Understanding Products and Their Risks

The right to vote on corporate matters (e.g., electing the board) and the right to receive dividends if and when the board declares them.

Last. Common stockholders have a residual claim — they are paid only after secured creditors, unsecured creditors (including bondholders), and preferred stockholders.

The most a stockholder can lose is the amount invested in the shares — personal assets cannot be reached to satisfy the corporation's debts.

A shareholder may cast one vote per share owned for each open board seat, but votes cannot be pooled — e.g., 100 shares and 3 seats allows 100 votes per seat.

A shareholder's total votes (shares owned × open seats) may be allocated in any combination, including all on a single candidate.

800 votes (200 shares × 4 seats), all of which may be cast for a single candidate.