Par Value
Par value is the minimum price that a startup corporation can issue its shares of stock.
If a startup issues 8,000,000 shares with a $0.001 par value, the minimum the founders would have to pay for those shares is $8,000.
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Ryan Roberts is a startup lawyer and represents technology companies through all phases of the startup process, including incorporation, seed & venture financings, and exit transactions. Click here to learn more about his practice.
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The cross-purchase is one of the two main ways ("stock redemption" the other) a buy-sell agreement can be structured to provide your company with a succession plan.
Under a cross-purchase plan, each company shareholder agrees in advance to buy the shares of the withdrawing shareholder while the withdrawing shareholder agrees to sell his or her shares to the remaining shareholders. The corporation is not involved in the transaction.
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