Effective 28 Aug 1980

393.220. Account for disposition of proceeds — issue void, when, exception — penalties — state not liable. — 1. The commission shall have power to require gas corporations, electrical corporations, water corporations and sewer corporations to account for the disposition of the proceeds of all sales of stocks, bonds, notes and other evidences of indebtedness in such form and detail as it may deem advisable, and to establish such rules and regulations as it may deem reasonable and necessary to insure the disposition of such proceeds for the purpose or purposes specified in its order.

2. All stock, and every bond, note or other evidence of indebtedness of a gas corporation, electrical corporation, water corporation or sewer corporation issued without an order of the commission authorizing the same then in effect shall be void, and likewise all stock, and every bond, note or other evidence of indebtedness of a gas corporation, electrical corporation, water corporation or sewer corporation, issued with the authorization of the commission, but not conforming in its provisions to the provisions, if any, which it is required by the order of authorization of the commission to contain, shall be void; but no failure in any other respect to comply with the terms or conditions of the order of authorization of the commission shall render void any stock, or any bond, note or other evidence of indebtedness, except as to a corporation or person taking the same otherwise than in good faith and for value and without actual notice.

3. Every gas corporation, electrical corporation, water corporation or sewer corporation which, directly or indirectly, issues or causes to be issued any stock or bond, note or other evidence of indebtedness, in nonconformity with the order of the commission authorizing the same, or contrary to the provisions of this chapter, or the constitution of this state, or which applies the proceeds from the sale thereof, or any part thereof, to any purpose other than the purpose or purposes specified in the commission's order in excess of the amount in said order authorized for the purpose, is subject to a penalty of not less than five hundred dollars nor more than twenty thousand dollars for each offense.

4. Every officer, agent or employee of a gas corporation, electrical corporation, water corporation, or sewer corporation, and every other person who knowingly authorizes, directs, aids in, issues or executes, or causes to be issued or executed, any stock or bond, note or other evidence of indebtedness, in nonconformity with the order of the commission authorizing the same, or contrary to the provisions of this chapter, or to the constitution of this state, or who, in any proceeding before the commission, knowingly makes any false statement or representation or with knowledge of its falsity files or causes to be filed with the commission any false statement or representation, which said statement or representation so made, filed or caused to be filed may tend in any way to influence the commission to make an order authorizing an issue of stock, or any bond, note or other evidence of indebtedness, or which results in the procuring from the commission the making of any such order, or who, with knowledge that any false statement or representation was made to the commission, in any proceeding, tending in any way to influence the commission to make such an order, issues or executes or negotiates, or causes to be issued, executed or negotiated any such stock or bond, note or other evidence of indebtedness, or who, directly or indirectly, knowingly applies, or causes or assists to be applied the proceeds, or any part thereof, from the sale of any stock or bond, note or other evidence of indebtedness, to any purpose not specified in the commission's order, or to any purpose specified in the commission's order, in excess of the amount authorized for such purpose, or who, with knowledge that any stock or bond, note or other evidence of indebtedness, has been issued or executed in violation of any of the provisions of this chapter, negotiates, or causes the same to be negotiated, shall be deemed guilty of a felony, and upon conviction shall be punished by a fine of not less than one thousand dollars nor more than five thousand dollars, or by imprisonment for not less than two years nor more than five years, or by both such fine and imprisonment.

5. No provision of this chapter, and no deed or act done or performed under or in connection therewith, shall be held or construed to obligate the state of Missouri to pay or guarantee in any manner whatsoever, any stock or bond, note or other evidence of indebtedness, authorized, issued or executed under the provisions of this chapter.

6. All stocks and bonds, notes and other evidences of indebtedness issued by any public utility after this law takes effect, upon the authority of any articles of incorporation or amendments thereto or vote of the stockholders or directors filed, taken or had, or other proceedings taken or had, previous to the taking effect of this chapter, shall be void, unless an order of the commission authorizing the issue of such stocks, bonds, notes or other evidences of indebtedness shall have been obtained from the commission prior to such issue. The commission may by its order impose such condition or conditions as it may deem reasonable and necessary.

7. Notwithstanding the other provisions of this section, the commission can approve all issues of stock, bonds, notes or other evidence of indebtedness of a gas corporation, electrical corporation, water corporation, or sewer corporation, which were issued without prior approval when it can be shown that the stocks, bonds, notes or other evidence of indebtedness were issued for purposes authorized by section 393.200, and were issued in good faith without knowledge of the requirement of obtaining prior approval.

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(RSMo 1939 § 5654, A.L. 1967 p. 578, A.L. 1980 H.B. 1618)