Elmat,
What's your take on RIO-P? (Maybe I should be in RIO?)
I elected to purchase over RIO. As I understand, it is common without votes, and in exchange you get any special dividends. Minimum dividends are declared on the common, preferred and golden shares (trade in Brazil only) and if anything extra is declared for the year, it goes to RIO-P. So, in exchange for no voting rights, RIO-P get extra dividends. RIO-P trades at a 15% discount, but same dividend or more. The only downside is you can't sell covered calls, which are possible on RIO.
What says you?
David
cvrd.com.br
cvrd.com.br
I found this posted:
also from filing F-3 dated 2/5/2002, page 116:
" Our by-laws authorize the issuance of up to 300 million common shares and
up to 600 million preferred class A shares or preferred class B shares, in each
case based solely on the approval of the board of directors without any
additional shareholder approval. There are currently no preferred class B shares
outstanding. Under the Brazilian Corporation Law, the number of preferred
non-voting or restricted voting shares outstanding, such as the preferred
shares, may not exceed two-thirds of the total number of outstanding shares.
Each common share entitles the holder thereof to one vote at meetings of
our shareholders. Holders of common shares are not entitled to any preference
relating to our dividends or other distributions or any preference upon our
liquidation.
Holders of preferred class A shares are generally entitled to the same
voting rights as holders of common shares, except with respect to the election
of members of the board of directors, and are entitled to a minimum annual
non-cumulative preferential dividend of 6% of their pro rata share of our
paid-in capital prior to any distribution to holders of common shares or to
holders of preferred class B shares, if any. Holders of preferred class A shares
and the golden share may also elect one member of the permanent audit committee
and an alternate. Non-controlling holders of common shares comprising at least
10% of the common shares outstanding may also elect one member of the audit
committee and an alternate. The preferred class A shares are not entitled to any
preference in the case of our liquidation."
And this:
from page 22 of F-3 filed 2/5/2002:
" Holders of preferred class A shares and the golden share are entitled to
receive an amount equal to 6% of their pro rata share of our paid-in capital
prior to any distribution to holders of preferred class B shares, if any are
issued, or to holders of common shares. Holders of preferred class B shares, if
any are issued, are entitled to receive an amount equal to 6% of their pro rata
share of our paid-in capital prior to any distribution to holders of common
shares and to any additional distribution to holders of preferred class A shares
and the golden share. After holders of common shares receive distributions per
share in an amount equal to the preferential dividend of holders of preferred
shares, all holders of shares receive the same additional distribution amount
per share.
According to Law No. 10,303, the recently enacted law that amended the
Brazilian Corporation Law, in order to be listed and traded on stock exchanges,
preferred shares must entitle their holders to at least one of the following
rights:
(i) a non-cumulative preferential dividend equal to at least 3% of the book
value per share and the right to receive the same additional dividend amounts as
are paid to holders of common shares, after holders of common shares have
received distributions equivalent, on a per share basis, to the preferential
dividends;
(ii) a preferential dividend 10% higher, on a per share basis, than the
dividends and other distributions received by holders of common shares; or
(iii) rights to join in any sale of control by our controlling shareholder
at a price per share at least equal to the price paid for common shares." |
