Preferred Stock

Preferred Stock refers to a class of stock that contains special preferences, or features, that are not present in common stock.  Generally, preferred stock exhibits one or more of these five types of features:

• Nonvoting Convertible Preferred - the preferred stockholders are not allowed to participate in the voting process normally offered to holders of common stock.
• Assets - these preferred stockholders get paid before common stockholders in the event of liquidation.
• Convertible Preferred Stock - shares of the preferred stock are convertible to common stock.
• Dividends - Preferred stock is generally paid dividends before common stockholders.
• Callable Preferred Stock - preferred stock that can be retrieved by the company.