Dividend question

I've read two news releases today stating that a company will pay a dividend on a given date to all shareholders on another given date.

For example:

TORONTO, Dec. 6 /CNW/ - Prism Medical Ltd. ("Prism") (TSX-VEN:PM) announced today that the directors have approved payment of a dividend of $0.075 per common share on January 4, 2011 to the shareholders of record on December 27, 2010.

Does this mean if you buy shares before december 27th, you will be eligable for the dividend payout on January 4th?

Anyway, dividends have several dates to keep in mind. The declaration date (hey, we are going to pay a dividend....), date of record (all shareholders as of Nov 15....), payment date (will receive a dividend of $0.50 on Jan 15). However, there is also a date called the ex-dividend date.

When you buy a stock, the trade generally does not settle for 2-3 days (can't remember which). this is the time required for one broker to validate the trade, and deliver the share certificates in exchange for cash. This is all generally automated now, and the physical shares never move, so they are pushing to shorten the clearing time.

Since the current rules are that the trade must have settled before the date of record in order to qualify for the dividend, they came up with the ex dividend date to represent the last date you can buy the stock and still qualify for the dividend (2-3 days before the date of record).

So for this stock in particular, you are going to want to buy on 21st in order to qualify for the date of record on the 27th considering settlement time and the holidays/weekend.

The ex-dividend date is two business days prior to the record date. To be a stockholder on the Record Date you must purchase the stock before the ex-dividend date. The latest date you can buy the stock to be a stockholder on record and be entitled to the dividend would be one day prior to the ex-dividend date to allow for the three stock trading day settlement of the stock purchase. If you purchase the stock the day before the ex-dividend date you would be a stockholder on the record date and would be entitled to receive the dividend payment.