O.C.G.A. § 14-2-604 (2019)
Fractional shares
(a) A corporation may:
(1) Issue fractions of a share or pay in money the value of fractions of a share;
(2) Arrange for disposition of fractional shares by or for the account of the shareholders;
(3) Issue scrip in registered or bearer form entitling the holder to receive a full share upon surrendering enough scrip to equal a full share.
(b) Each certificate representing scrip must be conspicuously labeled ‘‘scrip’’ and must contain the information required by subsection (b) of Code Section 14-2-625.
(c) The holder of a fractional share is entitled to exercise the rights of a shareholder, including the right to vote, to receive dividends, and to participate in the assets of the corporation upon liquidation. The holder of scrip is not entitled to any of these rights unless the scrip provides for them.
(d) The board of directors may authorize the issuance of scrip subject to any condition considered desirable, including:
(1) That the scrip will become void if not exchanged for full shares before a specified date; and
(2) That the shares for which the scrip is exchangeable may be sold and the proceeds paid to the scripholders.
History
(Code 1981, § 14-2-604, enacted by Ga. L. 1988, p. 1070, § 1.)
Annotations
Law reviews. - For article discussing rights pertaining to and value of fractional shares under the Georgia Business
Corporation Code, see 3 Ga. L. Rev. 11 (1968).
COMMENT Source: Model Act, § 6.04. This replaces former § 14-2-88. Subsection (a) authorizes handling fractional shares in various ways, including: (1) The corporation may issue scrip instead of fractional shares. As subsection (c) provides, scrip confers none of the substantive rights of shares, but only authorizes holders to combine scrip certificates in amounts aggregating a full share and then to exchange them for a full share. This aggregation must occur within the time and subject to the conditions set initially by the board of directors and stated in the scrip certificate. Scrip that is not combined and exchanged may become void, authorized by subsection (d). (2) The corporation may authorize the immediate sale of all fractional share interests, thereby avoiding the expense and delay of scrip and the inconvenience of recognizing fractional shares. Under this section fractional shares may be certificated or uncertificated. There is no difference in treatment of certificated or uncertificated shares for this purpose. See Sections 14-2-625 and 626. Cross-References Redemption, see §§ 14-2-601 & 14-2-631. Share dividends, see § 14-2-623. RESEARCH REFERENCES Am. Jur. 2d. - 18A Am. Jur. 2d, Corporations, § 844. C.J.S. - 18 C.J.S., Corporations, § 185 et seq. ALR. - Right to issue corporate stock without voting power, 21 ALR 643.
Issuance by corporation of new stock certificates without requiring surrender of old, 61 ALR 436; 150 ALR 148. Voting of jointly held or fractional shares in corporation, 98 ALR2d 357.
T.14, C.2, A.6, P.2 CORPORATIONS & PARTNERSHIPS
PART 2 ISSUANCE OF SHARES