---
title: "Screen whether a corporation may acquire its own shares"
url: "https://ailawframework.com/practice/mergers-and-acquisitions-private-equity/screen-whether-a-company-may-financially-assist-a-share-acquisition/united-states"
type: "task_jurisdiction_version"
site: "AI Law Framework"
id: "A2-TM20261022-14-US"
practice_area: "Mergers & Acquisitions / Private Equity"
tier: "yellow"
lawyer_review: "required"
jurisdictions: ["US"]
last_reviewed: "2026-10-22"
---

# Screen whether a corporation may acquire its own shares

> 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.…

Canonical page: https://ailawframework.com/practice/mergers-and-acquisitions-private-equity/screen-whether-a-company-may-financially-assist-a-share-acquisition/united-states  
Last reviewed: 2026-10-22

Site index for agents: https://ailawframework.com/llms.txt

## Key facts

| Fact | Value |
| --- | --- |
| Practice area | [Mergers & Acquisitions / Private Equity](https://ailawframework.com/practice/mergers-and-acquisitions-private-equity.md) |
| Human involvement | Yellow: Lawyer and AI draft together |
| 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 | United States |
| Applies to | [Screen whether a company may financially assist a share acquisition](https://ailawframework.com/practice/mergers-and-acquisitions-private-equity/screen-whether-a-company-may-financially-assist-a-share-acquisition.md) |

## Checking plan

- What the AI does: 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.
- Basis: Checked against the linked sources on 22 October 2026. Confirm the current instrument before reliance.

## Notes

- Section 160 is a capital-impairment limit on the corporation buying its own shares. It is not a member-approval regime for financial assistance.
- A director who is interested in the purchase is also tested under § 144. The lawyer decides whether that section applies.

## Sources

- [Delaware General Corporation Law, Subchapter V, including § 160 Dealings in the corporation's own stock](https://delcode.delaware.gov/title8/c001/sc05/index.html) (checked 2026-10-22)
- [Delaware General Corporation Law, Subchapter IV, including § 141 Board authority and § 144 interested directors](https://delcode.delaware.gov/title8/c001/sc04/index.html) (checked 2026-10-22)

*Practice guidance for planning and review. Confirm current primary sources and the requirements of the actual matter. This is general information, not legal advice.*