On April 1, 2020 articles of The Law on Amendments and Supplements to the Company Law (Official Gazette of the RS, No. 91/19) under the paragraph 3.2.a “Reserved Own Share and Right to Acquire Share” became applicable.
These amendments introduced two new legal concepts applicable to limited liability companies: (i) a reserved own share; and (ii) a financial instrument – the right to acquire shares.
A reserved own share of a company within the meaning of this Act shall be considered a share that the company acquires from a member of the company (shareholder) without consideration, for the purpose of granting a financial instrument – right to acquire a share.
Reserved own shares shall be registered in the Serbian Business Registers Agency.
The financial instrument – the right to acquire shares – shall be issued by a company to one or more persons, from its reserved own share. This instrument enables the person to whom the financial instrument has been issued to acquire a share in the company under preferential conditions (price) after the expiration of a certain period of time (stated in the resolution of issuance of the financial instrument). The holder of the right to acquire shares shall be, also, registered in the Central Securities, Depository and Clearing House Registry.
After the due date of the right to acquire shares and payment of the agreed price, the exercise of the right to acquire shares shall be realized by striking the financial instrument off the Central Securities, Depository and Clearing House Registry, while the legal holder of the financial instrument shall be registered as a shareholder in the Register of the Serbian Business Registers Agency simultaneously with registration of the reduction of the reserved own share.
Exceptionally, the financial instrument – right to acquire share shall become due even before the maturity date referred to in Article 159d paragraph 2, item 7) of this Act, namely in the case of: (i) Liquidation of the company – the next day after the publication of the announcement of the commencement of liquidation; (ii) Status change – the next day after the publication of the draft status change agreement, i.e. the plan of division; and (iii) Changes in the legal form – the next day after the date of publication of the proposal for a decision on the change of legal form.
The right to acquire shares is subject to judicial protection as stipulated in the Article 159h of the Law.