The simplest anatomy of equity chief is accepted stock. Accepted stock has abounding distinguishing factors as follows:
Accepted stock is not convertible into another type of security
Each share enjoys one vote
Dividends are payable without limit but alone when declared by the board of directors
In liquidation, accepted stock holders are the last priority to which to distribute assets
In adventure chief transactions, there may be two types of accepted stock which are issued. The aboriginal is Class A accepted stock, which is according to preferred stock without the adapted voting rights which some statutes crave in shares labeled “”preferred.”” A second type of accepted stock is subordinate accepted stock. While this type of stock is not used actual frequently, it allows companies to amuse cheap stock into the hands of answer employees at minimal levy cost.
Determining what type of chief to lift and how to structure the financing transaction is of critical accent to growing ventures. As such, it is crucial to accept the answer terms and consult the adapted legal and bag advisors when embarking on the chief-raising action.
About the author:
GT Bag Plans has developed over 200 bag plans for clients that accept collectively raised over $750 million in financing, launched abundant advanced product and service lines and gained competitive advantage and marketplace share. GT Bag Plans is the sister site of GT Adventure Chief
Originall posted May 12, 2012
