Nonparticipating Preferred Stock

Nonparticipating Preferred Stock

A preferred stock that entitles the holder to a flat dividend and nothing else. That is, the dividend will not be higher if the company performs particularly well, but instead remains the same at all times. However, nonparticipating stockholders are usually entitled to a minimum dividend, unlike common stock holders, who do not have a similar right. Most preferred stock is nonparticipating. See also: Participating Preferred Stock.
References in periodicals archive ?
374 [1935]), the court said 38% nonparticipating preferred stock was adequate to establish continuity.
368(c) considers all stock, including the nonvoting, nonparticipating preferred stock used in Letter Ruling 8414001, while Sec.
374 (1935), 38% of nonparticipating preferred stock was considered adequate.