(805 ILCS 5/6.05)
(from Ch. 32, par. 6.05)
Each corporation shall have power to
create and issue the number of shares stated in its articles of incorporation.
Such shares may be divided into one or more classes, including classes of
common shares, any or all of which classes may consist of shares with such
designations, preferences, qualifications, limitations, restrictions, and
such special or relative rights as shall be stated in the articles of
incorporation; provided, however, that common shares may have no preference
over any other shares with respect to distribution of assets upon
liquidation or with respect to payment of dividends. Subject to the
provisions of Section 7.40 of this Act, the articles of incorporation may
limit or deny the voting rights of or provide special voting rights for the
shares of any and all classes or of any series of a class.
Without limiting the authority herein contained, a corporation, if so
authorized in its articles of incorporation, may issue shares of preferred
or special classes subject to one or more of the following conditions:
(a) Subject to the right of the corporation to redeem
any of such shares at not exceeding the price fixed by the articles of incorporation for the redemption thereof.
(b) Entitling the holders thereof to dividends which
are cumulative or partially cumulative, or which are non-cumulative.
(c) Having preference over any other class or classes
of shares as to the payment of dividends.
(d) Having preference as to the assets of the
corporation over any other class or classes of shares upon the voluntary or involuntary liquidation of the corporation.
(e) Convertible into shares of any other class, or
into shares of any series of the same or any other class.
(f) The dividend rate on which may be determined upon
the basis of any facts ascertainable outside the articles of incorporation, but only if the manner in which such facts are to operate upon the dividend rate of any such preferred or special class shall be clearly and expressly set forth in the articles of incorporation.
Notwithstanding anything contained in Sections 6.10 and 7.40 of this
Act, except as otherwise provided in the articles of incorporation, a
corporation may create and issue, whether or not in connection with the
issue and sale of its shares or bonds, rights or options entitling the
holders thereof to purchase from the corporation, upon such consideration,
terms and conditions as may be fixed by the board, shares of any class or
series, whether authorized but unissued shares,
treasury shares or shares to be purchased or acquired, notes of the
corporation or assets of the corporation. The terms and conditions of such
rights or options may include, without limitation, restrictions or
conditions that preclude or limit the exercise, transfer or receipt of such
rights or options by any person or persons owning or offering to acquire a
specified number or percentage of the outstanding common shares or other
securities of the corporation, or any transferee or transferees of any such
person or persons, or that invalidate or void such rights or options held
by any such person or persons or any such transferee or transferees. Any
such rights or options heretofore created or issued prior to the effective
date of this amendatory Act of 1989 which are in conformity with this
Section 6.05 and are not otherwise in conflict with other provisions of this
Act, are hereby ratified. Nothing in this Section 6.05 shall affect the
rights and fiduciary obligations of the board of directors of a corporation
in the creation and issuance of such rights or options, or in the taking or
failing to take any action with respect to such rights or options.
(Source: P.A. 87-516; 88-151.)