(a) Unless the certificate of incorporation provides otherwise, stock may be issued pro rata and without consideration to the corporation‘s stockholders or to the stockholders of one or more classes or series of stock. An issuance of stock under this subsection is a stock dividend.
Terms Used In Alabama Code 10A-2A-6.23
certificate of incorporation: as used in this chapter is synonymous to the term "certificate of formation" used in Chapter 1. See Alabama Code 10A-2A-1.40
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.
(b) Stock of one class or series may not be issued as a stock dividend in respect of stock of another class or series unless (i) the certificate of incorporation so authorizes, (ii) a majority of the votes entitled to be cast by the class or series to be issued approve the issuance, or (iii) there is no outstanding stock of the class or series to be issued.(c) The board of directors may fix the record date for determining stockholders entitled to a stock dividend, which date may not be retroactive. If the board of directors does not fix the record date for determining stockholders entitled to a stock dividend, the record date is the date the board of directors authorizes the stock dividend.
