(a) 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 Section 33-6-102.

(b) The articles of incorporation must authorize (1) one or more classes of shares that together have unlimited voting rights, and (2) 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.

(c) The articles of incorporation may authorize one or more classes of shares that:

(1) have special, conditional, or limited voting rights, or no right to vote, except to the extent prohibited by Chapters 1 through 20 of this Title;

(2) 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 cash, indebtedness, securities, or other property; (iii) 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.

HISTORY: Derived from 1976 Code Section 33-9-10 [1962 Code Section 12-15.1; 1952 Code Sections 12-53, 12-211, 12-212; 1942 Code Sections 7693, 7694, 7696, 7726, 7729, 7731; 1932 Code Sections 7693, 7694, 7696, 7726, 7729, 7731; Civ. C. '22 Sections 4267, 4268, 4270, 4301, 4304; Civ. C. '12 Sections 2800, 2801, 2803, 2834, 2837; Civ. C. '02 Sections 1856, 1857, 1859, 1880, 1883; 1896 (22) 92, 94; 1897 (22) 522; 1900 (23) 386; 1901 (23) 712; 1903 (24) 75; 1920 (31) 754; 1923 (33) 157; 1927 (35) 218; 1928 (35) 1256; 1936 (39) 1337; 1942 (42) 1448; 1962 (52) 1996; 1981 Act No. 146, Section 2; Repealed, 1988 Act No. 444 Section 2], Section 33-9-190 [1962 Code Section 12-15.18; 1962 (52) 1996; 1963 (53) 327; 1981 Act No. 146, Section 2; Repealed, 1988 Act No. 444, Section 2], and Section 33-9-250 [1962 Code Section 12-15.24; 1962 (52) 1996; 1963 (53)327; 1981 Act No. 146, Section 2; Repealed, 1988 Act No. 444, Section 2]; 1988 Act No. 444, Section 2.