United States · Indiana

How to issue shares in Indiana corporations

Indiana is a Model Business Corporation Act state. The Indiana Business Corporation Law (Ind. Code Title 23, Article 1) follows the MBCA framework. Indiana is sometimes chosen for incorporation by Indianapolis-headquartered corporations and has a notable anti-takeover statute (the Indiana Control Share Acquisitions chapter under Article 42).

Governing statute
Indiana Business Corporation Law, Ind. Code § 23-1-
Ind. Code § 23-1-25-2Issuance of shares
Ind. Code § 23-1-26-2Consideration for shares
Ind. Code § 23-1-27-1Stock certificates
Ind. Code § 23-1-52-1Corporate records
Ind. Code § 23-1-52-2Inspection of records
Ind. Code § 23-19-3-1Indiana Uniform Securities Act
At a glance
  • Authorized by the board under Ind. Code § 23-1-25-2
  • Future services and promissory notes permitted as consideration
  • Uncertificated shares permitted under § 23-1-27-2
  • Inspection rights under § 23-1-52-2 with proper-purpose standard
  • Indiana Uniform Securities Act under § 23-19-3-1

Board authorization

Stock issuance is authorized by the board under Indiana Business Corporation Law § 23-1-25-2. The board determines consideration under § 23-1-26-2. Indiana follows MBCA pattern.

Consideration: MBCA pattern

Indiana permits the standard MBCA consideration framework: tangible and intangible property, services rendered, contracts for services to be performed, promissory notes.

Uncertificated shares

§ 23-1-27-2 permits uncertificated shares.

Corporate records and inspection

§ 23-1-52-1 requires MBCA-pattern records. § 23-1-52-2 grants inspection rights with proper-purpose standard.

Indiana Control Share Acquisitions and anti-takeover statute

Indiana has a notable Control Share Acquisitions chapter (Ind. Code Title 23, Article 42) that limits the voting rights of shares acquired in certain control-share acquisitions without shareholder approval. This is a state-specific anti-takeover protection that applies by default to Indiana-incorporated public corporations and may be opted into by Indiana-incorporated private corporations. The Indiana Uniform Securities Act (§ 23-19-3-1 et seq.) governs offerings to Indiana residents.

Common mistakes

Common Indiana-specific failure points in share issuance:

  • Ignoring Indiana Control Share Acquisitions provisions (Article 42) when structuring large equity transactions
  • Missing Indiana Uniform Securities Act notice filings
  • Not maintaining the § 23-1-52-1 corporate records inventory
  • Treating IN case law as identical to DE
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FAQ

Common questions in Indiana

Indiana's Control Share Acquisitions chapter (Ind. Code Title 23, Article 42) limits the voting rights of shares acquired in certain control-share acquisitions (typically acquisitions of large blocks of shares without prior board approval). The chapter is one of the strongest state-level anti-takeover statutes and applies by default to Indiana-incorporated public corporations. Indiana-incorporated private corporations may opt in or opt out.

Less common than Delaware. Indianapolis-headquartered corporations sometimes choose Indiana, particularly those that want the anti-takeover protections under Article 42. Most institutional-investor-backed startups default to Delaware.

Indiana has Commercial Courts in Marion, Allen, Vanderburgh, and other counties. Less developed than Delaware Chancery but established enough for routine commercial disputes.
Records that comply with IBCL
Issue shares the right way in Indiana.

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