Does convertible preferred stock that votes on an “as converted basis” comply with the NASDAQ Voting Rights Policy?
The issuance of preferred stock that may convert at a discount to the market price of the common stock at the date of issuance and votes accordingly is a violation of the NASDAQ Voting Rights rule, since such preferred shares would have greater voting rights than the existing common shares. This potential problem can be addressed by limiting the voting power, such that the preferred shares would vote as if converted at market value on the date of issuance.
Related Questions
- Are foreign private issuers required to comply with NASDAQs voting rights requirements, set forth in Listing Rule 5640 and Interpretative Material 5640?
- Is the issuance of a lower voting stock in connection with an exchange offer a violation of NASDAQs Voting Rights Rule?
- Does convertible preferred stock that votes on an "as converted basis" comply with the NASDAQ Voting Rights Policy?
