| Does the Corporation have to issue shares of stock? | | | | number of authorized shares. |
| Exactly when should this be done? What is the | | | | There is no requirement for the Corporation to issue all |
| process? Yes, the Corporation has to issue shares of | | | | of the authorized shares. It can set aside the remaining |
| stock. If the Corporation does not issue shares of | | | | unissued shares of stock for future use, to distribute |
| stock, there are no legal owners of the Corporation. | | | | as incentives to employees, for later public offerings to |
| After you have made the decision to create a | | | | raise capital for the Corporation or distributed as |
| Corporation, you will first file what is called the Articles | | | | dividends. |
| of Incorporation with the Secretary of State. This is | | | | Next on the agenda is to have a formal organizational |
| usually a one or two page document containing the | | | | meeting where shares of stock are issued to the |
| following information:o The Name of the Corporationo | | | | organizers and other new owners to make them legal |
| A declaration of the Corporations purpose,o The name | | | | shareholder/owners of the Corporation. Say for |
| of the Registered Agent that will be receiving all legal | | | | example an organizer decides to authorize 1,000,000 |
| documentation on behalf of the Corporation.o And the | | | | shares of stock with a par value of $1.00 in the |
| number of shares of stock and the type of stock that | | | | Articles. When the shares are issued, each new |
| the Corporation is authorized to issue. | | | | shareholder would pay $1.00 for each share of stock |
| As the Organizer of the Corporation, you will decide | | | | they purchase. If a shareholder purchases 2,000 |
| how many shares of stock to authorize. You can | | | | shares, he would make a check payable to the |
| choose to have the Corporation authorize as few as | | | | Corporation for $2,000 (2,000 shares multiplied by the |
| 100 or as many as 100,000,000, or more! Incidentally, | | | | par value). Each shareholder would then be entitled to |
| when deciding on the number of shares the | | | | receive a Stock Certificate declaring him to be a |
| Corporation will authorize, remember that in many | | | | shareholder of the company. |
| states, the filing fees may increase with a larger | | | | |