GA Code § 14-2-624 (2021)
2021 Georgia Code|Title 14 - Corporations, Partnerships, and Associations|Chapter 2 - Business Corporations|Article 6 - Shares and Distributions|Part 2 - Issuance of Shares|§ 14-2-624. Share Options

  A corporation may issue rights, options, or warrants with respect to the shares of the corporation whether or not in connection with the issuance and sale of any of its shares or other securities. The board of directors shall determine the terms upon which the rights, options, or warrants are issued, their form and content, the consideration for which they are to be issued, and the terms and conditions relating to their exercise, including the time or times, the conditions precedent, and the prices at which and the holders by whom the rights, options, or warrants may be exercised.   If at the time the corporation issues rights, the corporation does not have authorized and unissued shares sufficient to satisfy the rights if and when exercised, the granting of the rights is not invalid solely by reason of the lack of sufficient authorized but unissued shares to honor the exercise of the rights.   The terms of the rights, options, or warrants, including the time or times, the conditions precedent, and the prices at which and the holders by whom the rights, options, or warrants may be exercised, as well as their duration, (1) may preclude or limit the exercise, transfer, or receipt of such rights, options, or warrants or invalidate or void any rights, options, or warrants and (2) may be made dependent upon facts ascertainable outside the documents evidencing the rights, or the resolution providing for the issue of the rights, options, or warrants adopted by the board of directors, if the manner in which the facts shall operate upon the exercise of rights is clearly and expressly set forth in the document evidencing the rights or in the resolution. Such terms and conditions need not be set forth in the articles of incorporation. As used in this Code section, the term "facts" includes, but is not limited to, the occurrence of any event, including a determination or action by any person or body, including the corporation.   The terms and conditions of rights, options, or warrants issuable pursuant to this Code section may include provisions that:   Preclude or limit the exercise, transfer, or receipt of such rights, options, or warrants by, or invalidate or void any such rights, options, or warrants held by, any person that is a beneficial owner of a specified amount of the outstanding equity securities or percentage of the outstanding voting power of the corporation, or by any transferee of such person, except that such provisions shall not affect any person whose beneficial ownership at the date of adoption of any such provision exceeds such specified amount or percentage, unless the amount of outstanding equity securities beneficially owned by such person is subsequently increased; and   Limit, restrict, or condition the power of a future director to vote for the redemption, modification, or termination of the rights, options, or warrants for a period not to exceed 180 days from the initial election of the director, provided that such 180 day time limitation shall not apply to any such limitation, restriction, or condition that is based solely on a director's current or former status as an employee or officer of the corporation; as a director, officer, employee, affiliate, or associate of any interested shareholder or person seeking to become an interested shareholder; or as a director, officer, or employee of an affiliate of an interested shareholder or person seeking to become an interested shareholder.     The provisions of subsection (d) of this Code section shall be applied as follows:   The definition of "beneficial owner" contained in Code Section 14-2-1110 shall be applicable to this Code section, except (A) any exclusion from such definition shall be permitted, and (B) that the effective date of this paragraph shall be December 31, 2000, insofar as it may be deemed to apply to any right, option, or warrant issued or issuable at the date of enactment of this paragraph;   The definition of "affiliate," "associate," and "interested shareholder" contained in Code Section 14-2-1110 shall be applicable to this Code section; provided, however, that the inclusion of a person as a nominee for election as a director of the corporation by an interested shareholder or person seeking to become an interested shareholder shall not create an implication that such nominee is an affiliate of an interested shareholder or person seeking to become an interested shareholder; and   Any rights, options, or warrants issued or issuable pursuant to this Code section that contain a provision otherwise permitted by paragraph (2) of subsection (d) of this Code section but which do not purport to comply with the 180 day time limitation specified therein shall not be rendered invalid, but any such provision shall be deemed to be effective only to the extent permitted by paragraph (2) of subsection (d) of this Code section.     The board of directors may, by a resolution adopted by the board, authorize one or more officers of the corporation to do one or both of the following:   Designate officers and employees of the corporation or of any of its subsidiaries to be recipients of rights, options, or warrants to be issued by the corporation; or   Determine the number of rights, options, or warrants to be received by such officers and employees;  provided, however, that the resolution authorizing such officer or officers shall specify the total number of rights, options, or warrants such authorized officer or officers may award. The board of directors may not authorize an officer to designate himself or herself as a recipient of any rights, options, or warrants.        (Code 1981, §14-2-624, enacted by Ga. L. 1988, p. 1070, § 1; Ga. L. 1989, p. 946, § 16; Ga. L. 2000, p. 1567, § 3; Ga. L. 2001, p. 4, § 14; Ga. L. 2003, p. 897, § 4; Ga. L. 2004, p. 508, § 5.)   Law reviews.   - For article discussing treasury shares and restrictions placed upon their use by the corporation, see 3 Ga. L. Rev. 11 (1968). For article discussing corporate authority to create and issue share rights and options, see 3 Ga. L. Rev. 11 (1968). For article, "Some Distinctive Features of the Georgia Business Corporation Code," 28 Ga. St. B. J. 101 (1991). For note on 2000 amendment of O.C.G.A. § 14-2-624, see 17 Ga. St. U. L. Rev. 46 (2000). For comment on the survivability of the dead hand provision in corporate America, see 48 Emory L.J. 991 (1999). For comment, "Poison Pills: Are Dead Hand Pills Dead in Georgia?," see 50 Mercer L. Rev. 809 (1999). For comment, "Locking the Boardroom Dorr: What Can Georgia Courts Learn from Recent Delaware Poison Pill Decisions," see 32 Georgia St. U. L. Rev. 727 (2016).   RESEARCH REFERENCES   Am. Jur. 2d.   - 18A Am. Jur. 2d, Corporations, § 569 et seq.   C.J.S.   - 18 C.J.S., Corporations, §§ 252, 307, 308, 372, 373, 456 et seq.   ALR.    - Implied authority of general manager or superintendent of corporation to contract with employee for share in profits of business, 47 A.L.R. 1015.    Time factor in purchase or sale of corporate stock under contract not fixing a definite time for demand or performance, 144 A.L.R. 895.   Construction and application of provisions of articles, bylaws, statutes, or agreements restricting alienation or transfer of corporate stock, 2 A.L.R.2d 745.   Validity of stock-option plan under which selected personnel of corporation may acquire stock interest therein, 34 A.L.R.2d 852.   Rights and liabilities as between employer and employee with respect to employee stock options, 96 A.L.R.2d 176.   Transfer of, and voting rights in, stock of co-operative apartment association, 99 A.L.R.2d 236.   Construction and effect of "dilution" provision of employee's stock-option contract, dealing with rights where stock structure of corporation changes before option is exercised, 59 A.L.R.3d 1030.   Restrictions on transfer of corporate stock as applicable to testamentary dispositions thereof, 61 A.L.R.3d 1090.   Divorce and separation: treatment of stock options for purposes of dividing marital property, 46 A.L.R.4th 640.   Valuation of stock options for purposes of divorce court's property distribution, 46 A.L.R.4th 689.