Preferred equity redemption stock

Preferred equity redemption stock (PERC)

Preferred stock that converts automatically into equity at a stated date. A limit is placed on the value of the shares the investor receives.

Preferred Equity Redemption Stock

A convertible preferred stock that automatically converts to common stock or cash on a certain date. PERCs have higher, guaranteed returns than common stock; however, the issuer reserves the right to exchange them for common stock at any time.