16-10a-1004. Voting on amendments by voting groups.
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16-10a-1004. Voting on amendments by voting groups.
(1)Except as otherwise provided in Subsection
(5), the holders of the outstanding shares of a class are entitled to vote as a separate voting group, if shareholder voting is otherwise required by this chapter, on a proposed amendment if the amendment would:
(a)increase or decrease the aggregate number of authorized shares of the class;
(b)effect an exchange or reclassification of all or part of the shares of the class into shares of another class;
(c)effect an exchange or reclassification, or create the right of exchange, of all or part of the shares of another class into shares of the class;
(d)change the designation, rights, preferences, or limitations of all or part of the shares of the class;
(e)change the shares of all or part of the class into a different number of shares of the same class;
(f)create a new class of shares having rights or preferences with respect to distributions or to dissolution that are prior, superior, or substantially equal to the shares of the class;
(g)increase the rights, preferences, or number of authorized shares of any class that, after giving effect to the amendment, have rights or preferences with respect to distributions or to dissolution that are prior, superior, or substantially equal to the shares of the class;
(h)limit or deny an existing preemptive right of all or part of the shares of the class; or
(i)cancel or otherwise affect rights to distributions or dividends that have accumulated but not yet been declared on all or part of the shares of the class.
(2)Except as otherwise provided in Subsection
(3), if a proposed amendment would affect a series of a class of shares in one or more of the ways described in Subsection
(1), the shares of that series are entitled to vote as a separate voting group on the proposed amendment.
(3)If a proposed amendment that entitles two or more series of a class of shares to vote as separate voting groups under this section would affect those two or more series in the same or a substantially similar way, the shares of all the series so affected shall instead vote together as a single voting group on the proposed amendment.
(4)Except as otherwise provided in Subsection
(5), a class or series of shares is entitled to the voting rights granted by this section although the articles of incorporation provide that the shares are nonvoting shares.
(5)Notwithstanding the rights granted by this section to holders of the outstanding shares of a class or series to vote as a separate voting group, the rights may be otherwise restricted if so provided in the original articles of incorporation, in any amendment thereto which created the class or series or which was adopted prior to the issuance of any shares of the class or series, or in any amendment thereto which was authorized by a resolution or resolutions adopted by the affirmative vote of the holders of a majority of the class or series.
Enacted by Chapter 277 , 1992 General Session