When shares are held in book entry, you are relieved of the responsibility of storing a certificate and the risk of, and replacement cost associated with, the potential loss of the certificate. You can also sell book entry stock directly through the transfer agent or you can request a stock certificate at any time. Most IBM stockholders of record already have a book entry position at First Chicago. The stock split does not change your proportionate interest in the company. IBM's last stock split was a 2 for 1 split payable May 27, 1997.
Book entry allows share ownership without stock certificates.
This system is similar to that used with investments in a mutual fund or a corporate dividend reinvestment plan. You do not need to be enrolled in a dividend reinvestment plan to have book entry ownership. Registered stockholders hold their book entry shares with the transfer agent, First Chicago Trust Company, a division of EquiServe, which serves as the recordkeeper. When there is a transaction on the stockholder's account, the transfer agent records the transaction and mails a statement to the stockholder reflecting the transaction and the total number of shares owned. Stockholders may also request a book entry statement at any time.