Warning

Info

Warning

Info

Warning

Info

LSDefine

Simple English definitions for legal terms

closely held corporation

Read a random definition: Nil dicit default judgment

A quick definition of closely held corporation:

A closely held corporation is a type of company that is owned by a small group of people, usually family members. The shares of this company are not sold on the stock market. The owners of a closely held corporation have a special duty to be fair and honest with each other. This means they should not do anything that would harm the other owners. Sometimes, the owners of a closely held corporation have rules about how shares can be sold or transferred. If a minority owner feels they have been treated unfairly, they can take legal action against the other owners.

A more thorough explanation:

A closely held corporation is a type of company that is owned by a small group of people, usually family members or close friends. Unlike other corporations, the shares of a closely held corporation are not traded on the stock market. This means that the owners have more control over the company and its decisions.

Because there are only a few owners, the actions of each shareholder can have a big impact on the company. This is why shareholders in a closely held corporation have a special duty to act in good faith and not harm the other shareholders. For example, if a shareholder sells their shares for personal gain, knowing that it will hurt the company and the other shareholders, they could be breaking this duty.

Transferring ownership of a closely held corporation is also different from other companies. The owners often have agreements in place that restrict how and to whom shares can be sold or transferred. This helps keep ownership within the select group of people who started the company or are close to them.

If a minority shareholder in a closely held corporation feels that another shareholder has harmed them or the company, they can file a direct lawsuit against that shareholder. This is different from other corporations, where such lawsuits are usually brought as a shareholder-derivative suit. This exception is made because in closely held corporations, the majority shareholders may unfairly benefit from derivative suits.

For example, imagine a family starts a closely held corporation together. One of the siblings decides to sell their shares to an outsider, even though they know it will hurt the company and the other siblings. The other siblings could file a direct lawsuit against the sibling who sold their shares, claiming that they breached their duty to act in good faith and not harm the other shareholders.

closed-end loan | closing

Warning

Info

General

General chat about the legal profession.
main_chatroom
👍 Chat vibe: 0 👎
Help us make LSD better!
Tell us what's important to you
ParallelAgreeableOrangutan
19:58
idk what the situations are, but you absolutely should write about them if the school asks about them—the only time you should be asking *whether* to write one is when you're not sure whether your situation qualifies as what they're asking about
ParallelAgreeableOrangutan
19:59
better question is usually *how* to write about them
ParallelAgreeableOrangutan
20:00
I had to write about write
ParallelAgreeableOrangutan
20:01
... write-ups at work (petty, and they were removed from my file after a year, but even so the app asked so I wrote)
NosyBeagle
20:05
Ah it cancelled out my msg cus I switched tabs. But I’ll just tell you guys cus I get mixed answers: a) accused of cheating on a calc exam freshman year but was cleared of wrongdoing, b) sent to the hospital senior year because I go too drunk
ParallelAgreeableOrangutan
20:12
Seems like you'd need to write about A because it went through a formal process, but it shouldn't hurt you if you explain it straightforwardly and explain you were cleared (just don't be weirdly salty about it like you're holding a grudge)
ParallelAgreeableOrangutan
20:12
Re B, did this involve school in any way? Is there an app that has a C&F question that you think this applies to?
ParallelAgreeableOrangutan
20:13
Maybe you're not deep enough into the process to know this—each school has its own unique set of C&F questions, so you should disclose exactly what they ask about, no more, no less
NosyBeagle
20:14
OH
NosyBeagle
20:14
Ok why did I think it was just gonna be one type of q for all. My bad folks. Ignore my info dump
ParallelAgreeableOrangutan
20:16
No worries! Frankly I think it's wild that applications have weird hidden quirks that you don't know about until you're actually logged into LSAC working through the app. There's some info you can find about the oddball/unique questions you'll find on specific apps, so you might want to look for that for schools you're going to apply to
ParallelAgreeableOrangutan
20:17
Like on various consultants' blogs, reddit, etc
NosyBeagle
20:17
🫡 thank you good sir or ma’am or bam
ParallelAgreeableOrangutan
20:17
Ooh can I be a bam
NosyBeagle
20:39
You may
20:45
ima write my personal statement about being fired and how that made me want to do law but it would be funny if I also had to write an addendum about it
20:45
turns out defense companies don’t like it when you question the war machine 🙏
20:46
“What are your opinions on Edward Snowden” - my boss
ParallelAgreeableOrangutan
21:02
I wrote optional essays about a situation that affected my undergrad performance. For any school that required an "education gap addendum" I was basically like "pls see my optional essay"
ParallelAgreeableOrangutan
21:02
¯⁠\⁠_⁠(⁠ツ⁠)⁠_⁠/⁠¯
NosyBeagle
21:12
did they accept that?
NosyBeagle
21:12
that reminds me of filling out job apps and they want you to type out your resume in a text box. like huh??? open the pdf, idiots
ParallelAgreeableOrangutan
21:18
I mean I was nicer about it—I'd put a couple of sentences explaining it super lo-res, and then I said something like "I speak to this situation in detail in my optional essay."
ParallelAgreeableOrangutan
21:20
They don't send your application back to you and tell you to redo an addendum if they don't like it, so the only way to know whether they "accepted" it, as it were, is admissions results
Bettercaulsaul
22:28
Helpful video I found https://youtu.be/2ZVrX6DTSKU?si=KsZeWbF4_fJuqKl5
23:17
who up lsdin they law
8:27
now why does the basement here reek of glossier you
any spivey thoughts? thinking about applying for pro bono
What constitutes "diverse background" for the spivey pro bono?
I'm as "nURM" as they come, but I was the victim of a violent crime which absolutely tanked my grades. I would really want expert help on tackling that in my GPA addendum and my PS, but don't really have thousands to throw at consultants
LSD+ is ad-free, with DMs, discounts, case briefs & more.