§ 23-1-25-1 — Authorization of shares in articles of incorporation

(a) The articles of incorporation must prescribe
the number of shares that the corporation is authorized to issue. If more
than one (1) class of shares is authorized by the articles of
incorporation, the articles of incorporation must prescribe the number
of shares in each class and a distinguishing designation for each class.
Before 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 section 2 of this chapter.
(b) The articles of incorporation must authorize:
(1) one (1) or more classes of shares that together have unlimited
voting rights; and
(2) one (1) or more classes of shares (that 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.
(c) The articles of incorporation may authorize one (1) or more
classes of shares that have one (1) or more of the following
characteristics:
(1) Have special, conditional, or limited voting rights, or no right
to vote, except to the extent prohibited by this article.
(2) Are redeemable or convertible as specified in the articles of
incorporation:
(A) at the option of the corporation, the shareholder, or another
person or upon the occurrence of a designated event;
(B) for cash, indebtedness, securities, or other property; and
(C) in a designated amount or in an amount determined in
accordance with a designated formula or by reference to
extrinsic data or events.
(3) Entitle the holders to distributions calculated in any manner,
including dividends that may be cumulative, noncumulative, or
partially cumulative.
(4) Have preference over any other class of shares with respect to
distributions, including dividends and distributions upon the
dissolution of the corporation.
(d) The description of the designations, preferences, limitations, and
relative rights of share classes in subsection (c) is not exhaustive.

Legislative History

As added by P.L.149-1986, SEC.9.