PRIVATE LIMITED COMPANY
\pɹˈa͡ɪvət lˈɪmɪtɪd kˈʌmpəni], \pɹˈaɪvət lˈɪmɪtɪd kˈʌmpəni], \p_ɹ_ˈaɪ_v_ə_t l_ˈɪ_m_ɪ_t_ɪ_d k_ˈʌ_m_p_ə_n_i]\
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A company whose shareholders are offered limited liability. However, ownership restrictions are strictly in place to avoid the hostile takeover attempt by any association or bylaws. The restrictions include (1) The sale or transfer of a shareholder's share must be first offered to the other shareholders (2) The shareholders cannot sell their shares on the stock exchange to the public, (3) A fixed number of individuals are considered to be shareholders.TLDÂ Example: Unlike shareholders in a publicly traded company who can sell their shares without restriction, the private limited company enforced a right of first refusal clause on its shareholders.
By Henry Campbell Black
Word of the day
hydromorphic
- [Greek] Structurally adapted to an aquatic environment, as organs of water plants.