8/10/2019 Fractional Shares
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155. Fractions of shares.
A corporation may, but shall not be required to, issue fractions
of a
share. If it does not issue fractions of a share, it shall (1)
arrange for the
disposition of fractional interests by those entitled thereto,
(2) pay in
cash the fair value of fractions of a share as of the time when
those
entitled to receive such fractions are determined or (3) issue
scrip or
warrants in registered form (either represented by a certificate
oruncertificated) or in bearer form (represented by a certificate)
which
shall entitle the holder to receive a full share upon the
surrender of
such scrip or warrants aggregating a full share. A certificate
for a
fractional share or an uncertificated fractional share shall,
but scrip or
warrants shall not unless otherwise provided therein, entitle
the holder
to exercise voting rights, to receive dividends thereon and
to
participate in any of the assets of the corporation in the event
of
liquidation. The board of directors may cause scrip or warrants
to be
issued subject to the conditions that they shall become void if
not
exchanged for certificates representing the full shares or
uncertificated
full shares before a specified date, or subject to the
conditions that the
shares for which scrip or warrants are exchangeable may be sold
by the
corporation and the proceeds thereof distributed to the holders
of scrip
or warrants, or subject to any other conditions which the board
of
directors may impose.-
http://delcode.delaware.gov/title8/c001/sc05/
Section 41. Power to acquire own shares.- A stock corporation
shall have the
power to purchase or acquire its own shares for a legitimate
corporatepurpose or purposes, including but not limited to the
following cases:
Provided, That the corporation has unrestricted retained
earnings in its books
to cover the shares to be purchased or acquired:
1. To eliminate fractional shares arising out of stock
dividends;
2. To collect or compromise an indebtedness to the corporation,
arising out of
unpaid subscription, in a delinquency sale, and to purchase
delinquent shares
sold during said sale; and
3. To pay dissenting or withdrawing stockholders entitled to
payment for
their shares under the provisions of this Code. (a) -
Corporation Code of the
Philippines
http://delcode.delaware.gov/title8/c001/sc05/http://delcode.delaware.gov/title8/c001/sc05/http://delcode.delaware.gov/title8/c001/sc05/
8/10/2019 Fractional Shares
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Definition of 'Fractional Share'
A share of equity that is less than one full share. Fractional
shares usually
come about from stock splits, dividend reinvestment plans
(DRIPs) and
similar corporate actions. Normally, fractional shares cannot be
acquired from
the market.
Investopedia explains 'Fractional Share'
Fractional shares can be created in a situation where a company
has a 3-for-2
stock split. Suppose you have three shares of XYZ Corp. and XYZ
has a 3-for-2
stock split. In this case, you should get an extra 1.5 shares,
which would be 4.5
shares total. Normally, you can't buy half a share in the stock
market, but in
this case, you could end up with a fractional share.
Most companies tend to round up to the nearest whole number of
shares
when fractional shares occur. In the above example, XYZ Corp.
could opt to
round up the 0.5 share to leave you with a full five shares.
-
http://www.investopedia.com/terms/f/fractionalshare.asp
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