Rights

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 July 2012 Dear Sir,

What would be the rights given to a preferred shareholder in a company and how much share is such person entitled to receive?

Also, if such person wishes to sell his shares, what shall be the waiting period?

Thanks in anticipation

CS Divya Sorayan

CS Divya Sorayan (Expert)
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12 July 2012 Rights on preference shares:-

The Shareholders, which hold the preference non-documentary registered shares with the fixed rate of dividend, shall reserve the following rights:

to vote in the General Meeting of Shareholders of the Bank for resolution on the matters of reorganisation and liquidation of the Bank;
to vote for resolution on the matters of making any amendments and additions to the Articles of Association of the Bank, which may restrict the rights of the Shareholders, which hold the preference shares of the said type;
to vote on all the matters within the competence of the General Meeting of Shareholders of the Bank, beginning from the General Meeting, which follows the annual General Meeting, which, regardless of any reasons, failed to adopt the resolution for payment of dividends or adopted the resolution for incomplete payment of dividends for the preference shares of the said type; this right shall be terminated at the moment of the first payment of dividends in the full amount;
to receive the fixed dividend at the rate of 20 per cent per annum of the nominal value of shares, which shall be paid first with respect to the preference shares of other types and may be increased in accordance with the resolution by the General Meeting of Shareholders of the Bank;
to receive the liquidation value of share as 100 per cent of its nominal value to be paid first with respect to the preference shares of other types.
to dispose of the own shares without the consent of other Shareholders, in accordance with the current laws of Russian Federation, namely, to sell, grant, leave by will, give on pledge or assign otherwise;
to receive any information about any activities of the Bank, to have access to any documents of the Bank, in accordance with the procedure and in the volume prescribed by the current laws of Russian Federation;
to have priority in acquisition of any shares and other securities issued by the Bank, which may be converted into shares and issued through open subscription, in accordance with the procedure prescribed by the Articles of Association and by the current laws of Russian Federation;
to demand to the Bank for redemption of all or any part of the held shares, in the cases prescribed by the Articles of Association and by the current laws of Russian Federation;
to elect and to be elected to the bodies of management of the Bank and to the Auditing Commission of the Bank, in accordance with the procedure prescribed by the Articles of Association and by the current laws of Russian Federation;
to demand for convocation of the extraordinary General Meeting of Shareholders of the Bank and to be entitled to add any matters to the agenda of the annual General Meeting of Shareholders of the Bank, in accordance with the Articles of Association and with the current laws of Russian Federation;
to exercise any other rights, which may be prescribed by the Articles of Association, laws of Russian Federation, as well as by the resolutions, which may be adopted by the General Meeting of Shareholders of the Bank in accordance with the competence thereof.
The rights of the Shareholders, who hold preference registered shares, shall depend upon the volume of rights provided for each type of the said shares.

The preference shares of the Bank within the same type shall provide the same volume of rights for the relevant Shareholders.