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LSDefine
Simple English definitions for legal terms
assessable stock
Read a random definition: IRD
A quick definition of assessable stock:
Assessable stock is a type of stock that can be sold by the issuer if the holder doesn't pay any assessment levied on it. Stock is a part of a company that represents ownership and gives the holder the right to participate in the company's management and share in its profits. Assessable stock is different from non-assessable stock, which means the holder's liability is limited to the amount paid for the stock and cannot be charged additional funds to pay the issuer's debts.A more thorough explanation:
Assessable stock is a type of stock that can be resold by the issuer if the holder fails to pay any assessment levied on it. This means that if the company needs more money, they can charge the stockholders an additional amount, and if the stockholder doesn't pay, the company can take back the stock.
For example, if a company needs to raise more money, they may levy an assessment on their assessable stock. If a stockholder fails to pay the assessment, the company can take back the stock and sell it to someone else who is willing to pay the assessment.
Assessable stock is not commonly used today, as most stocks are non-assessable, meaning that the stockholder's liability is limited to the amount paid for the stock and they cannot be charged additional funds to pay the issuer's debts.