Public Company: A company that has issued securities through an initial public offering (IPO) and is traded on at least one stock exchange or in the over the counter market. Although a small percentage of shares may be initially "floated" to the public, the act of becoming a public company allows the market to determine the value of the entire company through daily trading.
Public companies must meet stringent reporting requirements set out by the Securities and Exchange Commission (SEC), including the public disclosure of financial statements and annual 10-k reports discussing the state of the company. Each stock exchange also has specific financial and reporting guidelines that govern whether a stock is allowed to be listed for trading.
Public companies must meet stringent reporting requirements set out by the Securities and Exchange Commission (SEC), including the public disclosure of financial statements and annual 10-k reports discussing the state of the company. Each stock exchange also has specific financial and reporting guidelines that govern whether a stock is allowed to be listed for trading.
Private Company:A company whose ownership is private. As a result, it does not need to meet the strict Securities and Exchange Commission filing requirements of public companies.
Private companies may issue stock and have shareholders. However, their shares do not trade on public exchanges and are not issued through an initial public offering. In general, the shares of these businesses are less liquid and the values are difficult to determine.
Private companies may issue stock and have shareholders. However, their shares do not trade on public exchanges and are not issued through an initial public offering. In general, the shares of these businesses are less liquid and the values are difficult to determine.
Companies Limited by Shares:A "company limited by shares" means a company formed on the principle of having the liability of its members limited by the memorandum to the amount (if any) unpaid on the shares respectively held by them. Most companies in Malaysia are companies limited by shares.
Thus when creditors give creditors to companies limited by shares, they are in theory giving credit to a fund made up of the amounts paid or payable by members for theirs. They do not have recourse against the members to an unlimited extent.
Companies Limited by Guarantee:The meaning of the term "company limited by guarantee" given in section 4 of the Companies Act is "a company formed on the principle of having the liability of its members limited by the memorandum to such amount as the members may respectively undertake to contribute to the assets of the company in the event of its being wound up."
A company limited by guarantee may be distinguished from a company limited by shares in that in respect of the former, a member is not required to pay in nay any capital while the company is in a going concern. If the company is wound up and its assets are not adequate to meet its liabilities, a member will be liable to pay the amount of the guarantee as specified in the memorandum of association. The amount may be made ascertainable by reference to a state of affairs existing when the company is wound up.
Companies Limited by Guarantee:The meaning of the term "company limited by guarantee" given in section 4 of the Companies Act is "a company formed on the principle of having the liability of its members limited by the memorandum to such amount as the members may respectively undertake to contribute to the assets of the company in the event of its being wound up."
A company limited by guarantee may be distinguished from a company limited by shares in that in respect of the former, a member is not required to pay in nay any capital while the company is in a going concern. If the company is wound up and its assets are not adequate to meet its liabilities, a member will be liable to pay the amount of the guarantee as specified in the memorandum of association. The amount may be made ascertainable by reference to a state of affairs existing when the company is wound up.
Companies Limited by Both Shares and Guarantee:It used to be possible for members to form a guarantee company with share capital. An
existing company limited by guarantee could also convert to a company limited both by shares and by guarantee.
The effect was that members would be liable to pay the issue price of their shares and to honor their guarantee if the company should be wound up. Guarantee companies with shares were rare. Indeed the Jenkins Committee were of the view that such companies should be abolished. Its rationale was that if a company was formed with the intention of making pro rata distributions of profits to its members, it was inappropriate that it should be able to register as a company limited by guarantee.
The Companies (Amendment) Act 1985 settled the issue by adding a new section 14A to the Companies Act, as /* mentioned above, which reads:"On or after the coming into operation of this Act, no company may be formed as, or become, a company limited by guarantee with a share capital."
Unlimited Companies:The definition of an "unlimited company" given in section 4 of the Companies Act is:"A company formed on the principle of having no limit placed on the liability of its members."In other words, in the event of a winding-up of an unlimited company, its members may be made liable for its debts without limit on their liability.
An unlimited company is similar to other companies in that it is also a corporation. As such, it can hold property, sue and be sued as an entity separate from its members. The unlimited company can create a floating charge on its assets and can deal freely with its assets in the ordinary course of business.
The effect was that members would be liable to pay the issue price of their shares and to honor their guarantee if the company should be wound up. Guarantee companies with shares were rare. Indeed the Jenkins Committee were of the view that such companies should be abolished. Its rationale was that if a company was formed with the intention of making pro rata distributions of profits to its members, it was inappropriate that it should be able to register as a company limited by guarantee.
The Companies (Amendment) Act 1985 settled the issue by adding a new section 14A to the Companies Act, as /* mentioned above, which reads:"On or after the coming into operation of this Act, no company may be formed as, or become, a company limited by guarantee with a share capital."
Unlimited Companies:The definition of an "unlimited company" given in section 4 of the Companies Act is:"A company formed on the principle of having no limit placed on the liability of its members."In other words, in the event of a winding-up of an unlimited company, its members may be made liable for its debts without limit on their liability.
An unlimited company is similar to other companies in that it is also a corporation. As such, it can hold property, sue and be sued as an entity separate from its members. The unlimited company can create a floating charge on its assets and can deal freely with its assets in the ordinary course of business.
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