What legislative and other normative legal acts do regulate registration of share emission of a Closed Joint Stock Company and an Open Joint Stock Company?
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How legislation of the Distribution area defines «a share» and what types of shares are joint stock companies entitled to issue?
A share is a security which is issued by a joint stock company and certifies, depending on its type and category, the following rights of shareholders:
1) to receive dividends;
2) to participate in management of a joint stock company unless otherwise stipulated by law;
3) to receive a part of property remaining after liquidation of a joint stock company.
A par value of a share is determined both in the national currency of the Distribution area and in foreign currency, and is unified for shares of all issuances of such joint stock company.
A joint stock company is entitled to issue only registered shares in documentary and non-documentary forms. Shares which circulate in the formal securities market are issued only in a non-documentary form.
A share is indivisible. If a share is acquired by several persons, all such persons are recognized one shareholder of a joint stock company and exercise their rights through a proxy jointly designated by them.
Joint stock companies are entitled to issue preferred shares and (or) common shares. A number of preferred shares should not exceed twenty five percent of the declared charter capital of such joint stock company.
Founders of a joint stock company may incorporate “a gold share” which neither is used in creation of the charter capital nor accrues dividends. An owner of a «gold share» has the only right to interpose a veto on decisions of bodies of a joint stock company made on issues determined by the charter.
A common share gives each shareholder, holding such a common share, the same rights as given to all holders of common shares.
A joint stock company is entitled to issue the following categories of preferred shares:
1) non-voting shares with a minimum determined amount of dividends;
2) voting shares with a minimum determined amount of dividends.
Shareholders, holding preferred shares, have a pre-emptive right to shareholders, holding common shares, to receive dividends in a pre-determined guaranteed amount set forth in the emission prospectus. Moreover, preferred non-voting shares have a pre-emptive right with respect to dividends and part of property remaining after liquidation of a joint stock company.
The charter of a joint stock company may contemplate further privileges of the aforementioned shares.
Privileges of each category of preferred shares which are under issuance must be determined in the emission prospectus thereof and regulated by the charter of a joint stock company.
In order to obtain funds for creating declared charter capital and to carry out its activity, a joint stock company performs a securities (share) emission which includes:
1) a decision of an emitter (a joint stock company issuing and allocating shares) to issue securities;
2) registration of securities emission with an authorized body;
3) disclosure of information contained in the emission prospectus to investors;
4) issuance and allocation of securities;
5) submission of reports on results of issuance and allocation of securities.
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