Screen whether a corporation may acquire its own shares
Key facts
- Human involvement
- YellowClose supervision
- How AI is used
- Record the corporation, the shares, and whether the transaction is a purchase or redemption by the corporation of its own shares for cash or other property. If the lawyer marks it as that, record whether the file contains a capital analysis. Do not decide that capital is impaired, and do not list a stockholder-approval gate.
- What the lawyer must review
- For a Delaware corporation, the lawyer applies § 160(a). The corporation may purchase, redeem or otherwise acquire its own shares, but it shall not purchase or redeem them for cash or other property when its capital is impaired or when the purchase or redemption would cause an impairment, subject to the preference-stock exception in § 160(a)(1). The section does not prohibit a third party from buying the shares with the corporation's help, and it does not require a stockholder vote as a condition of the purchase. If the transaction is not a purchase or redemption by the corporation of its own shares, the lawyer does not treat § 160(a)(1) as the test.
- Written for / version
- United States versionUS
Who does what
| Role | What they do |
|---|---|
| Assistance | Consider narrowly defined preparation support after confirming the tool’s capability and 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.