North Dakota Proposed amendment to the certificate of incorporation to authorize up to 10,000,000 shares of preferred stock with amendment

• Category: Corporations - Public - Changes Affecting Capital Stock
• State: Multi-State
• Control #: US-CC-3-168
• Format: Word; Rich Text

Description

This sample form, a detailed Proposed Amendment to the Certificate of Incorporation to Authorize Up to 10,000,000 Shares of Preferred Stock w/Amendment document, is a model for use in corporate matters. The language is easily adapted to fit your specific circumstances. Available in several standard formats.

The proposed amendment to the certificate of incorporation in North Dakota seeks to authorize the issuance of up to 10,000,000 shares of preferred stock with an amendment. This amendment would grant the company the flexibility to issue preferred stocks in addition to its existing common shares. Preferred stocks are a type of equity security that grants certain privileges to shareholders, different from those of common stockholders. They often carry higher dividend rates or priority rights to company assets in case of liquidation. These additional features make preferred stocks an attractive investment option for certain investors. By amending the certificate of incorporation to authorize the issuance of preferred stock, a company can potentially enhance its financial flexibility and raise capital in more diverse ways. This can be particularly beneficial in situations where the company needs to raise funds without diluting the ownership or voting rights of existing shareholders. There are different types of preferred stock that a company can issue, each with its distinct characteristics. These types may include: 1. Cumulative Preferred Stock: This type of preferred stock accumulates any unpaid dividends and requires the issuer to pay them before distributing dividends to common shareholders. 2. Convertible Preferred Stock: This preferred stock carries the option for shareholders to convert their shares into a specified number of common shares, offering potential capital appreciation in addition to regular dividend payments. 3. Non-Cumulative Preferred Stock: Unlike cumulative preferred stock, non-cumulative preferred stock does not accumulate unpaid dividends. If dividends are not declared or paid in any period, the unpaid dividends are forfeited. 4. Participating Preferred Stock: Holders of participating preferred stock are entitled to receive additional dividends on top of their fixed dividend rate if the company exceeds a certain level of profitability. 5. Redeemable Preferred Stock: This type of preferred stock can be redeemed by the issuer after a specified date or at the company's discretion. The redemption may involve paying a premium, providing investors with an exit option. With this proposed amendment, the company will have the ability to issue preferred stocks of various types to meet different financial objectives and attract a broader range of investors. It is important to note that the specific types of preferred stock that can be issued will be subject to the terms outlined in the amended certificate of incorporation and any applicable regulations set forth by North Dakota corporate law.