How to Prepare a Stock Certificate
A stock certificate is a document that establishes ownership of a stated number of shares in a corporation's stock. It entitles the investor/shareholder an equitable interest in the company in which he invested. Any company seeking to raise capital from outside investors must provide a stock certificate to all its shareholders.
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Instructions
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Order or download preprinted stock certificates from a business stationery supply company. All standard stock certificates provide space to add your company name, shareholders and other important information. Use your word processing software to complete this process.
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Type the name of your company on the top of the stock certificate along with the state in which your company is incorporated.
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Assign a unique number to each certificate issued to your shareholders. This enables you to keep track of all your company's certificates if a shareholder wishes to sell his shares.
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Type the name of the shareholder in the designated space provided on the preprinted stock certificate.
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Type the number of shares issued to your shareholder and the par value. Par value refers to the amount at which a stock can be redeemed.
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Sign the stock certificate. Typically the corporate secretary and the president of the company sign the stock certificate that is to be issued to the shareholders. Stamp the certificate with the company's corporate seal to validate it.
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Add a disclaimer, which is called the stock legend, in the back of the stock certificate stating that the shares are restricted. The U.S. Securities and Exchange Commission has certain restrictions regarding issuing and owning private stock. Rule 144 allows the resale of a restricted stock if certain conditions are met. It also describes how a restrictive legend can be removed.
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Tips & Warnings
Keep records of all stock certificates issued to shareholders.
Cancel and destroy certificates after a shareholder has sold his shares.
References
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