Preferred Stock | Practical Law

Preferred Stock | Practical Law

Preferred Stock

Preferred Stock

Practical Law Glossary Item 4-382-3700 (Approx. 2 pages)

Glossary

Preferred Stock

A class of stock in a corporation that entitles the holders to defined rights that typically include:
  • Priorities in payment over the common stockholders, such as a right to receive dividends or a right to specified distributions on the company's dissolution, liquidation or deemed liquidation.
  • Different or additional voting rights (called protective provisions), such as approvals on mergers, dividends and equity issuances.