As a shareholder you would theoretically 'share' in whatever remuneration the company received in the transaction, in this case preferred equity which includes entitlement to a share in Frontpoint profits for a period of five years.....
As the company repositions itself to thrive amid the new regulatory environment these moves should ultimately benefit shareholders in the long term.
That said it would appear that there will not be much in the way of a profit from this deal since they paid $400M for it in '06 and currently value it at $350M, so perhaps what you will be sharing in is a loss or maybe they make that up over time with the PFD/profit sharing and it becomes a net zero transaction.
Q: How many neutered knuckleheads does it take to write an idiotic post on the MS board?
A: Only one, but the neutered knucklehead will probably not realize he is making a fool of himself.....
"shareholder" means you own a piece of paper that you can use as toilet paper or to wallpaper a tin shack with if the SHTF.
nothing more, nothing less......
trade it, take profit, and move on.
Lehman, GM and others are a testament to this. While it will be a long time till something like that comes around again. It is wise to learn from others mistakes.
That's one reason I hold the Pfds I bought for pennies on the dollar when the survival of the company was in question.
Another reason is I like the BIG FAT check I get from Uncle Morgan every quarter WITHOUT having to trade the stock.