(1)  Unless the articles of incorporation provide otherwise, shares may be issued pro rata and without consideration to the corporation‘s shareholders or, to the extent and in the manner provided for in the articles of incorporation, to the shareholders of one or more classes or series of shares. An issuance of shares under this subsection is a share dividend.

Terms Used In Utah Code 16-10a-623

  • Articles of incorporation: include :
(a) amended and restated articles of incorporation;
(b) articles of merger; and
(c) a document of a similar import to those described in Subsections (4)(a) and (b). See Utah Code 16-10a-102
  • Bylaws: includes amended bylaws and restated bylaws. See Utah Code 16-10a-102
  • 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.
  • Record date: means the date established under 6, or 7, on which a corporation determines the identity of its shareholders. 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
    • (2)  Shares of one class or series may not be issued as a share dividend in respect of shares of another class or series unless:

    (a)  the articles of incorporation so authorize;

    (b)  a majority of the votes entitled to be cast by the outstanding shares of the class or series to be issued approve the issue; or

    (c)  there are no outstanding shares of the class or series to be issued.

    (3)  The bylaws or, in the absence of an applicable bylaw, the board of directors may fix a future date as the record date for determining shareholders entitled to a share dividend. If no future date is so fixed, the record date is the date the board of directors authorizes the share dividend.

    Enacted by Chapter 277, 1992 General Session

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