Private limited companies in the UK in many ways,

Particularly in respect of liability, naturally. Shareholders are

Not personally liable for the debts of the corporation in both

A C corporation and a private limited company.

Mr Wiseberg: That's right.

Mr Larsen: But if I'm not mistaken, a C corporation may

Become a public corporation, with its shares being bought

and sold either through a stock market or 'over the counter'.

Mr Wiseberg: Mm-hm.

Mr Larsen: In this respect, a private limited company differs.

Its shares are not available to the general public.

Mr Wiseberg: I see.

Mr Larsen: The two types of company are like each other in

That both can be founded by persons of any nationality, who

Need not be a resident of the country. Perhaps this is

Relevant for you, Mr Wiseberg.

Mr Wiseberg: Yes, it is.

Mr Larsen: And there is one big difference between a

C corporation in the US and our private limited company:

that's the limit on the number of shares. As I recall, there's

No limit on the number of shareholders of a C corporation.

Mr Wiseberg: That's right.

Mr Larsen: But that's not the case with a private limited

Company. The Companies Act stipulates that not more than

Members can hold shares within the company.

Mr Wiseberg: I see. I didn't know that. But that's not a

Problem for me.

Mr Larsen: On the other hand, a limited company is

Comparatively easy to form. You have several options open

To you, depending on how soon you want the company

Formed.

Mr Wiseberg: Well, I'd like to begin operations as soon as

possible. Of course, I know I'll have to wait until the

paperwork is completed. How long would that take? A

couple of days?

Mr Larsen: Well, once you supply all the necessary documents

To Companies House, it generally takes a couple of weeks

For them to process the documents.

Mr Wiseberg: A couple of weeks! That's much too long. What

other options do I have?

Mr Larsen: You could form the company through a company

Formation agent. The agent would fill in the required forms

For you and then submit them to Companies House. It

Would take around five to eight days before the company

May begin to trade.

Mr Wiseberg: That sounds better. Maybe you could tell me

Where I can find one of these agents. Perhaps you have...

Unit 3

Listening1

Mr Young: ... so if there are any questions, I'd be happy to

Answer them now.

Mrs Whiteman: Mr Young, I've got a question, if you don't

Mind. In your talk, you mentioned a rights issue. Could you

explain to me in detail what a rights issue is?

Mr Young: Well, a rights issue is an issue of new shares for

Cash to existing shareholders. The shares are issued

Proportionally, that is, in proportion to the number of shares

the shareholders already hold. It's a good way of raising

New cash from shareholders. For publicly quoted

companies, it's a source of new equity funding.

Mrs Whiteman: I see. But why issue shares to existing

shareholders?

Mr Young: From a legal standpoint, a rights issue must be

Date: 2015-12-11; view: 1266