Preferred stock normally has no voting rights.However,most preferred issues stipulate that the preferred stockholders can elect a minority number of the directors if the preferred dividend is omitted.

Question

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This statement is true. Some preferred stocks have a provision known as "cumulative voting", which allows preferred shareholders to elect a certain number of directors if the company fails to pay the preferred dividend for a certain period of time. This provision helps to protect the interests of the preferred shareholders and ensure that their voices are heard in the company's decision-making processes.

Preferred Stock Normally Has No Voting Rights