classes of shares of stocks

8/13/2019 Classes of Shares Of Stocks

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Stocks issues may vary

voting rights , preferences,

privileges, and restrictionsas may provided by the

articles of incorporation.


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COMMON STOCK

represents the basic issue

of shares and has all thebasic rights of a share.


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Common stocks feature:

VOTING RIGHTConceptual structure of

the corporation assumes thatthe share holders elect

directors who , in turn, hire

management to carry out their

directives.


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SHAREHOLDERS

Control the corporationthrough the right to elect the

directors.


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Directors are elected at an

annual shareholders meeting

by a vote of the holders of amajority of shares who are

present and entitled to vote.


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CUMULATIVE VOTING

A procedure in which a

shareholder may cast allvotes for one member of the

board of directors.


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STRAIGHT VOTING

A procedure in which a

shareholder may cast allvotes for eachmember of the

board of directors.


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PROXY VOTINGA grant of authority by a

shareholders allowing another

individual to vote his shares.

Voting in large public

corporations is actually doneby proxy.


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-Right to share proportionally in

dividends paid.

-Right to share proportionallyin assets remaining after liablities

have been paid in a liquidation.

-Right to vote on stockholders matterof great importance , such as

merger.

-Right to share proportionally in

any new stock sold , before offering

it to the general public , called pre

emptive right.


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PREFFERED STOCKClass of stock with

preferences over common

shares , including distributionof dividends and corporate

assets upon dissolution of thecorporation.


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STATED VALUE

It has a stated liquidating

value per share. The cash

dividends is describe in terms of

peso amount per share.Example:

ABC Corporation

10Preffered easily translatesinto a dividend yield to ten

percent of stated value .


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DIVIDENDS


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DIVIDENDSTypes given are either cumulative

or non cumulative. If preffereddividends are cumulative and are

not paid in a particular year, they

will be carried forward as anarreange. Usually,both the

accumulated (past)preffered

dividends and the current preffereddividends must be paid before the

common shareholders can

received payments.


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UNPAID PREFFERED

DIVIDENDS can be granted

voting rights , or to nominatepeople to represent their

interests on the board.

:


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:Class A- shares are for

Filipinos.Class B- are for foreigner

investor.

Founders shares areclassified as such in the

articles of incorporationandmaybe given certain rights

and privileges not enjoyed by

stockholders.


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PAR VALUE

Share capital of stock thathave been assigned a definite

or fixed value in the article ofincorporation so as to fix the

minimum subscription or

original issue price.


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NO PAR VALUEShares are those that not

have been assigned a definite

or fixed value .They mayassigned a stated value to

serve as the minimum issueprice.


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classes of shares of stocks

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