Whenever one recites the blessing over bread on Shabbat, one is to do so over two whole loaves. This mitzva is referred to as "lechem mishna" – a double portion. The reason for this requirement is in order to recall the double portion of manna which fell for the Jewish people in the desert each Friday, one to be used that day and another for consumption on Shabbat. As such we use two whole loaves at each Shabbat meal. Some authorities insist that the use of two loaves at each meal is actually a Torah mandated obligation! Nevertheless, one is not required to actually use both loaves – only one of them must be cut and eaten from. It is very important that the loaves are completely whole with nothing missing. There exists a custom to place twelve challot on the table at each Shabbat meal representing the twelve challot of the lechem hapanim.
A deficiency in the completeness of the loaf of more than 1/48 will disqualify the loaf for use as lechem mishna. In the event that one does not have two complete loaves then even any two pieces of bread will suffice in an emergency. In fact, it is said that Rav Itchele of Volozhin would provide guests who arrived late to his Shabbat meal with two slices of bread to use a lechem mishna. It is explained that since the latecomer was not present when the original loaf was sliced, the two slices he is now presented with can be deemed as "whole" for the purpose of lechem mishna. So too, one who only has one whole loaf, may combine a matza, a piece of cake which is whole (i.e. a rugelach) or even a frozen loaf from the freezer in order to meet the lechem mishna requirement. In an emergency, a broken loaf may be used for lechem mishna if it can be reattached by means of a toothpick or the like, in order that it at least appears to be whole.
One need not remove the second loaf being used for lechem mishna from its bag, should it be packaged in one, though doing so is to be preferred. Women are equally obligated to use lechem mishna at Shabbat meals just like men. One who eats cake, such as at a kiddush, should recite the blessing upon two pieces of cake rather than one.
Common custom is to first slice the bottom loaf at the Friday night meal, while at all other meals, the top loaf is cut first. Some have the custom to make a shallow slice in the loaf one intends to cut prior to reciting the blessing. This is done in order to minimize the delay between the recitation of the blessing and the eating of the bread. If two whole loaves are not available for seudat shlishit then one may recite the blessing over a single whole loaf. The use of lechem mishna is required on Yom Tov as well as it seems that manna did not fall on Yom Tov. Most authorities are of the opinion that a double portion of manna must have fallen on Erev Yom Tov just like on Fridays.
There is a custom to slice the Shabbat challa into seven pieces in order to recall that seven people are called to the Torah on Shabbat. Similarly, those who follow this custom cut the Yom Tov challa into five pieces corresponding to the five aliyot of Yom Tov. One should be sure to distribute a generous portion of challa which the "hamotzi" blessing was recited upon to all those participating in the meal.
 O.C. 274:1
 Shemot 16:22;Rashi. Every day two loaves of manna fell from Heaven - one for the morning meal and one for the evening meal. On Friday four loaves of bread fell: One to be eaten during the day on Friday and then one remaining for each of the Shabbat meals. See: Daat Zekeinim;Shemot 16:22
 Shabbat 117b, Rambam Shabbat 30:9, Rema O.C. 291:4
 Aruch Hashulchan O.C. 274:1
 Mishna Berura 274:4
 Be'er Heitev O.C. 274:2
 Be'er Moshe 5:82, Meishiv Davar 1:21
 Meishiv Davar 1:21
 Piskei Teshuvot 274:3
 Minchat Yitzchak 9:42
 O.C. 168:2
 Rivevot Ephraim 1:201
 Mishna Berura 274:1, Aruch Hashulchan O.C. 274:4
 Kitzur Shulchan Aruch 77:17, Magen Avraham 280
 For differing customs on this issue, see: Beit Yosef O.C. 274
 Which should be positioned slightly closer to oneself. Taz O.C. 274:1
 O.C. 274:1;Rema
 Mishna Berura 274:5
 Rema O.C. 291:4
 O.C. 629:1
 Tosafot;Beitza 2b
 Elya Rabba O.C. 167:2
 Rema O.C. 167:1