A preemptive right is the right of existing shareholders to maintain their proportion of ownership of a company. They do so by acquiring their proportional share of any additional stock issuances by the firm. 

Questions similar to the Snapbuzz questions in the Corporate Process slides. Preemptive rights questions similar to those in the Minority Shareholder Protections slides. Here's an example: Jack owns 100 shares of Corporation A, Jill owns 70 shares and Bertha owns 30 shares, which accounts for all of the Corporation's shares. The Articles of Incorporation include the following provision: The Corporation elects to have preemptive rights, including for shares issued in the first two months of the company's existence, except for shares issued as compensation to the Corporation's directors and shares. Assuming that MBCA 6.30 applies (see text below), would Bertha have preemptive rights under each of the situations below? Why or why not? Discuss the relevance of section 6.30. If she has preemptive rights, what would she have the right to do (provide the number of shares issued and received by Bertha, as applicable)? a. The company issues ten bonds, each of which is convertible to 10 shares at the holder's election. b. The company issues 18 shares to compensate an artist for painting a mural in the company's offices. c. After it has been in existence for 1 month, the company issues 40 shares that were provided for in the Articles of Incorporation.