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RURAL INDUSTRIALIZATION Start Tapping Economic Potential | |
| CRD-005, July 1994. V. Wilson Lee, Extension Economist Emeritus, and Harry B. Strawn, Extension Economist, Community Resource Development, Auburn University | ||
This project was undertaken in response to a need in many rural Alabama communities for increased local employment, an improved local tax base, and a more balanced economy. Such goals are consistent with the concept of overall economic development.
Contributors include the Alabama Cooperative Extension Service, Soil Conservation Service, Small Business Administration, Alabama Development Office and others. Their cooperation and aid in preparing this report is gratefully acknowledged.
Not every rural community has the potential for significant industrialization. Industrial potential depends on community location, local resources and attitudes, access to markets, and public facilities and services. Community leaders should consider all of these things before launching an industrialization program. Communities should know what they have, where they want to go, and how to create the conditions necessary to achieve their goals. Once this basic knowledge is thoroughly in hand, relevant statistics can be presented in terms of almost any prospective firm's needs and strategy.
Communities often send out representatives to sell their area who do not adequately know their product (the local community) or their customer (the prospective firm). In all probability, these selling efforts are doomed to failure. A certain core of basic information is necessary to demonstrate the advantages of your community as a future plant site. Back to Contents
The basic factors of production are land, labor, capital and management. Facilitating services such as transportation, communication, public utilities, education, recreation, and medical services are also important. In addition, the relation between the local community and regional and national markets may influence plant location.
The prospective firm will provide management and some or all capital, but the community must offer the other factors and amenities. The basic problem involves matching community resources to industrial needs.Back to Contents
Land has several characteristics to be considered in industrial production. Soils and topography should be such that needed structures can be built at reasonable cost. A land survey can quickly determine topographical characteristics. A site not subject to flooding and with a maximum slope of 10 percent or less will serve most purposes. Soils information and use interpretations are available through the local Soil Conservation Service (SCS) offices. The nature of underground rock formations may be obtained from the state geologist.1 Water standing for long periods of time probably indicates poor underground drainage. Test borings can give additional information about underground rock formations, soil types and the level of the water table. If rail service is available in the community, the land should, if at all possible, be located next to the rail line. To buy a site and then construct necessary rail spurs can be quite costly, especially if major highways or streams must be crossed or if topographic barriers exist. Land without rail service very much limits the kindss of firms that can economically locate in the community. Likewise, communities should include in their long-term planning efforts the capability to provide utilities and access roads to potential industrial sites.
To be effective, the local industrial development board or other bargaining agent must be able to quote a definite site price to a prospective customer. Land prices often rise drastically when landowners find an industrial prospect. Either purchase options, full site ownership by the bargaining agent, or full control of designated industrial districts or parks will permit definite price quotations. Appendix Document 1 is example of a site option.
Many people believe that designated industrial districts or parks greatly reduce the location problems of light industry while the needs of heavy industry can be served by other means. Industrial parks have the advantages of adequate space, compatible neighbors, planned traffic flow, and freedom from the time and expense of identifying and developing completely "raw" sites.2 Industrial parks are also consistent with the idea of planned development.
Probably the main disadvantage of industrial parks is the relatively high initial cost. This cost often appears more than it really is because providing necessary utilities and roads must often be added to raw land cost. Another problem is the lack of future expansion room for individual plants. Usually, the original plant building will occupy approximately 60 percent of the site. Purchase options that individual firms may obtain on neighboring sites are of relatively short duration. Thus, a particular plant might become "boxed in" after a few years.3 Allocate 10 square feet of land for every 1 square foot of building to allow room for parking and future expansions.
Some firms fear the possible loss of identity in an industrial park.4 This disadvantage is often more imagined than real because the firm is actually trading a surrounding environment over which it has little control for the security of planned development.
Detailed policies relating to local property and taxes and firm insurance rating should be included in any packet of materials provided to a prospective firm. Particular attention should be given to provisions for waivers of any taxes.
Prospective firms will also be interested in any comprehensive
land-use planning in the community. Local zoning regulations should be
spelled out clearly. Provisions which are expected to affect the prospective
firm should be highlighted. Most firms consider intelligent land-use plans
and regulations an asset rather than a liability in evaluating the community
as a possible plant location. Rules and regulations governing the park
itself should be clearly spelled out so that prospective tenants will be
assured that present and future plants will be compatible neighbors. One
method of accomplishing this is through the use of protective Covenants.
Appendix Document 2 is example of an industrial park covenant.
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Two crucial facets of the local labor market are the nature of available skills and number of employable persons. General information about the ethnic, sex and age distribution of the population can be obtained from census reports. More detailed information for decision-making often requires specific labor surveys.
If a new firm is moving into an area or if and existing firm is expanding, a training program may be organized to teach needed skills that may be lacking. The Alabama Industrial Development Training Program cooperates with approved new industry to provide job training.5 This training is specific and designed around particular job descriptions, thus providing a quick upgrading of local labor skills to meet specific needs.Back to Contents
Capital refers to wealth in terms of dollars and wealth in the form of physical facilities. Physical capital can also be designated as either public or private. Public capital refers to such public facilities and services as solid waste management, education, water, sewage, etc. Private capital refers primarily to plant buildings and facilities and earmarked operating capital.
For industry recruiting, the local community should provide the necessary public capital and assist in the accumulation of private capital. The availability of public capital should be emphasized and related to specific industry problems in your recruiting literature.
Facilitating the accumulation of private capital presents a somewhat different problem. First, major corporations that desire to build new facilities or expand existing ones will have world-wide access to borrowed funds through commercial banks and the public bond markets. New equity (stock, etc.) offerings are often used to raise needed funds. During periods of very high interest rates, internal financing through retained earnings becomes important.
Local banks often serve as temporary storehouses for plant operating capital and are used extensively by employees. The capital needs of a small business are somewhat different. Typically, small firms do not have the same access to capital markets as large corporations. Local banks, state industrial development funds and federal government agencies such as the Small Business Administration (SBA) and the Southern Development Council (SDC) play prominent roles in financing small businesses.
Availability of capital depends on access to necessary lending institutions and a favorable attitude on the part of the managers of such institutions. For this reason, local bankers and other financial managers should be active in any industrial development program. Usually, bankers willingly lend assistance because of the prospect for additional accounts. In some instances, however, they might be overly conservative.
Alabama has two principal industrial revenue bond plans that provide funds for plant construction. The advantages of these plans over conventional financing include: (1) lower interest rates, (2) possible exemption from ad valorem taxation, (3) exemption from state and local sales taxes on building materials, (4) 100 percent financing, and (5) savings on franchise taxes applicable to capital invested in Alabama.6
The Cater Act7 (Act No. 648), passed by the 1949 Alabama State Legislature, authorizes municipalities to form nonprofit public corporations to acquire, own, lease and dispose of property for the purpose of promoting industrialization. Property acquisition is financed through the issuance of bonds to be retired by revenue from the specified properties.
The Wallace Act8 (Act No. 756), passed by the 1951 Alabama Legislature, authorizes municipalities to finance the acquisition, construction or equipping of plants suitable for use by any manufacturing or processing firm. This is accomplished by issuing revenue bonds to be repaid solely out of revenues from leasing such properties and secured by mortgages and pledges against the specified property and its revenue.
Financing may also be obtained through certified development corporations. Such corporations can make loans to any person, firm corporation, joint stock company, association or trust. Likewise, the local development corporation has the power to regulate interest rates, terms and conditions of such loans consistent with state law. According to the enabling legislation, the loan applicant must show that he has applied for the loan through conventional channels and has been refused by at least one commercial bank.9 These corporations can also apply for grants and loans from the SBA.9
The principal vehicle for federal financial assistance to small business is the Small Business Administration (SBA). Loans are made to small manufacturers, processors, wholesalers, retailers, service concerns, and local development corporations. The money can be used to build plants, expand facilities, purchase equipment, or it can be used for working capital. SBA loans are not made if the applying firm can obtain financing from conventional sources on reasonable terms. A firm located in a town of less than 200,000 population must have been turned down by at least one local bank to qualify for a direct SBA loan. In towns of more than 200,000, the prospective firm must have been refused by two local banks. SBA funds are generally quite limited for direct loans. Most loans, however, are made through banks with SBA guaranteeing up to 90 percent of a loan up to $155,000.00 and 85 percent of a loan of more than $155,000.00. SBA can guarantee up to $750,000.00 of a private sector loan.
SBA has the authority for making loans to agriculture-related businesses: firms that buy, sell, or process agricultural supplies or commodities or provide other services to farmers. These firms may apply directly to the SBA if their previous applications have been turned down by the FMHA or agencies of the Farm Credit Administration. In addition, SBA may now make loans to those engaged in farming.
The Southern Development Council (SDC) was created as a nonprofit
corporation under the Alabama Nonprofit Corporation Act in 1983 (see the
1975 Alabama Code, 10-3A-1 to 10-3A-225). The purpose of SDC is to assist
the location and expansion of business in Alabama through the arrangement
of a broad variety of financing. The SDC board of directors selects a president,
who in turn chooses a staff and carries out the purposes and duties of
the Council. The SDC office receives support from, and works in collaboration
with, the Alabama Development Office and the Alabama Department of Economic
and Community Affairs. The SDC is one of the state's organizations for
financial packaging assistance to new or expanding businesses. SDC arranges
financing for business through U.S. Small Business Administration 504 Loans
and the State Economic Development Loan Programs. The SDC also assists
industry in securing financing through a variety of sources including private
bank financing, Alabama Industrial Development Bond Issues, Urban Development
Action Grants, Appalachian Regional Commission Grants, Alabama Industrial
Development Authority Building Loans, Alabama Industrial Site Preparation
Grants, and U.S. Department of Commerce Economic Development Administration
Funds, including programs for technical assistance, public works, and business
loan guarantees. The SDC is under contract with the Alabama Department
of Economic and Community Affairs (ADECA) to package and manage the Alabama
Economic Development Loan (CDBG) Program and is designated as a Certified
Development Company by the SBA.10
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A program for industrialization involves a succession of plant location or expansion decisions over a period of time. From the firm's point of view, each decision consists of many separate cost and revenue estimations. The need for additional plant production is first established. A program to determine the production and marketing costs that would be incurred is then begun. Tentative plant specifications are drawn up. Alternative plant locations are then identified and evaluated primarily on the basis of profitability. Other factors, of course, enter into the decision, but profitability is most important.
Most firms do not publicize major expansion or decentralization programs in advance to avoid alerting competitors or speculators. Probably the first step in determining which firms should be contacted is to ask local public officials and business people for information about firms with which they have dealings and other knowledge. This information should be assembled into a master list of possible firms. Other good sources of potential contacts include the Alabama Development Office, Alabama Power Company, Industrial Development Department, railroads that serve the area, various area industrial development organizations, and business newspapers such as The Wall Street Journal or Barron's. Firms that have announced large sales or profit increases, or new equity (stock, etc.), or bond offerings should be noted for further study. Published comments from editors and executives also provide useful information.
Personal information from trade associations, sales representatives, and executives, should be considered a valuable source. Such information, however, is often based on the "corporate grapevine" and may or may not prove accurate. But the possible payoffs from early receipt of correct information are such that this source should not be overlooked.
General industrial directories11 provide names, brief histories, and principal products of firms. Often public libraries, especially the larger ones, will have the directories available. The Industrial Development Division of the Alabama Development Office would also have these directories and other information about potential firms.
The next stage of your local industry search should be to divide the master list of prospects into convenient classifications or categories. The important thing in this breakdown is to have some realistic means of classifying firms. The groupings may be consistent with the Standard Industrial Classification Manual or any other system that appears useful for your organization. Examples of categories might include the following:
Factors identified as critical to the success of various industrial categories can then be compared to the local economy to determine which firms appear to have an advantage. Firms whose requirements most closely approximate the local situation should be put on the priority list. As much information as possible about these firms should be collected and studied. Then contact the management of each of these firms and explain the advantages of locating in your community, in terms of their needs. To interest a potential firm, it will be necessary to provide exact data about the kinds of resources available and the present and potential amounts.
Industrialization can be a cumulative process. The presence of raw materials such as agricultural products, minerals, and timber resources can provide the requirements for certain types of industry. Existing firms producing such semifinished products as metal castings, and ingredients for the processed food industry can provide the basis for additional industrialization to further process these products. As the number of firms increases in an area, a group of service industries might develop also.
Even though most plant location decisions are based on the economics
of production and marketing, other factors often influence decisions. Social
capital in the form of educational and recreational facilities, police
and fire protection, availability of medical services, and other forms
rank high on the list. Personal contacts of local citizens and business
people can prove invaluable. A local development corporation, chamber of
commerce, rural development committee, or any other industrial development
organization acting alone will have difficulty in maintaining a successful
industrialization program. Local citizens and government must be sold on
the idea, have positive attitudes, and act as sales people for their community.
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To be successful, an industrialization program must have not only a
commitment from community leadership but involvement of citizens. An important
step should be aimed at achieving citizen support. Local government or
the chamber of commerce must provide leadership at this stage. The Alabama
Cooperative Extension Service can help in such a program.
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It is important to work through existing organizations where possible. The first groundwork should be laid on a personal basis. Once a germ of interest has been created, guest speakers should be invited to meetings of the county commission, city council, chamber of commerce, and civic clubs to stimulate interest and support. These speakers may be local business people interested in industrial development, representatives of large corporations, state agencies such as the Alabama Development Office, regional planning commissions, universities, the Alabama Cooperative Extension Service, and others.
Newspapers, radio, and television can be useful in carrying the message to citizens. Personal interviews and public interest spots would probably be the best techniques for radio and television. Short news releases to local papers dealing with what industrialization will mean to the average family and stories about other industrializing communities would probably be most meaningful.
The central idea that industrialization is, by nature, a long-run
process rather than a one-shot item should always be stressed. The difficulties
of measuring results and evaluating programs should also receive attention.
A key to program success is preparation and follow-through.
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Industrial development programs generally include both formal and informal organizations. An independent industrial development committee might serve as a general umbrella group to facilitate and coordinate over-all efforts. This committee could be of any convenient size and include representatives of local government, chambers of commerce, community clubs, and private citizens. Efforts should be made to include the true leadership of the community. This might include successful farmers, business and professional people, clergy, and others.
Members of the committee should serve on a voluntary basis, and arrangements might be made to pay routine operating expenses through voluntary donations or small appropriations from local government or other sources. Such expenses would be minimal, consisting mainly of such things as office supplies, postage, telephone calls, and occasional trips to visit executives of prospective firms.
Because there is generally a limited number of qualified local people willing to serve on committees, it might be desirable to have an existing group perform these functions. One logical group would be the local Rural Development Committee. These committees exist in various forms in all 67 Alabama counties and are concerned with total resource development. Any arrangement should be subject to periodic review and change to meet changing conditions.
In addition to the informal committee, one or more formal organizations might be necessary to achieve maximum development in a particular county or area. For example, a formal industrial development board is necessary to fulfill the legal requirements of the Cater Act. This board must be a legally incorporated body with power to sponsor industrial bond issues, own property, and make contracts to facilitate local industrial development. Such a board might be considered the industrial development arm of local government. This approach is often best suited to financing large projects but may also be used for small ones. According to a recent survey, there are 260 such boards currently operating in 67 Alabama counties.12 Like other legal corporations, there are certain required steps in organizing industrial development boards.
1. Three or more local residents must sponsor the industrial development board. The sponsors must be property owners and duly qualified voters of the municipality.
2. A certificate of incorporation consistent with Alabama law must be drawn up (Appendix Document 3).
3. The certificate of incorporation must be submitted to the local city council along with an application for permission to incorporate (Appendix Documents 4a, 4b, 4c).
4. If the city council views the proposed industrial development board favorably, a resolution approving the incorporation and appointing a board of directors will be passed (Appendix Document 5).
5. A set of corporation bylaws describing the nature of the proposed industrial development board and its activities must be written (Appendix Document 6).
6. All legal documents pertaining to the new industrial development board must be submitted to the local probate judge for authentication.
7. After the probate judge has declared all documents consistent with Alabama law and any registration fees have been paid, the industrial development board is a legally constituted Alabama corporation.
Certified development corporations (CDC's) are the principal vehicles used by the Small Business Administration in its rural development activities. In an overall community development program, CDC's may be considered complementary with industrial development boards because of the different kinds of clients with which they deal. The legal authority of the SBA is such that it generally deals with small local companies. The SBA often makes a Section 503 loan to a CDC. This money is then reloaned by the CDC to finance a qualifying industrial development project that cannot be financed through conventional channels.
Certified development corporations are legally independent of industrial development boards. They may be organized prior to, concurrently with, or after an industrial development board has been organized. They also have somewhat greater freedom of operation, especially in such areas as profitability.
Since both industrial development boards and certified development corporations are similar legal entities, procedures for organizing them are quite similar.
1. The certified development corporation must have at least 25 members or stockholders. At least 75 percent of the ownership and control must be held by persons living or doing business in the local community.
2. The CDC may be organized as either a profit or nonprofit corporation.
3. A certificate of incorporation consistent with Alabama law must be drawn up (Appendix Document 7).
4. A set of corporation bylaws describing the nature of the proposed CDC and its activities must be written (Appendix Document 8).
5. All legal documents pertaining to the new CDC must be checked and authenticated by the local probate judge.
6. After the probate judge
has declared all documents consistent with Alabama law and any required fees have been paid, the CDC is a legally constituted Alabama corporation.
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Once an industrial development organization has been established, it should immediately start working to prove itself a useful instrument for economic development. Assembling a reliable inventory of local economic resources should receive high priority. Representatives should also visit local merchants and other business people, explain the organization's goals and programs, and outline the type of aid it can provide to a local firm desiring to expand. Local business people should also be asked about possible new firms they would like to see in the community. Pertinent information from these visits should be brought before the full organization, and projects that seem feasible should be filed for further study.
Another important task for a new industrial development organization is to establish channels of communication with regional, state, and federal agencies concerned with industrial development, advising them of its existence, goals, programs, and problems. The agencies, in turn, will draw on their experience with other local development organizations and their current legal authority to help solve problems, make suggestions, and explain present requirements for receiving aid under various programs.
In all probability, the local development job will soon become so large that a need for specialization will exist. Forming subcommittees on a functional basis would probably be the most efficient means for handling the increased work load. Subcommittees should regularly feed information back to the central file to keep it up to date. The following subcommittees might be needed.
1. THE INDUSTRIAL RESOURCES SUBCOMMITTEE. This subcommittee is responsible for assembling information relating to industrial resources available in the community. This includes the local crop and livestock production and markets, local mining, local forestry production, semifinished and finished manufactured products, as well as others.
2. REAL ESTATE SUBCOMMITTEE. The subcommittee is led by a public-spirited local realtor who is genuinely interested in economic development. He or she obtains a working knowledge of all available land suitable for industrial uses and maintains up-to-date county, city, zoning, and topographical maps. This subcommittee also knows the prices of all available industrial land and is able to get a purchase option at very short notice.
3. CONSTRUCTION AND INSURANCE SUBCOMMITTEE. The subcommittee includes one member with a good working knowledge of industrial construction and one member thoroughly familiar with industrial insurance. They will be responsible for industrial designs and building materials used in the area, construction problems, fire and casualty insurance rates and classifications, means of supplementing local fire protection, and the Alabama Workmen's Compensation Law.
4. CITY COMMITMENTS SUBCOMMITTEE. The subcommittee is headed by an influential member of local government. He or she is able to speak with authority about such things as provisions of water, sewage, streets, and tax exemptions.
5. COMMUNITY SERVICES SUBCOMMITTEE. The subcommittee must be thoroughly familiar with all community services such as police and fire protection, education, recreation, housing, and religious and civic organizations.
6. TRANSPORTATION SUBCOMMITTEE. The subcommittee is familiar with railroad, bus, truck, and air schedules for all lines serving the area. It should also determine elapsed times in transit between the local community and regional and national market centers. The existence of any transit privilege or other special considerations should also be determined. Another important category of information involves policies of rail lines for constructing spur tracks.
7. LABOR SUBCOMMITTEE. The subcommittee is responsible for maintaining correct information about the local labor supply, skills, wages, and other areas of labor.
8. FINANCIAL SUBCOMMITTEE. The subcommittee includes local bankers, savings and loan association representatives, and others familiar with financial transactions. Their responsibility includes maintaining all pertinent information relating to availability of financing from public and private sources, interest rates, typical repayment schedules, and other areas of finance.
9. INDUSTRIAL RECRUITMENT
SUBCOMMITTEE. This subcommittee has the responsibility for assembling
and maintaining files of prospective firms as well as making and following
up industrial contacts. Members should have a working knowledge of
industries considered suitable for the local community. They also
establish rapport with other public and private industrial development
organizations. If possible, the same board member should handle most
of the correspondence and negotiations with a particular firm. From
the firm's standpoint, this person will represent the community.
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The successful industrial development organization keeps in mind that it has a selling and facilitating job. It must continually update its knowledge about its product (the local community), its customers (prospective firms), and public and private programs for providing technical and financial assistance to business firms.
The central data file should always be kept up-to-date as new information becomes available. Regular meetings should be scheduled at least once a month to foster involvement and to stimulate participation. All subcommittees should make brief reports of their activities at these meetings. In addition, periodic reports should be made to the local government and other leaders about the activities of the local industrial development organization. These reports should be submitted at least once a quarter.
Since these organizations must always work toward legitimizing their existence in the minds of local people, representatives should be alert to every opportunity to speak to local civic clubs and other citizen groups. These speaking engagements serve at least two purposes: (1) they perform a very necessary public relations function, and (2) they keep local businesses up-to-date on how the industrial development organization can serve them.
As the industrial development organization operates over a period of
years, complementary effects can be seen. Firms begin to locate plants
in the area and to manufacture products that can be used by other firms
to produce additional products. This is the way that industrial complexes
are formed. Again, not every rural area has the potential for becoming
an industrial complex, but study of local resources, markets, and transportation
facilities can improve the insight of community leaders about the possibilities
for further economic development of their communities.
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Sample Document 1. Site Option
STATE OF ALABAMA
COUNTY OF _______________
OPTION
For and in consideration of One Dollar ($1.00) in hand paid, _____________ (hereinafter "Seller") hereby grants to the ___________ County Chamber of Commerce (hereinafter "Chamber"), and to any company or business entity it may designate hereunder, the option to purchase within one year from the date hereof the following described real estate located in ____________ County, Alabama for the sum of $ ____________ per acre:
This Option is subject to the following conditions:
1. Seller shall have the right to sell the above-described property to whomever he desires free and clear of this option during the terms of the option so long as the Chamber has not designated a company hereunder;
2. Seller shall be obligated to sell the above-described property to a company or business entity designated by the Chamber in writing, said written designation to be by certified mail to Seller at ________________ ;
3. Seller agrees to sell the property free and clear of all liens and encumbrances; and hereby warrants that seller has good and sufficient title to the property described above;
4. Upon designation by the Chamber of a company or business entity, Seller shall be bound by all terms and conditions of this option for a period of sixty (60) days from date of receipt of designation. If the designated company or business has not purchased the above described property from Seller within the 60 days, nor made satisfactory arrangements with Seller to purchase same at the above price, then Seller shall not be obligated further to the designated company or business by the terms of this agreement, but the option shall continue in full force and effect during the remainder of the term thereof as if no company or business had been designated by the Chamber.
5. Should the Chamber designate a company, Seller shall deal solely with said company and agrees to hold the Chamber, its officers, directors, agents, servants, and employees harmless and free of all liability to Seller for the acts or failure to act of the designated company of whatever nature, whenever occurring or discovered.
IN WITNESS WHEREOF, the Seller has hereunto set his or her hand and seal this, the __________ day of _____________ 19_____.
Witness:
_____________________________ L.S.
STATE OF ALABAMA
COUNTY OF ______________ I, the undersigned a Notary Public in and for said State and County, hereby certify that ___________ whose name _____________ signed to the foregoing conveyance, and who ________________ known to me acknowledged before me on this day, that, being informed of the contents of the conveyance ______________ executed the same voluntarily on the day the same bears date. Given under my hand and official seal this ________ day of ___________ , 19_____.
__________________________
Notary Public
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Sample Document 2. Protective Covenant For An Industrial Park.*
CONDITIONS, COVENANTS, RESTRICTIONS, RESERVATIONS, AND EASEMENTS AFFECTING PROPERTY OF ________ KNOW ALL MEN BY THESE PRESENTS, That the _________ does hereby declare that the following protective and restrictive covenants are applicable to the plot of land hereinafter described in Clause 1; and it further declares that all real property described in and deferred to in Clause 1 hereof is, and shall be, held, transferred, sold, conveyed, and occupied, subject to the conditions, covenants, restrictions, reservations, and easements hereinafter set forth.
"Building site" shall mean any lot, or portion thereof, or two or more contiguous lots, or portions thereof, or a parcel of land upon which a commercial, industrial, restaurant or cafeteria, office building, or buildings and appurtenant structures may be erected in conformance with the requirements of these covenants.
"Corporation," or "Grantor," or "Lessor" shall mean ___________ , its successors and assigns, unless the context indicates otherwise.
"Improvements" shall mean and include a commercial, industrial, restaurant or cafeteria, office building, or buildings, outbuildings appurtenant thereto, parking areas, loading areas, fences, masonry walls, hedges, lawns, mass plantings, and any structures of any type or kind located above ground.
"Building line or lines" shall mean the minimum distance which commercial, industrial, restaurant or cafeteria, office building, or buildings, and outbuildings, or any structures of any type or kind located above ground shall be set back from property or street lines. "Side building site line" shall mean the boundary or property line dividing two adjoining building sites. "Front building site line" shall mean the boundary or property line dividing two facing building sites or street lines.
*Source: The Can Do Story. 1974. Community Area New Development Organization, Inc. Mezzanine--The Northeastern Building, Hazelton, Pennsylvania. Pp. 68-71.
The real property which is, and shall be leased, conveyed, transferred, occupied, or sold subject to the conditions, covenants, restrictions, reservations, and easements set forth herein is located in the - , and is more particularly described as follows,
to wit:
The real property described in Clause I hereof is subjected to the conditions, covenants, restrictions, reservations, and easements hereby declared to insure proper use and appropriate development and improvement of each building site thereof; to protect the owners of building sites against such improper use of surrounding building sites as will depreciate the value of their property; to guard against the erection thereof of structures built of improper or unsuitable materials; to insure adequate and reasonable development of said property; to encourage the erection of attractive improvements thereon, with appropriate locations thereof on building sites; to prevent haphazard and inharmonious improvement of building sites; to secure and maintain proper setbacks from streets and adequate free spaces between structures; and, in general, to provide adequately for a high type and quality of improvement in said property.
A. No noxious or offensive trade or activity, such as a glue factory, fertilizer plant, or similar business shall be carried on, nor shall anything be done thereon which may be or become an annoyance or nuisance to the said industrial addition hereby restricted by reason of unsightliness or the excessive emission of odors, dust, fumes, or smoke. If any dispute shall arise as to the meaning of this paragraph, the final decision as to its applicability shall be made by the its successors or assigns.
B. Without otherwise limiting the provisions of Paragraph A of this Clause III or any of the other terms and conditions of these restrictions, the buildings or premises, except as otherwise provided in these restrictive covenants, may be used for any use except that the following shall not be permitted:
1. Auto wrecking; salvage yards; used material yards; storage or baling of waste or scrap paper, rags, scrap metals, bottles, or junk. This Clause shall be interpreted to prevent an independent business of the above type or kind; but it shall not be considered prohibitive to store scrap material, if the scrap material is used in or is from the business in which the industrial plant is engaged; but in all cases, the aforesaid scrap shall be stored in an orderly manner.
2. Bag cleaning.
3. Central mixing plant for asphalt, mortar, plaster, or concrete.
C. These covenants shall and do hereby provide that no improvements as herein defined shall be erected, placed, or altered on any building site in said development until the building or other improvement plans, specifications, and plot plan showing the location of such improvements on the particular building site have been submitted to and approved in writing, as to conformity and harmony of external design with existing structures in the development, and as to location of the improvements on the building site, giving due regard to the anticipated use thereof as same may affect adjoining structures, uses, and operations, and as to location of the improvements with respect to topography, grade, and finished ground elevation by __________, its successors or assigns, unless and until __________ such right has been expressly assigned, and then such right will pass to such assignee; provided, however, that the Grantor, its successors or assigns, shall not be liable in damages to anyone so submitting plans for approval or to any owner or owners of land covered by this instrument by reason of mistake in judgment, negligence, or nonfeasance of its, its agents or employees, arising out of or in connection with the approval or disapproval or failure to approve any such plans; likewise anyone so submitting plans to the Grantor, its successors or assigns, for approval, by the submitting of such plans, and any owner by so acquiring title to any of the property covered hereby, agrees that he or she or it will not bring any action or suit to recover for any such damages against the Grantor, its successors or assigns. In the event Grantor, its successors or assigns, fails to approve or disapprove such design and location within thirty (30) days after said plans and specifications have been submitted to it, this covenant will be deemed to have been fully complied with. If the construction, or alteration of improvements, or extension of trackage is begun in violation of the terms and conditions of this Section C, or without the written approval required in other sections hereof, and no suit to enjoin the erection, establishment, or alteration of such improvements, or extension of trackage has been commenced prior to the completion hereof, this covenant will be deemed to have been fully complied with.
D. No structures or buildings shall be located closer than twenty-five (25) feet to any side building site line or rear property line, it being the intent that an open area of at least fifty (50) feet shall exist between all adjacent but separately owned improvements both at sides and rear, provided however, that where a rear property line adjoins a dedicated alley, this provision regarding the rear property line shall not apply; where a right-of-way easement has been granted to __________ Railroad Company, its successors or assigns, either at the rear or side of any building site, no structures or buildings shall be constructed on said right-of-way, or any part thereof, except with the written consent of Grantor, its successors or assigns, and said Railroad Company, its successors or assigns. No portion of any building shall be closer than one hundred (100) feet to a front building site line, excepting that portion which may be used exclusively for offices, which portion may not be closer than seventy-five (75) feet to a front building line.
E. No building or structures above ground shall extend beyond the building lines, and it is hereby declared that said area between the building lines and the property lines is to be used either for open landscaped and green areas or for offstreet surfaced parking areas. If said area is to be landscaped, it shall be done attractively with lawn, trees, shrubs, etc., according to plans first approved in writing by the Grantor, its successors or assigns. If said area is to be used for offstreet parking, the parking arrangement and surfacing must likewise be approved in writing by the Grantor, its successors or assigns. Any landscaped areas shall be properly maintained thereafter in a sightly and well-kept condition. Parking areas shall likewise be maintained in good condition.
F. It is contemplated that maneuvering of trucks and trailers be confined in as far as possible to the premises of each establishment. To that end, it is hereby provided that no loading dock extend beyond the one hundred (100) foot or the twenty-five (25) foot building lines hereinbefore mentioned. Whenever a loading dock is to be located facing a street where the building line is within thirty (30) feet, and it appears that the nature of the business of the particular establishment using the premises contemplates the use of trucks exceeding twenty-five (25) feet in length, the end of any loading dock shall be located within the building or at least thirty (30) feet back of the building line to the end that, in general, such loading dock and every part thereof shall be at least thirty (30) feet from the nearest right-of-way of the street on which said loading dock fronts. The actual depth of such loading dock within the building or structures shall be determined in connection with the building plans or improvement plans to be approved as provided in Section C.
G. Power used in or developed or obtained for the operation of any establishment within the confines of the area subjected to these restrictions shall be confined to electrical or substantially equivalent type of power using only Anthracite coal, oil, gasoline, gas liquid petroleum products or similar combustible materials in its production, or other products which do not produce excessive smoke, odors, or fumes.
H. For each manufacturing, jobbing, warehousing, wholesaling, or other use permitted in the area subject to these covenants, there shall be provided offstreet automobile parking facilities, such facilities to be approved in writing by Grantor, its successors or assigns, but to be based generally, but not specifically, at the minimum rate of one parking space for each three employees to be employed on the premises by the original occupant thereof.
I. The storage of bulk commodities shall be confined to locations and screening thereof as approved in writing by the Grantor, its successors or assigns.
J. Railroad right-of-way easements may be granted by the Grantor, its successors or assigns, on any property hereby restricted so long as it is the owner in fee simple of said property. The same right is reserved to any subsequent owner in fee simple of property covered by these covenants.
K. No billboards or advertising signs other than those identifying the name, business, and products of the person or fin-n occupying the premises shall be permitted, except that a sign not to exceed five (5) by ten (10) feet in size, offering the premises for sale or lease, may be permitted, Grantor, its successors or assigns, must approve all signs in writing.
L. No fence, masonry wall, hedge, or mass planting shall be permitted to extend beyond the lot lines established herein except upon approval in writing by the Grantor, its successor or assigns.
M. No refining or mining operations of any kind, or quarrying shall be permitted upon or in any of the building sites subject to these covenants; nor shall tanks, tunnels, mineral excavations, or shafts be permitted upon or in any of the building sites covered by these covenants.
Tanks shall be permitted in or adjacent to any building where they are necessary in the manufacturing or industrial processes. Fuel oil storage tanks as a part of the heating equipment of any establishment shall be permitted only if located underground and in full compliance with rules and regulations of any governmental agency or agencies having jurisdiction over such matters and at a depth and in a location as approved by Grantor, its successors or assigns, in writing. Bulk storage of all liquids, including gasoline or petroleum products on the outside of buildings, shall be permitted only upon written consent of Grantor, its successors or assigns, in locations as approved by Grantor, its successors or assigns, in writing and if same be underground at a depth as approved by Grantor, its successors or assigns, in writing and subject to compliance with rules and regulations of any governmental agency or agencies having jurisdiction over such matters.
N. Whenever the written approval of the Grantor, its successors or assigns, is required in connection with any improvements to be installed, erected, or altered, or is otherwise required by the provisions of these covenants, same shall be governed by the conditions set forth in Section C hereof.
0. Each of the conditions, covenants, restrictions, and reservations set forth above shall continue and be binding upon the Grantor, and upon its successors and assigns and upon each of them and all parties and all persons claiming under them for a period of thirty (30) years from __________day of __________, and automatically shall be continued thereafter for successive periods of twenty-five (25) years each; provided, however, that the owners of 75 percent of the fee simple of the property subjected to these restrictive covenants, based on the number of square feet owned, as compared to the total area restricted, may release all or any part of the land so restricted from any one or more of said restrictions or may change or modify any one or more of said restrictions at the end of this first thirty (30) year period or any successive twenty-five (25) year period thereafter by executing and acknowledging an appropriate agreement or agreements in writing for such purposes and filing the same for record in the Office of the __________, at least five (5) years prior to the expiration of this first thirty (30) year period or of any successive twenty-five (25) year period thereafter; provided, however, that within ten (10) years from date hereof these covenants, or any part thereof, may be changed in whole or in part upon written approval of the owners of 70 percent of the fee simple of the property subjected to these covenants, based on the number of square feet owned as compared to the total area restricted, such written instrument to be properly recorded in the Office of the __________. before same becomes binding and in force and effect.
R The covenants herein set forth shall run with the land and bind the present owner, its successors and assigns, and all parties claiming by, through, or under it shall be taken to hold, agree, and covenant with the owner of said building sites, its successors and assigns, and with each of them, to conform to and observe said restrictions as to the use of building sites and the construction of improvements thereon; but no restrictions herein set forth shall be personally binding on any corporation, person, or persons except in respect to breaches committed during its, his, hers, or their use of, or title to said land; and Grantor, its successors or assigns, or the owner or owners of any of the above land shall have the right to sue for and obtain an injunction, prohibitive or mandatory, to prevent the breach of or to enforce the observance of the restrictions above set forth, in addition to ordinary legal action for damages, and the failure of Grantor, its successors or assigns; and the owner of any other lot or lots or building sites, hereby restricted to enforce any of the restrictions herein set forth at the time of its violation, shall in no event be deemed to be a waiver of the right to do so as to any subsequent violation. The violation of these restrictions shall not defeat nor render invalid the lien or any mortgage (or deed of trust) made in good faith and for value.
Q. If any owner of any plot of land in __________Industrial Park, his or her heirs, executors, or its assigns shall violate or attempt to violate any of the covenants herein, it shall be lawful for any other person or persons, corporation or corporations, owning any real property situated in said development or subdivision to prosecute any proceedings at law or in equity against the person or persons, corporation or corporations violating or attempting to violate any such covenant, and either to prevent him or her or them or any corporation from so doing, or to recover damages or other dues for said violation.
IN WITNESS WHEREOF, by authority of its Board of Directors, has caused this instrument to be executed by its President, attested by its Secretary-Treasurer, and its corporate seal to be hereto affixed this __________day of __________, 19_____ .
_________________________
(Name of Organization)
ATTEST:
BY_________________________
President
_________________________
Secretary-Treasurer (Seal)
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Sample Document 3. Sample Certificate of Incorporation For An Industrial Development Corporation in Alabama.
The undersigned, ____________ , and ____________ , each of whom is over the age of eighteen years, each of whom is a resident of the City of ____________ , Alabama, and each of whom is a qualified elector of and a taxpayer and property owner in said city, desiring to organize a body corporate under the laws of Alabama and particularly under Act No. 648, adopted at the 1949 Regular Session of the Legislature of Alabama, as heretofore or hereafter amended, and being all of the incorporators of the corporation hereby organized, do make, sign, and file this certificate of incorporation as follows:
(1) The name of the corporation is and shall be: THE INDUSTRIAL DEVELOPMENT BOARD OF THE CITY OF ____________.
(2) Permission and authorization to organize the corporation has been granted by resolution duly adopted by the governing body of the City of _____________ , Alabama, on ___________ , 19____ .
(3) The location of the principal office of the corporation shall be the City of ____________ in the State of Alabama, and the post office address of the corporation and of said principal office shall be ____________ , Alabama Zip Code ____________ .
(4) The purposes for which the corporation is formed are the acquisition, ownership, lease, and other disposition of property by the corporation to the end that it may be able (a) to promote industry and develop trade by inducing manufacturing, industrial, and commercial enterprises to locate in the State of Alabama and (b) to further the use of the agricultural products and natural resources of the State of Alabama. In furtherance of the said purposes, the corporation shall have all powers conferred on corporations of like nature by Act No. 648, adopted by the 1949 Regular Session of the Legislature of Alabama, and any amendment thereof heretofore or hereafter made and all other powers conferred upon corporations generally by the laws of Alabama not in conflict with the said Act No. 648 as heretofore or hereafter amended.
(5) The governing body of the corporation shall be a Board of Directors which shall consist of nine members, who shall be elected by the governing body of the City of ____________ , Alabama, in the manner and for the terms of office provided by law.
(6) The duration of the existence of the corporation shall be perpetual unless it shall be sooner dissolved by proceedings taken pursuant to Section 14 of said Act No. 648.
(7) The corporation shall be a nonprofit corporation, and no part of the net earnings thereof shall inure to any individual or private corporation.
IN WITNESS WHEREOF the undersigned incorporators have hereunto subscribed their signatures this ___________ day of ____________ , 19 ____________ .
__________________________
__________________________
__________________________
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Sample Document 4a. Sample Form Used To Apply For Permission To Organize An Industrial Development Board In Alabama.
TO THE CITY COUNCIL OF THE CITY OF _______________ ALABAMA.
We, the undersigned natural persons, each of whom is a duly qualified elector of the City of __________ , Alabama, and a taxpayer and the owner of property in said city, do hereby file with you, as the governing body of said city, this application in writing and do hereby make application for permission and authorization to incorporate an industrial development board of said city, pursuant to the provisions of Act No. 648, adopted at the 1949 Regular Session of the Legislature of Alabama, as heretofore or hereafter amended and do hereby request that said application be granted and that a proper resolution be adopted by you authorizing the incorporation of an industrial development board of and in said city under the name of "The Industrial Development Board of the City of ____________ ."
We submit herewith for your consideration a form of the certificate of incorporation, proposed to be used in organizing said corporation, to which shall be attached a certificate of the Secretary of State of Alabama that the name so designated is not identical with or so nearly similar to that of another corporation already in existence in this state as to lead to confusion and uncertainty.
WITNESS our signature this ______ day of __________ 19 _______ .
__________________________
__________________________
__________________________
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Sample Document 4b. Sample Notarized Statement Substantiating The Validity Of The Certificate Of Incorporation And The Qualifications Of The Incorporators And Resolution Granting Permission To Organize.
STATE OF ALABAMA )
COUNTY OF __________ )
I, ___________ , a Notary Public in and for said county in said state, hereby certify that ___________ whose names are signed to the foregoing certificate of incorporation and who are known to me, acknowledge before me on this day that, being informed of the contents of the certificate of incorporation, they executed the same voluntarily on the day the same bears date.
Given under my hand and seal of office this ___________ day of ___________ , 19___ .
__________________________
Notary Public
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Sample Document 4c. Formal Record Of Approval By The City Council Of The Certificate Of Incorporation.
After consideration of said application and said proposed form of certificate of incorporation, Council member introduced the following resolution together with the preambles thereto which were read to the meeting:
A RESOLUTION GRANTING PERMISSION AND AUTHORIZATION FOR THE INCORPORATION OF THE INDUSTRIAL DEVELOPMENT BOARD OF THE CITY OF ___________ AND APPROVING THE FORM OF CERTIFICATE OF INCORPORATION PROPOSED THEREFORE
WHEREAS, ___________ have filed with the City Council of this city an application in writing signed by said applicants for permission and authorization to incorporate a corporation to be known as "The Industrial Development Board of the City of ___________ ," and the said City Council have ascertained and found that the said applicants are natural persons and are duly qualified electors of and taxpayers and property owners in said city; and
WHEREAS, the City Council of said city have examined the said application and have found that the same is regular in all respects and said corporation is proposed to be organized, and the said City Council deem it wise, expedient, necessary, and advisable that said corporation be formed; and
WHEREAS, there was submitted with said application a form of certificate of incorporation proposed to be used in organizing said corporation, which form is deemed appropriate and satisfactory by said City Council;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of ___________ , Alabama, as follows:
(1) The recitals contained in the foregoing preambles are hereby found and declared to be true.
(2) The said application and the said proposed form of certificate of incorporation are hereby ordered to be spread on the minutes of this meeting.
(3) It is hereby found and declared to be wise, expedient, necessary, and advisable that there be formed the corporation for the incorporation of which the said application has been made.
(4) Said application is hereby allowed and permission and authorization are hereby granted to the persons signing said application to file and record a certificate for the incorporation of The Industrial Development Board of the City of ___________ in the manner provided by the laws of Alabama under which said corporation is proposed to be organized.
(5) The said form of certificate of incorporation proposed to be used in organizing said corporation is hereby approved.
____________________________________________________
President of the City Council
Authenticated:
____________________________________________________
City Clerk
Council member ______________ moved that unanimous consent be given for immediate consideration of and action on said resolution, which motion was seconded by Council member ______________ , and, upon the said motion being put to vote, the following vote was recorded: Yeas: Council members ______________ ; Nays: Council members ______________ .
The president thereupon declared that the motion for unanimous consent for immediate consideration of and action on said resolution had been unanimously carried. Council member ______________ thereupon moved that the said resolution be finally adopted, which was seconded by Council member ______________ and, upon the said motion being put to vote, the following vote was recorded: Yeas: ______________ ; Nays: ______________ .
The president then announced that the motion for adoption of said resolution had been unanimously carried.
Council member ______________ introduced the following resolution:
RESOLVED THAT THE RESOLUTION, ENTITLED "A Resolution Granting Permission and Authorization for the Incorporation of the Industrial Development Board of the City of ______________ and Approving the Form of Certificate of Incorporation Proposed Therefore," which was heretofore adopted at this meeting, shall be published one time in ______________ , a newspaper published and having general circulation in the city.
Council member ______________ moved that the foregoing resolution be adopted, which motion was seconded by Council member ______________ , and upon roll call the following vote was recorded: Yeas: Council members ______________ ; Nays: Council members ______________ .
The president thereupon declared the resolution has been duly adopted.
There being no further business to come before the meeting the same was on motion duly adjourned.
______________________________________________
President of the City Council
Attest:
______________________________________________
City Clerk
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Sample Document 5. Sample City Council Resolution Appointing A Board Of Directors For An Industrial Development Board.
A RESOLUTION APPOINTING DIRECTORS OF THE INDUSTRIAL DEVELOPMENT BOARD OF THE CITY OF ___________
WHEREAS, ___________ acting under and pursuant to authority duly granted by the governing body of the City of , Alabama, by resolution have duly executed and filed with the Judge of Probate of ___________ County, Alabama, a certificate of incorporation of The Industrial Development Board of the City of ___________ ;
WHEREAS, said Judge of Probate has approved the said certificate of incorporation and admitted the same to record in his office, and thereupon the said corporation became duly incorporated under the provisions of Act No. 648 adopted at the 1949 Regular Session of the Legislature of Alabama; and
WHEREAS, the said certificate of incorporation provides that the board of directors of said corporation shall consist of nine members and under the provisions of said Act No. 648 it is the duty of the governing body of said city to elect the membership of the said board of directors and to divide said directors into three groups of equal size, it being provided in said act that the first term of office of one group of directors shall be two years, that the first term of another group of directors shall be four years, and that the first term of the third group of directors shall be six years, as shall be designated at the time of their election, after which the term of office of each director shall be six years; and
WHEREAS, ___________ are duly qualified electors and property owners and taxpayers of said city, none of them is an officer or employee of said city, and in the opinion of said City Council each of them is competent and qualified to act as a member of the board of directors of said corporation;
NOW, THEREFORE, BE IT HEREBY RESOLVED by the City council as follows:
(1) The recitals contained in the foregoing preambles are hereby found to be true.
(2) The following are hereby elected as members of the Board of Directors of said corporation, the terms of office of said members to be as follows beginning in each instance on the ___________ day of ___________ , 19 ___________ ; ___________ and ___________ are hereby elected as such members for a period of two years from said date; ___________ and ___________ are hereby elected as such members for a period of four years from said date; and ____ and ___________ are hereby elected as members for a period of six years from said date.
Adopted and approved this ___________ day of ___________ , 19 _____,
_________________________________________
President of the City Council
Authenticated:
_________________________________________
City Clerk
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Sample Document 6. Sample Bylaws For An Industrial Development Board.
I
SEAL
The corporate seal shall have inscribed thereon the name of the corporation and the words, "CORPORATE SEAL and "ALABAMA."
1. The property and business of this corporation shall be managed by its board of directors, consisting of nine members, who shall be duly qualified electors of and property owners and taxpayers in the City of ___________ , Alabama, shall not be officers or employees of said city, and shall be elected in accordance with the provisions of the applicable laws of Alabama by the governing body of said city. The initial terms of the members of the board of directors shall be as follows: three members shall be elected for two years, three members shall be elected for four years, and three members shall be elected for six years. After the respective expirations of said initial terms, the terms of the members shall each be six years. Any vacancy in the membership of the board shall be filled by election of the said governing body.
2. The directors may hold their meetings and have one or more offices and keep the books of the corporation at such places as they may determine from time to time.
3. In addition to the powers and authorities by these bylaws expressly conferred upon it, the board of directors may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the certificate of incorporation or by these bylaws denied to them.
4. The members of the board of directors shall serve without compensation but shall be reimbursed for all actual expenses incurred by them in and about the performance of their duties as members of the board of directors.
1. Regular meetings of the board of directors may be held without notice to the directors at such times and places as shall be determined from time to time by resolution adopted by the board of directors.
2. Special meetings of the board of directors may be called by the chairman of the board of directors on one day's notice to each member of the board of directors. Special meetings may be called by any two members of the board of directors upon one day's notice to each member of the board of directors. The note provided for in this paragraph must be given in person, unless any director is absent from the City of ___________ Alabama, in which event any such notice may be given by registered letter or telegram. The notice provided for in this paragraph may be waived by any director, either before or after the meeting of which notice is waived.
3. Any regular meeting or special meeting of the board of directors may be continued in session by being adjourned at the end thereof to a specified time and place, and at any adjourned meeting may again be continued in session by adjournment thereof.
4. At all meetings of the board of directors, a majority thereof shall be necessary and sufficient to constitute a quorum for the transaction of business, and the act of a majority of the members of the board of directors present at any meeting at which there is a quorum shall be the act of the board of directors, provided, however, that the affirmative vote of a majority of the entire board of directors shall be necessary to authorize the borrowing of money and the issuance of securities by the corporation, and to take the actions hereinafter referred to under paragraphs 4 and 5 of the headings, "Officers," and under the heading, "Amendments."
1. The officers of the corporation shall be elected by the board of directors and shall consist of a chairman of the board of directors, a vice chairman of the board of directors, a secretary of the corporation, and a treasurer of the corporation. The chairman and vice chairman of the board of directors must be members of the board of directors, and said offices shall not be held by the same members. The secretary and the treasurer of the corporation need not be (but may be) members of the board and said offices may be held by the same person.
2. The board of directors may appoint such employees and agents as it may deem necessary, who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the board of directors.
3. The salaries of all employees and agents of the corporation shall be fixed by the board of directors.
4. The officers of the corporation shall hold office for a period of one year and until their successors are chosen and qualified in their stead. Any officer elected or appointed by the board of directors may be removed at any time by the affirmative vote of a majority of the entire board of directors.
5. In case of the absence of any officer of the corporation, or for any other reason that the board of directors may deem sufficient, the board of directors may delegate, for the time being, the powers and duties, or any of them, of such officer to any other officer, provided that a majority of the entire board of directors concur therein.
1. The chairman of the board of directors shall be the executive officer of the corporation. He shall preside at all meetings of the board of directors and see that all orders and recommendations of the board of directors are carried into effect. He shall execute all contracts of the corporation.
1. The vice chairman of the board of directors shall have the same powers and duties as the chairman except that he shall preside at meetings of the board of directors only in the absence of the chairman.
1. The secretary of the corporation shall attend all sessions of the board of directors and record the minutes of all proceedings thereof in a book to be kept for that purpose. He shall give, or cause to be given, notice of all meetings of the board of directors. He shall keep in safe custody the seal of the corporation and, when authorized by the board of directors, shall affix the same to any instrument requiring it and shall attest it. He shall perform such other duties as may be prescribed by the board of directors.
1. The treasurer of the corporation shall be the custodian of all funds of the corporation and shall withdraw and expand the same from time to time as may be authorized by the board of directors. He shall also serve as assistant secretary with full authority to perform all duties of the secretary only in the absence of the secretary. He shall perform such other duties as may be prescribed by the board of directors.
1. All checks or demands for money or notes of the corporation shall be signed by such officer or officers as the board of directors may designate from time to time.
1. The fiscal year shall begin on __________ in each calendar year and shall end on the then next succeeding ___________.
1. These bylaws may be altered or amended by the affirmative vote of a majority of the entire board if directors.
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Sample Document 7. Sample Form Of Certificate Of Incorporation For A Certified Development Corporation Eligible To Apply For A Loan Under Section 502 Of The Small Business Investment Act of 1958, as Amended.*
FIRST. The name of the corporation is ___________ Development Company.
SECOND. Its principal office in the State of ___________ is located at ___________ , in the City of ___________ , County of ___________ . The name and address of its resident agent is ___________ .
THIRD. This corporation is organized and chartered for the purpose of furthering the economic development of ___________ and its environs (area of operations) and promoting and assisting the growth and development of business concerns, including small business concerns, in said area. The primary objective of this corporation shall be benefit to the community as measured by increased employment, payroll, business volume, and corresponding factors rather than monetary profits to the shareholders. Any monetary profits or other benefits which flow to shareholders shall be merely incidental thereto.
FOURTH. The corporation is authorized and empowered to do all things necessary to carry on and accomplish the purpose for which it is organized and chartered, including authority and power:
To enter into, make, and perform contracts under authority herein granted.
To borrow or raise monies for any of the purposes of the corporation and, from time to time without limit as to amount, to draw, make, accept, endorse, execute and issue promissory notes, drafts, bills of exchange, warrants, bonds, debentures, and other negotiable or nonnegotiable instruments and evidences of indebtedness, and to secure the payment of any thereof and of the interest thereon by mortgagee upon or pledge, conveyance of assignment in trust of the whole or any part of the property of the corporation, whether at the time owned or thereafter acquired, and to sell, pledge, or otherwise dispose of such bonds or other obligations of the corporation for its corporate purposes.
To lend to any person, firm, or corporation any of its funds, either with or without security.
To purchase, hold, sell, and transfer the shares of its own capital stock.
To promote and assist the growth and development of small business concerns and others.
To have one or more offices, to carry on all or any of its operations and business and, without restriction or limit as to amount, to purchase or otherwise acquire, hold, own, mortgage, sell, convey, or otherwise dispose of real and personal property of every class and description.
To acquire, construct, convert, or expand plant facilities for lease or sale.
*This form may require technical or formal changes to comply with requirements of state laws and state officials. Applicants should consult with their attorneys to insure compliance with such requirements. Source: Small Business Administration Field Office, Birmingham, Alabama.
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Sample Document 8. Sample Bylaws Of A Certified Development Corporation.
1. The annual meeting of the stockholders of this corporation shall be held at the principal office of the corporation in ___________ on the ___________ of each year unless such day be a legal holiday, in which case the meeting shall be held on the next day following that is not a legal holiday, for the election of Directors, and the transaction of such other business as may then properly come before said meeting. A written or printed notice of time and place of such meeting shall be given by the Secretary, by delivery of or by mailing such notice to each stockholder, addressed to him at his usual place of business, or such address as may appear on the books of the company, at least ten (10) days previous to such meeting, and in such other manner, if any, as may be prescribed by law. If for any reason the annual election shall not be held as hereinbefore provided, it may be held on any subsequent day to be fixed by the Board of Directors.
2. Special meetings of the stockholders may be called at any time by the President or Board of Directors, and the President shall call a special meeting whenever he is requested in writing so to do by the stockholders representing ___________ of the capital stock. Such request may specify the time, place, and object of the proposed meeting. Notice of such special meeting shall be given in the same manner as is prescribed herein for the annual meeting of stockholders.
3. At said meeting of the stockholders a majority of interest of the stockholders shall constitute a quorum for the transaction of business, except as otherwise provided by law, and except that a lesser number may adjourn a meeting. At said meeting of stockholders, each stockholder shall be entitled to one vote for each share of common stock standing in his name on the books of the corporation, and such vote may be cast by the stockholders in person, or by proxy.
1. The entire general charge of the affairs of the company shall be managed and conducted by a Board of Directors composed of ___________ Directors to be elected by the stockholders for this company at the time and place fixed by the Bylaws. They shall hold office for one year and until their successors are elected. A majority of the Board of Directors at a meeting duly assembled shall be necessary to constitute a quorum for the transaction of business, and the act of a majority shall be the act of the Board. Any vacancy or vacancies in the Board may be filled for the period remaining until the next election by the other Directors.
2. A regular meeting of the Board of Directors shall be held on the day of and immediately after the annual meeting for the election of Directors, provided a majority of the Directors elected at said meeting shall be present. They shall organize and proceed to the election of officers as hereinafter provided.
3. Special meetings of the Directors may be called at any time by the President, or shall be called by him or by the Secretary, upon request in writing, signed by ___________ of the Directors, specifying the time and place and object of the proposed meeting.
4. A written or printed notice of the time, place, and object of every special meeting of the Board of Directors shall be given by the Secretary, by delivery of or by mailing such notice to each Director, addressed to him at his usual place of business, or such address may appear on the books of the company, at least three days before the time named for the meeting.
1. The officers of the company shall consist of a President, a Vice President, Secretary, and Treasurer, to be elected by the Board of Directors at a meeting for organization held after the annual meeting of the stockholders, or at any meeting held in lieu of said meeting, for said purpose. Each of such officers shall serve for the term of one year, until the election of his successor. The Board of Directors may also appoint such other officers, agents, and employees as they deem necessary. All officers, agents, or employees so appointed, shall be removable at the pleasure of the Directors. Any vacancy in any office may be filled by the Board of Directors. The offices of Secretary and Treasurer may be consolidated in one person, in which case he or she shall discharge the duties of both offices as hereinafter defined.
2. The President shall preside at all meetings of the corporation, and of the Board of Directors, and shall sign all certificates of stock, and all notes, loan deeds, and obligations of the corporation, unless otherwise directed by the Board of Directors, and all contracts, leases, bills of sale and other instruments, when authorized by the Directors, and generally shall perform all duties usually incumbent upon such officers, and such as may be required of him by the Board of Directors. He shall make annual reports of the conditions of the company, and submit the same to the stockholders at their annual meeting.
3. The Vice President shall perform all duties of the President in his or her absence and such other duties as may be required of him by the Board of Directors.
4. The Treasurer shall receive and have custody of all money and securities of the corporation, shall pay such dividends as may be declared from time to time by the Board of Directors, and do and perform all such duties as usually devolve upon such officers.
He shall deposit funds to the credit of the company in such banks or savings and loan associations as the Board of Directors shall direct and disburse the same under the direction of the Board of Directors. He shall sign all certificates of stock when signed by the President. He shall keep regular books and full accounts, showing all his receipts and disbursements, which books and accounts shall be open at all times to the inspection of the President or of any Director. At the end of each fiscal or calendar year, he or she shall submit to the directors detailed statements of his or her receipts and disbursements, and shall also from time to time, at request, make reports to the President as to the financial condition of the Company.
The Directors may require the Treasurer to give such security for the faithful performance of his duties as they shall from time to time determine.
5. The Secretary shall have the care and custody of the books of said corporation, give the necessary notices of all the meetings of the stockholders, and Board of Directors, and keep and record the proceedings of all such meetings. He shall have the custody of the seal of the corporation and shall affix the same to all instruments requiring the seal, when authorized by the Board of Directors. He shall keep such other books and records, and perform all such other duties as may be assigned to him by the Board of Directors or the President.
1. Subscription to the capital stock shall be paid in at such times and in such installments as the Board of Directors may require.
2. Certificates of stock shall be issued in the manner prescribed by law to each stockholder, showing the number of shares to which he is entitled. Each certificate shall be signed by the President and Treasurer or Secretary, and shall have the corporate seal affixed thereto. When fully paid, all stock shall be nonassessable.
3. Stock shall be transferable only by entry upon the books of the corporation upon surrender of the outstanding certificate or certificates therefore, with the assignment thereof duly executed. Each certificate, surrendered upon the transfer of stock, shall be at once canceled and posted on the margin or stub in the book from which it was taken when issued, and a new certificate issued in the name of the assignee.
4. In case of any application for the issue of a new certificate of stock in place of one or more claimed to have been lost or misplaced or destroyed, the same shall be referred to the Board of Directors, which shall determine the terms upon which a new certificate shall be issued.
1. Dividends may be declared and paid out of the surplus profits of the corporation as often and at such times as the Directors may determine.
1. The Common Sea] of the corporation shall be in the following form.
1. These Bylaws may be altered or amended and additional bylaws adopted by a majority vote at any meeting of the stockholders in the notice of which the purpose of the meeting shall be stated.
Read and adopted by the Board of Directors
_____________________________________
Secretary
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1Alabama State Geologist, Geological Survey of Alabama, P.O. Box 0, Tuscaloosa, Al 35486.
2Economic Development Administration (EDA), United States Department of Commerce, Formula For Growth: How to Make an Industrial Site Survey (Washington: Government Printing Office, October, 1969), pp. 13-15.
3EDA, pp. 13-15.
4EDA, pp. 13-15.
5Contact: Director, Alabama Industrial Development Training, One Technology Court, Montgomery, AL 36116-3200. Phone: (205) 261-4158.
6"Financing," Alabama Industrial Development Guide (Montgomery: Alabama Development Office).
7"Financing."
8"Financing."
9The Alabama Office of the Small Business Administration is located at 2121 8th Avenue North, Birmingham, AL 35203-2398.
10Contact: Director, Southern Development Council, 671 South Perry Street, Suite 500, Montgomery, Alabama 36104. Phone (205) 264-5441.
11Examples: Fortune's Plant and Product Directory, Dun and Bradstreet's Million Dollar Directory, Moody's Industrial Manual, Poor's Register of Corporations, Directors and Executives, Thomas' Register of American Manufacturers.
12"Directory of Industrial Development Boards for Alabama Cities and Counties" (Montgomery: Research Division, Alabama Development Office, August, 1987).
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