types of shares

Question 1

ordinary shares

Answer 1

default position for shares having rights of:
- dividend once declared by directors
- voting on resolution
- repayment of capital on winding-up (once creditors are paid)

Question 2

preference shares

Answer 2

shares with fixed dividends paid ahead of ordinary SHs but not always with voting rights
- they may have priority in getting capital returned and when winding-up if they are participating preference shares

Question 3

deferred shares

Answer 3

SH has no right to a dividend until either certain conditions met or fixed period of time has passed

Question 4

redeemable shares

Answer 4

‘temporary membership’- these shares cna be bought back by company at company’s or SH’s decision

Question 5

non-voting shares

Answer 5

control is not affected, can be issued where company wants to raise capital

Question 6

convertible shares

Answer 6

can be converted to a different class of shares by reference to a fixed formula in Articles

Question 7

employee shares

Answer 7

sometimes part of remuneration package, normally ordinary shares