A more thorough explanation:

A close corporation is a type of corporation that is owned by a small group of shareholders and is not publicly traded. This means that the shares of the company are not available for purchase by the general public. Instead, they are held by a limited number of people who are often family members or close friends.

Close corporations are often run directly by the shareholders, without the need for a formal board of directors or annual meetings. This allows for more flexibility in decision-making and can make it easier for the company to respond quickly to changes in the market.

Close corporations are also exempt from many of the formal rules that govern other types of corporations. For example, they may not be required to hold regular shareholder meetings or to file as much paperwork with regulatory agencies.

One example of a close corporation is a family-owned business. If a family decides to start a business together and they want to keep ownership within the family, they may choose to form a close corporation. This would allow them to maintain control over the company and make decisions together without interference from outside investors.

Another example of a close corporation is a small group of friends who decide to start a business together. They may choose to form a close corporation in order to keep ownership within the group and to maintain control over the company's direction.

These examples illustrate how a close corporation can be beneficial for small groups of people who want to start a business together and maintain control over its operations. By forming a close corporation, they can avoid many of the formalities and regulations that come with other types of corporations and focus on running the business in a way that works best for them.