4. Redeemable Preference shares
Another type of preference shares are redeemable, this means that the company can repay those shares based on the terms and conditions when they were issued. It might be that originally the preference shares were issued at a very high rate of interest so therefore it would be in the interest of the company to redeem these and then issue a new set of redeemable preference shares at a lower rate. All the terms and conditions must be contained in the MOI.