Guam § 28614 - Shareholders’ Preemptive Rights.

§ 28614. Shareholders’ Preemptive Rights.

(a) The shareholders of a corporation do not have a preemptive right to

acquire the corporation’s unissued shares except to the extent the articles of

incorporation so provide.

(b) A statement included in the articles of incorporation that the

corporation elects to have preemptive rights (or words of similar import)

means that the following principles apply except to the extent the articles of

incorporation expressly provide otherwise:

(1) The shareholders of the corporation have a preemptive right,

granted on uniform terms and conditions prescribed by the board of

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directors to provide a fair and reasonable opportunity to exercise the

right, to acquire proportional amounts of the corporation’s unissued

shares upon the decision of the board of directors to issue them.

(2) A shareholder may waive his preemptive right. A waiver

evidenced by a writing is irrevocable even though it is not supported by

consideration.

(3) Unless the articles expressly provide there is no preemptive

right with respect to:

(A) shares issued as compensation to directors, officers,

agents, or employees of the corporation, its subsidiaries or

affiliates;

(B) shares issued to satisfy conversion or option rights

created to provide compensation to directors, officers, agents, or

employees of the corporation, its subsidiaries or affiliates;

(C) shares authorized in articles of incorporation that are

issued within six months from the effective date of incorporation;

(D) shares sold otherwise than for money.

(4) Holders of shares of any class without general voting rights but

with preferential rights to distributions or assets have no preemptive

rights with respect to shares of any class.

(5) Holders of shares of any class with general voting rights but

without preferential rights to distributions or assets have no preemptive

rights with respect to shares of any class with preferential rights to

distributions or assets unless the shares with preferential rights are

convertible into or carry a right to subscribe for or acquire shares

without preferential rights.

(6) Shares subject to preemptive rights that are not acquired by

shareholders may be issued to any person for a period of one year after

being offered to shareholders at a consideration set by the board of

directors that is not lower than the consideration set for the exercise of

preemptive rights. An offer at a lower consideration or after the

expiration of one year is subject to the shareholders’ preemptive rights.

(c) For purposes of this section, shares includes a security convertible

into or carrying a right to subscribe for or acquire shares.

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