In short ...
Shares are titles of property representing “parts” of the company; people possessing these titles are called shareholders. By the shares they possess, shareholders are given a power on the company.
Shares can either be common or preferred. Possibilities of classes of shares are almost infinite; nevertheless, at least one category must confer the right to vote, the right to be paid dividends and the right to receive a part of the remaining property of the corporation upon liquidation. These three rights are mandatory; however, they can be distributed in several classes or gathered in a category. Plus, many classes can gather all three rights.
Amongst particular classes of shares can be mentioned :
- Common shares, which generally give the right to vote, the right to receive dividends and a part of the remaining property of the company on liquidation.
- Control shares, generally multi-voting (for example, ten votes per share). As their name say, these shares are used to keep control on the company.
- Preferred shares with restricted rights, which do not necessarily give the right to vote. Most of the time, this category gives right in priority to dividends and refund upon dissolution.
- Rollover shares, most of the time non-voting. These shares usually receive dividends and remaining property on liquidation in priority.
The share capital proposed by Paraco includes 9 classes of shares. Amongst these, class “A” shares give to their owners all mandatory rights.
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