Pre-emptive rights (or rights of first refusal) protect preferred stockholders against dilution from subsequent equity sales by a venture capital- or private equity-backed company. Such a right [...]
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Some of the types of preferred stock discussed in “Preferred Stock Demystified” – my previous series of blog posts on this topic – are convertible into shares of common stock. For example, a [...]
I drafted a series of posts last year entitled “Preferred Stock Demystified” regarding the payments rights and preferences attendant upon various classes of preferred stock. I now will supplement [...]
Like non-convertible, double-dip participating preferred stock, convertible, double-dip participating preferred stock has a fixed, accruing dividend and a senior liquidation preference pursuant [...]
Convertible, conventional participating preferred stock entitles the preferred shareholder to receive the greater of (a) the senior liquidation preference pursuant to which the preferred [...]
Convertible, non-participating preferred stock has a senior liquidation preference pursuant to which the preferred shareholder receives back its invested money plus all accumulated, unpaid [...]
Like non-convertible, straight preferred stock, non-convertible, double-dip participating preferred stock has a fixed, accruing dividend and a senior liquidation preference pursuant to which the [...]
Non-convertible, straight preferred stock is the most basic type of preferred stock. It is called “straight” preferred stock because it has a fixed dividend (often 8%) that continues to accrue if [...]
Preferred stock provides flexibility in structuring investments. It can furnish various dividend and participation rights (such as rights to participate with common stock in proceeds from company [...]
