Section 10A-10-1.07

Classification of shares.

(a) A real estate investment trust may provide by its declaration of trust any of the following:

(1) That any specified class of shares is preferred over another class as to its distributive share of the assets on voluntary or involuntary liquidation of the real estate investment trust and the amount of the preference.

(2) That any specified class of shares may be redeemed at the option of the real estate investment trust or of the holders of the shares and the terms and conditions of redemption, including the time and price of redemption.

(3) That any specified class of shares is convertible into shares of one or more classes and the terms and conditions of conversion.

(4) That the holders of any specified securities issued or to be issued by the real estate investment trust have any voting or other rights which, by law, are or may be conferred on shareholders.

(5) For any other preferences, rights, restrictions, including restrictions on transferability and qualifications not inconsistent with law.

(6) That the board of trustees may classify or reclassify any unissued shares, from time to time, by setting or changing the preferences, conversion, or other rights, voting powers, restrictions, limitations as to dividends, qualifications, or terms or conditions of redemption of the shares.

(7) That the board of trustees may amend the declaration of trust to increase or decrease the aggregate number of shares or the number of shares of any class that the trust has authority to issue.

(b) If, under a power contained in the declaration of trust, the board of trustees classifies or reclassifies any unissued shares by setting or changing the preferences, conversion, or other rights, voting powers, restrictions, limitations as to dividends or distributions, qualifications or terms or conditions of redemption, the board, before issuing any of the shares, shall file articles supplementary for record with the judge of probate in the county in which its principal place of business is located, in the manner and as provided by Article 4 of Chapter 1, which shall include both of the following:

(1) A description of the shares, including the preferences, conversion, and other rights, voting powers, restrictions, limitations as to dividends, qualifications, and terms and conditions of redemption, as set or changed by the board of trustees.

(2) A statement that the shares have been classified or reclassified by the board of trustees under the authority contained in the declaration of trust.

(c) (1) For purposes of this subsection, "facts" include the occurrence of any event, including a determination or action by any person or body, including the real estate investment trust.

(2) Any of the preferences, conversion, or other rights, voting powers, restrictions, limitations as to dividends or distributions, qualifications, or terms or conditions of redemption of any class or series of shares may be made dependent upon facts ascertainable outside the declaration of trust and may vary among holders of the shares, provided, that the manner in which the facts or variations will operate upon the preferences, conversion, or other rights, voting powers, restrictions, limitations as to dividends or distributions, qualifications, or terms or conditions of redemption of the class or series of shares is clearly and expressly set forth in the declaration of trust.

(d) If the real estate investment trust has authority to issue shares of more than one class, the certificate evidencing the shares shall contain on its face or back a full statement or summary of:

(1) The designations and any preferences, conversion, and other rights, voting powers, restrictions, limitations as to dividends or distributions, qualifications, and terms and conditions of redemption of the shares of each class which the real estate investment trust is authorized to issue.

(2) If the real estate investment trust is authorized to issue any preferred or special class in series both of the following:

a. The differences in the relative rights and preferences between the shares of each series to the extent they have been set.

b. The authority of the board of trustees to set the relative rights and preferences of subsequent series.

(e)(1) A summary of the information required by subsection (d), as included in a registration statement permitted to become effective under the Federal Securities Act of 1933, is an acceptable summary for the purposes of this section.

(2) Instead of a full statement or summary, the certificate may state that the real estate investment trust will furnish a full statement of the information required by subsection (d) to any holder of shares on request and without charge.

(f) Unless the declaration of trust provides otherwise, the trustees of a real estate investment trust may authorize the issue of some of the shares of any or all of its classes or series without certificates. The authorization does not affect shares already represented by certificates until they are surrendered to the real estate investment trust. At the time of issuance or transfer of any shares without certificates, the real estate investment trust shall send the shareholder a written statement of the information required on certificates by subsection (d) or (e).

(Acts 1995, No. 95-628, p. 1317, §7; §10-13-7; amended and renumbered by Act 2009-513, p. 967, §308.)