If a company has more than one class of shares, what must be true about those classes?

The correct understanding regarding classes of shares in a company is that they can have different characteristics and rights, including differences in voting rights and dividend entitlements. Therefore, it is accurate to state that classes of shares can vary significantly in their rights and obligations.

Each class of shares is established to serve various purposes, such as attracting different types of investors or offering varying degrees of control. For instance, a company might issue preferred shares that have priority in dividend distribution but carry limited or no voting rights, while common shares might offer voting rights but no guaranteed dividends.

The notion that they must be of the same kind is misleading because it does not allow for the flexibility that companies often need to meet their financial and strategic goals. Thus, the diversity of voting rights and dividend entitlements among different classes of shares is a fundamental aspect of corporate structure that facilitates tailored investment opportunities.

In summary, while companies may issue shares of the same kind, they can also introduce varying classifications that differ in important rights, thereby enhancing their operational and financial strategies.