There's a variety of ways this can be handled. I've gone through a couple of these and sometimes it's just a straight buyout where you'll get to keep your shares of Company A and you'll get cash for your shares of Company B. Sometimes you'll keep your shares in Company A and your shares of Company B get converted into shares of Company A at some ratio. Sometimes shares of both companies A and B get converted into entirely new shares of Company AB.

If you visit either one of the companies websites and find their investor relations page there's going to be a press release or some other document that will explain all the terms for you. Those financial releases aren't always the easiest things to read though as they can be written in legalese.

Depends on the deal being made. Sometimes one company buys the stock of the other company (usually for a premium from the regular trading price), or you could be offered so many shares in one of the companies for your shares in the other company, or it could be a combination.

A while back I purchased shares from two companies. They've now announced they are merging. I've purchased shares of other companies here and there, but I've never owned any that have merged with other companies while I had them.

What does this mean for my shares from each company? I use Sharebuilder to trade, so I'm not sure if I'll get a notification or see something about it in my portfolio. Really, I have no idea what to expect.

Can anyone help me out? Thanks in advance. :)