1. Any capital stock insurance company shall have power to create and issue the number of shares stated in its articles of incorporation. Such shares may be divided into one or more classes, any or all of which classes shall consist of shares with a minimum par value of one dollar, with such designations, preferences, qualifications, limitations, restrictions and such special or relative rights including the right of conversion into any other class of shares as shall be stated in the articles of incorporation; provided, that the authorized number of shares of any class or classes without voting rights shall not exceed in the aggregate a ratio of two shares of such class or classes to one share of the voting stock of the company to be outstanding when the corporation commences business.

2. In case a corporation is authorized by its articles of incorporation to issue preferred shares entitled to limited preferential dividends and to a limited amount on dissolution or liquidation, the board of directors may, if expressly authorized so to do by the articles of incorporation, and with the written approval of the director of the department of commerce and insurance, cause such shares to be issued from time to time in series and may, to the extent expressly authorized by such articles of incorporation, by resolution adopted prior to the issue of shares of a particular series, fix the distinctive serial designation of the shares of such series, the dividend rate thereof, the date from which dividends on shares issued prior to date for payment of the first dividend thereon shall be cumulative, the redemption price and the terms of redemption, the amounts payable thereon on dissolution or liquidation and the terms and amount of any sinking fund for the purchase or redemption thereof, and the terms and conditions, if any, under which said shares may be converted; and in respect of the terms so fixed by the board of directors, the shares of a particular series may vary from those of any or all other series, but only in respects and within the limits, if any, set forth in the articles of incorporation; and, except as so varied by the board of directors, all of the shares of the same class, regardless of series, shall in all respects be equal and shall have the preferences, rights, privileges and restrictions fixed by the articles of incorporation. Before the issue of any preferred shares of any series, the number of shares of such series and the designation, description and terms thereof fixed by the board of directors pursuant to such authority shall be set forth in a certificate signed and verified by the president or a vice president and countersigned by the secretary or an assistant secretary of the corporation, which certificates shall be filed with the director of the department of commerce and insurance and secretary of state and otherwise dealt with as in the case of articles of incorporation.

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3. In the event of the conversion or exchange of any issued shares into or for other shares of the corporation, whether of the same or of a different class or classes, the consideration for the shares so issued in such conversion or exchange is deemed to be:

(1) The consideration originally received for the shares so converted or exchanged; and

(2) That part of surplus, if any, transferred to stated capital upon the issuance of shares for the shares so converted or exchanged; and

(3) Any additional consideration paid to the corporation upon the issuance of shares for the shares so exchanged or converted.

4. When payment of the consideration for which shares are to be issued shall have been received by the corporation, the shares are full-paid and nonassessable. In the absence of actual fraud in the transaction, the judgment of the board of directors or the shareholders, as the case may be, as to the value of the consideration received for shares shall be conclusive.