No-par stock is
stock
In finance, stock (also capital stock) consists of all the shares by which ownership of a corporation or company is divided.Longman Business English Dictionary: "stock - ''especially AmE'' one of the shares into which ownership of a company ...
issued with no
par or face value. In modern practice, par value is an antiquated concept and no-par stock is increasingly common.
In most jurisdictions, the par value of a stock is the lowest possible price at which a company could issue stock, and amounts equivalent to the aggregate par values of the stock were required to have special treatment as
stated capital in
accounting
Accounting, also known as accountancy, is the measurement, processing, and communication of financial and non financial information about economic entities such as businesses and corporations. Accounting, which has been called the "languag ...
. No-par stocks often require the
board of directors
A board of directors (commonly referred simply as the board) is an executive committee that jointly supervises the activities of an organization, which can be either a for-profit or a nonprofit organization such as a business, nonprofit organiz ...
of a company to determine a stated value when issuing no-par stock to replace the par-determined capital amounts.
Some U.S. states do not allow corporations incorporated in the state to issue no-par stock. In these states stock's par values are often extremely low relative to the trading value of the shares (''e.g.'', one cent, or fractions of a cent).
See also
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Corporation
A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and r ...
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Incorporation
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Stock
In finance, stock (also capital stock) consists of all the shares by which ownership of a corporation or company is divided.Longman Business English Dictionary: "stock - ''especially AmE'' one of the shares into which ownership of a company ...
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Par value
Par value, in finance and accounting, means stated value or face value. From this come the expressions at par (at the par value), over par (over par value) and under par (under par value).
Bonds
A Bond_(finance), bond selling at par is priced at 1 ...
Equity securities
Stock market
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