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Ozark Distributing Company is primarily engaged in the wholesale distribution of consumer products in the Ozark Mountain regions. The following disclosure note appeared in the
Ozark Distributing Company is primarily engaged in the wholesale distribution of consumer products in the Ozark Mountain regions. The following disclosure note appeared in the company's annual report:
Note Convertible Preferred Stock in part:
The Company has the following Convertible Preferred Stock outstanding as of September :
Date of issuance:
Optionally redeemable beginning:
Par value gross proceeds:
Number of shares:
Liquidation preference per share:
Conversion price per share:
Number of common shares in which to be converted:
Dividend rate:
June
June
$
$
$
The Preferred Stock is convertible at any time by the holders into a number of shares of Ozark's common stock equal to the number of preferred shares being converted times a fraction equal to $ divided by the conversion price. The conversion prices for the Preferred Stock are subject to customary adjustments in the event of stock splits, stock dividends and certain other distributions on the Common Stock. Cumulative dividends for the Preferred Stock are payable in arrears, when, as and if declared by the Board of Directors, on March June September and December of each year.
The Preferred Stock is optionally redeemable by the Company beginning on various dates, as listed above, at redemption prices equal to of the liquidation preference. The redemption prices decrease annually thereafter until the redemption price equals the liquidation preference, after which date it remains the liquidation preference.
Required:
What amount of dividends is paid annually to a preferred shareholder owning shares of the Series A preferred stock?
If dividends are not paid in and but are paid in what amount of dividends will the shareholder receive?
If the investor chooses to convert the shares in how many shares of common stock will the investor receive for their shares?
If Ozark chooses to redeem the shares on June what amount will the investor be paid for their shares?
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