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Simple English definitions for legal terms
paid-up stock
Read a random definition: govern
A quick definition of paid-up stock:
Paid-up stock refers to a type of stock where the shareholder has already paid the full amount for the shares they own, and no further payments are required. This means that the company cannot demand any more money from the shareholder. Paid-up stock is a type of equity security issued by a corporation, and it grants the shareholder the right to participate in the company's general management and to share in its net profits or earnings.
A more thorough explanation:
Definition: Paid-up stock is a type of stock that has been fully paid for by the shareholder and no further payments can be demanded by the issuing company.
Example: If a company issues 100 shares of paid-up stock and a shareholder buys 10 shares, they must pay the full price for those 10 shares upfront. The shareholder cannot be asked to pay any more money for those shares in the future.
Explanation: Paid-up stock is different from other types of stock, such as assessable stock, which can be subject to resale by the issuer if the holder fails to pay any assessment levied on it. Paid-up stock is fully paid for and the shareholder has no further financial obligation to the company. This type of stock is often used by companies to raise capital for their operations.