply to railroads, which shall have the power given other corporationsgenerally by this subsection. The foregoing limitation on public servicecompanies shall not apply to partnership agreements, joint ventures or otherassociations where the purposes of such partnerships, joint ventures or otherassociations are activities that the public service company could lawfullyengage in without participation in a partnership, joint venture orassociation and will require an equity investment by the public servicecompany and debt with recourse to the public service company of an amount notmore than one percent of its net equity as measured at the end of the mostrecent fiscal year so long as all such partnerships, joint ventures andassociations collectively will require an equity investment by the publicservice company and debt with recourse to the public service company of lessthan five percent of the net equity of the public service company as measuredat the end of the most recent fiscal year. Upon application by the publicservice company, the Commission may approve any partnership agreements, jointventures or other associations that exceed the equity investment criteria setforth above. The foregoing limitation on public service companies shall notapply to partnership agreements, joint ventures or other associations betweentelephone companies and telephone companies, whether in corporate or otherform, or between telephone companies and commonly owned affiliates oftelephone companies for the purpose of providing domestic cellular radiotelecommunication service.

C. Privileges and powers conferred and restrictions and requirements imposedby other titles of the Code on railroads or other public service companies,banking corporations, insurance corporations, savings and loan associations,credit unions, industrial loan associations or other special types ofcorporations, shall not be deemed repealed or amended by any provision ofthis chapter except where specifically so provided.

D. Each corporation which is deemed a private foundation, as defined in § 509of the Internal Revenue Code, unless its articles of incorporation expresslyprovide otherwise, shall distribute its income and, if necessary, principal,for each taxable year at such time and in such manner as not to subject suchcorporation to tax under § 4942 of the Internal Revenue Code. Suchcorporation shall not engage in any act of self-dealing, as defined in § 4941(d) of the Internal Revenue Code, retain any excess business holdings, asdefined in § 4943 (c) of the Internal Revenue Code, make any investments insuch manner as to give rise to liability for the tax imposed by § 4944 of theInternal Revenue Code or make any taxable expenditures, as defined in § 4945(d) of the Internal Revenue Code. This subsection shall apply to anycorporation organized after December 31, 1969, under this chapter or underthe Virginia Stock Corporation Act (§ 13.1-601 et seq.) enacted by Chapter428 of the 1956 Acts of General Assembly; and to any corporation organizedbefore January 1, 1970, only for its taxable years beginning on and afterJanuary 1, 1972, unless the exceptions provided in § 508 (e) (2) (A) or (B)of the Internal Revenue Code shall apply or unless the board of directors ofsuch corporation shall elect that such restrictions as contained in thissubsection shall not apply by filing written notice of such election with theAttorney General and the clerk of the Commission on or before December 31,1971. Each reference to a section of the Internal Revenue Code made in thissubsection shall include future amendments to such Code sections andcorresponding provisions of future internal revenue laws.

(Code 1950, § 13.1-2.1; 1975, c. 500; 1977, c. 508; 1983, c. 534; 1984, c.406; 1985, c. 522; 1993, cc. 61, 143, 419; 1994, c. 452; 1996, cc. 16, 257;2005, c. 765.)