Does a corporation have to issue stock?
Yes. Shareholders are the owners of the corporation. If no stock shares are issued, then there are no legal owners of the corporation. Shares must be issued to those individuals who will be owners of the corporation. This is the case even if only one individual will own the corporation. In some circumstances, a corporation can sell shares of stock to investors in order to provide the corporation with its own capital. The sale of securities is heavily regulated by both the state and federal governments, and we recommend that you contact an attorney in your state of incorporation before issuing stock.
Shares of stock represent ownership of the corporation. Where no shares are issued, no individual owns the corporation. Thus, shares must be issued to those individuals who will own the corporation. While most states have created many exceptions and exemptions from registering a stock issuance with the State or with the SEC for most small businesses, it may be wise to contact the appropriate entity to determine whether you must file a notice of stock issuance on a state or Federal Level. Because this office is a non-attorney, legal document preparation service, our company CANNOT be involved with your corporation’s stock issuance. For help regarding your corporation’s stock issuance, please contact a licensed attorney or the appropriate state entity.
