Section 7-1-431. Preemptive rights

   (a) Except as provided in subsection (b) of this Code section or in the articles, a bank or trust company shall issue shares, option rights, or securities having conversion or option rights by first offering them to shareholders of the same class in proportion to their holdings of shares of such class.

(b) Except as provided in the articles, there shall be no preemptive right to:

   (1) Shares issued as a share dividend;

   (2) Fractional shares;

   (3) Shares issued pursuant to share plans authorized by subsection (e) of Code Section 7-1-488;

   (4) Shares issued pursuant to acquisition of substantially all of the assets of another bank or trust company;

   (5) Shares released by waiver from their preemptive right by the affirmative vote or written consent of the holders of two-thirds of the shares of the class to be issued. Any such vote or consent shall be binding on all shareholders and their transferees for the time specified in such vote or consent up to but not exceeding one year from the date thereof and shall protect the bank or trust company, its management, and all persons who may within such time acquire the shares so released;

   (6) Shares which have been offered to shareholders to satisfy their preemptive right but not purchased by them within the prescribed time and which are thereafter issued or sold to any other person or persons at a price not less than the price at which they were offered to such shareholders.

(c) Unless otherwise provided in the articles, no holder of shares of any class shall have any preemptive right with respect to shares of any other class which may be issued or sold by the bank or trust company.

(d) Nothing in this Code section shall impair any cause of action or remedy which any shareholder may have for a breach of duty by the board of directors relating to the sale or other disposition by the bank or trust company of shares or securities not subject to the preemptive rights under this Code section or under the articles.

(e) The holders of shares entitled to the preemptive rights shall be given prompt notice setting forth the time within which and the terms and conditions upon which such shareholders may exercise their preemptive rights. Such notice shall be given at least 30 days prior to the expiration of the period during which the rights may be exercised.

Ga. L. 1919, p. 135, art. 9, § 9; Ga. L. 1920, p. 102, § 1; Code 1933, § 13-1009; Ga. L. 1965, p. 496, § 1; Ga. L. 1966, p. 590, § 5; Ga. L. 1968, p. 1045, § 5; Code 1933, § 41A-2002, enacted by Ga. L. 1974, p. 705, § 1.