Closed Corporation

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Closed Corporation

A type of business corporation that is owned and operated by a small group of people.

A closed corporation is also known as a close corporation, a family corporation, an incorporated partnership, and a chartered partnership. In this type of corporation all of the functions are usually performed by the same parties. These individuals serve as shareholders, officers, and directors and are involved in the management and operation of the business. A closed corporation differs from a publicly held corporation since its stock is neither issued nor traded to the public at large.

West's Encyclopedia of American Law, edition 2. Copyright 2008 The Gale Group, Inc. All rights reserved.
References in periodicals archive ?
To a closely held company, the ESOP is a relatively permanent company owner.
It is important for investors owning a minority interest in a closely held company to obtain contractual protective rights to maintain a certain level of control over the operations of the business.
When valuing the common stock and ESOs of a closely held company, the appraised total value of common equity must first be determined using traditional business valuation methods.
Today, their closely held company is a power in the multi-billion-dollar home furnishings industry, with 60 stores from Maine to California and a worldwide catalog network.
When the ESOP was instituted in 1985, the shares of the closely held company were valued at $59.20; they are now worth almost six times that much.
One method of transferring a family business from one generation to the next while minimizing gift and estate taxes involves the gifting of closely held company stock shares over a period of years.
Revenue rose 10 per cent to Dh18.7 billion ($5.1 billion), the closely held company said in an e-mailed statement yesterday.
Pawan was incorporated as a closely held company in 2001 by Mr.
In a buy-sell agreement, it is not uncommon for the purchase price of an interest in a closely held company to be the amount of an owner's life or disability insurance policy proceeds.
Many analysts argue that shares bought and sold in the publicly traded market do not have such "enterprise" control and that a premium should be added to adjust the value of shares in a closely held company. A controlling interest might warrant a premium of 30% or more.
The decedent owned approximately 22% of the outstanding shares of a closely held company. Other family members owned 57%; an employee stock ownership plan (ESOP) held the remaining 21%, by purchase from the decedent during his life.