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A Checklist to Remember When Issuing Stock from Your Corporation
August 10, 2007
The Articles of Incorporation state how many shares the company is authorized to issue. Issuing stock to shareholders, even in a very small corporation, is a difficult process—especially if your company is public now or will be in the future there are a number of mind-boggling rules and regulations you must follow. Consult a lawyer and be sure not to miss any of the following steps:
- Comply with state and federal securities laws when issuing stock to shareholders.
- Take into account that the value of the corporation will be diluted by the stock issuance, so set the price and number of shares very carefully.
- If you will be issuing common and preferred stock, you’ll need different certificates for each.
- Record all information about stock transactions in a stock ledger.
- Submit appropriate filings with the SEC and any state securities administrators promptly, usually within 15 days of the stock sale.
Posted by Shanu Singh Guliani on August 10, 2007 | Comments (0)
