Preference shares (also known as preferred stock or preferred shares) are typically a higher ranking stock than voting shares, and its terms are negotiated between the corporation and the investor.
Preference shares usually carry no voting rights but may carry superior voting rights to common shares. Preference shares may carry a dividend that is paid out prior to any dividends to common shareholders. The dividend may be agreed in advance and will be accumulated if there are no profits in any year. Preference shares may have a convertibility feature into common shares. Preference shareholders will be paid out in assets before other shareholders and after debt holders in bankruptcy.
sending...