Calculating And Issuing Shares of Stock

In order to properly complete your corporate documents, you will need to determine the number of shares of stock to be issued to the various shareholders. As a small business, most small businesses initially authorize either 1,000 or 10,000 shares of Stock. It is recommended that you do not issue all of ssuch stock upon the inital issuance. Stock that is not issued is held in reserve. It does not determine percentage of ownership, but leaves additional stock in reserve in the event that you agree to add additional shares.

I Nevada you will want to normally state a low par value for your shares when you initially incorporate a small business. This is because Nevada calculates the initial filing fee based on a multiple of the number of shares authorized times the par value. If this multiple is $75,000 or less, the standard $75.00 filing fee applies. SEE THE NEVADA FEE SCHEDULE FOR FILING FEES BASED ON THIS MULTIPLE

See also NEVADA FILING FEES

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You can always amend your Articles of incorporation to authorize additional shares of stock, but this requires additional state filings and related fees.

In the usual situation, where there are three shareholders for example, each who own one-third of the stock of the Corporation, you should issue each shareholder an equal number of shares, for example 100 shares each, leaving 700 shares in reserve. Where percentage of ownership is more complicated, you should use the same general principals to calculate the actual number of shares to be issued. The main point being that it is adviseable to leave shares in reserve.

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