Nonvoting Stock

Corporate securities that do not empower a holder to vote on corporate resolutions or the election of directors. Such stock is sometimes issued in connection with a takeover attempt, when management creates nonvoting shares to dilute the target firm's equity and thereby discourage the merger attempt. Except in very special circumstances, the New York Stock Exchange does not list nonvoting stock. Preferred stock is normally nonvoting stock. See also Voting Stock; Voting Trust Certificate.

Corporate securities that do not empower a holder to vote on corporate resolutions or the election of directors. Such stock is sometimes issued in connection with a takeover attempt, when management creates nonvoting shares to dilute the target firm's equity and discourage the merger attempt. Preferred Stock is normally nonvoting stock.