Is it equity or preferential ?

hi

now its time to know what type of shares are available and how they differ !!
as many of you know .. there are two kinds of shares available
1. Equity shares
2. Preferential shares

let us see an example to differentiate how these two types vary

Now i am going to start a company .. i may need more investment ..
lets say about 25 lacs and i have only 5 lacs in hand . i am short of 20 more lacs
this time i will ask help from my friends or someone i trust and give them some percentage of shares .. lets say about 25 % shares .. this will be the preferential shares ... lets say i get about 10 lacs from them .. i am still short of another 10 lacs .. so , i will now issue some shares for public interest to buy and they are the equity shares ...

on any occasion the company will not issue more than 50 % of shares for the public notice .. that s because if i am a rival for your company i will start buying all your shares available in the market ... if more than 50 % shares are with me .. then i take over your company .. due to this problem .. the company will not issue more than 50 % shares for the public ....

hmmmmm ..
lets say i got all the money and started the company and got good profits ..
now i can declare dividend for the shares !!!
my share holders will get part of the dividend on the amount of shares they hold
but this dividend is not a compulsory one to be given for the share holders !!
it means .. i can give them if i wish .. its at my will

lets say now my company runs better and need an expansion .. i already have issued shares to public interest and so i am left with no share options
now at this point i can issue a debenture on the company s properties
now it is here where i must compulsorily agree to pay the interest for the amount i receive

remember .. shares get u dividend and debentures get u interest
with this i can get the amount i wish to make an expansion and make the company better


the shares we buy are equity and are not preferential shares
the share dividend rate will vary with the equity and dividend shares
that s all about the type of shares !!
we will see soon how are we going to make money with these shares !