16-10a-601. Authorized shares.
(1) The articles of incorporation must prescribe the classes of shares and the number of
shares of each class that the corporation is authorized to issue. If more than one class of shares is
authorized, the articles of incorporation must prescribe a distinguishing designation for each class,
and prior to the issuance of shares of a class the preferences, limitations, and relative rights of that
class must be described in the articles of incorporation. All shares of a class must have
preferences, limitations, and relative rights identical with those of other shares of the same class
except to the extent otherwise permitted by this section and Section 16-10a-602.
(2) The articles of incorporation must authorize:
(a) one or more classes of shares that together have unlimited voting rights; and
(b) one or more classes of shares, which may be the same class or classes as those with
voting rights, that together are entitled to receive the net assets of the corporation upon
dissolution.
(3) The articles of incorporation may authorize one or more classes of shares and one or
more series of shares within any class that:
(a) have special, conditional, or limited voting rights, or no right to vote, except to the
extent prohibited by this chapter;
(b) are redeemable or convertible as specified in the articles of incorporation:
(i) at the option of the corporation, the shareholder, or another person or upon the
occurrence of a designated event;
(ii) for money, indebtedness, securities, or other property; or
(iii) in a designated amount or in an amount determined in accordance with a designated
formula or by reference to extrinsic data or events;
(c) entitle the holders to distributions calculated in any manner, including dividends that
may be cumulative, noncumulative, or partially cumulative; or
(d) have preference over any other class or series of shares with respect to distributions,
including dividends and distributions upon the dissolution of the corporation.
(4) The description of the designations, preferences, limitations, and relative rights of
share classes or series of shares in Subsection (3) is not exhaustive.
Enacted by Chapter 277, 1992 General Session
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Last revised: Thursday, May 28, 2009