Louisiana Revised Statutes 12:212 – Shareholders’ preemptive rights
Terms Used In Louisiana Revised Statutes 12:212
- Articles: means the original articles of incorporation, and all amendments thereto including those contained in merger agreements, or if restated, the latest restatement thereof, except in those instances in which the context expressly refers to the original articles of incorporation only. See Louisiana Revised Statutes 12:201
- Directors: means persons designated in the articles as such, and persons designated, elected or appointed by any other name or title to act as directors, and their successors. See Louisiana Revised Statutes 12:201
- person: includes a body of persons, whether incorporated or not. See Louisiana Revised Statutes 1:10
- Shareholder: means a natural or artificial person who is the owner of a property interest in a corporation represented by a certificate for shares of stock. See Louisiana Revised Statutes 12:201
- Treasury shares: means issued shares which have been acquired by and belong to the corporation, if not required by the articles to be cancelled, or if not cancelled by order of the board of directors. See Louisiana Revised Statutes 12:201
Shareholders shall have only such preemptive rights as may be provided in the articles. If the articles simply provide that “Shareholders shall have preemptive rights”, then:
A. Each holder of shares having voting rights shall, upon issuance for cash of shares having voting rights, have a preemptive right, during a reasonable period to be fixed by the board of directors (which need not exceed fifteen days after the giving or mailing of written notice to him of the terms and conditions on which such right is exercisable), to subscribe, at such price and upon such terms as may be fixed in the manner provided in La. Rev. Stat. 12:213, for such proportion of the shares to be issued, as the number of shares having voting rights held by him bears to the total number of shares having voting rights then outstanding.
B. A shareholder shall have no preemptive right to subscribe for shares:
(1) Which are to be issued for consideration other than cash; or
(2) Which are to be issued to satisfy conversion or option rights; or
(3) Which are treasury shares.
C. Shares which have been offered to shareholders having a preemptive right at a price or upon terms duly fixed, and which have not been subscribed for by them within the period fixed by the board of directors, may thereafter, for one year following the end of such period, be issued or sold to any other person or persons at a price not less than that at which they were offered to such shareholders.
Acts 1968, No. 105, §1.