Utah Code 16-10a-604. Fractional shares

(1)

A corporation may:

Terms Used In Utah Code 16-10a-604

Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
Receive: when used in reference to receipt of a writing or other document by a domestic or foreign corporation, means the writing or other document is actually received by:

(a)

the corporation at its:

(i)	registered office in this state; or

(ii)	principal office;

(b)	the secretary of the corporation, wherever the secretary is found; or

(c)

another person authorized by the bylaws or the board of directors to receive the writing or other document, wherever that person is found. See Utah Code 16-10a-102

Share: means the unit into which the proprietary interests in a corporation are divided. See Utah Code 16-10a-102

Shareholder: means :

(i)	the person in whose name a share is registered in the records of a corporation; or

(ii)	the beneficial owner of a share to the extent recognized pursuant to Section 16-10a-723. See Utah Code 16-10a-102
(a)	issue fractions of a share or pay in money the value of fractions of a share;

(b)	arrange for disposition of fractional shares by the shareholders; or

(c)	issue scrip in registered or bearer form entitling the holder to receive a full share upon surrendering enough scrip to equal a full share.

(2)	Each certificate representing scrip shall be conspicuously labeled “scrip” and shall contain the information required to be included on a share certificate by Subsections 16-10a-625(2) and (3) and Section 16-10a-627.

(3)

The holder of a fractional share is entitled to exercise the rights of a shareholder, including the right to vote, to receive dividends, and to participate in the assets of the corporation upon liquidation. The holder of scrip is not entitled to any of these rights unless the scrip provides for them.

(4)

The board of directors may authorize the issuance of scrip subject to any condition considered desirable, including:

(a)	that the scrip will become void if not exchanged for full shares before a specified date; and

(b)	that the shares for which the scrip is exchangeable may be sold and the proceeds paid to the scripholders.

Amended by Chapter 378, 2010 General Session

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