1 definition found for this term.
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Less than one whole share. Various events can create fractions of shares issued by a corporation. If a corporation consolidates its shares on some basis, shareholders may end up with less than a whole share. For example, if all common shares of a corporation were consolidated on a ten for one basis, a holder of five shares would end up holding just one-half of a share. Fractional shares can also arise on certain kinds of corporate reorganizations, such as amalgamations, where existing shares of each amalgamating corporation are exchanged for shares of the corporation that results from the amalgamation. Under the CBCA, corporations may purchase fractional shares for cancellation so long as certain financial tests are met (s. 34).