PRIVATE COMPANY LIMITED BY SHARES

This defines that a vast majority of the trading companies are private companies that are limited by shares. Companies which are limited by shares must have the word “Limited” or “Ltd” at the end of its name.

As most the companies are limited by shares, this “stake” is usually referred to the shares that are held by the companies shareholder.

In those companies the individual or the shareholders’ duty is to pay the company for the shares they have taken in it. It works like that the individual will put some amount of money and in return he/she will receive some amount of percentage of ownership in the form of shares. The price of a single share could be of any value.

The shareholders will not have to pay any money once the shares are fully paid but if it is found unpaid then the company will call them to pay the shares. The responsibility of the shareholder is limited to the amount they have paid, or they are about to pay, to provide satisfactory consideration for the shares that they won.

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