GSE Charter

4.1. Owner-Membership (Member-Shareholders) of the Exchange is regulated by this Charter, the Georgian Laws On Entrepreneurs and On Securities Markets.
4.2. Every licensed Brokerage Company, which owns a share of the Exchange, is the Member-Shareholder of the Exchange. No Member-Shareholder can own more than three shares of the Exchange.
4.3. Transfer of the rights on the shares of the Exchange is regulated by this Charter, by the Law of Georgia on Securities Markets, and by Georgian Legislation.
4.4. The Exchange is not allowed to distribute its profits as dividends to its Member-Shareholders.
4.5. One share of the Exchange gives its owner the right to own one brokerage seat. A brokerage seat is the right, which provides access to the trading system and participation in the trades in accordance with Article 4.8. of these rules.
4.6. Each Member-Shareholder becomes a member of a Self-Regulated Organization under Article 1.3. of this charter. The rights of a member of a Self-Regulated Organization are defined in accordance with the Law of Georgia on Securities Markets.
4.7. Member-Shareholders have the following rights:
4.7.1. to participate in securities trading organized by the Exchange and to use Exchange services in accordance with the established rules;
4.7.2. to participate in the General Meeting of the Exchange Member-Shareholders. The voting principle at the General Meeting is the following: one share - one vote;
4.7.3. to be informed on the main results of the economic-financial activities of the Exchange;
4.7.4. to obtain information pertaining to the accounting and control status of the Exchange, in accordance with the Law of Georgia on Entrepreneurs;
4.7.5. No rule shall be adopted on the Exchange nor any change shall be made in it until the Member-Shareholders, not less than two weeks prior to the adoption, review the rule and submit the comments on them, one week prior to their adoption, if such comments arise;
4.7.6. to elect and to be elected in structures of the Exchange.
4.8. The main duties of Member-Shareholders are:
4.8.1. to sign a Convention by which they will join collective duties of Member-Shareholders - to abide the requirements of the Charter, Inner Regulations, Trading Rules and Rules of the Exchange and comply with the decisions of the managing bodies of the Exchange and the Arbitration;
4.8.2. to provide the compliance with the norms of the Code of Ethics approved by the General Meeting of Member-Shareholders;
4.8.3. In the event of dismissal from the Exchange, Member-Shareholder shall either sell within 30 days, the shares in its ownership to another entity authorized to become a Member-Shareholder, or if he fails to do so, transfer the right of selling its shares to the Exchange, at the prevailing market price. The proceeds from the sale of shares shall be returned to the dismissed Member-Shareholder after deducting the amount required for the coverage of liabilities to the customers and the Exchange;
4.8.4. to provide confidentiality of technical, technological and commercial information, the disclosure of which may cause damage to the Exchange, its Members and Clients;
4.8.5. to timely pay membership fees, commissions and other payments set by the Exchange;
4.8.6. to facilitate the fulfillment of the goals set by the Charter of the Exchange, protect the interests stipulated in it and care about raising its image and prestige;
4.8.7. to inform timely the Managing Body of the Exchange about the present or expected changes in their financial and legal status, which may have negative effect on their ability to fulfill the obligations to the Exchange and its members;
4.8.8. to possess the necessary license for brokerage activities;
4.8.9. not to own directly or through affiliated persons more than 10% of the Exchange votes;
4.8.10. to give the Exchange a written consent to check its books and records in order to verify accuracy of any provided information;
4.8.11. to comply with the capital requirements set forth by the regulations of the National Securities Commission of Georgia.
4.9. A Member-Shareholder may be dismissed from the Exchange by the decision of the General Meeting of Member-Shareholders or the Supervisory Board in accordance with the Law of Georgia on Securities Markets and the Exchange Rules;
4.10. Any brokerage company may become a Member-Shareholder of the Exchange. For this purpose, it shall conclude an agreement with a seller to acquire a share of the Exchange. If a candidate of a Member-Shareholder does not have a brokerage company license, it shall submit to the National Securities Commission of Georgia an application for obtaining a brokerage company license, within 30 days from submitting to the Exchange one copy of an agreement with a seller and the order of a seller on re-registration of its shares in the register. Immediately upon the submission of an application to the Commission, a candidate for Member-Shareholder becomes a Provisional Member-Shareholder. Within one day from the submission, a copy of the application shall be filed with the Exchange. In the event of failure to submit, it shall lose the status of the Provisional Member-Shareholder. Upon submission of the Brokerage Company license to the Managing Body of the Exchange, a respective change is made to the share register and the Provisional Member-Shareholder acquires a status of a Member-Shareholder. If, within 15 days of final decision taken by the National Securities Commission of Georgia regarding a license to the Provisional Member-Shareholder, a candidate for a Member-Shareholder fails to file a copy of such a license or a copy of this decision with the Exchange Managing Body, it shall be revoked a right of Provisional Member-Shareholder and shall be denied a right to become a Member-Shareholder and an order on re-registration of shares in the Exchange register shall be deemed null and void.

5.1. The supreme governing body of the Exchange is the General Meeting of Member-Shareholders, which is held once a year. Extraordinary meeting may also be called. Meeting is called in accordance with the Law of Georgia on Entrepreneurs.
5.2. The General Meeting of Member-Shareholders is authorized to:
5.2.1. approve the Charter of the Exchange and amendments to it;
5.2.2. make a decision on the Exchange reorganization or liquidation;
5.2.3. approve or reject a proposal of the Supervisory Board and Directors regarding use of profits;
5.2.4. elect members of the Supervisory Board;
5.2.5. approve reports of Directors and the Supervisory Board;
5.2.6. elect the Arbitrators, Advisory Board, Judicatures of the Disciplinary Committee and determine their competence;
5.2.7. make decisions on remuneration of the Supervisory Board members;
5.2.8. elect an Auditor;
5.2.9. take decisions in other cases provided for by the Law of Georgia on Entrepreneurs and the Law of Georgia on Securities Markets, in particular, approve the Code of Ethics of the JSC Georgian Stock Exchange, Rule on Settlement of Disputes, Provision on Member-Shareholders of JSC Georgian Stock Exchange and fees of the Member-Shareholders;
5.2.10. take decisions on the dismissal of a Member-Shareholder in accordance with Article 34 of the Law of Georgia on Securities Markets.
5.3. Decisions on the General Meeting are made by voting in accordance with the quotes provided for in the Law of Georgia on Entrepreneurs, except the exceptions provided in Article 5.4 and 11.2 of this Charter.
5.4. For making decision on the issues provided for in Article 5.2.1 of this Charter no less than 3/4 of Member-Shareholders votes is required.
5.5. From the date the Exchange obtains a Stock Exchange License, all the decisions taken according to Article 5.2.1. and 5.2.2. shall be effective only after their approval by the National Securities Commission of Georgia.

6.1. The Supervisory Board of the Exchange consists of twelve members.
6.2. A member of the Supervisory Board may not be at the same time the Exchange Director or its employee.
6.3. The Supervisory Board elects a Chairman and his Deputy from the list of its members.
6.4. Meetings of the Supervisory Board are held at least once a month. The invitation shall be made in writing and at least eight days prior to the meeting date and it shall indicate the proposed agenda. Other members (proxies) may represent the members of the Supervisory Board, provided that one proxy represents one member.
6.5. The Supervisory Board is authorized to take decisions, if at least half of the Board Members are attended or represented. If the Supervisory Board is not authorized to take decisions, the Chairman (in his absence, his Deputy) may call another meeting, at least within eight days, which shall be authorized to take decisions if it is attended by no less than 25% of the members. If, however, the Board is still unauthorized to take decisions, the Chairman (in his absence, his Deputy) may, at least within eight days, call another meeting, which shall be authorized to take decisions regardless the number of attending members.
6.6. Supervisory Board makes decisions by simple majority of attended or represented members.
6.7. Rights and duties of the Supervisory Board are to:
6.7.1. approve, reject or amend the Exchange Trading Rules, Code of Procedures, provisions on admitting securities to the Trading System and Listing, fees of Member-Shareholders, fees and dues for admitting securities to Listing, other Rules and Inner Regulations, with approval form the National Securities Commission of Georgia in accordance with Article 42 of the Law of Georgia on Securities Markets;
6.7.2. ensure compliance with the active legislation, the Charter of the Exchange, Inner Regulations and Trading rules;
6.7.3. delegate rights and duties to the Exchange Directors in accordance to the Charter and Inner Regulations;
6.7.4. define the Exchange Trading Rules;
6.7.5. appoint and dismiss Exchange General Director and Directors, conclude or terminate employment contracts with them;
6.7.6. approve the Exchange organizational structure and amendments to it;
6.7.7. take decision on accepting a new Member-Shareholder and suspending membership to a Member-Shareholder, except for the cases provided by section 5.2.10 of this Charter;
6.7.8. admit for trading certain securities, remove or temporarily remove some securities from trading;
6.7.9. control activities of the Directors;
6.7.10. request from the Directors a report on Activities of the Exchange;
6.7.11. control and examine the Exchange accounting books, as well as assets;
6.7.12. call the General Meeting of the Exchange Member-Shareholders;
6.7.13. present an annual report of the Exchange to the General Meeting of Member-Shareholders.
6.8. Only upon approval of the Supervisory Board may the following activities be carried out:
6.8.1. acquisition and disposal of capital investments;
6.8.2. acquisition and disposal of fixed assets and similar rights;
6.8.3. investments, value of which together or separately, in one fiscal year, exceeds ten per cent of the previous year's book value of the total assets of the Exchange;
6.8.4. establishment of general principles of economic policy of the Exchange.
6.9. For the purposes of better execution of its obligations the Supervisory Board of the Exchange creates Commissions from the Board members.
6.10. The Commission of the Supervisory Board shall work out its Charter and shall elect a Chairman.
6.11. The Supervisory Board approves Chairmen and Charters of the Commissions.
6.12. The Commission of the Supervisory Board is responsible to continuously supervise the issues, which are in its jurisdiction, to consult with the Exchange Directors and to timely present appropriate decisions to the Supervisory Board for its ruling.
6.13. The Commission has no right to make any decisions on behalf of the Supervisory Board or to give any orders to the Exchange Directors.
6.14. A member of the Supervisory Board may be a member of several Commissions at the same time.
6.15. Directors' functions can not be transferred to the Supervisory Board.

7.1. The General Director and Directors are responsible to manage and represent the Exchange.
7.2. General Director of the Exchange:
7.2.1. is responsible to and reports to the Supervisory Board on execution of decisions of the Supervisory Board;
7.2.2. is the official representative of the Exchange in all its relationships with the Government, other organizations or persons;
7.2.3. appoints the Exchange employees, experts and advisors and determines their responsibilities, working conditions and terms.
7.3. The Exchange Directors are responsible and accountable to the Supervisory Board and the General Director, under the terms of this Charter and the Exchange Inner Regulations.
7.4. The responsibilities of a General Director and the Directors of the Exchange are the following:
7.4.1. to ensure observance of the active legislation, the Charter of the Exchange, Inner Regulations and Trading Rules and in connection with the stated above to control the activities and the financial status of the Member-Shareholders;
7.4.2. to delegate its powers to the Exchange structural units and employees in accordance with Exchange Inner Regulations, provided that a party effected by such a decision may require review of such a decision with the Exchange Directors or the Supervisory Board of the Exchange;
7.4.3. to suspend trading of some securities in accordance with the established rules;
7.4.4. to admit Member-Shareholders to participation in the activities on the Stock Exchange or to suspend or temporarily suspend the Brokers of the Brokerage Companies from trading, in compliance with the Trading Rules and with Article 34 of the Law of Georgian on Securities Markets.
7.4.5. to ensure legal and accurate business of the Exchange, as well as publication of quotations, prices and related market information;
7.4.6. to provide Member-Shareholders with information about results of the concluded trades;
7.4.7. to impose sanctions to the Exchange Member-Shareholders for violation of this Charter, Exchange Inner Regulations and Trading Rules in accordance with legislation, concluded agreements and the Exchange Rules;
7.4.8. to exercise any other rights bestowed on it under the Law of Georgia on Entrepreneurs, Law of Georgia on Securities Markets, this Charter, the Exchange Inner Regulations and Rules.
7.5. The Exchange Directors make independent decisions, as deemed necessary, within the scope of their jurisdiction. They are obliged to inform the General Director about their decisions.
7.6. Directors and all employees of the Exchange are obligated to fulfill the decisions of the General Director of the Exchange. The General Director has right to cancel or change the decision taken by the Exchange Director.
7.7. The Exchange General Director is responsible for the decisions made by him to the Supervisory Board.
7.8. The system of relationships between the Directors and other employees of the Exchange is determined by the Exchange Inner Regulations and the Charter of Exchange Departments.