Louisiana Revised Statutes 6:257 – Restriction on transfer of shares and other securities
Terms Used In Louisiana Revised Statutes 6:257
- 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 refers expressly to the original articles of incorporation only. See Louisiana Revised Statutes 6:201
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Dependent: A person dependent for support upon another.
- Enrolled bill: The final copy of a bill or joint resolution which has passed both chambers in identical form. It is printed on parchment paper, signed by appropriate officials, and submitted to the President/Governor for signature.
- person: includes a body of persons, whether incorporated or not. See Louisiana Revised Statutes 1:10
- Shares: means the units into which the stockholders' rights to participate in the control of the state bank, in its profits, or in the distribution of corporate assets are divided. See Louisiana Revised Statutes 6:201
A. For purposes of this Section, “share” includes a security convertible into or carrying a right to subscribe or acquire shares.
B. A corporation‘s articles of incorporation or bylaws, an agreement among shareholders or an agreement between shareholders and the corporation, may impose restrictions on the transfer or registration of transfer of shares of the corporation. A restriction does not affect shares issued before the restriction was adopted unless the holders of the shares are parties to the restriction agreement or voted in favor of the restriction.
C. A restriction on the transfer or registration of transfer of shares is valid and enforceable against the holder or a transfer1 of the holder if the restriction is authorized by this Section and its existence is noted conspicuously on the front or back of the certificate or is contained in the information statement required by La. Rev. Stat. 6:255(H). Unless so noted, a restriction is not enforceable against a person who has no knowledge of the restriction.
D. A restriction on the transfer or registration of transfer of shares is authorized for any of the following:
(1) To maintain the corporation’s status when it is dependent on the number or identity of its shareholders.
(2) To preserve exemptions under federal or state securities law.
(3) For any other reasonable purpose.
E. A restriction on the transfer or registration of transfer of shares may do any of the following:
(1) Obligate the shareholder first to offer the corporation or other persons, separately, consecutively, or simultaneously, an opportunity to acquire the restricted shares.
(2) Obligate the corporation or other persons, separately, consecutively, or simultaneously, to acquire the restricted shares.
(3) Require the corporation, the holders of any class of its shares or another person to approve the transfer of the restricted shares if the requirement is not manifestly unreasonable.
(4) Prohibit the transfer of the restricted shares to designated persons or classes of persons if the prohibition is not manifestly unreasonable.
Acts 2005, No. 97, §1.
1As appears in enrolled bill. Should be “transferee”.