2009 Iowa Code
Title 12 - Business Entities
Subtitle 2 - Business and Professional Corporations and Companies
CHAPTER 490 - BUSINESS CORPORATIONS
490.630 - SHAREHOLDERS' PREEMPTIVE RIGHTS.

        490.630  SHAREHOLDERS' PREEMPTIVE RIGHTS.
         1.  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.
         2.  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:

         a.  The shareholders of the corporation have a preemptive
      right, granted on uniform terms and conditions prescribed by the
      board of 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.
         b.  A shareholder may waive the shareholder's preemptive
      right.  A waiver evidenced by a writing is irrevocable even though it
      is not supported by consideration.
         c.  There is no preemptive right with respect to:
         (1)  Shares issued as compensation to directors, officers, agents,
      or employees of the corporation, its subsidiaries, or its affiliates.

         (2)  Shares issued to satisfy conversion or option rights created
      to provide compensation to directors, officers, agents, or employees
      of the corporation, its subsidiaries, or its affiliates.
         (3)  Shares authorized in articles of incorporation that are
      issued within six months from the effective date of incorporation.
         (4)  Shares sold otherwise than for money.
         d.  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.
         e.  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.
         f.  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.
         3.  For purposes of this section, "shares" includes a security
      convertible into or carrying a right to subscribe for or acquire
      shares.  

         89 Acts, ch 288, §50; 2006 Acts, ch 1089, §8
         Referred to in § 534.508