The Right of Common Shareholders to Protect Their Proportionate Interest

question 34

Multiple Choice

The right of common shareholders to protect their proportionate interest in a corporation by having the first opportunity to buy additional proportionate shares of common stock issued by the corporation is called a:

• A)Preemptive right.
• B)Proxy right.
• C)Right to call.
• D)Financial leverage.
• E)Voting right.

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Definitions:

Qualified Endorsement

An endorsement on a negotiable instrument that includes conditions limiting the liability of the endorser.

Special

Distinguished by a unique or particular quality, different from the norm.

Trust Endorsement

An endorsement that is used when the instrument is being transferred to an agent or trustee for the benefit of either the endorser or a third party; gives the endorser the rights of a holder.

Agent

An individual authorized to act on behalf of another person or entity in business transactions or legal matters.