Key rights and features of ‘Ordinary Shares’?
a. one vote per share.
b. residual rights to dividends (declared by directors, approved by shareholders).
c. equal entitlement to surplus assets on winding up after all creditors and preference shareholders are paid.
d. the default is ‘residual’ class.
Key rights and features of Preference Shares (cumulative)?
a. Fixed dividend expressed as a percentage of nominal value.
b. Cumulative - if not paid in one year, the unpaid dividend rolls forward and accumulates.
c. must be paid before ordinary dividends can be declared.
d. usually carry no voting rights on ordinary business.
Key rights and features of Preference Shares (non-cumulative)?
a. Fixed dividend but if unpaid in a given year the right to that years dividend is simply lost. It does not carry forward.
