Sec. 1. (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.

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