Commercial Law, 2012 Bar — Question 57

MULTIPLE CHOICE

The capital stock of ABC Corporation is divided into common shares and preferred shares. Preferred shares are preferred as to dividends and common shares are those shares which have the regular and ordinary attributes of a share of a corporation. Which statement is most accurate? A) This kind of classification may not be allowed or else it will violate the Doctrine of Equality of shares. B) Classifications of shares may be allowed for as long as it is clearly stated as such in the Articles of Incorporation of the Corporation. C) Classifications of shares is mainly for business purpose to attract investors. D) Classifications of shares may be allowed with the approval of the stockholders and the Board of Directors.

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