Also known as: authorized & outstanding · outstanding shares · authorized shares
Written by attorneys · grounded in primary & secondary sources — see below
Shares of a corporation that the articles of incorporation permit the corporation to issue and that have been issued to and remain held by shareholders. Issued shares stay outstanding until the corporation reacquires, redeems, converts, or cancels them.
Arcadia Retail's board approves a share dividend to existing holders. The articles authorize only 100,000 common shares and all 100,000 are already held by shareholders. The board adopts an amendment increasing authorized shares to 200,000 so the dividend can be paid without violating the charter limit.
Ashford Manufacturing buys back 20,000 of its 100,000 issued shares from Anita Ali. The shares remain authorized under the articles. Because the corporation holds them as treasury stock rather than cancelling them, the 80,000 shares still held by other shareholders continue as the only outstanding shares.
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Alfred Ashford sells his 60 percent block of Aurora Biotech shares to the corporation. After the sale the remaining 40 percent held by Anika Anand constitutes all the outstanding shares even though the articles still authorize the original total.
Antonio Alvarado brings a derivative suit against Artemis Logistics. The court determines standing by counting only the shares he holds among the 75,000 authorized and outstanding shares. Treasury shares the company later reacquired do not count toward the outstanding total.
Aurora Biotech files an SEC report listing its 500,000 authorized shares. Only 320,000 of those shares have been issued and remain in shareholder hands, so the report correctly states that 320,000 shares are authorized and outstanding.
Cede & Co. holds shares in Technicolor as record owner for beneficial holders. The merger agreement fixes the exchange ratio by reference to the number of authorized and outstanding shares at closing, excluding any shares the company has repurchased and holds in treasury.
Authorized and outstanding shares have been issued by the corporation and are currently held by shareholders. Authorized but unissued shares have been permitted by the articles but have never been issued or have been reacquired and held as treasury stock.
Under Model Business Corporation Act § 10.05(d)(2) the board may amend the articles without shareholder approval to increase authorized shares to the extent necessary to issue a share dividend when only one class of shares is outstanding.
A repurchase reduces authorized shares only when the articles prohibit reissuance of the acquired shares. Otherwise the reacquired shares remain authorized but become treasury shares that are no longer outstanding.
…per share for its common stock, and on the following day publicly announced its approval of Combustion's tender offer for all outstanding shares. Respondents are former Basic shareholders who sold their stock after Basic's first public statement of October 21, 1977, and before the suspension of trading in December 1978. Respondents…