Yep JPM is correct. A preferred (subscriber) share or PSS means that the shareholder is preferred in the line of payouts when the company is being liquidated. Most often this preferred right comes as a trade off for voting rights. Means preferred subscribers don't get to vote, but will get the first lot of payouts if something goes wrong [if there is anything left to payout by then].
The shares that have full voting rights, right of first refusal for new stock offers, automatic allocations for new stock splits and all that are usually referred to as 'A' shares or 'private class 1'. That's the ones the private owners have before a company goes public. Often a second or even third variety is issued before IPO as well. Class B shares usually go to Angel investors who will put in 90% of additional capital for 10% of stock. So the ration between A and B then is 1:9 with a right split at 50-50. Venture capitalists usually get either C or S class shares. Both are basically the same with the difference that S class has to be returned for D class or PSS during IPO, while C class will only be diluted and the the VC usually reserves the right to bail during the dilution process. So, if a company starts with $100,000 share capital, gets an angel investor with $900,000 but still owns weighted shares for 50%. When the VC arrives on the scene and C or S are issued, the original owner is usualle taking a portion of his shares and returns them for cash in a 10:1 capital increase. So now A shares have 10% of the ownership but still 50% of the votes while Angel and VC split the other 50% voting rights and the B shares are diluted. Result: Owner has 10% of shares of a 10,000,000 company (50% voting rights) Angel has 10% of shares of a 10,000,000 company (25% voting rights) VC has 30% of shares of a 10,000,000 company (25% voting rights) available are still 50% During the IPO they'll issue between 5-1 and 50-1 new shares. Of course, this is once again, a simplified example ;o) Cheers, Robert. budget & privacy website hosting http://www.cyberica.net budget & privacy domain registrations + mail http://www.u2planet.com/cfdomaintrust.html --- You are currently subscribed to e-gold-list as: [EMAIL PROTECTED] To unsubscribe send a blank email to [EMAIL PROTECTED] Use e-gold's Secure Randomized Keyboard (SRK) when accessing your e-gold account(s) via the web and shopping cart interfaces to help thwart keystroke loggers and common viruses.