NORTH CAROLINA GENERAL ASSEMBLY

1963 SESSION

CHAPTER 753

HOUSE BILL 425

AN ACT TO PROVIDE FINANCIAL RESOURCES TO PROMOTE THE GROWTH OF INDUSTRY IN NORTH CAROLINA BY AMENDING CHAPTER 24 OF THE GENERAL STATUTES TO PERMIT CORPORATIONS ORGANIZED FOR PECUNIARY GAIN TO CONTRACT FOR BORROWED FUNDS WITHOUT LEGISLATIVE RESTRICTION AS TO INTEREST RATE.

The General Assembly of North Carolina do enact:

Section 1. Chapter 24 of the General Statutes is amended by adding a new Section immediately following G. S. 24-8, to be designated as G. S. 24-9, and to read as follows:

"Notwithstanding any other provision of this Chapter or any other provision of law, any foreign or domestic corporation substantially engaged in commercial, manufacturing or industrial pursuits for pecuniary gain may agree to pay, and any commercial factor may charge and collect from such corporation, interest at any rate which such corporation may agree to pay in writing, provided such interest is charged upon loans, advances or forbearances which are secured by liens upon or security interests in accounts receivable, materials, goods in process, inventory, machinery, equipment and other similar personal property, whether tangible or intangible, and as to any such transaction the claim or defense of usury by such corporation and its successors or anyone else in its behalf is prohibited. For purpose of this Section the term "commercial factor" shall be defined to mean any corporation, foreign or domestic, which in the regular course of its business engages in the purchase of accounts receivable, without recourse to the account creditor, and with notification of such purchase to the account debtor.

Sec. 1½. This Act shall not apply to Ashe, Columbus, New Hanover and Pender Counties.

Sec. 2. All laws and clauses of laws in conflict with this Act are hereby repealed.

Sec. 3. This Act shall be in full force and effect from and after its ratification.

In the General Assembly read three times and ratified, this the 7th day of June, 1963.