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8 Cards in this Set

  • Front
  • Back
Rights of stock owners
1. Right to certificate (proving ownership)
2. Voting rights
3. Right to buy and sell
4. Preemptive right
5. Right to information
Class A shares of common stock
-shares pay cash dividends
-sold to the public
-may have limited or no voting rights
-similar to preferred stock but considered common
Class B shares of common stock
-voting stock held by management
-limited or no cash dividends
-often given to managers as a reward for founding, merging or reorganizing the company
-can give management control without any investment
Contribution in excess of par
Amount paid by stockholders in an issuance above the par value of the stock
Dividends in arrears
Some preferred stock will accumulate missed dividend payments, called dividends in arrears, which will be paid at a future date.
Money market preferred stock
Re-issued with a new cash dividend rate every 7 weeks. Sold in large denominations to institutional investors.
Stock warrant
A call option with the company's stock as the underlying security
-exercise price is initially set higher than the market price
-can be traded in the secondary market
Stock right
Issued to give stockholders their preemptive right.
-shorter time period than warrants (often 2-10 weeks)
-exercise price often set below market price
-traded mostly in the OTC market