Minority Equity Stakes
ility: A limited company is a registered body whose liability to any third party is limited to what the body itself can provide. The members (shareholders) of a limited company (unlike members of a partnership) have no liability, except to pay the nominal value of their shares.
A limited company can either be private or public. A public company is one where the public can buy and sell its shares. Public companies have 'plc'(public limited company) after their name. Private companies have 'Ltd'(limited).
Public companies are either 'listed'or 'unlisted'. A listed company is one which is listed on the Stock Exchange. Sometimes 'quoted'is used instead of 'listed'.
Every company has a memorandum of association and articles of association. These are the terms of what is effectively a legally binding contract between the members, and between the members and the company. Any member is entitled to have a copy on payment of a nominal fee (though few ever exercise this right).
These documents are usually fairly short and uninformative. The longest section states the objects of the company. This is a totally pointless relic of a bygone age, as most are written so that the company can do what it likes anyway. It was designed to stop people raising money 'for carrying on an undertaking of great advantage but nobody to know what it is', as someone (very successfully) did in 1720. He disposed of 1000 shares in six hours. History fails to record what the great advantage was (probably none).
The care and control of the company is vested in the directors alone. The shareholders'rights are confined to appointing the directors and asking them awkward questions at the annual general meeting.
Every company must have a registered office and a company secretary (who may also be a director). The company secretary is responsible for making sure that the company meets its legal requirements. If you need to communicate with the company as a shareholder, you should write to the company secretary at the registered office. (https://www.companiesmadesimple.com/the-facts-forming-a-uk-limited-company.html)
A limited company effectively borrows money from its shareholders (and sometimes others) with which it trades to make a profit. Corporation tax is payable on the profits. The rest is either kept by the company (retained profit) or distributed as a dividend.
Money borrowed may take the form of a saleable instrument (e.g. share, debenture, loan stock, etc.). These are explained further on the ne
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