6. Classes of Shares
As a rule, all shares are equal within the same class. Where shares have different rights, preferences and limitations these are split into different classes. A company can have multiple classes of shares. Shares with different classes may have a different dividend participation on liquidation and also the ability to convert from one class to another class when certain events happen. A company virtually has an unlimited freedom to create any capital structure it requires.
The MOI must set out with respect to each class of share.
a. A distinguishing designation for that class; and
b. The preferences, rights, limitations and other terms associated with that class, unless these will be determined later by the board.
The capital of a company may consist of one type of share like an ordinary share or of several classes of shares, each with different rights.