Riscario

Preferred shares:

• owner entitled to
  • a dividend (fixed or floating) before any dividends paid to common shareholders
  • a stated dollar amount per share upon liquidation of the company
• generally no voting rights
• no legal obligation to pay dividends but moral obligation, since missing payments
  • reduces market value of outstanding securities
  • impedes ability to raise future financing
• types
  • cumulative: a dividend that is a missed may accumulate for payment later
  • non-cumulative: no rollover (missed = missed)
  • participating: receive preferred dividends + common share dividends
  • convertible: can convert to common shares (generally) under certain conditions
  • redeemable: Corporation and redeem at a set price under certain conditions