In the absence of provisions in articles of incorporation, what is the legal presumption of different shares of stocks?

The legal presumption regarding different shares of stock, in the absence of specific provisions in the articles of incorporation, is that each type of share shall be equal in all respects. This means that unless the articles stipulate otherwise, all shares of a particular class are treated as having equal rights concerning dividends, voting, and liquidation rights.

This principle stems from the idea of fairness and equality in the treatment of shareholders. Typically, shares can be structured with various rights and restrictions, but if no such provisions are established, the default assumption is that shares within a class share the same characteristics. This equal treatment is crucial for maintaining investor confidence and ensuring that shareholders have consistent rights relative to their ownership stake.

The other options reflect specific characteristics of shares that do not apply universally in the absence of explicit provisions. Common shares may or may not have voting rights depending on the company’s bylaws. Similarly, while preferred shares often have different voting rights, they are not automatically classified as non-voting without specific language in the articles. Redeemable shares may have different implications in terms of rights, but their voting rights would also depend on the stipulations set forth in the governing documents.