Untitled Deck Flashcards
What is a company limited by shares?
A company having the liability of its members limited by the memorandum to the extent of any unpaid amount on the shares held by them. Most businesses that incorporate as companies are companies limited by shares.
This form allows the company to raise additional capital by issuing new shares.
What is a company limited by guarantee?
A company having the liability of its members limited by the memorandum to the amount they undertake to contribute to the company’s assets in the event of winding up.
A company limited by guarantee may or may not have share capital.
What is the liability of members in a company limited by guarantee without share capital?
The liability is restricted to the amount of guarantee as mentioned in the memorandum.
What is the liability of members in a company limited by guarantee with share capital?
The liability is restricted to the amount of guarantee as mentioned in the memorandum, in addition to any unpaid amount on shares.
What is an unlimited company?
A company not having any limit on the liability of its members. This type has all the advantages of a normal company except that the liability of its members is not limited.
Unlimited companies are fairly rare but are sometimes used by ‘partnership style’ businesses.
