Prepare a preemptive offer only where the certificate grants the right
Key facts
- Human involvement
- YellowClose supervision
- How AI is used
- From the certificate and the proposed issue, quote any clause that expressly grants stockholders a preemptive right to subscribe, and set out the class, the offerees and the period exactly as that clause states them. If the certificate does not grant the right, say so and do not prepare an offer. Do not issue the shares.
- What the lawyer must review
- The lawyer confirms whether § 102(b)(3) applies: no stockholder has a preemptive right to subscribe to an additional issue of stock, or to a security convertible into stock, unless and except to the extent the certificate expressly grants it. Rights in existence on 3 July 1967 remain until changed by an action that expressly provides for the change. The lawyer settles the terms and decides what is done with shares that are not taken up.
- Written for / version
- United States versionUS
Who does what
| Role | What they do |
|---|---|
| Assistance | Do not begin AI assistance until the responsible lawyer has defined and confirmed its permitted scope. |
| Lawyer | Set the scope, supervise the work closely, verify every part relied on, resolve omissions and exceptions, and approve the exact output. |
Checklist
- Confirm the output against the client’s instructions and the complete relevant source material, including omissions or contradictions.
- Resolve exceptions and record the responsible lawyer’s approval of the exact output and intended use.