Initial register

The term of existence of the Initial register is not determined. It will exist as long as there are shares that have not been deregistered. Therefore, the term of storage of shares in the Initial Register is unlimited.

In order for the owner of the shares to be able to freely deal with the securities he owns (sell, pledge, give away, receive dividends) the owner must deregister the securities. Deregistration is the transfer of securities by order of their owner from the Initial Register to the owner’s securities account in a bank or a brokerage company that is a participant of Nasdaq CSD.

• The shareholder must 1) open a securities account in a bank or a brokerage firm and 2) submit a deregistration order. Both can be done at the same time. To transfer shares from Nasdaq CSD to your account, the owner needs to know which company’s shares he owns.

• At the request of the securities owner, the bank or brokerage firm that has opened a securities account for this person submits a deregistration request to the Nasdaq CSD system, i.e. a request to transfer securities from the Initial Register to a securities account in a bank or brokerage firm.

• On Monday of the following week, Nasdaq CSD transfers the accumulated dividends to the bank or brokerage firm, which are credited to the owner’s cash account.

• As soon as the shares are credited to the securities account, the owner can submit an order to the bank to sell them.

• It is possible for the owner of securities to deregister the shares he owns to another person’s securities account. In that case, the owner of the securities must specify in the deregistration order the person to whose securities account the securities should be transferred. The recipient must give his acceptance to the bank.

Information from the Initial Register about the shares owned by a person can be obtained only by the person himself, presenting an identity document, or his authorized representative, presenting an identity document and a notarized Power of Attorney.

Transfer of shares from the Initial Register to a securities account, opening of securities and cash accounts, storage of shares, as well as other activities are performed by banks and brokerage companies, and these are paid services, the prices of which are determined by the specific bank or brokerage company.

No, deregistration of shares from the Initial Register is irreversible.

In case of liquidation of the company, its shares are deleted from the Initial Register maintained by the Nasdaq CSD. Therefore, it is necessary to understand the possible situations.

• Insolvency is a process that can end with the resumption of normal operations of the company or its bankruptcy. In cases of bankruptcy and liquidation, company property is sold. For the money obtained in this way, the company first settles its obligations with creditors and other persons as specified by law. The company’s shareholders have the “last hand” on the funds obtained from the sale of the company’s assets. After settling company’s obligations with creditors, there are two possibilities: 1) there is no money left to distribute to the company’s shareholders; 2) money left over is distributed to the company’s shareholders in proportion of the number of shares they own. If the company distributes the remaining funds to the shareholders, the shareholders are awarded so-called liquidation quotas, or compensation for the liquidation of the company.

• Liquidation is a process due to which the shareholders can terminate company existence, thus, shares no longer exist. In order for a person, whose shares have been registered in the Initial Register, to receive accrued dividends or due liquidation compensation (if any) for the shares of a liquidated company, the person must go to the bank and ask for the deregistration of the right to dividends or other sums of money accumulated in the Initial Register and payment of money, indicating the shares owned of the liquidated company.