What type of shares cannot be issued below the face value stated in its certificate of stock?

Par value shares have a specific face value that is assigned to them when they are issued. This value is significant because it establishes a minimum price at which the shares can be sold. According to corporate law, a corporation cannot issue par value shares for less than this designated face value, as doing so would undermine the integrity of the capital structure and the financial obligations of the corporation to its creditors.

Consequently, issuing shares below their par value can lead to potential legal issues, including the possibility of shareholder liabilities. This requirement aims to protect both the company and its stakeholders by ensuring that the capital raised is not undervalued or diluted.

In contrast, no par value shares do not have a specified face value, allowing them to be issued at any price. This flexibility is particularly beneficial for companies looking to adjust share pricing based on market conditions or strategic considerations. Therefore, while no par value shares can be issued below any specific face value, par value shares are strictly governed to uphold the economic foundation of the corporate entity.