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notional shares

A share is an ownership which offers its owner specific rights in a company
Type of shares
Shares can be described in many different ways, but division of shares are as follows:
o ordinary share- giving its owners targeted rights on stakes of yearly company profits (dividends), voter rights at General Assemblies and other rights.
o preferred share- not giving its owners voters rights but giving them priority on dividend payouts compared to the owners of ordinary shares as well as the priority of prepayment in case of liquidation or bankruptcy of a company compared to owners of ordinary shares.

Minority shareholders

Concept
A share is a security ownership which gives its owner specific rights in the Company.
Basic rights which owners of shares indulge in:
o Controlling right (right to vote) - this right includes right to vote at General Assemblies. Owners of preferred shares usually do not possess this right,
o the right on portion of profit-this right includes right on dividends-payout of specific monetary amounts per share on the bank account that is a member of the Central securities depository and clearing house and in reinvesting profit-participation in share issue defined on the basis of determined profit portions for distribution,
o encumber purchasing rights – giving the share owner pre rights for the new emission and take advantage of their rights and purchase a part of the shares out of the new emission in order not to violate ownership structure,
o The right to business insight results of companies-this includes the ability for shareholders to have insight of basic financial reports – statements of financial condition and income sheet...
o The right to proportional part of bankruptcy or bankruptcy estate-this includes the payout to shareholders in case of bankruptcy or company liquidations. This right is of residual character, namely companies not having legal obligations to payout shareholders. In case of bankruptcy or liquidation companies first payout owners of bonds then owners of preferred shares and lastly owners of ordinary shares,
o The right to transfer shares-and including the right to freely sell shares, namely shareholders are not obligated to comply with management or other shareholders in order to sell their shares. Of course the prerequisite is that the share is quoted on the Belgrade Stock Exchange.
Shares can be identified in several different ways, but the basic ways are as follows:
o ordinary shares- give its owners specific rights to participation in profit of the company (dividends), right to vote at Shareholder Assemblies and other rights
o preferred shares-do not give its owners of these shares the right to vote, but do give them the priority of dividend payouts in relation to owners of ordinary shares, as well as the priority of prepayment in case of liquidation or bankruptcy of the company with respect to owners of ordinary shares
With induction of new Law which regulates the securities market, business regulations of the Central securities depository clearing house, business regulations of the Belgrade Stock Exchange and every shareholder to clearly dispose of his/her shares in requirement through the member Central securities and depository clearing house open a securities account, in other words
Of course, «Intercity broker" JSC, Belgrade offer its clients extremely fast and effective process of opening an ownership account. Opening this account does in no way mean you are able to sell your shares, but does give you the ability to clearly dispose of your shares and use your rights that are available to your according to Law.
It is extremely important that shareholders have an open currency account for shares in one of the member banks of the Central securities depository and clearing house. This is really important for the shareholders during the contracting of “Contract on opening and managing a securities account" to submit an order for transfer from one issuers issue account to their ownership account and make possible the payment of eventual profit from dividends or from share sales (in the case that the shareholder decides to give an order for sale).

Share sale procedure

Shares are traded exclusively on the Belgrade Stock Exchange. The only way to sell your shares is through a stock broker.
In order to give an order to sell shares you must possess an original certificate of ownership of shares given by the Issuer (until dematerialization of securities and in compliance with Law), as well as the opened earmarked dinar account for selling shares at the member bank of the Central securities depository and clearing house. In case you do not have an open earmarked account, , "Intercity broker" JSC, Belgrade will on your request and on your behalf effectively open this account for you free of charge in one of the banks they do business with and who are of course members of the Central securities depository and clearing house according to Law.
You must bring the following documents to the broker’s office:

an original certificate of shares ownership,
An original dinar account card for selling shares-at location and identification card at location.

We will open an ownership account (in case you don’t have one opened already or in the case that you already have an ownership account but would like "Intercity broker" JSC, Belgrade to open another on your behalf). After this we will open a securities trading account.
We will inform you whether or not the shares you possess are trading on the Exchange, what is their price, when is the future trading and offer you a number of other information and consulting services.
After this the broker from «Intercity broker" JSC, Belgrade will familiarize you on the business Regulations and give you specific examples.
In addition to this we will familiarize you with the tariff regulations of Intercity Broker where you will become aware of the total commissions of Intercity Broker.
When you are familiar with stipulations, conduct «Contract on mediation in selling shares» with "Intercity broker" JSC, Belgrade which Intercity broker is obligated to possess in selling shares on your behalf, in other words conducting selling of shares on your behalf and you obligate yourself to pay these services spent during this process and stated in the Contract.
After both parties sign «Contract on mediation in selling shares», you submit an order to sell shares and endorse (sign) an original ownership Certificate of shares. During submission of orders you have the ability to determine the price, the amount as well as the duration of the order in dependency of the trading method:

Mainstream price method

Price- you designate the price. The prices by which you choose to sell your shares are exclusively your choice. On behalf of your demeanor in regards to the price which will be information received from Intercity broker" JSC, Belgrade. During price selection you have two possibilities:

o «Market price»- this price is the price which is declared at trading and based on all entered orders for purchasing or selling.

Market price includes all prices which are «indicative price». the price that is concluded at the previous trading (in case the indicative price is 100, 00 dinars this means that the given order at market price includes all prices -12%/+20% from 100, 00 dinars, all prices from 88, 00-120, 00 dinars)

The advantage of this price is first of all the precedence of realization namely the pre-realization of orders on the Exchange are orders realized according to «market price» then last of all according to «limit» price.

Disadvantage of this price is the possibility of selling the share at 12% lower than the indicated price in our case by the price from 88, 00 dinars.

In the case that a given order«market price» is not realized at the first following trading this share is no longer active, in other words it is shown as an expired order and for this reason it is important to give the order once again at Intercity broker" JSC, Belgrade.
«Limit price» namely is the stipulated price «not lower than»- this price includes selling the share by the price equally or higher than that one given in the order.

The advantage of this price is the share owner’s security that his shares will not be sold at a lower price then he stated in his given order...

The disadvantage of this price:

o The possibility of inadequate demand and that the share is not sold. This is the reason shares are sold first at «market price», and then after the fact if there is still demand for the share it is sold through «limit price»,

Duration of the order- duration of an order is chosen on your behalf entirely on your own. An order according to duration of an order may be:

daily (valid only for that specific day),
until that day (valid until the day specified in the order, but no longer than 90 days) and
Until cancellation (an order is valid until realization, in other words until you change it or until you cancel it, but no longer than 90 days).

When you decide on the price, amount and validity of the order you will receive from "Intercity broker" JSC, Belgrade a «Certificate of a given order to sell shares» with all the conditions you have demand.
Through the «mainstream price method», after trading you as the seller undergo these following expenses:

Central securities depository and clearing house commission,
Belgrade stock exchange commission,
"Intercity broker" JSC, Belgrade commission,
Institutions regulated tax in compliance with Law.

After trading, "Intercity broker" JSC, Belgrade will send to you an announcement of compliance with law.

«Minimum price method»
According to regulation of the Belgrade Stock Exchange in Belgrade, «minimum price method» is used exclusively for shares brought forth on the market by the Share fund. The Request for reserving trading through «minimum price method» may initiate:

Share fund and
Member of the exchange that represent the share fund.

In case of this method, share offer joined per price must total at the lowest 10%, and at the most 15% of shares from the total number of issued shares. By way of exception form this, through an explanation request from the Share fund, the Director of the Exchange may approve trading through minimum price method even when announced share offers are joined per price at the total price no lower than 10%, in other words no larger than 15%.
The price achieved through share sales «minimum price method» represents indicative price for the following trading of that particular share.

Price- Share fund stipulates the minimum price by which shares will be sold at. This is called «limit price» the price with conditions «not lower than». In this case package shares are formed which are totaled per minimum market price.
Advantage- the price which the Share fund sells at can be no lower than the price given in the order.
Disadvantage- the danger of high prices in which the buyer does not have a desire to purchase at this price.

Amount- amount is limited and through one auction it must move in-between 10% and 15% shares from total number of shares from the issuer. By way of exception form this, through an explanation request from the Share fund, the Director of the Exchange may approve trading through minimum price method even when announced share offers are joined per price at the total price no lower than 10%, in other words no larger than 15%.

«Mainstream price method-initial trading»

Separate from the first two methods, if certain companies shares are entering the Exchange for their initial time «mainstream price method», indicative price equals the total restated cost/value of shares and the zone in which it may be formed is -20%/+50% from the total restated cost/value of shares..
Procedure for purchasing shares
In order to purchase shares on the Belgrade Stock Exchange, you must proceed through a Stock broker.
You may come to "Intercity broker" JSC, Belgrade and request which shares and through what conditions (according to price) you would wish to purchase and with how much resources you have set aside for investment. We make you aware of how many shares you are able to purchase, the date of following trading and we also offer a number of other information and consulting services.
Immediately following "Intercity broker" JSC, Belgrade will familiarize you with business regulations and give specific examples. In addition, on this occasion we will familiarize you with the tariff regulations of Intercity broker, where you will find the total commission of intercity broker.
If you by any chance participate in purchasing shares, but do not have an open ownership account (or you have one but would like to open one up through "Intercity broker" JSC, Belgrade), Intercity broker will also open this account on your behalf.
Following this, writing up a «Contract on purchasing shares brokerage» with "Intercity broker" JSC, Belgrade, in which "Intercity broker" JSC, Belgrade obligates that it will represent you on your behalf in purchasing of shares., but you obligate yourself to pay the commission stated in the Contract.
Following this, your obligations are:

Opening a dedicated dinar account for purchasing shares in the bank that must be a member of the Central securities depository and clearing house. In case you do not have an opened account, "Intercity broker" JSC, Belgrade will on your behalf and on your request in a speedy, effective and free of charge process open an account in one of the banks they are affiliated with and who are as well members of the Central Securities depository and clearing house,
depositing monetary resources in the Dedicated dinar account for purchasing shares,
the apprehension of original Certificates certified by the bank, or statement status on the same account certified by the bank, in which you have the ability to see the status of the open dedicated dinar account for purchasing shares,
Apprehension of Power of attorney certified by the bank. This Power of attorney takes into consideration that you as the client and owner of the account authorize "Intercity broker" JSC, Belgrade to the rights of handling monetary resources in your account, but only in the goal to realization of planned purchases of shares on the Belgrade Stock Exchange.

Therefore, before entering "Intercity broker" JSC, Belgrade, you must bring the following:

Original bank card for your dedicated dinar account for purchasing shares (in person). In case you do not have one open at the time, we can open one for you free of charge,
original identification card (in person),
Original Certificate certified by the bank or an original Statement balance sheet of your dedicated dinar account, certified by your bank.
Power of attorney for "Intercity broker" JSC, Belgrade certified by the bank.

Before price choice, you have two possible scenarios:

«Market price»- this price includes the price specified at trading based on all entered orders for sell and purchases.
Market price includes all prices which move fluctuate -12%/+20% from «indicative price» the price that is stipulated at the previous trading. (In case the indicative price is 100,00 dinars, this means the order will be given at market price including all prices -12%/+20% from 100,00 dinars, all prices from 88,00-120,00 dinars. The coverage of orders per «market price» includes deposited resources by the price of 120, 00 dinars per one share increased by the participant’s costs of trading).
Advantage of these prices is first of all the realization before realization of orders on the Exchange are realized according to given orders through «market price» and then after this process orders through «limit» price.
Disadvantage of this price is the possibility of purchasing shares at the price of 20% higher than indicative price in our case by the price of 120, 00 dinars.
«Limit price» the prerequisite price «no larger than»- this price understands purchasing shares at a lower price or the identical price given in the order.
Advantage of this price is the security of the buyer that the share will not be purchased by a price higher than the price stipulated in the purchase order.
Disadvantage of this price:
- The first disadvantage of this price is the possibility that there is not enough offers and that the share may not be sold. This is due to the fact that all purchase orders are realized first that are given through «market price», then last of all as long as there are still offers, they are realized through «limit price»,
- The second disadvantage of this price is the possibility that the price is stipulated by the level that is larger than the conditioned price given in the order and due to this shares are not purchased. (In the case that orders are given at the price «no larger than» 100, 00 dinars and a price is conditioned on the Exchange from 101, 00 dinars, the order will not enter the possibility of realization).

After trading, you as the buyer bear all the following costs:

Central securities depository and clearing house fees,
Belgrade stock exchange commission,
"Intercity broker" JSC, Belgrade commission
bank fees where your monetary resources are deposited

ISSUERS

THE OBLIGATION OF REGISTERING OWNERSHIP OF SHARES IN THE CENTRAL SECURITIES DEPOSITORY AND CLEARING HOUSE.

Law enforcement of Law on securities and other financial instruments (from 01.10.2003.), sub regulated acts (from 29.10.2003.) and the formation of the Central securities depository and clearing house created the conditions for change in specific stipulations for companies. The most important stipulations of new Law are as follows:
- the obligation of every brokerage firm to submit data on all of its owners, 60 days from the day of enforced law,
- Central securities depository and clearing house obligation to submit lists per shareholders request as well as achieving right to vote at shareholder assemblies as well as acquiring the right to dividend payouts and
- procedures have been prescribed and deadlines for dematerialization of securities.
For all three stated regulations you may contact Intercity Broker JSC which indeed possesses great experience and excellent information support in the realization of these procedures and other projects.

GENERAL SHAREHOLDER ASSEMBLIES

As far as sub regulated acts go, one of the most important places are taken up by «Rulebook on forms and contents of Proxies», in other words its containing elements:

Request for approval of proxy statements and
Power of attorney submission,

Which are necessary in order to hold Shareholder assemblies.
Employees in "Intercity broker" JSC, Belgrade, as well as their expert colleagues will use their professional knowledge in order to consult you on the road to successful and legitimate organization of Shareholder assemblies.

HARMONIZING SHAREHOLDER DATABASES AND ALLOCATION OF «CFI» CODES ANDI «ISIN» NUMBERS

One of the basic obligations of every company represents the harmonization of existing database with database of shareholders in the Central securities depository and clearing house.
Along side these obligations, companies are obligated to allocate «CFI» codes and «ISIN» numbers to every issue.
«CFI» code is a code for securities from a specific security issuer where legal owners acquire their legal rights in regards to the class in other words the series of those securities. Intercity broker will follow provisions of «securities table of contents and other financial instruments» the Central securities depository and clearing house will allocate a «CFI» code, to our shares which in fact the Central register verifies.
«ISIN number»- contains combinations of a number of alphabetical letters and numbers which identify the country origin, the issuer, the type of security and other important facts in regards to the security.
Within the «Instructions for allocating CFI codes and ISIN numbers and process of securities registration in the Central securities depository and clearing house amongst these also:
«Member Central securities depository and clearing house in the name and on behalf of their client – issuer submit to the Central register a request for allocation of CFI codes and ISIN number of securities which the issuer has the intention to release.

The best guarantee for harmonizing databases and allocating «CFI» codes and «ISIN» numbers represents the reality that Intercity broker JSC, Belgrade signed Contracts for representing and consulting corporate business with numerous companies:

• "Hemofarm koncern" JSC Vršac, which has over 10.000 shareholders,
• "Apatinska pivara" JSC Apatin, with more than 7.000 shareholders,
• "Velefarm a.d. Holding kompanija" JSC Belgrade
• "Metalservis" JSC Belgrade, with more than 1150 shareholders

• "Yugorosgaz" JSC Belgrade,
• "UP Višnjica" JSC Belgrade
• "ATD Putnik" JSC Belgrade
• "Hemofarm koncern- Zorka Pharma" JSC Šabac , with more than 800 shareholders
• "Politika" JSC Belgrade
• "NIP Kompanija Novosti" JSC Belgrade
• "Progres" JSC Belgrade, with more than 7.500 shareholders,
• "GP Mostogradnja" JSC Belgrade
• "JSC FMP" Belgrade
• "UP Madera" JSC Belgrade
• "Iritel" JSC, Belgrade
• "Elektroveze" JSC Belgrade
• "Igma" JSC Uljma
• "Srbija turist" JSC Niš
• "7. Juli" JSC Vranje
• "Hemkolor" JSC Belgrade
• "Epoksid" JSC Priboj
• "Sanitarija" JSC Novi Sad
• "Ecoagri Serbia" JSC Bela Crkva
• "Agrovojvodina" JSC Vršac
• "MPA inženjering" JSC Novi Sad
• "JSC za osiguranje Kopaonik" Belgrade
• "Hidrozavod" JSC Novi Sad
• "AD Inex-Radulaška" JSC Belgrade
• "TK Savremena" JSC Belgrade
• "Tehnohemija" JSC Belgrade
• "Komerc šampion" JSC Vršac
• "Sloga" JSC Užice
• "Elektrotehna" JSC Niš
• "Jedinstvo" JSC Vlajkovac
• "Transport" JSC Vera
• "Stup" JSC Vršac
• "Zenit" JSC Vršac
• "Dehidrator" JSC Vršac
• "Kadinjača" JSC Užice
• "Obezbeđenje komerc" JSC Belgrade
• "Izolacija holding" JSC Belgrade
• "Intersilver" JSC Belgrade
• "Budimka" JSC Požega
• "Fasil" JSC Arilje
• "Fiaz" JSC Prokuplje
• "JSC Frizer-Stari grad" Užice
• "Trešnjica" JSC Požega
• "VF Holding" JSC Belgrade
• "Moravamermer" JSC Belgrade
• "HI Kotroman" JSC Mokra Gora
• "Elektrografit" JSC Belgrade
• "Mlekara Sevojno" JSC Užice
• "Sinter" JSC Užice
• "Zlatarplast" JSC Nova Varoš
• "Poljoprivredna banka Agrobanka" JSC Belgrade
• "Alfa protein" JSC Vršac
• "Biro Plus" JSC Vršac
• "GP Centar" JSC Belgrade
• "Centar Millennium" JSC Vršac
• "IGM Trudbenik" JSC Belgrade
• "HI Luxol" JSC Zrenjanin
• "Potens" JSC Požega
• "Šljunkara" JSC Bela Crkva
• "Zimpa" JSC Ub

• "Zlatarplast" JSC Nova Varoš
• "HTP Srbija " JSC Vršac
• "Vetprom " JSC Belgrade

For the following companies Intercity broker has conducted or is in the process downloading issuer databases harmonizing the share book with the Temporary register and the issuer with the Central securities depository and clearing house allocating «CFI» codes and «ISIN» numbers.
Don’t miss out on the opportunity to become successful. Be part of our team and secure a place amongst other successful companies.

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