Sec. 33-665. Authorized shares.
Sec. 33-665. Authorized shares. (a) The certificate of incorporation shall set forth
any classes of shares and series of shares within a class, and the number of shares of
each class and series, that the corporation is authorized to issue. If more than one class
or series of shares is authorized, the certificate of incorporation shall prescribe a distinguishing designation for each class or series and must describe, prior to the issuance of
shares of a class or series, the terms, including the preferences, rights and limitations,
of such class or series. Except to the extent varied as permitted by this section, all shares
of a class or series shall have terms, including preferences, rights and limitations, that
are identical with those of other shares of the same class or series.
(b) The certificate of incorporation shall authorize (1) one or more classes or series
of shares that together have unlimited voting rights, and (2) one or more classes or series
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 certificate of incorporation may authorize one or more classes or series of
shares that: (1) Have special, conditional or limited voting rights, or no right to vote,
except as otherwise provided by sections 33-600 to 33-998, inclusive; (2) are redeemable
or convertible as specified in the certificate of incorporation (A) at the option of the
corporation, the shareholder or another person or upon the occurrence of a specified
event, (B) for cash, indebtedness, securities or other property, and (C) at prices and in
amounts specified or determined in accordance with a formula; (3) entitle the holders
to distributions calculated in any manner, including dividends that may be cumulative,
noncumulative or partially cumulative; or (4) have preference over any other class or
series of shares with respect to distributions, including distributions upon the dissolution
of the corporation.
(d) Terms of shares may be made dependent upon facts objectively ascertainable
outside the certificate of incorporation in accordance with subsection (l) of section
33-608.
(e) Any of the terms of shares may vary among holders of the same class or series
as long as such variations are expressly set forth in the certificate of incorporation.
(f) The description of the preferences, rights and limitations of classes or series of
shares in subsection (c) of this section is not exhaustive.
(P.A. 94-186, S. 39, 215; P.A. 96-271, S. 31, 254; P.A. 03-158, S. 6.)
History: P.A. 94-186 effective January 1, 1997; P.A. 96-271 replaced "articles" of incorporation with "certificate" of
incorporation where appearing, effective January 1, 1997; P.A. 03-158 amended Subsec. (a) by replacing "shall prescribe
the classes" with "shall set forth any classes", adding provisions re series of shares within a class and revising provisions
re terms, preferences, rights and limitations of classes or series, amended Subsec. (b) by adding references to series,
amended Subsec. (c) by adding references to series, replacing "except to the extent prohibited" with "except as otherwise
provided", replacing "designated event" with "specified event", replacing provision re designated amount or amount
determined in accordance with designated formula or reference to extrinsic data or events with provision re prices and
amounts specified or determined in accordance with formula and making technical changes, added new Subsecs. (d) and
(e) re terms dependent upon facts objectively ascertainable outside certificate of incorporation and re variation of terms
of shares among holders, redesignated existing Subsec. (d) as Subsec. (f) and amended same by deleting provisions re
designations and relative rights and adding provisions re rights of classes or series of shares.
Annotation to former section 33-42:
Record title determines right to vote. 42 C. 560.
Annotations to former sections 33-59, 33-62, 33-96 and 33-98:
Cited. 72 C. 664. Re specially chartered corporation, increase may be by way of stock dividend. 83 C. 43. Failure of
corporation to comply with section empowers subscriber to avoid subscription contracts and recover money paid unless
guilty of laches; receipt of dividend checks held not to destroy power of avoidance. 106 C. 54. Cited. 125 C. 353.
Annotations to former section 33-324:
Cited. 150 C. 239.
Subsec. (a):
Cited. 16 CA 420.