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5. Participating Preference Shares Those preference shares, which have right to participate in any surplus profit of the company after paying the equity shareholders, in addition to the fixed rate of their dividend, are called participating preference shares. 6. Non-participating Preference Shares Preference shares, which have no right to participate on the surplus profit or in any surplus on liquidation of the company, are called non-participating preference shares. 7. Convertible Preference Shares Those preference shares, which can be converted into equity shares at the option of the holders after a fixed period according to the terms and conditions of their issue, are known as convertible preference shares. 8. Non-convertible Preference Shares Preference shares, which are not convertible into equity shares, are called non-convertible preference shares.