221.0215 Authorized stock.

(1) Increase in capital stock. A bank may authorize an increase in the capital stock of the bank in the category of authorized but unissued stock if approved by the division and if approved by a vote of shareholders owning a majority of the stock of the bank entitled to vote, or by such greater percentage provided in the bank's articles of incorporation or bylaws.

(2) Authorized but unissued stock. A bank may issue authorized but unissued stock in all of the following circumstances:

(a) To employees of the bank pursuant to a stock option or stock purchase plan.

(b) In exchange for convertible preferred stock and convertible capital debentures, in accordance with the terms of the stock or debentures.

(c) For such other purposes and considerations as may be approved by both the division and the board of directors of the bank.

(3) Classes of shares. The articles of incorporation shall prescribe the classes of shares and the number of shares of each class that the bank is authorized to issue. If more than one class of shares is authorized, the articles of incorporation shall prescribe a distinguishing designation for each class. Before the issuance of shares of a class, the bank shall describe in its articles of incorporation the preferences, limitations and relative rights of that class. All shares of a class shall have preferences, limitations and relative rights identical with those of other shares of the same class, unless the class is divided into series.

(4) Series of shares. The articles of incorporation may create series of shares within a class of shares. Before the issuance of shares of a series, the bank shall describe in its articles of incorporation the number of shares of each series that the bank is authorized to issue, a distinguishing designation for each series within a class and the preferences, limitations and relative rights of that series. All shares of a series shall have preferences, limitations and relative rights identical with those of other shares of the same series and, except to the extent otherwise provided in the description of the series, with those of other series of the same class.

(5) Articles of incorporation. The articles of incorporation shall authorize all of the following:

(a) One or more classes of shares that together have unlimited voting rights.

(b) One or more classes of shares, which may be the same class or classes as those with voting rights under par. (a), that together are entitled to receive the net assets of the bank upon dissolution.

(6) Types of preferences and rights. The articles of incorporation may authorize one or more classes of shares that have designations, preferences, limitations and relative rights that may include any of the following:

(a) Special, conditional or limited voting rights, or no right to vote, except to the extent prohibited by this chapter.

(b) Subject to s. 221.0323, provisions for the redemption or conversion of the shares under any of the following terms specified by articles of incorporation:

1. At the option of the bank, the shareholder or another person, or upon the occurrence of a designated event.

2. For cash, indebtedness, securities or other property.

3. In a designated amount or in an amount determined in accordance with a designated formula or by reference to extrinsic data or events.

(c) Provisions entitling the holders to distributions calculated in any manner, including dividends that may be cumulative, noncumulative or partially cumulative.

(d) Preference over any other class of shares with respect to distributions, including dividends and distributions upon the dissolution of the bank.

(7) Powers of board of directors with respect to classes and series. To the extent provided in the articles of incorporation, the board of directors may, subject to the limits of this section, do any of the following:

(a) Determine with respect to any class of shares the preferences, limitations and relative rights, in whole or in part, before the issuance of any shares of that class.

(b) Create one or more series within a class, and, with respect to any series, determine the number of shares of the series, the distinguishing designation and the preferences, limitations and relative rights, in whole or in part, before the issuance of any shares of that series.

(8) Articles of amendment. Articles of amendment to a bank's articles of incorporation authorizing the issuance of shares of a class or series shall contain all of the following and shall be delivered to the division before issuing any shares of the class or series:

(a) The name of the bank.

(b) The text of the amendment determining the terms of the class or series of shares.

(c) The number of shares of the class or series of shares created.

(d) A statement that none of the shares of the class or series has been issued.

(e) The date that the amendment was adopted.

(f) A statement that the amendment was adopted by the board of directors and that shareholder action was not required. An amendment filed under this subsection is not effective unless approved by the division.

(9) Resolutions modifying preferences, limitations and relative rights. After the articles of amendment are filed under sub. (8) and before the bank issues any shares of the class or series that is the subject of the articles of amendment, the board of directors may alter or revoke any preferences, limitations or relative rights described in the articles of amendment, by adopting another resolution appropriate for that purpose. The bank shall file with the division revised articles of amendment that comply with sub. (8). A preference, limitation or relative right may not be altered or revoked after the issuance of any shares of the class or series that are subject to the preference, limitation or relative right.

History: 1995 a. 336.