 | | The division of the outstanding shares of a company into a larger number of shares. A 3 - for - 1 stock split by a company with 1 million shares outstanding results in 3 million shares outstanding. Each holder of 100 shares before the 3 - for - 1 stock split would have 300 shares, although his proportionate equity in the company would remain the same; 100 parts of 1 million are the equivalent of 300 parts of 3 million. Ordinarily stock splits must be voted by the company's Board of Directors and approved by shareholders. (See Para. 703.02(A).) |
