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Annexure - A THE COCHIN STOCK EXCHANGE LIMITED (DEMUTUALISATION)
SCHEME, 2005 1. Title and
Commencement 1.1 This Scheme shall be called the
Cochin Stock Exchange Limited (Demutualisation) Scheme, 2005 (hereinafter
referred to as this Scheme). 1.2 This Scheme shall have effect on its
publication under sub-section (4) of section 4B of the Securities Contracts
(Regulation) Act, 1956 (hereinafter referred to as
"SCRA"). 1.3 Cochin Stock Exchange Limited
(hereinafter referred to as CoSE) shall be demutualised in accordance with this
Scheme on and from the Appointed Date, as may be notified by the Securities and
Exchange Board of India (hereinafter referred to as SEBI), in respect of CoSE under Section 4A of the SCRA: Provided that the activities specified in the respective clauses of this
Scheme shall be implemented as per the time schedule specified in those
clauses. 2. Definitions In this Scheme,
unless the context otherwise requires: 2.1 Cochin Stock Exchange Limited means the Company limited
by shares, registered under the Companies Act, 1956 having its Registered
Office at MES Dr. P. K. Abdul Gafoor Memorial Cultural Complex, 36/1565, 4th
Floor, Judges Avenue, Kaloor, Cochin 682017 and recognized as a stock
exchange by the Central Government under the SCRA. 2.2 Due Date means the date, as may be determined by the Governing
Board which shall not be later than 3 months from the date of publication of
the Order under sub-section (7) of section 4B of the SCRA. 2.3 Governing Board means the
Board of Directors of CoSE. 2.4 Member means a person who is a member of CoSE on the day preceding
the Due Date as per the register of members maintained by it. 2.5 Shareholder means a person who holds any equity share(s) of CoSE on
or after the Due Date. 2.6 Trading Member means a stock broker of CoSE and registered with
SEBI as such under the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992. 2.7 Words and expressions used and not
defined in this Scheme but defined in the Securities and Exchange Board of
India Act, 1992, the Depositories Act, 1996, the SCRA, the Companies Act, 1956,
the rules and regulations made under these Acts and the Memorandum and Articles
of Association, Rules, Bye-laws and Regulations of CoSE shall have the same
meanings respectively assigned to them in the above mentioned Acts, Memorandum
and Articles of Association, Rules, Bye-laws and Regulations. 3. Governing Board 3.1 The Governing Board, on and from Due
Date, shall be constituted in accordance with the provisions of the Articles of
Association of CoSE in force from time
to time: Provided that (i)
the representation of Trading
Members does not exceed one-fourth of the total strength of the Governing
Board, and the remaining directors are appointed in the manner as may be specified
by SEBI from time to time, and (ii) the Chief Executive, by whatever
name called, is an ex-officio director. 3.2 Notwithstanding anything contained
in clause 3.1 SEBI may nominate directors on the Governing Board as and when
deemed fit. 4. Listing of Shares CoSE may at any
time list its securities on any recognised stock exchange. 5. Demutualisation 5.1 A Trading Member may or may not be a Shareholder. 5.2 A Shareholder may or may not be a Trading Member. 6. Trading Rights 6.1 A Member, who is registered as a Stock
Broker on the day preceeding the Due Date, shall become a Trading Member on the
Due Date. 6.2 A Member, who is not registered as a stock broker on the day
preceding the Due Date, shall become a Trading Member on being registered as a
stock broker under the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992: Provided that his
application for registration is submitted to SEBI within one month from the Due
Date. 6.3 After the Due Date, a person
desirous of becoming a Trading Member shall be admitted if he complies with
requirements and brings in specified fees and deposits as specified in the
Rules, Bye-laws and Regulations of CoSE. 6.4 CoSE shall, for the purpose of
admitting any person as a Trading Member, follow uniform standards in terms of
capital adequacy, deposits, fees etc. irrespective of mode of acquisition of
trading right by that person: Provided that different standards may be followed for admission of a
person as a Trading Member who has
acquired trading right by way of transmission. 6.5 Irrespective of the date or mode of
acquisition of trading right, the Trading Members shall have uniform rights and
privileges: Provided that CoSE
may, with the prior approval of SEBI, grant additional privileges to those
Trading Members who were Members on the day preceding the Due Date. 6.6 Trading Members on the Due Date
shall continue to have the same rights and privileges in respect of their
clients and constituents and other members arising out of or under any act,
omission or contract or law, notification, order, direction, etc. as had
accrued to them while being Members on or before the Due Date. 6.7 Trading Members shall be bound by
all obligations and liabilities towards their clients and constituents, SEBI, CoSE and other authorities or other persons
arising out of or under any act, omission or contract or law, notification,
order, direction, etc. while being Members on or before the Due Date. 6.8 A Trading Member may
surrender his membership to CoSE in the manner specified in the Rules, Bye-laws
and Regulations of CoSE. 7. Shareholding Rights 7.1 A Member shall become a shareholder on the Due Date. 7.2 CoSE shall ensure that atleast 51% of its equity shares are held by
public other than shareholders having trading rights in the manner and within
the period prescribed in sub-section (8) of Section 4B of the SCRA. 7.3 On and from the Appointed Date, CoSE
shall ensure that public other than shareholders having trading rights
continuously hold at least 51% of equity shares. 7.4 On and from the Due Date, no
shareholder, who is a Trading Member, shall have voting rights (taken together
with voting rights held by him and by any persons acting in concert with him) exceeding 5% of
the voting rights in CoSE. 8. Memorandum
and Articles of Association, etc. 8.1 CoSE shall incorporate the provisions of
this Scheme appropriately in its Memorandum and Articles of Association and the
Rules, Bye-laws and Regulations on or before the Due Date. 8.2 The Memorandum and Articles of Association
and the Rules, Bye-laws and Regulations of CoSE may be amended after the Due
Date in accordance 9. Transfer of Clearing
and Settlement Functions 9.1 CoSE shall, within
two years of the Due Date, subject to the prior approval of SEBI, transfer the
duties and functions of its clearing house to a Clearing Corporation, recognised
under the SCRA. 9.2 Until the duties and functions of
the clearing house are transferred as provided in clause 9.1, the clearing and
settlement functions in relation to trading on CoSE shall be carried out by the clearing and
settlement mechanism as used by CoSE at
present or in such other manner as the Governing Board may determine. 10. Utilisation of Assets
and Reserves 10.1 CoSE shall not do anything contrary
to the provisions of section 4B (3) of the SCRA. 10.2 Without prejudice to the generality of the provisions
of clause 10.1, CoSE shall not use its assets and reserves as on the date of
publication of this Scheme or the proceeds from disposal of such assets or the
proceeds from disposal of successive species of assets acquired from the
proceeds of disposal of such assets for any purpose other than discharging the
current liabilities outstanding as on the date of publication of this Scheme or
for the business operations of stock exchange. 11. Compliance with this Scheme 11.1 CoSE shall ensure compliance with the provisions of this Scheme at all
times and shall not do anything contrary to the provisions of this Scheme. 11.2 Without prejudice to the
generality of the provisions in clause 11.1, CoSE shall continuously comply
with the provisions in clauses 3.1, 5, 6.3, 6.4, 6.5, 6.8, 7.3, 7.4, 8.2 and
10. 11.3 CoSE shall report
compliance with the provisions of this Scheme in such manner as may be required
by SEBI from time to time. 12. Removal
of Difficulties If any difficulty
arises in giving effect to the provisions of this Scheme, SEBI may, at the written
request of CoSE, relax any of the provisions of this Scheme. ********* |
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