Also known as: pro-rata sharing · prorata sharing · pro rata share · pro rata shares · pro rata · prorata · proportionate sharing · proportional allocation
Written by attorneys · grounded in primary & secondary sources — see below
A method of allocation by which assets, shares, or payments are distributed to recipients in proportion to their respective ownership interests or claim amounts. The allocation ensures each participant receives a fractional share matching the size of its interest relative to the whole.
Prosperity Investments holds two classes of shares outstanding. Upon board approval of a dissolution plan, the remaining corporate assets are divided among the holders of each class according to the number of shares each owns. Class A holders receive a larger aggregate portion than Class B holders because they own more shares overall.
Piper Patel and Parker Phillips each own common shares in Pulse Media. The board declares a ten-percent stock dividend payable without consideration. Additional shares are issued to Patel and Phillips in direct proportion to the number of shares each already holds, resulting in Patel receiving twice as many new shares as Phillips.
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No. Model Bus. Corp. Act § 6.23(a) requires shares issued as a dividend to go pro rata to all holders of the same class or series. Excluding a shareholder based on when she acquired her shares violates the uniform treatment the statute mandates.
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The unsatisfied balance is charged against all remaining nonprobate transfers to others and apportioned among their recipients in proportion to the value of each recipient's interest.
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Yes. Additional shares received solely because the testator owned the originally devised shares are treated as accretions and pass to the specific devisee rather than the residuary estate.
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A distribution is unlawful if, after the distribution, the partnership would be unable to pay its debts as they become due in the ordinary course of business.
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