1. A telecommunications company may, when authorized by order of the commission, and not otherwise, issue stock, bonds, notes or other evidence of indebtedness payable at periods of more than twelve months after the date thereof when necessary for the acquisition of property, the construction, completion, extension or improvement of its facilities or the improvement or maintenance of its service within the state, or for the discharge or lawful refunding of its obligations, or reimbursement of moneys actually expended from the income from any source, within five years next prior to the filing of the application therefor, or for any of such purposes; provided, however, that no order shall be granted authorizing such issue for reimbursement of moneys expended from income for betterments or replacements unless the applicant shall have kept its accounts and vouchers of such expenditures in such manner as to enable the commission to ascertain the amount of moneys so expended and the purposes for which such expenditures were made.

2. The commission may by order authorize the issue of bonds, notes or other evidence of indebtedness for the reimbursement of moneys heretofore actually expended from income for any of the purposes herein specified. The order of the commission shall fix the amount of any such issue and the purposes to which it or its proceeds are to be applied and recite that in the opinion of the commission the money, property or labor procured or to be procured or paid for by such issue or its proceeds has been or is reasonably required for the purposes specified in the order, and that such purposes are in no part reasonably chargeable to operating expenses or to income except in the case of bonds, notes or other evidence of indebtedness as may be permitted in the order.

3. For the purpose of enabling the commission to determine whether it should issue such an order the commission shall make such inquiry or investigation, hold such hearings and examine such witnesses, books, papers, documents or contracts as it may determine of importance in enabling it to reach a determination.

4. No such company shall, without the consent of the commission, apply any such issue or its proceeds to any purpose not specified in the order. Such telecommunications company may issue notes for proper business purposes and not in violation of any provision of this chapter, or of any other law, payable at periods of not more than twelve months, without the consent of the commission; but no such note shall, in whole or in part, directly or indirectly, be refunded by any issue of stock or bonds, or by any evidence of indebtedness running for more than twelve months, without the consent of the commission.

5. No telecommunications company shall be required, however, to apply to the commission for authority to issue stocks, bonds, notes or other evidence of indebtedness except for the acquisition of property, the construction, completion, extension or improvement of its facilities, or the improvement or maintenance of its service within the state, or the discharge or refunding of obligations, or reimbursement of moneys actually expended for such purposes.

6. The commission shall have no power to authorize the capitalization of any franchise or right to be a corporation, or to authorize the capitalization of any franchise, or the right to own, operate or enjoy any franchise whatsoever in excess of the amount (exclusive of any tax or annual charge) actually paid to the state or any political subdivision thereof, as the consideration of the grant of such franchise or right, nor shall the corporate stock of the corporation formed by the merger or consolidation of two or more other corporations exceed the sum of the capital stock of the corporation so consolidated, at the par value thereof, or such sum and any additional sum actually paid in cash; nor shall any contract for consolidation or lease be capitalized in the stock of any corporation whatever; nor shall any corporation hereafter issue any bonds against or as a lien upon any contract for consolidation or merger.