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302A.401 AUTHORIZED SHARES.
    Subdivision 1. Board may authorize. Subject to any restrictions in the articles, a corporation
may issue securities and rights to purchase securities only when authorized by the board.
    Subd. 2. Terms of shares. All the shares of a corporation:
(a) shall be of one class and one series, unless the articles establish, or authorize the board to
establish, more than one class or series;
(b) shall be common shares entitled to vote and shall have equal rights and preferences in all
matters not otherwise provided for by the board, unless and to the extent that the articles have
fixed the relative rights and preferences of different classes and series; and
(c) shall have, unless a different par value is specified in the articles, a par value of one
cent per share, solely for the purpose of a statute or rule imposing a tax or fee based upon the
capitalization of a corporation, and a par value fixed by the board for the purpose of a statute or
rule requiring the shares of the corporation to have a par value.
    Subd. 3. Procedure for fixing terms. (a) Subject to any restrictions in the articles, the
power granted in subdivision 2 may be exercised by a resolution or resolutions approved by the
affirmative vote of the directors required by section 302A.237 establishing a class or series,
setting forth the designation of the class or series, and fixing the relative rights and preferences
of the class or series.
(b) A statement setting forth the name of the corporation and the text of the resolution and
certifying the adoption of the resolution and the date of adoption shall be filed with the secretary
of state before the issuance of any shares for which the resolution creates rights or preferences not
set forth in the articles; provided, however, where the shareholders have received notice of the
creation of shares with rights or preferences not set forth in the articles before the issuance of
the shares, the statement may be filed any time within one year after the issuance of the shares.
The resolution is effective when the statement has been filed with the secretary of state; or, if it is
not required to be filed with the secretary of state before the issuance of shares, on the date of its
adoption by the directors.
(c) Filing a statement with the secretary of state in accordance with paragraph (b) is not
considered an amendment of the articles for purposes of sections 302A.135, 302A.137, and
302A.471. Filing an amendment of such a statement with the secretary of state is considered an
amendment of the articles for purposes of sections 302A.135, 302A.137, and 302A.471.
    Subd. 4. Specific terms. Without limiting the authority granted in this section, a corporation
may issue shares of a class or series:
(a) subject to the right of the corporation to redeem any of those shares at the price fixed for
their redemption by the articles or by the board or at a price determined in the manner specified by
the articles or by the board;
(b) entitling the shareholders to cumulative, partially cumulative, or noncumulative
distributions in the amounts fixed by the articles or by the board or in amounts determined in the
manner specified by the articles or by the board;
(c) having preference over any class or series of shares for the payment of distributions
of any or all kinds;
(d) convertible into shares of any other class or any series of the same or another class on
the terms fixed by the articles or by the board or on terms determined in the manner specified
by the articles or by the board; or
(e) having full, partial, or no voting rights, except as provided in section 302A.137.
History: 1981 c 270 s 55; 1982 c 497 s 32; 1985 c 248 s 70; 1987 c 104 s 18; 1991 c 49
s 3,4; 1993 c 17 s 22,23; 1994 c 417 s 2; 1997 c 10 art 1 s 11; 2004 c 199 art 14 s 12; 2006 c
250 art 1 s 21

Official Publication of the State of Minnesota
Revisor of Statutes