Authorized Shares (Noun)
Meaning
The maximum number of shares authorized under the terms of a corporation's articles of incorporation.
Classification
Nouns denoting possession and transfer of possession.
Examples
- The company's articles of incorporation specify that the authorized shares are limited to 10 million.
- In the event of an acquisition, the board may consider increasing the authorized shares to accommodate the incoming investment.
- As stated in the annual report, the total number of outstanding shares did not exceed the authorized shares.
- Authorized shares play a crucial role in determining a corporation's capital structure and equity distribution.
- During the merger negotiations, one key concern was the potential dilution of shareholder value due to an increase in authorized shares.