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In-Depth Incorporation FAQ

What is par value?

Par value is a term that is still widely used but no longer has much meaning. Par value is not necessarily the amount paid for the stock, and does not necessarily represent the value of the stock at any time. It can best be described as an arbitrary number put in the articles of incorporation and on the stock certificates which signifies that the stock has some value. Nevertheless, most states allow a company to state within the articles of incorporation that its stock has no par value.