Other derivative financial instruments, Issuer options, Russian depositary receipts - Securities market. Theory and practice

Other Derivative Financial Instruments

Issuer options

At the end of 2002, another financial instrument - the issuer option (Federal Law No. 185-FZ of December 28, 2002 "On Amendments and Additions to the Federal Law") was added to the list of derivatives of the securities market admitted to circulation in the United States. the law "On the Securities Market" and on the introduction of amendments to the Federal Law "On Non-Profit Organizations".)

The issuer's options are registered emissive securities that fix the right of their owner to purchase a certain number of the issuer's shares at the price specified in them within the time period specified in them (upon occurrence of specified circumstances). The decision on placement of the issuer's options and their placement is made in accordance with the rules of placement of securities convertible into shares, established by federal laws. Therefore, the issuer is not entitled to place options if the number of announced shares is less than the number of shares, the right to purchase which is granted by such options. Moreover, the number of shares eligible for issuing options of the issuer can not exceed 5% of placed shares, and their placement is possible only after full payment of the authorized capital of the joint-stock company.

Russian Depositary Receipts

Russian Depository Receipts (RDRs) are nominal registered securities that do not have a par value, which certify the ownership of a certain number of shares or bonds of a foreign issuer. Securities of a foreign issuer constituting the basis of a DDR are called represented securities. Receipts of one issue can certify the ownership of securities of only one foreign issuer and only one of them. RTR can be issued for those securities whose issuers take obligations to the owners of receipts or are included in the quotation lists of foreign stock exchanges from the list approved by the federal executive body for the securities market. The owner of the RDR has the right to require the issuer of the RDR to obtain the appropriate number of securities to be provided and to provide services related to the exercise of the rights assigned to them.

DDR issuers can be depositors who carry out professional activity in the market of chain securities for at least three years. The same depositary may maintain a registry of RDRs regardless of the number of their owners. In relation to the securities being represented, the depositary acts as a person acting in the interests of third parties.

The procedure for the issuance of DDR includes the following stages: approval by the authorized body of the depositary of a decision on their issue; their state registration and placement of the issue. State registration of the issue of DDR is carried out by the federal executive body for the securities market. The additional issue of RDR is not subject to state registration and is implemented by amending the decision to issue DDRs in terms of increasing the maximum number of receipts that can be simultaneously in circulation. There are no restrictions on the duration of the placement of the DDR.

The Depository - an RDR issuer must quarterly submit to the federal executive body for the securities market information on the number of RDRs in circulation and the number of securities represented on its account, as well as disclose information about themselves and the issuer of the securities being represented securities in the form of a quarterly report and reports on material facts affecting the issuer's financial and business activities.

DDR fragmentation is carried out in accordance with the list of their owners. As a result of such a fragmentation, one receipt may certify the ownership right to at least one represented security.

If the owner of RDR has received from the depositary the corresponding amount of securities to be provided, such a receipt is paid off. At the same time, the maximum number of DDRs that can simultaneously be in circulation in accordance with the decision to issue such securities does not change.

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