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Dematerialization of Stocks

Pursuant to article 20 of the Law of Ukraine 'Concerning joint-stock companies' (N514-17 dated 17.09.08) the shares of joint-stock companies are to be kept in book-entry form.

The period allotted by law to dematerialize (the stock) issue (transfer the shares into book-entry form), is very limited and will expire October 29, 2010, furthermore the procedure takes some six months to complete.

Therefore Altana Capital offers issuers a full range of services to dematerialize stocks:

  • Assistance in organizing a general stakeholders meeting during which a decision will be made to change the forms of share issue;
  • Preparation of documents for the Securities and Stock Market State Commission in order to receive a new certificate of registration of securities issue;
  • Preparation of documents for opening an issuer account in a chosen Depositary;
  • Assistance in preparing and depositing the global certificate issuance of shares;
  • Preparation of documents for the Custodian of securities;
  • Open by owners a securities account with the Custodian of Altana Capital followed by transferring the actual securities to them.

Steps to take in dematerializing stocks:

  • Adopt a policy decision to start the procedure of dematerialization.
  • Set the date of the general shareholders meeting during which a decision will be made on dematerialization.
  • Notification of the upcoming shareholders meeting.
  • Conduct shareholders meeting.
  • Publish the decision made by the general meeting.
  • Prepare and submit to the Securities and Stock Market State Commission documents to replace certificates to issue securities.
  • Submit the package of documents to the joint-stock company Registrar for the termination of the shareholders' register.
  • Conclude a contract for the servicing of the issuer with the selected Depositary and contract to dematerialize the issue (opening of an account) with the selected Custodian.
  • Transfer the securities registry to the Custodian.
  • Registration of global certificate (GC) on the issue of shares.
  • Submit the GC and instructions to the Depositary with whom the contract to service the issue was concluded.
  • Obtain from the Depositary a certified copy of the GC with the date of the deposit.
  • Submit instructions to the Custodian regarding the stockholders opening accounts and crediting of shares to the accounts.
  • Provide the Registrar with a certified copy of the GC with dated deposit.

Each of these stages has statutory deadlines, and failure to meet any of them could result in the Securities and Stock Market State Commission to decline replacement of the certificate(s) or impose penalties on the issuer.