Dividend Preferences Preferred Stock
- Fully participating--P/S is given its stated return and, if available, an equal return to C/S (based on par). If additional dividends are available an equal return is given to P/S and C/S (based on their par values) until all dividends are distributed. No maximum (ceiling) on the amount P/S can receive.
Example of participation:
P/S, $100 par, 8%, cumulative, 2,000 shares.........$200,000
C/S, $5 par, 50,000 shares outstanding.................. 250,000
Total par both classes $450,000