Ace the Canadian Securities Course 2025 - Rock the CSC Practice Exam!

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What defines subordinated voting when it comes to shares?

Shares with higher profitability

Shares with lower risk

Shares with no voting rights

Subordinated voting shares are characterized by their reduced or limited voting power compared to other classes of shares. They typically provide shareholders with a limited say in corporate decisions or less influence on corporate governance relative to other share classes that may have greater voting rights. This structure allows certain stakeholders, often founders or initial investors, to maintain control over the company while still raising capital by issuing shares that do not afford comparable voting rights.

This concept is crucial for understanding how different classes of shares can impact corporate management and control. For many companies, particularly those with complex ownership structures, having subordinated voting shares enables them to balance the need for investment with the desire to retain decision-making power among a select group.

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Shares given preferential treatment in voting power

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