Share With Par Value

State:
Multi-State
Control #:
US-CC-3-215A
Format:
Word; 
Rich Text
Instant download

Description

The document outlines a resolution proposed by the Board of Directors of a corporation to amend the par value of the company's Common Stock from five dollars to one dollar per share. This adjustment aims to enhance the corporation's flexibility in issuing stock dividends and conducting stock splits while ensuring compliance with state corporation law requirements. The proposed change highlights the critical distinction between a Capital Account, which reflects the total number of shares multiplied by par value, and a Surplus Account, representing net assets exceeding the Capital Account. By lowering the par value, the corporation seeks to alleviate restrictions related to stock distributions, simplifying future stock transactions. Furthermore, the Board validates that this change will not impact the actual market value of shares or the total shareholders' equity. Attorneys, partners, owners, associates, paralegals, and legal assistants will find this form useful for analyzing stock valuation, understanding corporate governance, and ensuring compliance during capital funding adjustments.
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How to fill out Amendment Of Common Stock Par Value?

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FAQ

?Par value? or ?face value? is the lowest price for which a company can sell stock. ?Fair Market Value? is the notional value of stock on the market at the time of sale. A reasonable par value for an early stage company can be as low as $0.00001. Setting a par value low can avoid tax liabilities later.

The company's par value is calculated by multiplying the par value per share by the total number of shares issued. That means you'll just need to grab your calculator and key in the math.

The par value is the minimum price at which a corporation can legally sell its shares, and most are priced below $0.01. As a real-life example, Apple (NASDAQ: AAPL) has set its common stock's par value at $0.00001 per share.

A bond's par value is the face value of the bond plus coupon payments, annually or sem-annually, owed to the bondholders by the issuer of the debt. A bond with a par value of $1,000 and a coupon rate of 4% will have annual interest payments of 4% x $1,000 = $40.

For example, if company XYZ issues 1,000 shares of stock with a par value of $50, then the minimum amount of equity that should be generated by the sale of those shares is $50,000.

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Share With Par Value