Glossary: Authorized, But Unissued Stock

Authorized, But Unissued Stock

Authorized, But Unissued Stock - The type(s) of stock and maximum number of shares of stock of your corporation are specified in and authorized by your corporation's Articles of Incorporation. Your Board of Directors, with shareholder approval, may authorize the issuance of additional classes of stock and quantities of stock. When your corporation sells stock to its founders or to other individuals or entities those shares of stock are called issued and outstanding stock. All other stock remains Authorized, But Unissued Stock until it is actually issued to a shareholder. As a shareholder, your ownership percentage is determined by dividing the number of shares you own by the number of shares of issued stock.

Disclaimer: The foregoing is intended to provide general information and may not be suitable in specific instances. The glossary information is not intended to be exhaustive, but rather to illustrate typical considerations. The material is provided with the understanding that it is not legal, accounting, tax or any other professional advice.

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