SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009
THE GAZETTE OF INDIA
EXTRAORDINARY
PART III � SECTION 4
PUBLISHED BY AUTHORITY
NEW DELHI, AUGUST 26, 2009
SECURITIES AND EXCHANGE BOARD OF INDIA
NOTIFICATION
Mumbai, 26th August, 2009
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
No. LAD-NRO/GN/2009-10/15/174471.
In exercise of the powers conferred by section 30 of the Securities and
Exchange Board of India Act, 1992 (15 of 1992), the Board hereby makes the
following regulations, namely:-
PRELIMINARY
Short title and commencement.
1. (1) These regulations may be called the Securities and Exchange Board of
India (Issue of Capital and Disclosure Requirements) Regulations, 2009.
(2) They shall come into force on the date of their publication in the
Official Gazette.
Definitions.
2. (1) In these regulations, unless the context otherwise requires:
(a)
�Act� means the
Securities and Exchange Board of India Act, 1992 (15 of 1992);
(b)
�advertisement�
includes notices, brochures, pamphlets, show cards, catalogues, hoardings,
placards, posters, insertions in newspaper, cover pages of offer documents,
pictures and films in any print media or electronic media, radio, television
programme;
(c)
�anchor investor" means a qualified institutional buyer an
application for a value of ten crore rupees or more in a public issue made
through the book building process in accordance with these regulations;
(d)
�Application
Supported by Blocked Amount (ASBA)� means an application for subscribing to a
public issue or rights issue, along with an authorisation to Self Certified
Syndicate Bank to block the application money in a bank account;
(e)
�Board� means the
Securities and Exchange Board of India established under section 3 of the Act;
(f)
�book building�
means a process undertaken to elicit demand and to assess the price for
determination of the quantum or value of specified securities or Indian
Depository Receipts, as the case may be, in accordance with these regulations;
(g)
�book runner�
means a merchant banker appointed by the issuer to undertake the book building
process;
(h)
�composite issue�
means an issue of specified securities by a listed issuer on public-cum-rights
basis, wherein the allotment in both public issue and rights issue is proposed
to be made simultaneously;
(i)
�control� shall
have the same meaning as assigned to it under clause (c) of sub-regulation (1)
of regulation 2 of the Securities and Exchange Board of India (Substantial
Acquisitions of Shares and Takeovers) Regulations, 1997;
(j)
�convertible debt
instrument� means an instrument which creates or acknowledges indebtedness and
is convertible into equity shares of the issuer at a later date at or without
the option of the holder of the instrument, whether constituting a charge on
the assets of the issuer or not;
(k)
[1][�convertible
security� means a security which is convertible into or exchangeable with
equity shares of the issuer at a later date, with or without the option of the
holder of the security and includes convertible debt instrument and convertible
preference shares;]
(l)
�designated stock
exchange� means a recognised stock exchange in which securities of an issuer
are listed or proposed to be listed and which is chosen by the issuer as a
designated stock exchange for the purpose of a particular issue of specified
securities under these regulations:
�Provided that where one or more of such stock
exchanges have nationwide trading terminals, the issuer shall choose one of
them as the designated stock exchange:
�Provided further that subject to the
provisions of this clause, the issuer may choose a different recognised stock
exchange as a designated stock exchange for any subsequent issue of specified
securities under these regulations;
(m) �employee� means a permanent and full-time employee of
the issuer, working in India or abroad or a director of the issuer, whether
whole time or part time and does not include promoters and an immediate
relative of the promoter (i.e., any spouse of that person, or any parent,
brother, sister or child of the person or of the spouse);
(n)
�further public
offer� means an offer of specified securities by a listed issuer to the public
for subscription and includes an offer for sale of specified securities to the
public by any existing holders of such securities in a listed issuer;
(o)
�green shoe
option� means an option of allotting equity shares in excess of the equity
shares offered in the public issue as a post-listing price stabilizing
mechanism;
(p)
�initial public
offer� means an offer of specified securities by an unlisted issuer to the
public for subscription and includes an offer for sale of specified securities
to the public by any existing holders of such securities in an unlisted issuer;
(q)
�issue size�
includes offer through offer document and promoters� contribution;
(r)
�issuer� means
any person making an offer of specified securities;
(s)
�key management
personnel� means the officers vested with executive powers and the officers at
the level immediately below the board of directors of the issuer and includes
any other person whom the issuer may declare as a key management personnel;
(t)
�listed issuer�
means an issuer whose equity shares are listed in a recognised stock exchange;
(u)
�net offer to
public� means an offer of specified securities to the public but does not
include reservations;
(v)
�net worth� means
the aggregate of the paid up share capital, share premium account, and reserves
and surplus (excluding revaluation reserve) as reduced by the aggregate of� miscellaneous expenditure (to the extent not
adjusted or written off) and the debit balance of the profit and loss account;
(w) �non institutional investor� means an investor other
than a retail individual investor and qualified institutional buyer;
(x)
�offer document�
means a red herring prospectus, prospectus or shelf prospectus and information
memorandum in terms of section 60A of the Companies Act, 1956 in case of a
public issue and letter of offer in case of a rights issue;�������
(y)
"offer
through offer document� means net offer to public and reservations;
(z)
�preferential
issue� means an issue of specified securities by a listed issuer to any select
person or group of persons on a private placement basis and does not include an
offer of specified securities made through a public issue, rights issue, bonus
issue, employee stock option scheme, employee stock purchase scheme or
qualified institutions placement or an issue of sweat equity shares or
depository receipts issued in a country outside India or foreign securities;
(za) �promoter� includes:
(i)
the person or
persons who are in control of the issuer;
(ii)
the person or
persons who are instrumental in the formulation of a plan or programme pursuant
to which specified securities are offered to public;
(iii)
the person or
persons named in the offer document as promoters:
�Provided that a
director or officer of the issuer or a person, if acting as such merely in his
professional capacity, shall not be deemed as a promoter:
�Provided
further that a financial institution, scheduled bank, foreign institutional
investor and mutual fund shall not be deemed to be a promoter merely by virtue
of the fact that ten per cent. or more of the equity share capital of the
issuer is held by such person;
�Provided
further that such financial institution, scheduled bank and foreign
institutional investor shall be treated as promoter for the subsidiaries or
companies promoted by them or for the mutual fund sponsored by them;
(zb) �promoter group� includes:
(i)
the promoter;
(ii)
an immediate
relative of the promoter (i.e., any spouse of that person, or any parent,
brother, sister or child of the person or of the spouse); and
(iii)
in case promoter
is a body corporate:
(A) a subsidiary or holding company of such body
corporate;
(B) any body corporate in which the promoter holds ten per
cent. or more of the equity share capital or which holds ten per cent. or more
of the equity share capital of the promoter;
(C) any body corporate in which a group of individuals or
companies or combinations thereof which hold twenty per cent. or more of the
equity share capital in that body corporate also holds twenty per cent. or more
of the equity share capital of the issuer; and
(iv) in case the promoter is an individual:
(A) any body corporate in which ten per cent. or more of
the equity share capital is held by the promoter or an immediate relative of
the promoter or a firm or Hindu Undivided Family in which the promoter or any
one or more of his immediate relative is a member;
(B) any body corporate in which a body corporate as
provided in (A) above holds ten per cent. or more, of the equity share capital;
(C) any Hindu Undivided Family or firm in which the
aggregate shareholding of the promoter and his immediate relatives is equal to
or more than ten per cent. of the total; and
(v)
all persons whose
shareholding is aggregated for the purpose of disclosing in the prospectus
under the heading "shareholding of the promoter group":
�Provided that a
financial institution, scheduled bank, foreign institutional investor and
mutual fund shall not be deemed to be promoter group merely by virtue of the
fact that ten per cent. or more of the equity share capital of the issuer is
held by such person:
�Provided further
that such financial institution, scheduled bank and foreign institutional
investor shall be treated as promoter group for the subsidiaries or companies
promoted by them or for the mutual fund sponsored by them;
(zc) �public issue� means an initial public offer or
further public offer;
(zd) �qualified institutional buyer� means:
(i)
a mutual fund,
venture capital fund and foreign venture capital investor� registered with the Board;
(ii)
a foreign
institutional investor and sub-account (other than a sub-account which is a
foreign corporate or foreign individual), registered with the Board;
(iii)
a public
financial institution as defined in section 4A of the Companies Act, 1956;
(iv)
a scheduled
commercial bank;
(v)
a multilateral
and bilateral development financial institution;
(vi)
a state
industrial development corporation;
(vii)
an insurance
company registered with the Insurance Regulatory and Development Authority;
(viii)
a provident fund
with minimum corpus of twenty five crore rupees;
(ix)
a pension fund
with minimum corpus of twenty five crore rupees;
(x)
National
Investment Fund set up by resolution no. F. No. 2/3/2005-DDII dated November
23, 2005 of the Government of India published in the Gazette of India;
(xi)
[2][insurance funds
set up and managed by army, navy or air force of the Union of India;]
(ze) �retail individual investor� means an investor who
applies or bids for specified securities for a value of not more than one lakh
rupees;
(zf) �retail individual shareholder� means a shareholder of
a listed issuer, who:
(i)
as on the date
fixed for the purpose of determining shareholders eligible for reservation in
terms of regulation 41 of these regulations, is holding equity shares which, on
the basis of the closing price of the equity shares on the recognised stock
exchange in which highest trading volume in
respect of the equity shares of the issuer was recorded as on the
previous day, are worth up to one lakh rupees; and
(ii)
applies or bids
for specified securities for a value of not more than one lakh rupees;
(zg) �rights issue� means an offer of specified securities
by a listed issuer to the shareholders of the issuer as on the record date
fixed for the said purpose;
(zh) �Schedule� means schedule annexed to these
regulations;
(zi)
�Self Certified
Syndicate Bank� means a banker to an issue registered with the Board, which
offers the facility of Application Supported by Blocked Amount;
(zj) �specified securities" means equity shares and
convertible securities;
(zk) �stabilising agent� means a merchant banker who is
responsible for stabilising the price of equity shares under a green shoe
option, in terms of these regulations;
(zl)
�syndicate
member� means an intermediary registered with the Board and who is permitted to
carry on the activity as an underwriter;
(zm) �unlisted issuer� means an issuer which is not a
listed issuer.
(2) All other words and expressions used but not defined
in these regulations, but defined in the Act or the Companies Act, 1956, the
Securities Contracts (Regulation) Act, 1956, the Depositories Act, 1996 and/or
the rules and regulations made thereunder shall have the same meaning as respectively
assigned to them in such Acts or rules or regulations or any statutory
modification or re-enactment thereto, as the case may be.
Applicability of the regulations.
3. Unless
otherwise provided, these regulations shall apply to the following:
(a)
a public issue;
(b)
a rights issue,
where the aggregate value of specified securities offered is fifty lakh rupees
or more;
(c)
a preferential
issue;
(d)
an issue of bonus
shares by a listed issuer;
(e)
a qualified
institutions placement by a listed issuer;
(f)
an issue of Indian
Depository Receipts.
COMMON
CONDITIONS FOR PUBLIC ISSUES AND RIGHTS ISSUES
General conditions.
4. (1) Any
issuer offering specified securities through a public issue or rights issue
shall satisfy the conditions of this Chapter at the time of filing draft offer
document with the Board (unless stated otherwise in this Chapter) and at the
time of registering or filing the final offer document with the Registrar of
Companies or designated stock exchange, as the case may be.
(2) No issuer shall make a public issue or rights issue of
specified securities:
(a)
if the issuer,
any of its promoters, promoter group or directors or persons in control of the
issuer are debarred from accessing the capital market by the Board;
(b)
if any of the
promoters, directors or persons in control of the issuer was or also is a
promoter, director or person in control of any other company which is debarred
from accessing the capital market under any order or directions made by the
Board;
(c)
if the issuer of
convertible debt instruments is in the list of wilful defaulters published by
the Reserve Bank of India or it is in default of payment of interest or
repayment of principal amount in respect of debt instruments issued by it to
the public, if any, for a period of more than six months;
(d)
unless it has
made an application to one or more recognised stock exchanges for listing of
specified securities on such stock exchanges and has chosen one of them as the
designated stock exchange:
�Provided that in case of an
initial public offer, the issuer shall make an application for listing of the
specified securities in at least one recognised stock exchange having
nationwide trading terminals;�
(e)
unless it has
entered into an agreement with a depository for dematerialisation of specified
securities already issued or proposed to be issued;
(f)
unless
all existing partly paid-up equity shares of the issuer have either been fully
paid up or forfeited;
(g)
unless
firm arrangements of finance through verifiable means towards seventy five per
cent. of the stated means of finance, excluding the amount to be raised through
the proposed public issue or rights issue or through existing identifiable internal accruals, have been made.���
�����������������������������������������������������
Appointment of merchant banker and other
intermediaries.
5. (1) The issuer shall appoint one or more
merchant bankers, at least one of whom shall be a lead merchant banker and
shall also appoint other intermediaries, in consultation with the lead merchant
banker, to carry out the obligations relating to the issue.
(2) The issuer shall, in consultation with the lead
merchant banker, appoint only those intermediaries which are registered with
the Board.
(3) Where the issue is managed by more than one merchant
banker, the rights, obligations and responsibilities, relating inter alia to disclosures, allotment,
refund and underwriting obligations, if any, of each merchant banker shall be
predetermined and disclosed in the offer document as specified in Schedule I.
(4) The lead merchant banker shall, only after
independently assessing the capability of other intermediaries to carry out
their obligations, advise the issuer on their appointment.
(5) The issuer shall enter into an agreement with the lead
merchant banker in the format specified in Schedule
II and with other intermediaries as required under the respective
regulations applicable to the intermediary concerned:
�Provided that such agreements may include such
other clauses as the issuer and the intermediary may deem fit without
diminishing or limiting in any way the liabilities and obligations of the
merchant bankers, other intermediaries and the issuer under the Act, the
Companies Act, 1956, the Securities Contracts (Regulation) Act, 1956, the
Depositories Act, 1996 and the rules and regulations made thereunder or any
statutory modification or statutory enactment thereof:
�Provided further that in case of ASBA process,
the issuer shall take cognisance of the deemed agreement of the issuer with
Self Certified Syndicate Banks.
(6) An issuer shall, in case of an issue made through the
book building process, appoint syndicate members and in the case of any other
issue, appoint bankers to issue, at all mandatory collection centres as
specified in Schedule III and such
other collection centres as it may deem fit.
(7) The issuer shall appoint a registrar which has
connectivity with all the depositories:
�Provided that if issuer itself is a registrar
to an issue registered with the Board, then another registrar to an issue shall
be appointed as registrar to the issue:
�Provided further that the lead merchant banker
shall not act as a registrar to the issue in which it is also handling the post
issue responsibilities.
Explanation:
For the purpose of this regulation, in case of a book built issue, the lead
merchant banker appointed by the issuer shall act as the lead book runner.
Filing of offer document.
6. (1) No issuer shall make,
(a)
a public
issue; or
(b)
a rights
issue, where the aggregate value of the specified securities offered is fifty
lakh rupees or more,
unless a draft offer document,
along with fees as specified in Schedule IV,
has been filed with the Board through the lead merchant banker, at least thirty
days prior to registering the prospectus, red herring prospectus or shelf
prospectus with the Registrar of Companies or filing the letter of offer with
the designated stock exchange, as the case may be.
(2)
The
Board may specify changes or issue observations, if any, on the draft offer
document within thirty days from the later of the following dates:
(a)
the date
of receipt of the draft offer document under sub-regulation (1); or
(b)
the date
of receipt of satisfactory reply from the lead merchant bankers, where the
Board has sought any clarification or additional information from them; or
(c)
the date
of receipt of clarification or information from any regulator or agency, where
the Board has sought any clarification or�
information from such regulator or agency; or
(d)
the date
of receipt of a copy of in-principle approval letter issued by the recognised
stock exchanges.
(3)
If the
Board specifies changes or issues observations on the draft offer document, the
issuer and lead merchant banker shall carry out such changes in the draft offer
document and comply with the observations issued by the Board before
registering the prospectus, red-herring prospectus or shelf prospectus, as the
case may be, with the Registrar of Companies or filing the letter of offer with
the designated stock exchange.
(4)
The
issuer shall, simultaneously while registering the prospectus, red herring
prospectus or shelf prospectus with the Registrar of Companies or filing the
letter of offer with the designated stock exchange or
before the opening of the issue, file a copy thereof with the Board through the
lead merchant banker.
(5)
The lead
merchant banker shall, while filing the offer document with the Board in terms
of sub-regulation (1) and
sub-regulation (4), file a copy of such
document with the recognised stock exchanges where the specified
securities are proposed to be listed.
(6)
The
offer document filed with the Board
under this regulation shall also be furnished to the Board in a soft copy in
the manner specified in Schedule V.
In-principle approval from recognised stock exchanges.
7. The issuer shall obtain in-principle approval
from recognised stock exchanges as follows:
(a)
in case
of an initial public offer, from all the recognised stock exchanges in which
the issuer proposes to get its specified securities listed; and
(b)
in case
of a further public offer and rights issue:
(i)
where
the specified securities are listed only on recognised stock exchanges having
nationwide trading terminals, from all such stock exchanges;
(ii)
where
the specified securities are not listed on any recognised stock exchange having
nationwide trading terminals, from all the stock exchanges in which the
specified securities of the issuer are proposed to be listed;
(iii) where the specified securities are listed on
recognised stock exchanges having nationwide trading terminals as well as on
the recognised stock exchanges not having nationwide trading terminals, from
all recognised stock exchanges having nationwide trading terminals.
Documents to be submitted before opening of the issue.
8. (1) The lead merchant bankers shall submit
the following to the Board along with the draft offer document:
(a)
a copy of the
agreement entered into between the issuer and the lead merchant bankers;
(b)
a copy of
inter-se allocation of responsibilities of each merchant banker, in case the
issue is managed by more than one merchant banker;
(c)
a due diligence
certificate as per Form A of Schedule
VI;
(d)
in case of an
issue of convertible debt instruments, a due diligence certificate from the
debenture trustee as per Form B of
Schedule VI;
(e)
a certificate in the format specified in Part D of Schedule VII,
confirming compliance of the conditions mentioned therein.
(2) The lead merchant bankers shall submit the following
documents to the Board after issuance of observations by the Board or after
expiry of the period stipulated in sub-regulation (2) of regulation 6 if the
Board has not issued observations:
(a)
a statement
certifying that all changes, suggestions and observations made by the Board
have been incorporated in the offer document;
(b)
a due diligence
certificate as per Form C of Schedule VI, at the time of registering the
prospectus with the Registrar of Companies;
(c)
a copy of the
resolution passed by the board of directors of the issuer for allotting
specified securities to promoters towards amount received against promoters�
contribution, before opening of the issue;
(d)
a certificate
from a Chartered Accountant, before opening of the issue, certifying that
promoters� contribution has been received in accordance with these regulations,
accompanying therewith the names and addresses of the promoters who have
contributed to the promoters� contribution and the amount paid by each of them
towards such contribution;
(e)
a due diligence
certificate as per Form D of Schedule VI, immediately before the opening of
the issue, certifying that necessary corrective action, if any, has been taken;
(f)
a due diligence
certificate as per Form E of Schedule VI, after the issue has opened but
before it closes for subscription.
(3) The issuer shall, at the time of filing draft offer
document with the recognised stock exchange where the specified securities are
proposed to be listed, submit the Permanent Account Number, bank account number
and passport number of its promoters to such stock exchange.
Draft offer document to be made public.
9. (1) The draft offer document filed with
the Board shall be made public, for comments, if any, for a period of at least
twenty one days from the date of such filing, by hosting it on the websites of
the Board, recognised stock exchanges where specified securities are proposed
to be listed and merchant bankers associated with the issue.
(2) The lead merchant bankers shall, after expiry of the
period stipulated in sub-regulation (1), file with the Board a statement giving
information of the comments received by them or the issuer on the draft offer
document during that period and the consequential changes, if any, to be made
in the draft offer document.
Fast Track Issue.
10. (1) Nothing contained in sub-regulations
(1), (2) and (3) of regulation 6 and regulations 7 and 8 shall apply to a
public issue or rights issue if the issuer satisfies the following conditions:
(a)
the equity shares
of the issuer have been listed on any recognised stock exchange having
nationwide trading terminals for a period of at least three years immediately
preceding the reference date;
(b)
the average
market capitalisation of public shareholding of the issuer is at least [3][five thousand crore rupees];
(c)
the annualised
trading turnover of the equity shares of the issuer during six calendar months
immediately preceding the month of the reference date has been at least two per
cent. of the weighted average number of equity shares listed during such six
months� period:
[4][Provided that for
issuers, whose public shareholding is less than fifteen per cent. of its issued
equity capital, the annualised trading
turnover of its equity shares has been at least two per cent. of the weighted
average number of equity shares available as free float during such six months�
period;]
(d)
the issuer has
redressed at least ninety five per cent. of the complaints received from the
investors till the end of the quarter immediately preceding the month of the
reference date;
(e)
the issuer has
been in compliance with the equity listing agreement for a period of at least
three years immediately preceding the reference date:
[5][Provided that if the issuer has not complied with the
provision of the equity listing agreement relating to composition of board of
directors, for any quarter during the last three years immediately preceding
the reference date, but is compliant with such provisions at the time of filing
of offer document with the Registrar of Companies or designated stock exchange,
as the case may be, and adequate disclosures are made in the offer document
about such non-compliances during the three years immediately preceding the
reference date, it shall be deemed as compliance with the condition;]
(f)
the impact of
auditors� qualifications, if any, on the audited accounts of the issuer in
respect of those financial years for which such accounts are disclosed in the
offer document does not exceed five per cent. of the net profit or loss after
tax of the issuer for the respective years;
(g)
no show-cause
notices have been issued or prosecution proceedings initiated or pending
against the issuer or its promoters or whole time directors as on the reference
date;
(h)
the entire
shareholding of the promoter group of the issuer is held in dematerialised form
on the reference date.
(2) The issuer shall file the offer document with the
Board and the recognised stock exchanges in accordance with sub-regulations
(4), (5) and (6) of regulation 6 and shall pay fees to the Board as specified
in Schedule IV.
(3) The lead merchant bankers shall submit to the Board,
the following documents along with the offer document:
(a)
a due diligence
certificate as per Form A of Schedule VI including additional confirmations as
specified in Form F of Schedule
VI;
(b)
in case of a fast track issue of convertible debt instruments, a due diligence certificate from the debenture trustee
as per Form B of Schedule VI.
Explanation: For the purposes of this regulation:
(I)
�reference date�
means:
(a)
in case of a
public issue by a listed issuer, the date of registering the red herring
prospectus (in case of a book built issue) or prospectus (in case of a fixed
price issue) with the Registrar of Companies; and
(b)
in case of a
rights issue by a listed issuer, the date of filing the letter of offer with
the designated stock exchange.
(II) �average market capitalisation of public shareholding�
means the sum of daily market capitalisation of public shareholding for a
period of one year up to the end of the quarter preceding the month in which
the proposed issue was approved by the shareholders or the board of the issuer,
as the case may be, divided by the number of trading days.
(III) �public shareholding� shall have the same meaning as
assigned to it in the equity listing agreement.
Opening of an issue.
11. (1) Subject to the
compliance with sub-section (4) of
section 60 of the Companies Act, 1956, a public issue or rights issue may be
opened:�
(a)
within twelve
months from the date of issuance of the observations by the Board under
regulation 6; or
(b)
within three
months of expiry of the period stipulated in sub-regulation (2) of regulation
6, if the Board has not issued observations:
�Provided that
in case of a fast track issue, the issue shall open within the period
stipulated in sub-section (4) of section 60 of the Companies Act, 1956.
(2) In case of shelf prospectus, the first issue may be
opened within three months of issuance of observations by the Board.
(3) The issuer shall, before
registering the red herring prospectus (in case of a book built issue) or
prospectus (in case of a fixed price issue) with the Registrar of Companies or
filing the letter of offer with the designated stock exchange, as the case may
be, file with the Board through the lead merchant bankers, an updated offer
document highlighting all changes made in the offer document.
(4) Notwithstanding anything
contained in this regulation, if there are changes in the offer document in
relation to the matters specified in Schedule
VII, the updated offer document or new draft offer document, as the case
may be, shall be filed with the Board along with fees specified in Schedule IV.
Dispatch of issue material. �
12. The lead merchant bankers shall dispatch the offer
document and other issue material including forms for ASBA to the designated
stock exchange, syndicate members, underwriters, bankers to the issue,
investors� associations and Self Certified Syndicate Banks in advance.
Underwriting.
13. (1) Where the issuer making a public issue (other than through the book building
process) or rights issue, desires to have the issue underwritten, it shall
appoint the underwriters in accordance with Securities and Exchange Board of
India (Underwriters) Regulations, 1993.
(2) Where the issuer makes a public issue through the book building process, such
issue shall be underwritten by book runners or syndicate members:
�Provided that fifty per cent. [sixty per cent,
if public issue is made with at least ten per cent. public offer under clause
(b) of sub-rule (2) of rule 19 of the Securities Contracts (Regulation) Rules,
1957] of the net offer to public proposed to be compulsorily allotted to
qualified institutional buyers for the purpose of compliance of the eligibility
conditions specified in sub-regulation (2) of regulation 26 and regulation 28
cannot be underwritten.
(3) The issuer shall enter into underwriting agreement
with the book runner, who in turn shall enter into underwriting agreement with
syndicate members, indicating therein the number of specified securities which
they shall subscribe to at the predetermined price in the event of
under-subscription in the issue.
(4) If syndicate members fail to fulfil their underwriting
obligations, the lead book runner shall fulfil the underwriting obligations.
(5) The book runners
and syndicate members shall not subscribe to the issue in any manner except for
fulfilling their underwriting obligations.
(6)
A copy of the syndicate agreement shall be filed with
the Board before the opening of bids.
(7) In case of every underwritten issue, the lead merchant
banker or the lead book runner shall undertake minimum underwriting obligations
as specified in the Securities and Exchange Board of India (Merchant Bankers)
Regulations, 1992.
(8) Where hundred per cent. of
the offer through offer document is underwritten, the underwriting obligations
shall be for the entire hundred per cent. of the offer through offer document
and shall not be restricted upto the minimum subscription level.
Minimum subscription.
14. (1) The minimum subscription to
be received in an issue shall not be less than ninety per cent. of the offer
through offer document.
(2) In the event of non-receipt of minimum subscription
referred to in sub-regulation (1), all application moneys received shall be
refunded to the applicants forthwith, but not later than:
(a)
fifteen days of
the closure of the issue, in case of a non-underwritten issue; and
(b)
seventy days of the closure of the issue, in the case of an underwritten
issue where minimum subscription including devolvement obligations paid by the
underwriters is not received within sixty days of the closure of the
issue.�
(3) The offer document shall contain adequate disclosures
regarding minimum subscription as specified in Part A of Schedule VIII.
(4) Nothing contained in this regulation shall apply to:
(a)
offer for sale of
specified securities;
(b)
public issue by
infrastructure companies if the disclosures regarding the alternate source of
funding of the objects of the issue have been made in the offer document.
Explanation: For
the purpose of clause (b) of sub-regulation (4), the term �infrastructure company� means, an enterprise wholly engaged
in the business of (i) developing or (ii) operating and maintaining or (iii)
developing, operating and maintaining any infrastructure facility.
Oversubscription.
15. No
allotment shall be made by the issuer in
excess of the specified securities offered through the offer document:
�Provided that in case of oversubscription, an
allotment of not more than ten per cent. of the net offer to public may be made
for the purpose of making allotment in minimum lots.
Monitoring agency.
16. (1) If
the issue size exceeds five hundred crore rupees, the issuer shall make
arrangements for the use of proceeds of the issue to be monitored by a public financial institution or by one of the scheduled commercial banks named in the offer document as bankers of the
issuer:
�Provided that nothing contained in this clause
shall apply to an offer for sale or an issue of specified securities made by a
bank or public financial institution.
(2) The monitoring agency shall
submit its report to the issuer in the format specified in Schedule IX on a half yearly basis, till
the proceeds of the issue have been fully utilised.
Manner of calls.
17. If the issuer proposes to receive subscription monies in calls, it shall
ensure that the outstanding subscription money is called within twelve months
from the date of allotment in the issue and if any applicant fails to pay the
call money within the said twelve months, the equity shares on which there are
calls in arrear along with the subscription money already paid on such shares
shall be forfeited:
�Provided that it shall not be
necessary to call the outstanding subscription money within twelve months, if
the issuer has appointed a monitoring agency in terms of regulation 16.
Allotment, refund and payment of
interest.
18. (1) The issuer and merchant bankers shall ensure that specified
securities are allotted and/or application moneys are refunded within fifteen
days from the date of closure of the issue.
(2) Where specified securities are
not allotted and/or application moneys are not refunded within the period
stipulated in sub-regulation (1), the issuer shall undertake to pay interest at such rate and within such time as
disclosed in the offer document.
Restriction on further capital issues.
19. No issuer shall make any further issue of specified
securities in any manner whether by way of public issue, rights issue,
preferential issue, qualified institutions placement, issue of bonus shares or
otherwise:
(a)
in case of a fast
track issue, during the period between the date of registering the red herring
prospectus (in case of a book built issue) or prospectus (in case of a fixed
price issue) with the Registrar of Companies or filing the letter of offer with
the designated stock exchange and the listing of the specified securities
offered through the offer document or refund of application moneys; or
(b)
in case of other
issues, during the period between the date
of filing the draft offer document with the Board and the listing of the specified
securities offered through the offer document or refund of application moneys;
unless full disclosures regarding the
total number of specified securities and amount proposed to be raised from such
further issue are made in such draft offer document or offer document, as the
case may be.
Additional requirements for issue of convertible debt
instruments.
20. (1) In
addition to other requirements laid down in these regulations, an issuer making
a public issue or rights issue of convertible debt instruments shall comply
with the following conditions:
(a)
it� has obtained credit rating from one or more
credit rating agencies;
(b)
it has appointed
one or more debenture trustees in accordance with the provisions of section
117B of the Companies Act, 1956 and Securities and Exchange Board of India
(Debenture Trustees) Regulations, 1993;
(c)
it has created
debenture redemption reserve in accordance with the provisions of section 117C
of the Companies Act, 1956;
(d)
if the issuer
proposes to create a charge or security on its assets in respect of secured
convertible debt instruments, it shall ensure that:
(i)
such assets are
sufficient to discharge the principal amount at all times;
(ii)
such assets are
free from any encumbrance;
(iii)
where security is
already created on such assets in favour of financial institutions or banks or
the issue of convertible debt instruments is proposed to be secured by creation
of security on a leasehold land, the consent of such financial institution,
bank or lessor for a second or pari passu charge has been obtained and
submitted to the debenture trustee before the opening of the issue;
(iv)
the
security/asset cover shall be arrived at after reduction of the liabilities
having a first/prior charge, in case the convertible debt instruments are
secured by a second or subsequent charge.
(2) The issuer shall redeem the convertible debt instruments in terms of
the offer document.
Roll over of non convertible portion of partly
convertible debt instruments.
21. (1) The non-convertible
portion of partly convertible debt instruments issued by a listed issuer, the
value of which exceeds fifty lakh rupees, may be rolled over without change in
the interest rate, subject to compliance with the provisions of section 121 of
the Companies Act, 1956 and the following conditions:
(a)
seventy five per cent. of the holders of the convertible debt instruments
of the issuer have, through a resolution, approved the rollover through postal
ballot;
(b)
the issuer has, along with the notice for passing the resolution, sent to
all holders of the convertible debt instruments, an auditors� certificate on
the cash flow of the issuer and� with
comments on the liquidity position of the issuer;�
(c)
the issuer has undertaken to redeem the non-convertible portion of the
partly convertible debt instruments of all the holders of the convertible debt
instruments who have not agreed to the resolution;
(d)
credit rating has been obtained from at least one credit rating agency
registered with the Board within a period of six months prior to the due date
of redemption and has been communicated to the holders of the convertible debt
instruments, before the roll over;
(2) The creation of fresh
security and execution of fresh trust deed shall not be mandatory if the
existing trust deed or the security documents provide for continuance of the
security till redemption of secured convertible debt instruments;
�Provided that whether the issuer
is required to create fresh security and to execute fresh trust deed or not
shall be decided by the debenture trustee.
Conversion of optionally convertible debt instruments
into equity share capital.
22. (1) An issuer shall not convert its optionally convertible debt instruments
into equity shares unless the holders of such convertible debt instruments have
sent their positive consent to the issuer and non-receipt of reply to any
notice sent by the issuer for this purpose shall not be construed as consent
for conversion of any convertible debt instruments.
(2) Where the value of the
convertible portion of any convertible debt instruments issued by a listed
issuer exceeds fifty lakh rupees and the issuer has not determined the
conversion price of such convertible debt instruments at the time of making the
issue, the holders of such convertible debt instruments shall be given the
option of not converting the convertible portion into equity shares:
�Provided that where the upper
limit on the price of such convertible debt instruments and justification
thereon is determined and disclosed to the investors at the time of making the
issue, it shall not be necessary to give such option to the holders of the
convertible debt instruments for converting the convertible portion into equity
share capital within the said upper limit.
(3) Where an option is to be
given to the holders of the convertible debt instruments in terms of
sub-regulation (2) and if one or more of such holders do not exercise the
option to convert the instruments into equity share capital at a price
determined in the general meeting of the shareholders, the issuer shall redeem
that part of the instruments within one month from the last date by which
option is to be exercised, at a price which shall not be less than its face
value.
(4) The provision of
sub-regulation (3) shall not apply if such redemption is in terms of the
disclosures made in the offer document.
Issue of
convertible debt instruments for financing.
23. No issuer shall issue convertible debt instruments for financing replenishment of funds or for providing loan to or for acquiring shares of
any person who is part of the same group or who is under the same
management:�
�Provided that an issuer may issue fully convertible
debt instruments for these purposes if the period of conversion of such debt
instruments is less than eighteen months from the date of issue of such debt
instruments.
Explanation: For
the purpose of this regulation:
(I)
Two persons shall
be deemed to be �part of the same group� if they belong to the group within the
meaning of clause (ef) of section 2 of the Monopolies and Restrictive Trade
Practices Act, 1969 (54 of 1969) or if they own �inter connected undertakings
within the meaning of clause (g) of section 2 of the said Act;
(II)
The expression
�under the same management� shall have the same meaning as assigned to it in
sub-section (1B) of section 370 of the Companies Act, 1956 (1 of 1956).
Alteration of rights of holders of specified
securities.
24. No
issuer shall alter the terms (including the terms of issue) of specified
securities which may adversely affect the interests of the holders of that
specified securities, except with the consent in writing of the holders of not
less than three-fourths of the specified securities of that class or with the
sanction of a special resolution passed at a meeting of the holders of the
specified securities of that class.
PROVISIONS AS TO PUBLIC ISSUE
PART I - ELIGIBILITY REQUIREMENTS
Reference date.
25. Unless otherwise
provided in this Chapter, an issuer making a public issue shall satisfy the
conditions of this Chapter as on the date of filing draft offer document with the
Board and also as on the date of registering the offer document with the
Registrar of Companies.
Conditions for initial public offer.
26. (1) An issuer may make an initial public offer, if:
(a)
it has net
tangible assets of at least three crore rupees in each of the preceding three
full years (of twelve months each), of which not more than fifty per cent. are
held in monetary assets:
�Provided that if more than fifty per cent. of the net tangible
assets are held in monetary assets, the issuer has made firm commitments to
utilise such excess monetary assets in its business or project;
(b)
it has a track
record of distributable profits in terms of section 205 of the Companies Act,
1956, for at least three out of the immediately preceding five years:
�Provided that extraordinary items shall not be considered for
calculating distributable profits;
(c)
it� has a net worth of at least one crore rupees
in each of the preceding three full years (of twelve months each);
(d)
the aggregate of
the proposed issue and all previous issues made in the same financial year in
terms of issue size does not exceed five times its pre-issue net worth as per
the audited balance sheet of the preceding financial year;
(e)
if it has changed
its name within the last one year, at least fifty per cent. of the revenue for
the preceding one full year has been earned by it from the activity indicated
by the new name.
(2) An issuer not satisfying any
of the conditions stipulated in sub-regulation (1) may make an initial public
offer if:
(a)��� (i) ���� the
issue is made through the book building process and the issuer undertakes to
allot at least fifty per cent. of the net offer to public to qualified
institutional buyers and to refund full subscription monies if it fails to make
allotment to the qualified institutional buyers ;
or
(ii)� at least fifteen per cent.
of the cost of the project is contributed by scheduled commercial banks or
public financial institutions, of which not less than ten per cent. shall come
from the appraisers and the issuer undertakes to allot at least ten per cent.
of the net offer to public to qualified institutional buyers and to refund full
subscription monies if it fails to make the allotment to the qualified
institutional buyers;
(b)��� (i)����� the
minimum post-issue face value capital of the issuer is ten crore rupees;
or
(ii)���� the issuer undertakes to
provide market-making for at least two years from the date of listing of the
specified securities, subject to the following:
(A) the market makers offer buy and
sell quotes for a minimum depth of three hundred specified securities and
ensure that the bid-ask spread for their quotes does not, at any time, exceed
ten per cent.;
(B) the inventory of the market
makers, as on the date of allotment of the specified securities, shall be at
least five per cent. of the proposed issue.
(3) An issuer may make an
initial public offer of convertible debt instruments without making a prior
public issue of its equity shares and listing thereof.
(4) An issuer shall not make an
allotment pursuant to a public issue if the number of prospective allottees is
less than one thousand.
(5)
No issuer shall make an initial public offer if there are any outstanding
convertible securities or any other right
which would entitle any person any option to receive equity shares after the
initial public offer:
�Provided that the provisions of this
sub-regulation shall not apply to:
(a)
a public issue made during the currency of convertible debt instruments
which were issued through an earlier initial public offer, if the conversion
price of such convertible debt instruments was determined and disclosed in the
prospectus of the earlier issue of convertible debt instruments;
(b)
outstanding
options granted to employees pursuant to an employee stock option scheme framed
in accordance with the relevant Guidance Note or Accounting Standards, if any,
issued by the Institute of Chartered Accountants of India in this regard.
(6) Subject to provisions of the
Companies Act, 1956 and these regulations, equity shares may be offered for
sale to public if such equity shares have
been held by the sellers for a period of at least one year prior to the filing
of draft offer document with the Board
in accordance with sub-regulation (1) of regulation 6:
�Provided that in case equity shares received
on conversion or exchange of fully paid-up compulsorily convertible securities
including depository receipts are being offered for sale, the holding period of
such convertible securities as well as that of resultant equity shares together
shall be considered for the purpose of calculation of one year period referred
in this sub-regulation:
�Provided further that the requirement of
holding equity shares for a period of one year shall not apply:
(a)
in case of an offer for sale of specified securities of a government
company or statutory authority or corporation or any special purpose vehicle
set up and controlled by any one or more of them, which is engaged in
infrastructure sector;
(b)
if the specified securities offered for sale were acquired pursuant to
any scheme approved by a High Court under sections 391-394 of the Companies
Act, 1956, in lieu of business and invested capital which had been in existence
for a period of more than one year prior to such approval.
(7) No issuer shall make an initial public offer, unless as on the date of registering prospectus or red herring
prospectus with the Registrar of Companies, the issuer has obtained grading for
the initial public offer from at least one credit rating agency registered with
the Board.
Explanation: For
the purposes of this regulation:
(I)
�net tangible
assets� mean the sum of all net assets of the issuer, excluding intangible
assets as defined in Accounting Standard 26 (AS 26) issued by the Institute of
Chartered Accountants of India;
(II)
�project� means
the object for which monies are proposed to be raised to cover the objects of
the issue;
(III)
In case of an
issuer which had been a partnership firm, the track record of distributable
profits of the partnership firm shall be considered only if the financial
statements of the partnership business for the period during which the issuer
was a partnership firm, conform to and are revised in the format prescribed for
companies under the Companies Act, 1956 and also comply with the following:
(a)
adequate
disclosures are made in the financial statements as required to be made by the
issuer as per Schedule VI of the Companies Act, 1956;
(b)
the financial
statements are duly certified by a Chartered Accountant stating that:
(i)
the accounts and
the disclosures made are in accordance with the provisions of Schedule VI of
the Companies Act, 1956;
(ii)
the accounting
standards of the Institute of Chartered Accountants of India have been
followed;
(iii)
the financial
statements present a true and fair view of the firm�s accounts;
(IV)
In case of an
issuer formed out of a division of an existing company, the track record of
distributable profits of the division spun-off shall be considered only if the
requirements regarding financial statements as provided for partnership firms
in Explanation III are complied with;
(V)
�bid-ask spread�
means the difference between quotations for sale and purchase;
(VI)
The term
�infrastructure
sector� includes the facilities or services as specified in Schedule X.
Conditions for further public
offer.
27. An
issuer may make a further public offer if it satisfies the conditions specified
in clauses (d) and (e) of sub-regulation (1) of regulation 26 and if it does
not satisfy those conditions, it may make a further public offer if it
satisfies the conditions specified in sub-regulation (2) of regulation 26.
PART II - PRICING IN PUBLIC ISSUE
Pricing.
28. (1) An issuer may determine the
price of specified securities in consultation with the lead merchant banker or
through the book building process.
(2) An issuer may determine the
coupon rate and conversion price of convertible debt instruments in
consultation with the lead merchant banker or through the book building
process.
(3) The issuer shall undertake the book building process
in a manner specified in Schedule XI.
Differential
pricing.
29. An
issuer may offer specified securities at different prices, subject to the
following:
(a)
retail individual investors or retail
individual shareholders [6][or employees of the
issuer entitled for reservation made under regulation 42 making an application
for specified securities of value not more than one lakh rupees,] may
be offered specified securities at a price lower than the price at which net
offer is made to other categories of applicants:
�Provided that such difference shall not be
more than ten per cent. of the price at which specified securities are offered
to other categories of applicants;
(b)
in case of a book built issue, the price of
the specified securities offered to an anchor investor shall not be lower than
the price offered to other applicants;
(c)
in case of a composite issue, the price of
the specified securities offered in the public issue may be different from the
price offered in rights issue and justification for such price difference shall
be given in the offer document.
Price and price
band.
30. (1) The issuer may mention a price or price band in the draft
prospectus (in case of a fixed price issue) and floor price or price band in
the red herring prospectus (in case of a book built issue) and determine the
price at a later date before registering the prospectus with the Registrar of
Companies:
�Provided that the prospectus registered with
the Registrar of Companies shall contain only one price or the specific coupon
rate, as the case may be.
(2)If the floor price or price band
is not mentioned in the red herring prospectus, the issuer shall announce the
floor price or price band at least two
working days before the opening of the bid (in case of an initial public offer)
and at least one working day before the opening of the bid (in case of a
further public offer), in all the
newspapers in which the pre issue advertisement was released.
(3)The announcement referred to in sub-regulation (2)
shall contain relevant financial ratios computed for both upper and lower end
of the price band and also a statement drawing attention of the investors to
the section titled �basis of issue price� in the prospectus.
(4)The cap on the
price band shall be less than or equal to one hundred and twenty per cent. of
the floor price.
(5) The floor price or the final price shall not be less
than the face value of the specified securities.
Explanation: For the purposes of sub-regulation (4), the �cap on the price band�
includes cap on the coupon rate in case of convertible debt instruments.
Face value of equity shares.
31. (1) Subject to the provisions
of the Companies Act, 1956, the Act and these regulations, an issuer making an
initial public offer may determine the face value of the equity shares in the
following manner:
(a)
if the issue price per equity share is five hundred rupees or more, the
issuer shall have the option to determine the face value at less than ten
rupees per equity share:
�Provided that the face value shall
not be less than one rupee per equity share;
(b)
if the issue price per equity share is less than five hundred rupees, the
face value of the equity shares shall be ten rupees per equity share:
�Provided that nothing contained in this
sub-regulation shall apply to initial public offer made by any government
company, statutory authority or corporation or any special purpose vehicle set
up by any of them, which is engaged in infrastructure sector.
(2) The disclosure about the
face value of equity shares (including the statement about the issue price
being �X� times of the face value) shall be made in the advertisements, offer
documents and application forms in identical font size as that of issue price
or price band.
Explanation: For the purposes of this
regulation, the term �infrastructure
sector� includes the facilities or services as specified in Schedule X.
PART III - PROMOTERS� CONTRIBUTION
Minimum promoters� contribution.
32. (1) The
promoters of the issuer shall contribute in the public issue as follows:
(a)
in case of an
initial public offer, not less than twenty per cent. of the post issue capital;
(b)
in case of a
further public offer, either to the extent of twenty per cent. of the proposed
issue size or to the extent of twenty per cent. of the post-issue capital;
(c)
in case of a
composite issue, either to the extent of twenty per cent. of the proposed issue
size or to the extent of twenty per cent. of the post-issue capital excluding
the rights issue component.
(2) In case of a public issue or
composite issue of convertible securities, minimum promoters� contribution
shall be as follows:
(a)
the promoters shall contribute twenty per cent. as stipulated in clauses
(a), (b) or (c) of sub-regulation (1), as the case may be, either by way of
equity shares or by way of subscription to the convertible securities:
�Provided that if the price of the
equity shares allotted pursuant to conversion is not pre-determined and not
disclosed in the offer document, the promoters shall contribute only by way of
subscription to the convertible securities being issued in the public issue and
shall undertake in writing to subscribe to the equity shares pursuant to
conversion of such securities.
(b)
in case of any issue of convertible securities which are convertible or
exchangeable on different dates and if the promoters� contribution is by way of
equity shares (conversion price being pre-determined),� such contribution shall not be at a price lower
than the weighted average price of the equity share capital arising out of
conversion of such securities.�
(c)
subject to the provisions of clause (a) and (b) above, in case of an
initial public offer of convertible debt instruments without a prior public issue
of equity shares, the promoters shall bring in a contribution of at least
twenty per cent. of the project cost in the form of equity shares, subject to
contributing at least twenty per cent. of the issue size from their own funds
in the form of equity shares:
�Provided that if the project is to
be implemented in stages, the promoters� contribution shall be with respect to
total equity participation till the respective stage vis-�-vis the debt raised
or proposed to be raised through the public issue.
(3) In case of a further public
offer or composite issue where the promoters contribute more than the
stipulated minimum promoters� contribution, the allotment with respect to
excess contribution shall be made at a price determined in terms of the
provisions of regulation 76 or the issue price, whichever is higher.
(4) The promoters shall satisfy
the requirements of this regulation at least one day prior to the date of
opening of the issue and the amount of
promoters� contribution shall be kept in an escrow account with a scheduled
commercial bank and shall be released to the issuer along with the release of
the issue proceeds:
�Provided that where the promoters� contribution has already been brought in and
utilised, the issuer shall give the cash flow statement disclosing the use of
such funds in the offer document;
�Provided further that where the minimum promoters� contribution is more than
one hundred crore rupees, the promoters shall bring in at least one hundred
crore rupees before the date of opening of the issue and the remaining amount
may be brought on pro-rata basis before the calls are made to public.
Explanation: For the purpose of this
regulation:
(I)
Promoters� contribution shall be computed on the basis of the post-issue
expanded capital:
(a)
assuming full proposed
conversion of convertible securities into equity shares;
(b)
assuming exercise
of all vested options, where any employee stock options are outstanding at the
time of initial public offer in terms of proviso (b) to sub-regulation (5) of
regulation 26.
(II) For computation of �weighted
average price�:
(a)
�weights� means
the number of equity shares arising out of conversion of such specified securities into equity shares
at various stages;
(b)
�price� means the price of equity shares on conversion arrived at after
taking into account predetermined conversion price at various stages.
Securities ineligible for minimum promoters�
contribution.
33. (1) For
the computation of minimum promoters� contribution, the following specified
securities shall not be eligible:
(a)
specified
securities acquired during the preceding three years, if they are:
(i)
acquired for
consideration other than cash and revaluation of assets or capitalisation of
intangible assets is involved in such transaction; or
(ii)
resulting from a
bonus issue by utilisation of revaluation reserves or unrealised profits of the
issuer or from bonus issue against equity shares which are ineligible for
minimum promoters� contribution;
(b)
specified
securities acquired by promoters during the preceding one year at a price lower
than the price at which specified securities are being offered to public in the
initial public offer:
�Provided that nothing contained in this clause
shall apply:
(i)
if promoters pay
to the issuer, the difference between the price at which specified securities
are offered in the initial public offer and the price at which the specified
securities had been acquired;
(ii)
if such specified
securities are acquired in terms of the scheme under sections 391-394 of the
Companies Act, 1956, as approved by a High Court, by promoters in lieu of
business and invested capital that had been in existence for a period of more
than one year prior to such approval;
(iii)
to an initial
public offer by a government company,
statutory authority or corporation or any special purpose vehicle set up
by any of them, which is engaged in infrastructure sector;
(c)
specified
securities allotted to promoters during the preceding one year at a price less
than the issue price, against funds brought in by them during that period, in
case of an issuer formed by conversion of one or more partnership firms, where
the partners of the erstwhile partnership firms are the promoters of the issuer
and there is no change in the management:
�Provided that specified securities, allotted
to promoters against capital existing in such firms for a period of more than
one year on a continuous basis, shall be eligible;
(d)
specified
securities pledged with any creditor.
(2) Specified securities referred to in clauses (a) and
(c) of sub-regulation (1) shall be eligible for the computation of promoters�
contribution, if such securities are acquired pursuant to a scheme which has been approved under
sections 391-394 of the Companies Act, 1956.
Explanation: For the purposes
of clause (b) of sub-regulation (1), the term �infrastructure sector� includes the
facilities or services as specified in Schedule X.
Requirement of minimum promoters� contribution not
applicable in certain cases.
34. The
requirements of minimum promoters� contribution shall not apply in case of:
(a)
an issuer which
does not have any identifiable promoter;
(b)
a further public
offer, where the equity shares of the same
class which are proposed to be allotted pursuant to conversion or exchange of convertible securities offered
through the offer or are proposed to be allotted in the offer have been
listed and are not infrequently traded in a recognised stock exchange for a
period of at least three years and the issuer has a track record of dividend
payment for at least immediately preceding three years:
�Provided that where promoters propose to
subscribe to the specified securities offered to the extent greater than higher
of the two options available in clause (b) of sub-regulation (1) of regulation
32, the subscription in excess of such percentage shall be made at a price determined
in terms of the provisions of regulation 76 or the issue price, whichever is
higher.
(c)
rights issues.
Explanation: For the purpose of clause (b), the words
�infrequently traded� have the same meaning as assigned to them in Explanation
to sub-regulation (5) of regulation 20 of the Securities and Exchange Board of
India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 and
the reference date for the purpose of computing the annualised trading turnover
referred to in the said Explanation shall be the date of filing the draft offer
document with the Board and in case of a fast track issue, the date of filing
the offer document with the Registrar of Companies before opening of the issue.
PART IV - RESTRICTION ON TRANSFERABILITY (LOCK-IN) OF
PROMOTERS� CONTRIBUTION, ETC.
Date of commencement of lock in and inscription of
non-transferability.
35. (1) Save as otherwise provided in this
Chapter, specified securities held by promoters and persons other than
promoters shall not be transferable (hereinafter referred to as �lock-in�) from
the date of allotment of the specified securities in the proposed public issue
for the period stipulated in this Chapter .
(2) The certificate of specified securities which are
subject to lock-in shall contain the inscription �non transferable� and the
lock-in period and in case such specified securities are dematerialised, the
issuer shall ensure that lock-in is recorded by the depository.
(3) Where the specified securities which are subject to
lock-in are partly paid-up and the amount called-up on such specified
securities is less than the amount called-up on the specified securities issued
to the public, the �lock-in� shall end only on the expiry of three years after
such specified securities have become pari-passu with the specified securities
issued to the public.
Lock-in of specified securities held by promoters.
36. In a
public issue, the specified securities held by promoters shall be locked-in for
the period stipulated hereunder:
(a)
minimum
promoters� contribution shall be locked-in for a period of three years from the
date of commencement of commercial production or date of allotment in the
public issue, whichever is later;
(b)
promoters�
holding in excess of minimum promoters� contribution shall be locked-in for a period
of one year:
�Provided
that excess promoters� contribution as provided in proviso to clause (b)
of regulation 34 shall not be subject to lock-in.
Explanation: For the purposes of this clause, the expression
"date of commencement of commercial production" means the last date
of the month in which commercial production in a manufacturing company is
expected to commence as stated in the offer document.
Lock-in of specified securities held by persons other
than promoters.
37. In case of an initial public offer, the entire
pre-issue capital held by persons other than promoters shall be locked-in for a
period of one year:
�Provided that nothing contained in
this regulation shall apply to:
(a)
equity shares allotted to employees under an employee stock option or
employee stock purchase scheme of the issuer prior to the initial public offer,
if the issuer has made full disclosures with respect to such options or scheme
in accordance with Part A of Schedule VIII;
(b)
equity shares held by a venture capital fund or a foreign venture capital
investor for a period of at least one year prior to the date of filing the
draft prospectus with the Board:
Explanation: For the
purpose of clause (b), in case such equity shares have resulted pursuant to
conversion of fully paid-up compulsorily convertible securities, the holding
period of such convertible securities as well as that of resultant equity
shares together shall be considered for the purpose of calculation of one year
period and convertible securities shall be deemed to be fully paid-up, if the
entire consideration payable thereon has been paid and no further consideration
is payable at the time of their conversion.
Lock-in of specified
securities lent to stabilising agent
under green shoe option.
38. The
lock-in provisions of this Chapter
shall not apply with respect to the specified securities lent to stabilising
agent for the purpose of green shoe option, during the period starting from the
date of lending of such specified securities and ending on the date on which they
are returned to the lender in terms of sub-regulation (5) or (6) of regulation
45:
�Provided that the specified
securities shall be locked-in for the remaining period from the date on which
they are returned to the lender.�
Pledge of locked-in specified securities.
39. Specified
securities held by promoters and locked-in may be pledged with any scheduled
commercial bank or public financial institution as collateral security for loan
granted by such bank or institution, subject to the following:
(a)
if the specified
securities are locked-in in terms of clause (a) of regulation 36, the loan has
been granted by such bank or institution for the purpose of financing one or
more of the objects of the issue and pledge of specified securities is one of
the terms of sanction of the loan;
(b)
if the specified
securities are locked-in in terms of clause (b) of regulation 36 and the pledge
of specified securities is one of the terms of sanction of the loan.
Transferability of locked-in specified securities.
40. Subject
to the provisions of Securities and Exchange Board of India (Substantial
Acquisition of shares and Takeovers) Regulations, 1997, the specified
securities held by promoters and locked-in as per regulation 36 may be
transferred to� another� promoter or any person of the� promoter group or a new promoter or a person
in control of the issuer and the specified securities held by persons other
than promoters and locked-in as per regulation 37 may be transferred to any
other person holding the specified securities which are� locked-in along with the securities proposed
to be transferred:
�Provided that lock-in on such specified
securities shall continue for the remaining period with the transferee and such
transferee shall not be eligible to transfer them till the lock-in period
stipulated in these regulations has expired.
PART V - MINIMUM OFFER TO PUBLIC, RESERVATIONS, ETC.
Minimum offer to public.
41. (1) Subject to the provisions of
sub-clause (b) of clause (2) of rule 19 of Securities Contracts (Regulations) Rules,
1957, the net offer to public:
(a)
in case of an
initial public offer, shall be at least ten per cent. or twenty five per cent.
of the post-issue capital, as the case may be; and
(b)
in case of a
further public offer, shall be at least ten per cent. or twenty five per cent.
of the issue size, as the case may be.
(2) Nothing contained in sub- regulation (1) shall apply
if the issuer is:
(a)
a government company or statutory authority or corporation or any special purpose vehicle set up and controlled by any
one or more of them, which is engaged in infrastructure sector;
(b)
an infrastructure
company fulfilling the following conditions:
(i)
its project has
been appraised by one or more public financial institutions;
(ii)
not less than
fifty per cent. of the project cost is financed by one or more such
institutions, jointly or severally, by way of loan or subscription to equity
shares or a combination of both, irrespective of whether they appraise the
project or not.�
Explanation: For
the purpose of this regulation:
(I)
The term �infrastructure company� means, an enterprise wholly engaged
in the business of (i) developing or (ii) operating and maintaining or (iii)
developing, operating and maintaining any infrastructure facility;
(II)
The term �infrastructure
sector� includes the facilities or services as specified in Schedule X.
Reservation on competitive
basis.
42. (1) In case of an issue made through the book building process, the
issuer may make reservation on competitive basis out of the issue size excluding promoters� contribution
and net offer to public in favour of the following categories of
persons:
(a)
employees of the issuer including employees of the promoting companies
in case of a new issuer;
(b)
shareholders (other than promoters) of:
(i)
listed promoting companies, in case of a new issuer; and
(ii)
listed group companies, in case of an existing issuer:
�Provided that if the promoting
companies are designated financial institutions or state and central financial
institutions, the shareholders of such promoting companies shall not be
eligible for the reservation on competitive basis;
(c)
persons who, as on the date of filing the draft offer document with the
Board, are associated with the issuer as depositors, bondholders or subscribers
to services of the issuer making an initial public offer:
�Provided
that the issuer shall not make the reservation to the issue management team,
syndicate members, their promoters, directors and employees and for the group
or associate companies of the issue management team and syndicate members and
their promoters, directors and employees;
(2) In case of an issue made other
than through the book building process, the issuer may make reservation on
competitive basis out of the issue size
excluding promoters� contribution and net offer to public in favour of
the following categories of persons:
(a)
employees of the issuer including employees of the promoting companies
in case of a new issuer;
(b)
shareholders (other than promoters) of:
(i)
listed promoting companies, in the case of a new issuer; and
(ii)
listed group companies, in the case of an existing issuer:
�Provided that if the promoting
companies are designated financial institutions or state and central financial
institutions, the shareholders of such promoting companies shall not be
eligible for the reservation on competitive basis.
(3) In case of a further public
offer (not being a composite issue), the issuer may make reservation on
competitive basis out of the issue size excluding promoters� contribution and
net offer to public in favour of retail individual shareholders of the issuer.
(4) The reservation on competitive
basis shall be subject to following
conditions:
(a)
the aggregate of reservations for employees shall not exceed [7][five per cent. of
the post issue capital of the issuer];
(b)
reservation for shareholders shall not exceed ten per cent. of the
issue size;
(c)
reservation for persons who as on the date of filing the draft offer
document with the Board, have business association as depositors, bondholders
and subscribers to services with the issuer making an initial public offer
shall not exceed five per cent. of the issue size;
(d)
no further application for subscription in the net offer to public
category shall be entertained from any person (except an employee and retail
individual shareholder) in favour of whom reservation on competitive basis is
made;
(e)
any unsubscribed portion in any reserved category may be added to any
other reserved category and the unsubscribed portion, if any, after such
inter-se adjustments among the reserved categories shall be added to the net
offer to the public category;
(f)
in case of under-subscription in the net offer to the public category,
spill-over to the extent of under-subscription shall be permitted from the
reserved category to the net public offer category;
(g)
[8][value of allotment
to any employee in pursuance of reservation made under sub-regulations (1) or
(2), as the case may be, shall not exceed one lakh rupees.]
(5) In the case of reserved
categories, a single applicant in the reserved category may make an application
for a number of specified securities which exceeds the reservation.
Explanation: For the purposes of this
regulation:
(I)
The term "reservation on competitive basis� means reservation
wherein specified securities are allotted in proportion of the number of
specified securities applied for in respect of a particular reserved category
to the number of specified securities reserved for that category;
(II)
The term �new
issuer� means an issuer which has not completed twelve months of commercial
operation and its audited operative results are not available.
Allocation in net offer to
public.
43. (1) No person shall make an application in the net offer to public
category for that number of specified securities which exceeds the number of
specified securities offered to public.
(2) In an issue made through the
book building process, the allocation in the net offer to public category shall
be made as follows:
(a)
not less than thirty five per cent. to retail individual investors;
(b)
not less than fifteen per cent. to non-institutional investors;
(c)
not more than fifty per cent. to qualified institutional buyers, five
per cent. of which shall be allocated to mutual funds:
�Provided that in case of an
issue made in terms of sub-clause (i) of clause (a) of sub-regulation (2) of
regulation 26, at least fifty per cent. of the net offer to public shall be
allotted to qualified institutional buyers:
�Provided further that where the
issuer is required to allocate sixty per cent. of the net offer to public to
qualified institutional buyers in terms of the
provisions of sub-clause (b) of clause (2) of rule 19 of Securities Contracts
(Regulations) Rules, 1957, allocation to
retail individual investors and non-institutional investors shall be thirty per
cent. and ten per cent. respectively:
�Provided further that in
addition to five per cent. allocation available in terms of clause (c), mutual
funds shall be eligible for allocation under the balance available for
qualified institutional buyers.
(3) In an issue made through the
book building process, the issuer may allocate upto thirty per cent. of the
portion available for allocation to qualified institutional buyers to an anchor
investor in accordance with the conditions specified in this regard in Schedule
XI.
(4) In an issue made other than
through the book building process, allocation in the net offer to public
category shall be made as follows:
(a)
minimum fifty per cent. to retail individual investors; and
(b)
remaining to:
(i)
individual applicants other than retail individual investors; and
(ii)
other investors including corporate bodies or institutions, irrespective
of the number of specified securities applied for;
(c)
the unsubscribed portion in either of the categories specified in
clauses (a) or (b) may be allocated to applicants in the other category.
Explanation: For the purpose of sub-regulation (4), if the retail
individual investor category is entitled to more than fifty per cent. on
proportionate basis, the retail individual investors shall be allocated that
higher percentage.
Safety-net arrangement.
44. An issuer may provide for a
safety-net arrangement for the specified securities offered in any public issue
in consultation with the merchant banker after ascertaining the financial
capacity of the person offering the safety-net arrangement, subject to
disclosures specified in this regard in Part A of Schedule VIII:
�Provided that any such arrangement
shall provide for an offer to purchase up to a maximum of one thousand
specified securities per original resident retail individual allottee at the
issue price within a period of six months from the last date of despatch of security certificates or
credit of demat account.
Explanation: For the purpose of this regulation, the term �safety net arrangement�
means an arrangement provided by the issuer under which a person offers to
purchase specified securities from the original resident retail individual
allottees at the issue price.
Price stabilisation through
green shoe option.
45. (1) An issuer making a public
issue of specified securities may provide green shoe option for stabilising the
post listing price of its specified securities, subject to the following:
(a)
the issuer has been authorized, by a resolution passed in the general
meeting of shareholders approving the public issue, to allot specified
securities to the stabilising agent, if required, on the expiry of the
stabilisation period;
(b)
the issuer has appointed a�
merchant banker or book runner, as the case may be, from amongst the
merchant bankers appointed by the issuer as a stabilising agent, who shall be
responsible for the price stabilisation process;
(c)
prior to filing the draft offer document with the Board, the issuer and
the stabilising agent have entered into an agreement, stating all the terms and
conditions relating to the green shoe option including fees charged and
expenses to be incurred by the stabilising agent for discharging his
responsibilities;
(d)
prior to filing the offer document with the Board, the stabilising
agent has entered into an agreement with the promoters or pre-issue
shareholders or both for borrowing specified securities from them in accordance
with clause (g) of this sub-regulation, specifying therein the maximum number
of specified securities that may be borrowed for the purpose of allotment or
allocation of specified securities in excess of the issue size (hereinafter
referred to as the �over- allotment�), which shall not be in excess of fifteen
per cent. of the issue size;
(e)
subject to clause (d), the lead merchant banker or lead book runner, in
consultation with the stabilising agent, shall determine the amount of
specified securities to be over-allotted in the public issue;
(f)
the draft and final offer documents shall contain all material
disclosures about the green shoe option specified in this regard in Part A
of Schedule VIII;
(g)
in case of an initial public offer pre-issue shareholders and promoters
and in case of a further public offer pre-issue shareholders holding more than
five per cent. specified securities and promoters, may lend specified
securities to the extent of the proposed over-allotment;
(h)
the specified securities borrowed shall be in dematerialised form and
allocation of these securities shall be made pro-rata to all successful
applicants.
(2) For the purpose of stabilisation
of post-listing price of the specified securities, the stabilising agent shall
determine the relevant aspects including the timing of buying such securities,
quantity to be bought and the price at which such securities are to be bought
from the market.�
(3) The stabilisation process shall
be available for a period not exceeding thirty days from the date on which
trading permission is given by the recognised stock exchanges in respect of the
specified securities allotted in the public issue.
(4) The stabilising agent shall open
a special account, distinct from the issue account, with a bank for crediting
the monies received from the applicants against the over-allotment and a
special account with a depository participant for crediting specified
securities to be bought from the market during the stabilisation period out of
the monies credited in the special bank account.
(5) The specified securities bought
from the market and credited in the special account with the depository
participant shall be returned to the promoters or pre-issue shareholders
immediately, in any case not later than two working days after the end of the
stabilization period.
(6) On expiry of the stabilisation
period, if the stabilising agent has not been able to buy specified securities
from the market to the extent of such securities over-allotted, the issuer
shall allot specified securities at issue price in dematerialised form to the
extent of the shortfall to the special account with the depository participant,
within five days of the closure of the stabilisation period and such specified
securities shall be returned to the promoters or pre-issue shareholders by the
stabilising agent in lieu of the specified securities borrowed from them and
the account with the depository participant shall be closed thereafter.��
(7) The issuer shall make a listing
application in respect of the further specified securities allotted under
sub-regulation (6), to all the recognised stock exchanges where the specified
securities allotted in the public issue are listed and the provisions of
Chapter VII shall not be applicable to such allotment.
(8) The stabilising agent shall remit
the monies with respect to the specified securities allotted under
sub-regulation (6) to the issuer from the special bank account.
(9) Any monies left in the special
bank account after remittance of monies to the issuer under sub-regulation (8)
and deduction of expenses incurred by the stabilising agent for the
stabilisation process shall be transferred to the Investor Protection and
Education Fund established by the Board and the special bank account shall be
closed soon thereafter.
(10) The stabilising agent shall
submit a report to the stock exchange on a daily basis during the stabilisation
period and a final report to the Board in the format specified in Schedule
XII.
(11) The stabilising agent shall
maintain a register for a period of at least three years from the date of the
end of the stabilisation period and such register shall contain the following
particulars:
(a)
The names of� the promoters or
pre-issue shareholders from whom the specified securities were borrowed and the
number of specified securities borrowed from each of them;
(b)
The price, date and time in respect of each transaction effected in the
course of the stabilisation process; and�
(c)
The details of allotment made by the issuer on expiry of the
stabilisation process.
Period of subscription.
46. (1) A public issue shall be kept open for at least three working days
but not more than ten working days including the days for which the issue is
kept open in case of revision in price band.
(2) In case the price band in a
public issue made through the book building process is revised, the bidding
(issue) period disclosed in the red herring prospectus shall be extended for a
minimum period of three working days:
�Provided that the total bidding
period shall not exceed ten working days.
Pre-issue
advertisement for public issue.
47. (1) Subject to the provisions of
section 66 of the Companies Act, 1956, the issuer shall, after registering the
red herring prospectus (in case of a book built issue) or prospectus (in case
of fixed price issue) with the Registrar of Companies, make a pre-issue
advertisement in one English national daily newspaper with wide circulation,
Hindi national daily newspaper with wide circulation and one regional language
newspaper with wide circulation at the place where the registered office of the
issuer is situated.
(2) The pre-issue advertisement shall be in the format and
shall contain the disclosures specified in Part
A of Schedule XIII.
Issue opening and
issue closing advertisement for public issue.
48. An issuer may issue advertisements for issue opening and issue closing
advertisements, which shall be in the formats specified in Parts B and C of Schedule XIII.
Minimum
application value.
49. (1) The issuer shall stipulate
in the offer document, the minimum application size in terms of number of
specified securities which shall fall within the range of minimum application
value of five thousand rupees to seven thousand rupees.
(2)
The issuer shall invite applications in multiples of the minimum
application value, an illustration whereof is given in Schedule XIV.
(3) The minimum sum payable on
application shall not be less than twenty five per cent. of the issue price:
�Provided that in case of an
offer for sale, the issue price payable for each specified security shall be
brought in at the time of application.
Explanation: For the purpose of this
regulation, �minimum application value� shall be with reference to the issue
price of the specified securities and not with reference to the amount payable
on application.
Allotment procedure and basis of allotment.
50. (1) The allotment of specified securities to applicants other than
anchor investors shall be on proportionate basis within the specified investor
categories and the number of securities allotted shall be rounded off to the
nearest integer, subject to minimum allotment being equal to the minimum
application size as determined and disclosed by the issuer:
�[9][Provided
that value of specified securities allotted to any person in pursuance of reservation made under clause
(a) of sub-regulation (1) or clause (a) of sub-regulation (2) of regulation 42,
shall not exceed one lakh rupees.]
(2) The executive director or managing director of the
designated stock exchange along with the post issue lead merchant bankers and
registrars to the issue shall ensure that the basis of allotment is finalised
in a fair and proper manner in accordance with the allotment procedure as
specified in Schedule XV.
Utilisation of subscription money.�
51. The post-issue lead merchant banker shall ensure that
moneys received in respect of the issue are released to the issuer in
compliance with the provisions of section 73 of the Companies Act, 1956.
RIGHTS ISSUE
Record Date.
52. (1) A
listed issuer making a rights issue shall
announce a record date for the purpose of determining the shareholders eligible
to apply for specified securities in the proposed rights issue.
(2)
The issuer shall not withdraw rights issue after announcement of the
record date.
(3) If the issuer withdraws the
rights issue after announcing the record date, it shall not make an application
for listing of any of its specified securities on any recognised stock exchange
for a period of twelve months from the record date announced under
sub-regulation (1):
�Provided that the issuer may seek listing of
its equity shares allotted pursuant to conversion or exchange of convertible
securities issued prior to the announcement of the record date, on the
recognised stock exchange where its securities are listed.
Restriction on rights issue.
53. (1) No issuer shall make a rights issue of equity shares
if it has outstanding fully or partly convertible debt instruments at
the time of making rights issue, unless it
has made reservation of equity shares of the same class in favour of the
holders of such outstanding convertible debt instruments in proportion to the
convertible part thereof.
(2) The equity shares reserved for the holders of fully or
partially convertible debt instruments shall be issued at the time of
conversion of such convertible debt instruments on the same terms on which the
equity shares offered in the rights issue were issued.
Letter of offer, abridged letter of offer, pricing and period
of subscription.
54. (1) The abridged letter of offer, along
with application form, shall be dispatched through registered post or speed
post to all the existing shareholders at least three days before the date of
opening of the issue:
�Provided that the letter of offer shall be given by the issuer or lead
merchant banker to any existing shareholder who has made a request in this
regard.
(2) The shareholders who have not received the application
form may apply in writing on a plain paper, along with the requisite
application money.
(3) The shareholders making application otherwise than on the
application form shall not renounce their rights and shall not utilise the
application form for any purpose including renunciation even if it is received
subsequently.
(4)
Where any shareholder makes an
application on application form as well as on plain paper, the application is
liable to be rejected.
(5) The issue price shall be decided before determining
the record date which shall be determined in
consultation with the designated stock exchange.������
(6) A rights issue shall be open for
subscription for a minimum period of fifteen days and for a maximum period of
thirty days.
Pre-Issue Advertisement for rights issue.
55. (1) The issuer shall issue an
advertisement for rights issue disclosing the following:
(a)
the date of
completion of despatch of� abridged
letter of offer and the application form;
(b)
the centres other
than registered office of the issuer where the shareholders or the persons
entitled to receive the rights entitlements may obtain duplicate copies of the
application forms in case they do not receive the application form within a
reasonable time after opening of the rights issue;
(c)
a statement that
if the shareholders entitled to receive the rights entitlements have neither
received the original application forms nor they are in a position to
obtain� the duplicate forms, they may
make application in writing on a plain paper to subscribe to the rights issue;
(d)
a format to
enable the shareholders entitled to apply against their rights entitlements, to
make the application on a plain paper specifying therein necessary particulars
such as name, address, ratio of rights issue, issue price, number of equity
shares held, ledger folio numbers, depository participant ID, client ID, number
of equity shares entitled and applied for, additional shares if any, amount to
be paid along with application, and particulars of cheque, etc. to be drawn in
favour of the issuer�s account;
(e)
a statement that
the applications can be directly sent by the shareholders entitled to apply
against rights entitlements through registered post together with the
application moneys to the issuer's designated official at the address given in
the advertisement;
(f)
a statement to
the effect that if the shareholder makes an application on plain paper and also
on application form both his applications shall be liable to be rejected at the
option of the issuer.
(2)
The advertisement
shall be made in at least one English national daily newspaper with wide
circulation, one Hindi national daily newspaper with wide circulation and one
regional language daily newspaper with wide circulation at the place where registered
office of the issuer is situated, at least three days before the date of
opening of the issue.
[10][Reservation
for employees alongwith rights issue.
55A.��� Subject to other applicable
provision of these regulations the issuer may make reservation for its
employees alongwith rights issue subject to the condition that value of
allotment to any employee shall not exceed one lakh rupees.]
Utilisation of
funds raised in rights issue.
56. The issuer shall utilise funds
collected in rights issues after the finalisation of the basis of
allotment.�
MANNER OF DISCLOSURES IN THE OFFER DOCUMENTS
Manner of
disclosures in the offer document.
57. (1) The offer document shall contain all material disclosures which are
true and adequate so as to enable the applicants to take an informed investment
decision.
(2) Without prejudice to the generality of sub-regulation
(1):
(a)
the red-herring
prospectus, shelf prospectus and prospectus shall contain:�
(i)
the disclosures
specified in Schedule II of the Companies Act, 1956; and
(ii)
the disclosures
specified in Part A of Schedule VIII, subject to the provisions of Parts B and C thereof.
(b)
the letter of
offer shall contain disclosures as specified in Part E of Schedule VIII.
Abridged
prospectus, abridged letter of offer and ASBA.
58. (1) The
abridged prospectus shall contain the disclosures of the memorandum prescribed
under sub-section (3) of section 56 of the Companies Act, 1956 and additional
disclosures as specified in Part D of Schedule VIII.
(2) The abridged letter of offer shall contain the
disclosures as specified in Part F of Schedule VIII.
(3) The abridged prospectus and abridged letter of offer
shall not contain any matter extraneous to the contents of the offer document.
(4) Every application form including ASBA form distributed
by the issuer or any other person in relation to an issue shall be accompanied
by a copy of the abridged prospectus or abridged letter of offer, as the case
may be.
(5) The issuer
shall provide the facility of ASBA in all book built public issues and rights
issues, where not more than one payment option is given to the retail
individual investors, in accordance with the procedure specified by the Board.
(6) �An
application through ASBA form may be made:
(a)
in a public
issue, by an applicant who:
(i)
is a resident
retail individual investor;
(ii)
is bidding at
cut-off, with single option as to the number of shares bid for;
(iii)
is applying
through blocking of funds in a bank account with the self certified syndicate
banks;
(iv)
has agreed not to
revise his bid;
(v)
is not bidding
under any of the reserved categories;
(b)
in a rights
issue, by an applicant who:
(i)
holds the shares
of the issuer in dematerialised form as on the record date and has applied for
entitlements and/or additional equity shares in dematerialised form;
(ii)
has not renounced
his entitlements in full or in part;
(iii)
is not a
renouncee;
(iv)
who is applying
through blocking of funds in a bank account with the Self Certified Syndicate
Bank.
GENERAL
OBLIGATIONS OF ISSUER AND INTERMEDIARIES WITH RESPECT TO PUBLIC ISSUE AND
RIGHTS ISSUE
Prohibition on
payment of incentives.
59. No
person connected with the issue shall offer any incentive, whether direct or indirect, in any manner, whether
in cash or kind or services or otherwise to any person for making an
application for allotment of specified securities:
�Provided that nothing contained in this
regulation shall apply to fees or commission for services rendered in relation
to the issue.
Explanation: For
the purpose of this regulation, the expression �person connected with the issue�
includes a person connected with the distribution of the issue.
Public
communications, publicity materials, advertisements and research reports.
60. (1) Any public communication
including advertisement and publicity material issued by the issuer or research report made by the issuer or any intermediary concerned with the issue
or their associates shall contain only factual information and shall not
contain projections, estimates, conjectures, etc. or any matter extraneous to the contents of the offer document. �
(2) All public communications and publicity material
issued or published in any media during the period commencing from the date of
the meeting of the board of directors of the issuer in which the public issue
or rights issue is approved till the date of filing draft offer document with
the Board shall be consistent with its past practices:
�Provided that where such public communication
or publicity material is not consistent with the past practices of the issuer,
it shall be prominently displayed or announced in such public communication or
publicity material that the issuer is proposing to make a public or rights
issue of specified securities in the near future and is in the process of
filing a draft offer document with the Board.
(3) All public communications and publicity material
issued or published in any media during the period commencing from the date of
filing draft offer document with the Board�
till the date of allotment of securities offered in the issue, shall
prominently disclose that:
(a)
the issuer is
proposing to make a public issue or rights issue of the specified securities
and has filed a draft offer document with the Board or has filed the red
herring prospectus or prospectus with the Registrar of Companies or the letter
of offer with the designated stock exchange, as the case may be.
(b)
the draft offer
document, red herring prospectus or final offer document, as the case may be,
is available on the website of the Board, lead merchant bankers or lead book
runners.
(4) The issuer shall make prompt, true and fair disclosure
of all material developments which take place during the following period
mentioned in this sub-regulation, relating to its business and securities and
also relating to the business and securities of its subsidiaries, group companies,
etc., which may have a material effect on the issuer, by issuing public notices
in all the newspapers in which the issuer had issued pre-issue advertisement
under regulation 47 or regulation 55, as the case may be:
(a)
in case of public
issue, between the date of registering final prospectus or the red herring
prospectus, as the case may be, with the Registrar of Companies, and the date
of allotment of specified securities;
(b)
in case of a
rights issue, between the date of filing the letter of offer with the designated
stock exchange and the date of allotment of the specified securities.
(5) The issuer shall not, directly or indirectly, release,
during any conference or at any other time, any material or information which
is not contained in the offer document.
(6) In respect of all public communications, issue
advertisements and publicity materials, the issuer shall obtain approval from
the lead merchant bankers responsible for marketing the issue and shall also
make copies of all issue related materials available with the lead merchant
bankers at least till the allotment is completed.
(7) Any advertisement or research report issued or caused
to be issued by an issuer, any intermediary concerned with the issue or their
associates shall comply with the following:
(a)
it shall be truthful, fair and shall not� be manipulative or deceptive or distorted and
it shall not contain any statement, promise or forecast which is untrue or
misleading;
(b)
if it reproduces or purports to reproduce any information contained in
an offer document, it shall reproduce such information in full and disclose all
relevant facts and not be restricted to select extracts relating to that
information;
(c)
it shall be set forth in a clear, concise and understandable language;
(d)
it shall not include any issue slogans or brand names for the issue
except the normal commercial name of the issuer or commercial brand names of
its products already in use;
(e)
if it presents any financial data, data for the past three years shall
also be included alongwith particulars relating to sales, gross profit, net
profit, share capital, reserves, earnings per share, dividends and the book
values;
(f)
no advertisement shall use extensive technical, legal terminology or
complex language and excessive details which may distract the investor;
(g)
no issue advertisement shall contain statements which promise or
guarantee rapid increase in profits;
(h)
no issue advertisement shall display models, celebrities, fictional
characters, landmarks or caricatures or the likes;
(i)
no issue advertisement shall appear in the form of crawlers (the
advertisements which run simultaneously with the programme in a narrow strip at
the bottom of the television screen) on television;
(j)
in any issue advertisement on television screen, the risk factors shall
not be scrolled on the television screen and the advertisement shall advise the
viewers to refer to the red herring prospectus or other offer document for
details;
(k)
no issue advertisement shall contain slogans, expletives or non-factual
and unsubstantiated titles;
(l)
if an advertisement or research report�
contains highlights, it shall also contain risk factors with equal
importance in all respects including print size of not less than point seven
size;
(m) an issue advertisement displayed
on a billboard shall not contain information other than that specified in Parts
A, B and C of Schedule XIII, as applicable;
(n)
an issue advertisement which contains highlights or information other
than the details contained in the format as specified in Parts A and B of
Schedule XIII shall contain risk factors.
(8) No advertisement shall be issued giving any impression
that the issue has been fully subscribed or oversubscribed during the period
the issue is open for subscription.
(9) An announcement
regarding closure of issue shall be made only after the lead merchant banker(s)
is satisfied that at least ninety per cent. of the offer through offer document
has been subscribed and a certificate has been obtained to that effect from the
registrar to the issue:
�Provided that
such announcement shall not be made before the date on which the issue is to be
closed.�
(10) No advertisement or distribution
material with respect to the issue shall contain any offer of incentives,
whether direct or indirect, in any manner, whether in cash or kind or services
or otherwise.
(11) No product advertisement shall
contain any reference, directly or indirectly, to the performance of the issuer
during the period commencing from the date of the resolution of the board of
directors of the issuer approving the public issue or rights issue till the date
of allotment of specified securities offered in such issue.
(12) A research report may be
prepared only on the basis of information, disclosed to the public by the
issuer by updating the offer document or otherwise.
(13) No selective or additional
information or information which is extraneous to the information disclosed to
the public through the offer document or otherwise, shall be given by the
issuer or any member of the issue management team or syndicate to any
particular section of the investors or to any research analyst in any manner
whatsoever, including at road shows, presentations, in research or sales
reports or at bidding centres.
Explanation: For the purpose of this regulation:
(I)
�public
communication or publicity material� includes corporate, product and issue
advertisements of the issuer, interviews by its promoters, directors, duly
authorized employees or representatives of the issuer, documentaries about the
issuer or its promoters, periodical reports and press releases.
(II) An issue advertisement shall be
considered to be misleading, if it contains:
(a)
Statements made about the performance or activities of the issuer
without necessary explanatory or qualifying statements, which may give an
exaggerated picture of such performance or activities.
(b)
An inaccurate portrayal of past performance or its portrayal in a
manner which implies that past gains or income will be repeated in the future.
�Copies of offer
documents to be available to public.
61. (1) The issuer and lead
merchant bankers shall ensure that the contents of offer documents hosted on
the websites as required in these regulations are the same as that of their
printed versions as filed with the Registrar of Companies, Board and the stock
exchanges.
(2) The lead merchant bankers and the recognised stock
exchange shall provide copies of the draft offer document and final offer
document to the public as and when requested.
(3) The lead merchant bankers or the recognised stock
exchange may charge a reasonable sum for providing the copy of the offer
document.
Redressal of investor grievances.
62. The post-issue lead merchant bankers shall actively associate himself
with post-issue activities such as allotment, refund, despatch and giving
instructions to syndicate members, Self Certified Syndicate Banks and other
intermediaries and shall regularly monitor redressal of investor grievances
arising therefrom.
Appointment of
Compliance Officer.
63. The issuer shall appoint a compliance officer who shall be responsible
for monitoring the compliance of the securities laws and for redressal of
investors� grievances.
Explanation: For the purpose of this regulation, the term
�securities laws� means the Companies Act, 1956, the Act, the Securities
Contracts (Regulation) Act, 1956, the Depositories Act, 1996 and the rules and
regulations made thereunder and the regulations, general or special orders,
guidelines or circulars made or issued by the Board.
Due diligence.
64. (1) The lead merchant bankers shall exercise due diligence and satisfy
himself about all the aspects of the issue including the veracity and adequacy
of disclosure in the offer documents.
(2) The lead merchant bankers shall call upon the issuer,
its promoters or directors or in case of an offer for sale, the selling
shareholders, to fulfil their obligations as disclosed by them in the offer
document and as required in terms of these Regulations.
(3)
The post-issue
merchant banker shall continue to be responsible for post-issue activities till
the subscribers have received the securities certificates, credit to their demat
account or refund of application moneys and the listing agreement is entered
into by the issuer with the stock exchange and listing/ trading permission is
obtained.
(4) The responsibility of the lead merchant banker shall
continue even after the completion of issue process.
Post- issue reports.
65. (1) The lead merchant banker
shall submit post-issue reports to the Board in accordance with sub-regulation
(2).
(2) The post-issue reports shall be submitted as
follows:�
(a)
initial post
issue report as specified in Parts A and
B of Schedule XVI, within three days of closure of the issue
(b)
final post issue
report as specified in Parts C and D of
Schedule XVI, within fifteen days of the date of finalisation of basis
of allotment or within fifteen days of refund of money in case of failure of
issue.
(3) The lead merchant banker shall submit a due diligence
certificate as per the format specified in Form
G of Schedule VI, along with the final post issue report.
Post-issue Advertisements.
66. (1) The post-issue merchant
banker shall ensure that advertisement giving
details relating to oversubscription, basis of allotment, number, value and
percentage of all applications including ASBA, number, value and percentage of
successful allottees for all applications�
including ASBA, date of completion of despatch of refund orders or
instructions to Self Certified Syndicate Banks by the Registrar, date of
despatch of certificates and date of filing of listing application, etc. is released within ten days from
the date of completion of the various activities in at least one English
national daily newspaper with wide circulation, one Hindi national daily
newspaper with wide circulation and one regional language daily newspaper with
wide circulation at the place where registered office of the issuer is
situated.
(2) The post-issue merchant banker shall ensure that
issuer, advisors, brokers or any other entity connected with the issue do not
publish any advertisement stating that issue has been oversubscribed or
indicating investors� response to the issue, during the period when the public
issue is still open for subscription by the public.
Co-ordination with Intermediaries.
67. (1) The post-issue merchant
banker shall maintain close co-ordination with the registrars to the issue and
arrange to depute its officers to the offices of various intermediaries at
regular intervals after the closure of the issue to monitor the flow of
applications from collecting bank branches and/or Self Certified Syndicate
Banks, processing of the applications including application form for ASBA and
other matters till the basis of allotment is finalised, despatch of security
certificates and refund orders are completed and securities are listed.
(2) Any act of omission or commission on the part of any
of the intermediaries noticed during such visits shall be duly reported to the
Board.
(3) In case there is a devolvement on underwriters, the
merchant banker shall ensure that the notice for devolvement containing the
obligation of the underwriters is issued within a period of ten days from the
date of closure of the issue.
(4) In case of undersubscribed issues, the merchant banker
shall furnish information in respect of underwriters who have failed to meet
their underwriting devolvement to the Board in the format specified in Schedule
XVII.
(5) The post-issue merchant banker shall confirm to the
bankers to the issue by way of copies of listing and trading approvals that all
formalities in connection with the issue have been completed and that the
banker is free to release the money to the issuer or release the money for
refund in case of failure of the issue.
Audited financial
statements in the offer document.
68. The merchant banker shall ensure that the
information contained in the offer document and the particulars as per audited
financial statements in the offer document are not more than six months old
from the issue opening date.
Other responsibilities.
69. (1) The post-issue merchant banker shall
ensure that the despatch of refund orders, allotment letters and share
certificates is done by way of registered post or certificate of posting, as
may be applicable.
(2) The post-issue merchant banker shall ensure payment of
interest to the applicants for delayed dispatch of allotment letters, refund
orders, etc. as per the disclosure made in the offer document.
(3) In case of absence of definite information about
subscription figures, the issue shall be kept open for the required number of
days to avoid any dispute, at a later date, by the underwriters in respect of
their liability.
(4) The issuer shall ensure that
transactions in securities by the promoter and promoter group during the period
between the date of registering the offer document with the Registrar of
Companies or filing the letter of offer with the designated stock exchange, as
the case may be and the date of closure of the issue shall be reported to the
recognised stock exchanges where the specified securities of the issuer are
listed, within twenty four hours of the transactions.
PREFERENTIAL
ISSUE
Chapter VII not to
apply in certain cases.
70. (1) The provisions of this Chapter shall not apply
where the preferential issue of equity shares is made:
(a)
pursuant to conversion of loan or option attached to convertible debt
instruments in terms of sub-sections (3) and (4) of sections 81 of the
Companies Act, 1956;
(b)
pursuant to a scheme approved by a High Court under section 391 to 394
of the Companies Act, 1956;
(c)
in terms of the rehabilitation scheme approved by the Board� of Industrial and Financial Reconstruction
under the Sick Industrial Companies (Special Provisions) Act, 1985:
�Provided that the lock-in provisions of this
Chapter shall apply to such preferential issue of equity shares.
(2) The provisions of this Chapter
relating to pricing and lock-in shall not apply to equity shares allotted to
any financial institution within the meaning of sub-clauses (ia) and (ii) of
clause (h) of section 2 of the Recovery of Debts due to Banks and Financial
Institutions Act, 1993 (51 of 1993).
(3) The provisions of regulation 73
and regulation 76 shall not apply to a
preferential issue of equity shares and compulsorily convertible debt
instruments, whether fully or partly, where the Board has granted relaxation to
the issuer in terms of regulation 29A of the Securities and Exchange Board of
India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, if
adequate disclosures about the plan and process proposed to be followed for
identifying the allottees are given in the explanatory statement to notice for
the general meeting of shareholders.
Relevant date.
71. For the purpose of this Chapter, "relevant
date" means:
(a)
in case of preferential issue of equity shares, the date thirty days
prior to the date on which the meeting of shareholders is held to consider the
proposed preferential issue:
�Provided that in case of preferential issue of
equity shares pursuant to a scheme approved under the Corporate Debt
Restructuring framework of Reserve Bank of India, the date of approval of the
Corporate Debt Restructuring Package shall be the relevant date.
(b)
in case of preferential issue of convertible securities, either the
relevant date referred to in clause (a) of this regulation or a date thirty
days prior to the date on which the holders of the convertible securities
become entitled to apply for the equity shares.
Conditions for preferential
issue.
72. (1) A
listed issuer may make a preferential issue of specified securities, if:
(a)
a special resolution has been passed by its shareholders;
(b)
all the equity shares, if any, held by the proposed allottees in the
issuer are in dematerialised form;
(c)
the issuer is in compliance with the conditions for continuous listing
of equity shares as specified in the listing agreement with the recognised
stock exchange where the equity shares of the issuer are listed;
(d)
the issuer has obtained the Permanent Account Number of the proposed
allottees.
(2) The issuer shall not make
preferential issue of specified securities to any person who has sold any
equity shares of the issuer during the six months preceding the relevant date:
�Provided that in
respect of the preferential issue of equity shares and compulsorily convertible debt instruments, whether
fully or partly, the Board may grant
relaxation from the requirements of this sub-regulation, if the Board has
granted relaxation in terms of regulation 29A of the Securities and Exchange
Board of India (Substantial Acquisition of Shares and Takeovers) Regulations,
1997 to such preferential allotment.
Disclosures.
73. (1) The
issuer shall, in addition to the disclosures required under section 173 of the
Companies Act, 1956 or any other applicable�
law, disclose the following in the explanatory statement to the notice
for the general� meeting proposed for
passing special resolution:
(a)
the objects of the preferential issue;
(b)
the proposal of the promoters, directors or key management personnel of
the issuer to subscribe to the offer;
(c)
the shareholding pattern of the issuer before and after the
preferential issue;
(d)
the time within which the preferential issue shall be completed;
(e)
the identity of the proposed allottees, the percentage of post
preferential issue capital that may be held by them and change in control, if
any, in the issuer consequent to the preferential issue;
(f)
an undertaking that the issuer shall re-compute the price of the
specified securities in terms of the provision of these regulations where it is
required to do so;
(g)
an undertaking that if the amount payable on account of the
re-computation of� price is not paid
within the time stipulated in these regulations, the specified securities shall
continue to be locked- in till the time such amount is paid by the allottees.
(2) The issuer shall place a copy of
the certificate of its statutory auditor before the general meeting of the
shareholders, considering the proposed preferential issue, certifying that the
issue is being made in accordance with the requirements of these regulations.
(3) Where specified securities are issued on a
preferential basis to promoters, their relatives, associates and related
entities for consideration other than cash, the valuation of the assets in
consideration for which the equity shares are issued shall be done by an
independent qualified valuer, which shall be submitted to the recognised stock
exchanges where the equity shares of the
issuer are listed:
�Provided that if the recognised stock exchange
is not satisfied with the appropriateness of the valuation, it may get the
valuation done by any other valuer and for this purpose it may obtain any
information, as deemed necessary, from the issuer.
(4) The special resolution
shall specify the relevant date on the basis of which price of the equity
shares to be allotted on conversion or exchange of convertible securities shall
be calculated.
Explanation:
For the purpose of sub-regulation (3), the term �valuer� has the same meaning
as is assigned to it under clause (r) of sub-regulation (1) of regulation 2 of
the Securities and Exchange Board of India (Issue of Sweat Equity) Regulations,
2002.
Allotment pursuant
to special resolution.
74. (1) Allotment
pursuant to the special resolution shall be completed within a period of
fifteen days from the date of passing of such resolution:
�Provided that where any
application for exemption from the applicability of the Securities and Exchange
Board of India (Substantial Acquisition of Shares and Takeovers) Regulations,
1997 or any approval or permission by any regulatory authority or the Central
Government for allotment is pending, the period of fifteen days shall be
counted from the date of order on such application or the date of approval or
permission, as the case may be:
�Provided further that where the
Board has granted relaxation to the issuer in terms of regulation 29A of SEBI
(Substantial Acquisition of Shares and Takeovers) Regulations, 1997, the
preferential issue of equity shares and compulsorily
convertible debt instruments, whether fully or partly, shall be made by it within such time as may be specified by the Board
in its order granting the relaxation:
�Provided further that
requirement of allotment within fifteen days shall not apply to allotment of
specified securities on preferential basis pursuant to a scheme of corporate
debt restructuring as per the corporate debt restructuring framework specified
by the Reserve Bank of India.
(2) If the allotment of specified
securities is not completed within fifteen days from the date of special
resolution, a fresh special resolution shall be passed and the relevant date
for determining the price of specified securities under this Chapter will be
taken with reference to the date of latter special resolution.
Tenure of convertible
securities.
75. The tenure of the convertible securities of the issuer
shall not exceed eighteen months from the date of their allotment.
Pricing of equity
shares.
76. (1) If� the equity shares of the issuer have been
listed on a recognised stock exchange for a period of six months or more as on
the relevant date, the equity shares shall be allotted at a price not less than
higher of the following:
(a)
The average of the weekly high and low of the closing prices of the
related equity shares quoted on the recognised stock exchange during the six
months preceding the relevant date; or
(b)
The average of the weekly high and low of the closing prices of the
related equity shares quoted on a recognised stock exchange during the two
weeks preceding the relevant date.
(2) If� the equity shares of the issuer have been
listed on a recognised stock exchange for a period of less than six months as
on the relevant date, the equity shares shall be allotted� at a price not less than the higher of the
following:
(a)
the price at which equity shares were issued by the issuer in its
initial public offer or the value per share arrived at in a scheme of
arrangement under sections 391 to 394 of the Companies Act, 1956, pursuant to
which the equity shares of the issuer were listed, as the case may be; or
(b)
the average of the weekly high and low of the closing prices of the
related equity shares quoted on the recognised stock exchange during the period
shares have been listed preceding the relevant date; or
(c)
the average of the weekly high and low of the closing prices of the
related equity shares quoted on a recognised stock exchange during the two
weeks preceding the relevant date.
(3) Where the price of the equity
shares is determined in terms of sub-regulation (2), such price shall be
recomputed by the issuer on completion of six months from the date of listing
on a recognised stock exchange with reference to the average of the weekly high
and low of the closing prices of the related equity shares quoted on the
recognised stock exchange during these six months and if such recomputed price
is higher than the price paid on allotment, the difference shall be paid by the
allottees to the issuer.
(4) Any preferential issue of
specified securities, to qualified institutional buyers not exceeding five in
number, shall be made at a price not less than the average of the weekly high
and low of the closing prices of the related equity shares quoted on a
recognised stock exchange during the two weeks preceding the relevant date.
Explanation: For the purpose of this
regulation, �stock exchange�� means any
of the recognised stock exchanges in which the equity shares are listed and in
which the highest trading volume in respect of the equity shares of the issuer
has been recorded during the preceding six months prior to the relevant date.
Payment of
consideration.
77. (1) Full
consideration of specified securities other than warrants issued under this
Chapter shall be paid by the allottees at the time of allotment of such specified
securities:
�Provided that in case of a
preferential issue of specified securities pursuant to a scheme of corporate
debt restructuring as per the corporate debt restructuring framework specified
by the Reserve Bank of India, the allottee may pay the consideration in terms
of such scheme.
(2) An amount equivalent to at least
twenty five per cent. of the consideration determined in terms of regulation
76� shall be paid against each warrant on
the date of allotment of warrants.
(3) The balance seventy five per
cent. of the consideration shall be paid at the time of allotment of equity
shares pursuant to exercise of option against each such warrant by the warrant
holder.
(4) In case the warrant holder does
not exercise the option to take equity shares against any of the warrants held
by him, the consideration paid in respect of such warrant in terms of
sub-regulation (2) shall be forfeited by the issuer.
Lock-in of specified securities.
78. (1) The
specified securities allotted on preferential basis to promoter or promoter
group and the equity shares allotted pursuant to exercise of options attached
to warrants issued on preferential basis to promoter or promoter group, shall
be locked-in for a period of three years from the date of allotment of the
specified securities or equity shares allotted pursuant to exercise of the
option attached to warrant, as the case may be:
�Provided that not more than
twenty per cent. of the total capital of the issuer shall be locked-in for
three years from the date of allotment:
�Provided further that equity
shares allotted in excess of the twenty per cent. shall be locked-in for one
year from the date of their allotment pursuant to exercise of options or
otherwise, as the case may be.
(2) The specified securities
allotted on preferential basis to persons other than promoter and promoter
group and the equity shares allotted pursuant to exercise of options attached
to warrants issued on preferential basis to such persons shall be locked in for
a period of one year from the date of their allotment.
(3) The lock-in of equity shares
allotted pursuant to conversion of convertible securities other than warrants,
issued on preferential basis shall be reduced to the extent the convertible
securities have already been locked-in.
(4) The equity shares issued on
preferential basis pursuant to a scheme of corporate debt restructuring as per
the Corporate Debt Restructuring framework specified by the Reserve Bank of
India shall be locked-in for a period of one year from the date of allotment:
�Provided that partly paid up equity shares, if
any, shall be locked-in from the date of allotment and the lock-in shall end on
the expiry of one year from the date when such equity shares become fully paid
up.
(5) If the amount payable by the
allottee, in case of re-calculation of price under sub-regulation (3) of
regulation 76 is not paid till the expiry of lock-in period, the equity shares
shall continue to be locked in till such amount is paid by the allottee.
(6) The entire pre-preferential
allotment shareholding of the allottees, if any, shall be locked-in from the
relevant date upto a period of six months from the date of preferential
allotment.�
Explanation: For the purpose of this
regulation:
(I)
The expression �total capital of the issuer� means:
(a)
equity share capital issued by way of public issue or rights issue
including equity shares issued pursuant to conversion of specified securities
which are convertible; and
(b)
specified securities issued on a preferential basis to promoter or
promoter group.
(II)� (a)�� For the computation of twenty per cent. of
the total capital of the issuer, the amount of minimum promoters� contribution
held and locked-in, in the past in terms of Securities and Exchange Board of
India (Disclosure and Investor Protection) Guidelines, 2000 or these regulations
shall be taken into account.
(b) � The minimum promoters� contribution shall not again be put under
fresh lock-in, even though it is considered for computing the requirement of
twenty per cent. of the total capital of the issuer, in case the said minimum
promoters� contribution is free of lock-in at the time of the preferential
issue.
Transferability of locked-in specified securities and
warrants issued on preferential basis.
79. Subject
to the provisions of Securities and Exchange Board of India (Substantial
Acquisition of shares and Takeovers) Regulations, 1997, specified securities
held by promoters and locked-in in terms of sub-regulation (1) of regulation 78
may be transferred among promoters or promoter group or to a new promoter or
persons in control of the issuer:
�Provided that lock-in on such specified
securities shall continue for the remaining period with the transferee.
QUALIFIED INSTITUTIONS PLACEMENT
Applicability.
80. The provisions of this Chapter shall apply to a qualified
institutions placement made by a listed issuer.
Definitions.
81. For the purpose of this Chapter:
(a)
�eligible securities� include equity shares, non-convertible debt
instruments along with warrants and convertible securities other than warrants;
(b)
�qualified institutions placement� means allotment of eligible
securities by a listed issuer to qualified institutional buyers on private
placement basis in terms of these regulations;
(c)
"relevant date" means:
(i)
in case of allotment of equity shares, the date of the meeting in which
the board of directors of the issuer or the committee of directors duly
authorised by the board of directors of the issuer decides to open the proposed
issue;
(ii)
in case of allotment of eligible convertible securities, either the
date of the meeting in which the board of directors of the issuer or the
committee of directors duly authorised by the board of directors of the issuer
decides to open the issue of such convertible securities or the date on which
the holders of such convertible securities become entitled to apply for the
equity shares.
Conditions
for qualified institutions placement.
82. A listed issuer may make
qualified institutions placement if it satisfies the following conditions:
(a)
a special resolution approving the qualified institutions placement has
been passed by its shareholders;
(b)
the equity shares of the same class, which are proposed to be allotted
through qualified institutions placement or pursuant to conversion or exchange
of eligible securities offered through qualified institutions placement, have
been listed on a recognised stock exchange having nation wide trading terminal
for a period of at least one year prior to the date of issuance of notice to
its shareholders for convening the meeting to pass the special resolution:
�Provided
that where an issuer, being a transferee company in a scheme of merger,
de-merger, amalgamation or arrangement sanctioned by a High Court under
sections 391 to 394 of the Companies Act, 1956, makes qualified institutions
placement, the period for which the equity shares of the same class of the
transferor company were listed on a stock exchange having nation wide trading
terminals shall also be considered for the purpose of computation of the period
of one year.
(c)
it is in compliance with the requirement of minimum public
shareholding� specified in� the listing agreement with the stock
exchange;
(d)
In the special resolution, it shall be, among other relevant matters,
specified that the allotment is proposed to be made through qualified
institutions placement and the relevant date referred to in sub-clause (ii) of
clause (c) of regulation 81 shall also be specified.
Explanation: For the purpose of clause (b),
�equity shares of the same class� shall have the same meaning as assigned to
them in Explanation to sub-rule (4) of rule 19 of the Securities Contracts
(Regulation) Rules, 1957.
Appointment of merchant banker.
83. (1) A qualified institutions placement
shall be managed by merchant banker(s) registered with the Board who shall
exercise due diligence.
(2) The merchant banker shall, while seeking in-principle
approval for listing of the eligible securities issued under qualified
institutions placement, furnish to each stock exchange on which the same class
of equity shares of the issuer are listed, a due diligence certificate stating
that the eligible securities are being issued under qualified institutions
placement and that the issuer complies with requirements of this Chapter.
Placement
Document:
84. (1) The
qualified institutions placement shall be made on the basis of a placement
document which shall contain all material information, including those
specified in Schedule XVIII.
(2) The placement document shall be
serially numbered and copies shall be circulated only to select investors.
(3) The issuer shall, while seeking
in-principle approval from the recognised stock exchange, furnish a copy of the
placement document, a certificate
confirming compliance with the provisions of this Chapter along with any other
documents required by the stock exchange.
(4) The placement document shall
also be placed on the website of the concerned stock exchange and of the issuer
with a disclaimer to the effect that it is in connection with a qualified
institutions placement and that no offer is being made to the public or to any
other category of investors.
(5) A copy of the placement document
shall be filed with the Board for its record within thirty days of the
allotment of eligible securities.
Pricing.
85. (1) The
qualified institutions placement shall be made at a price not less than the
average of the weekly high and low of the closing prices of the equity shares
of the same class quoted on the stock exchange during the two weeks preceding
the relevant date.
(2) Where eligible securities are
convertible into or exchangeable with equity shares of the issuer, the issuer
shall determine the price of such equity shares allotted pursuant to such
conversion or exchange taking the relevant date as decided and disclosed by it
while passing the special resolution.
(3)
The issuer shall not allot partly paid up eligible securities:
�Provided
that in case of allotment of non convertible debt instruments along with
warrants, the allottees may pay the full consideration or part thereof payable
with respect to warrants, at the time of allotment of such warrants:
�Provided
further that on allotment of equity shares on exercise of options attached to
warrants, such equity shares shall be fully paid up.
(4)
The prices determined for qualified institutions placement shall be
subject to appropriate adjustments if the issuer:
(a)
makes an issue of equity shares by way of capitalization of profits or
reserves, other than by way of a dividend on shares;
(b)
makes a rights issue of equity shares;
(c)
consolidates its outstanding equity shares into a smaller number of
shares;
(d)
divides its outstanding equity shares including by way of stock split;
(e)
re-classifies any of its equity shares into other securities of the
issuer;
(f)
is involved in such other similar events or circumstances, which in the
opinion of the concerned stock exchange, requires adjustments.
Explanation: For the purpose of
sub-regulation (1), the term �stock exchange� means any of the recognised stock
exchanges in which the equity shares of the same class of the issuer are listed
and in which the highest trading volume in such equity shares has been recorded
during the two weeks immediately preceding the relevant date.
Restrictions on allotment.
86. (1) Allotment under the qualified
institutions placement shall be made subject to the following conditions:
(a)
Minimum of ten per cent. of eligible securities shall be allotted to
mutual funds:
�Provided
that if the mutual funds do not subscribe to�
said minimum percentage or any part thereof, such minimum portion or
part thereof may be allotted to other qualified institutional buyers;
(b)
No allotment shall be made, either directly or indirectly, to any
qualified institutional buyer who is a promoter or any person related to
promoters of the issuer:
�Provided that a qualified
institutional buyer who does not hold any shares in the issuer and who has
acquired the said rights in the capacity of a lender shall not be deemed to be
a person related to promoters.
(2) In a qualified institutions placement of
non-convertible debt instrument along with warrants, an investor can subscribe
to the combined offering of non- convertible debt instruments with warrants or
to the individual securities, that is, either non- convertible debt instruments
or warrants.
(3)
The applicants in qualified institutions
placement shall not withdraw their bids after the closure of the issue.
Explanation: For the purpose of clause (b)
of sub-regulation (1), a qualified institutional buyer who has any of the
following rights shall be deemed to be a person related to the promoters of the
issuer:
(a)
�rights under a shareholders�
agreement or voting agreement entered into with promoters or persons related to
the promoters;
(b)
veto rights; or
(c)
right to appoint any nominee director on the board of the issuer.
Minimum number of
allottees.
87. (1) The
minimum number of allottees for each placement of eligible securities made
under qualified institutions placement shall not be less than:
(a)
two, where the issue size is less than or equal to� two hundred and fifty crore rupees;
(b)
five, where the issue size is greater than two hundred and fifty crore
rupees:
�Provided
that no single allottee shall be allotted more than fifty per cent. of the
issue size.
(2) The qualified institutional
buyers belonging to the same group or who are under same control shall be
deemed to be a single allottee.
Explanation: For the purpose of
sub-regulation (2), the expression �qualified institutional buyers belonging to
the same group� shall have the same meaning as derived from sub-section (11) of
section 372 of the Companies Act, 1956;
Validity of the
special resolution.
88. (1) Allotment pursuant to the
special resolution referred to in clause (a) of regulation 82 shall be
completed within a period of twelve months from the date of passing of the
resolution.
(2) The issuer shall not make
subsequent qualified institutions placement until expiry of six months from the
date of the prior qualified institutions placement made pursuant to one or more
special resolutions.
Restrictions on amount
raised.�
89. The aggregate of the proposed
qualified institutions placement and all previous qualified institutions
placements made by the issuer in the same financial year shall not exceed five
times the net worth of the issuer as per the audited balance sheet of the
previous financial year.
Tenure.
90. The tenure of the convertible or exchangeable eligible
securities issued through qualified institutions placement shall not exceed
sixty months from the date of allotment.
Transferability of
eligible securities.
91. The eligible securities allotted under qualified
institutions placement shall not be sold by the allottee for a period of one
year from the date of allotment, except on a recognised stock exchange.
BONUS ISSUE
Conditions for bonus issue.
92. Subject
to the provisions of the Companies Act, 1956 or any other applicable law for
the time being in force, a listed issuer may issue bonus shares to its members
if:
(a)
it is authorised
by its articles of association for issue of bonus shares, capitalisation of
reserves, etc.:
�Provided that if there is no such provision in
the articles of association, the issuer shall pass a resolution at its general
body meeting making provisions in the articles of associations for
capitalisation of reserve;
(b)
it has not
defaulted in payment of interest or principal in respect of fixed deposits or
debt securities� issued by it;
(c)
it has sufficient
reason to believe that it has not defaulted in respect of the payment of
statutory dues of the employees such as contribution to provident fund,
gratuity and bonus;
(d)
the partly paid
shares, if any outstanding on the date of allotment, are made fully paid up
Restriction on bonus issue.
93. (1) No issuer
shall make a bonus issue of equity shares if it has outstanding fully or
partly convertible debt instruments at the time of making the bonus issue, unless it has made reservation of equity shares
of the same class in favour of the holders of such outstanding
convertible debt instruments in proportion to the convertible part thereof.
(2) The equity shares reserved for the holders of fully or
partly convertible debt instruments shall be issued at the time of conversion
of such convertible debt instruments on the same terms or same proportion on
which the bonus shares were issued.
Bonus shares only against reserves, etc. if
capitalised in cash.
94. (1) The bonus issue shall be made out of
free reserves built out of the genuine profits or securities premium collected
in cash only and reserves created by revaluation of fixed assets shall not be
capitalised for the purpose of issuing bonus shares.
(2) Without prejudice to the provisions of sub-regulation
(1), the bonus share shall not be issued in lieu of dividend.
Completion of bonus issue.
95. (1) An
issuer, announcing a bonus issue after the approval of its board of directors
and not requiring shareholders� approval for capitalisation of profits or
reserves for making the bonus issue, shall implement the bonus issue within
fifteen days from the date of approval of the issue by its board of directors:
�Provided that where the issuer is required to
seek shareholders� approval for capitalisation of profits or reserves for
making the bonus issue, the bonus issue shall be implemented within two
months from the date of the meeting of its board of directors wherein the
decision to announce the bonus issue was taken subject to shareholders�
approval.
(2) Once the decision to make a bonus issue is announced,
the issue can not be withdrawn.
ISSUE OF INDIAN
DEPOSITORY RECEIPTS
Applicability.
96. (1) The
provisions of this Chapter shall apply to an issue of Indian Depository
Receipts (hereinafter referred to as �IDR�) made in terms of section 605A of
the Companies Act, 1956 and Companies (Issue of Indian Depository Receipts) Rules, 2004.
(2) All provisions of these
regulations shall be applicable in case of issue of IDR, except the
disclosure requirements with respect to public issue and rights issue of
specified securities as provided in these regulations and the following:
(a)
clauses (a), (b),
(c) and (f) of sub-regulation (2) of regulation 4;
(b)
sub-regulations
(1), (2) and (3) of regulation 6,
(c)
clauses (c),(d)
and (e)� of sub-regulation (1) of
regulation 8;
(d)
sub-regulations
(2) and (3) of regulation 8;
(e)
regulations
10,16,17,19, 20,21,22,23,24,26,27,31,41, 42,[11][***]
45,47, 49 and 68;
(f)
sub-regulation
(2) of regulation 11;
(g)
�sub-regulation (2) of regulation 28;
(h)
clauses (b) and
(c) of regulation 29;
(i)
Parts III and IV
of Chapter III;
� [12][(ia) ��
regulation 43, except sub-regulation (3) thereof;]
(j)
Chapter IV;
(k)
sub-regulation
(3) of regulation 65;
(l)
Chapters VII,
VIII and IX.
(3) Further, the applicability of regulation 60 shall be
as follows:
(a)
the applicability
of sub-regulations (1) and (7) and Explanation II shall be restricted to any
issue advertisements made in India or any research report circulated in India,
pertaining to the IDR issue of the issuing company;
(b)
�the applicability of sub-regulations (2) and
(3) shall be restricted to any public communications and publicity material
issued or published in any media in India;
(c)
�the applicability of sub-regulations (5) and
(6) shall be restricted to any material or information released in India and
any issue advertisements and publicity materials issued or published in any
media in India;
(d)
�the applicability of sub-regulation (13) shall
be restricted to any product advertisement of an issuing company issued or
published in any media in India;
(e)
all other
provisions of regulation 60 shall be applicable.
Eligibility.
97.� An issuing company making an issue of IDR shall also satisfy the following:
(a)
the issuing company is listed in its home country;
(b)
the issuing company is not prohibited to issue securities
by any regulatory body;
(c)
the issuing company has track record of compliance with
securities market regulations in its
home country.
Explanation: For
the purpose of this regulation, the term �home country� means the country where
the issuing company is incorporated and listed.
Conditions for issue of IDR.
98. An issue
of IDR shall be subject to the following conditions:
(a)
issue size shall
not be less than fifty crore rupees;
(b)
procedure to be
followed by each class of applicant for applying shall be mentioned in the
prospectus;
(c)
minimum
application amount shall be twenty thousand rupees;
(d)
at least fifty
per cent. of the IDR issued shall be allotted to qualified institutional buyers
on proportionate basis as per illustration given in Part C of Schedule XI;
(e)
the balance fifty
per cent. may be allocated among the categories of non-institutional investors
and retail individual investors including employees at the discretion of the
issuer and the manner of allocation shall be disclosed in the prospectus.
Allotment to investors within a category shall be on proportionate basis:
[13][Provided that atleast thirty per cent. of the said
fifty per cent. IDR issued shall be allocated to retail individual investors
and in case of under-subscription in retail individual investor category, spill
over to the extent of under-subscription shall be permitted to other
categories.]
(f)
At any given
time, there shall be only one denomination of IDR of the issuing company.
Minimum subscription.
99. (1) For
non-underwritten issues:
(a)
If the issuing
company does not receive the minimum subscription of ninety per cent. of the
offer through offer document on the date of closure of the issue, or if the
subscription level falls below ninety per cent. after the closure of issue on
account of cheques having being returned unpaid or withdrawal of applications,
the issuing company shall forthwith refund the entire subscription amount
received.
(b)
If the issuing
company fails to refund the entire subscription amount within fifteen days from
the date of the closure of the issue, it is liable to pay the amount with
interest to the subscribers at the rate of fifteen per cent. per annum for the
period of delay.
(2) For underwritten issues: If the issuing company does
not receive the minimum subscription of ninety per cent. of the offer through
offer document including devolvement of underwriters within sixty days from the
date of closure of the issue, the issuing company shall forthwith refund the
entire subscription amount received with interest to the subscribers at the
rate of fifteen per cent. per annum for the period of delay beyond sixty days.
Fungibility.
100. The
Indian depository Receipts shall not be automatically fungible into underlying
equity shares of issuing company.
Filing
of draft prospectus, due diligence certificates, payment of fees and issue
advertisement for IDR.
101. (1) The issuing company making an issue of IDR shall
enter into an agreement with a merchant banker on the lines of format of agreement
specified in Schedule II.
(2) Where the issue is managed by more than one merchant
banker, the rights, obligations and responsibilities, relating inter-alia to
disclosures, allotment, refund and underwriting obligations, if any, of each
merchant banker shall be predetermined and disclosed in the prospectus on the
lines of format as specified in Schedule
I.
(3) The issuing company shall file a draft prospectus with
the Board through a merchant banker along with the requisite fee, as prescribed
in Companies (Issue of Indian Depository Receipts) Rules, 2004.
(4) The prospectus filed with the Board under this
regulation shall also be furnished to the Board in a soft copy on the lines
specified in Schedule V.
(5) The lead merchant bankers shall:
(a)
submit a due
diligence certificate as per format given in Part C of Schedule XIX to the Board along with the draft
prospectus.
(b)
certify that all
amendments, suggestions or observations made by the Board have been
incorporated in the prospectus
(c)
submit a fresh
due diligence certificate as per format given in Part C of Schedule XIX, at the time of filing the prospectus with
the Registrar of the Companies.
(d)
furnish a
certificate as per format given in Part
C of Schedule XIX, immediately before the opening of the issue, certifying
that no corrective action is required on its part.
(e)
furnish a
certificate as per format given in Part
C of Schedule XIX, after the issue has opened but before it closes for
subscription.
(6) The issuing company shall make arrangements for
mandatory collection centres as specified in Schedule III.
(7) The issuing company shall issue an advertisement in
one English national daily newspaper with wide circulation and one Hindi
national daily newspaper with wide circulation, soon after receiving final
observations, if any, on the publicly filed draft prospectus with the Board,
which shall be on the lines of the format and contain the minimum disclosures
as given in Part A of Schedule XIII.
Display
of bid data.
102. The
stock exchanges offering online bidding system for the book building process
shall display on their website, the data pertaining to book built IDR issue, in
the format specified in Part B(II) of
Schedule XI, from the date of opening of the bids till at least three days
after closure of bids.
Disclosures
in prospectus and abridged prospectus.
103. (1) The prospectus shall contain all
material disclosures which are true, correct and adequate so as to enable the
applicants to take an informed investment decision.
(2) Without prejudice to the generality of sub-regulation (1),
the prospectus shall contain:�
(a)
the disclosures
specified in Schedule to Companies (Issue of Indian Depository Receipts) Rules, 2004; and
(b)
the disclosures
in the manner as specified in Part A of
Schedule XIX.
(3) The abridged prospectus for issue of Indian Depository
Receipts shall contain the disclosures as specified in Part B of Schedule XIX.
Post-issue reports.
104. (1) The merchant banker
shall submit post-issue reports to the Board in accordance with sub-regulation
(2).
(2) The post-issue reports shall be submitted as
follows:�
(a)
initial post
issue report on the lines of Parts A and B of Schedule XVI, within three days of closure of the issue;
(b)
final post issue
report on the lines of Parts C and D of Schedule
XVI, within fifteen days of the date of finalisation of basis of
allotment or within fifteen days of refund of money in case of failure of
issue.
Undersubscribed
issue.
105.
In case of undersubscribed issue of
IDR, the merchant banker shall furnish information in respect of underwriters
who have failed to meet their underwriting devolvement to the Board on the
lines of the format specified in Schedule XVII.
Finalisation
of basis of allotment.
106. The executive director or managing director of the
stock exchange, where the IDR are proposed to be listed, along with the post
issue lead merchant bankers and registrars to the issue shall ensure that the
basis of allotment is finalised in a fair and proper manner in accordance with
the allotment procedure as specified in Schedule XV.
MISCELLANEOUS
Directions by the Board.
107. Without prejudice to the power under sections 11, 11A,
11B, 11D, sub-section (3) of section 12, Chapter VIA and section 24 of the Act
or section 621 of the Companies Act, 1956, the Board may either suo motu or on receipt of information or
on completion or pendency of any inspection, inquiry or investigation, in the
interests of investors or the securities market, issue such directions or
orders as it deems fit including any or all of the following:
(a)
directing the
persons concerned not to access the securities market for a specified period;
(b)
directing the
person concerned to sell or divest the securities;
(c)
any other
direction which Board may deem fit and proper in the circumstances of the case:
�Provided that the Board shall, either before
or after issuing such direction or order, give a reasonable opportunity of
being heard to the person concerned:
�Provided further that if any interim direction
or order is required to be issued, the Board may give post-decisional hearing
to the person concerned.
Power to
remove difficulty.
108. In order to remove any difficulties in the application
or interpretation of these regulations, the Board may issue clarifications
through guidance notes or circulars after recording reasons in writing.
Power to
relax strict enforcement of the regulations.
109. The Board may, in the interest of investors or for the
development of the securities market, relax the strict enforcement of any
requirement of these regulations, if the Board is satisfied that:
(a)
the requirement
is procedural in nature; or
(b)
any disclosure
requirement is not relevant for a particular class of industry or issuer; or
(c)
the
non-compliance was caused due to factors beyond the control of the issuer.
�
Amendments to other regulations.
110. On and from the commencement of these regulations, the
regulations mentioned in Schedule XX shall stand amended to the extent
specified therein.
Repeal and
Savings.
111. (1) On and from the commencement
of these regulations, the Securities and Exchange Board of India (Disclosure
and Investor Protection) Guidelines, 2000 shall stand rescinded.
(2) Notwithstanding such rescission:
(a) anything done or any action
taken or purported to have been done or taken including observation made in
respect of any draft offer document, any enquiry or investigation commenced or
show cause notice issued in respect of the said Guidelines shall be deemed to
have been done or taken under the corresponding provisions of these regulations;
(b) any offer document, whether
draft or otherwise, filed or application made to the Board under the said
Guidelines and pending before it shall be deemed to have been filed or made
under the corresponding provisions of these
regulations.
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE
I
[See regulation 5(3) and 101(2)]
INTER-SE ALLOCATION OF RESPONSIBILITIES
(1)
The lead merchant
bankers shall make inter-se allocation of responsibilities pertaining to the
activities or sub-activities to be carried out under these regulations.
(2)
The lead merchant
bankers shall delineate the activity-wise allocation of responsibilities and
intimate the Board about the name of the lead merchant banker responsible for
each set of the activities or sub-activities at the time of filing the draft
offer document with the Board. This intimation must be signed by all the lead
merchant bankers to the issue.
(3)
Where
circumstances warrant joint and several responsibility of the lead merchant
bankers for any particular activity, a co-ordinator designated from among the
lead merchant bankers (hereinafter referred to as the �designated lead merchant
banker�) shall furnish to the Board, when called for, information, report,
comments, etc. on matters relating to such activity.
(4)
The activities or
sub-activities may be grouped on the following lines:
(a)
Capital
structuring with the relative components and formalities such as composition of
debt and equity, type of instruments, etc.
(b)
Drafting and
design of the offer document and of the advertisement or publicity material
including newspaper advertisement and brochure or memorandum containing salient
features of the offer document.
(c)
Selection of
various agencies connected with issue, such as registrars to the issue,
printers, advertising agencies, etc.
(d)
Marketing of the
issue, which shall cover, inter alia,
formulating marketing strategies, preparation of publicity budget, arrangements
for selection of (i) ad-media, (ii) centres for holding conferences of stock
brokers, investors, etc., (iii) bankers to the issue, (iv) collection centres
as per schedule III, (v) brokers to the issue, and (vi) underwriters and
underwriting arrangement, distribution of publicity and issue material
including application form, prospectus and brochure and deciding upon the
quantum of issue material.
(e)
Post-issue
activities, which shall involve essential follow-up steps including follow-up
with bankers to the issue and Self Certified Syndicate Banks to get quick
estimates of collection and advising the issuer about the closure of the issue,
based on correct figures, finalisation of the basis of allotment or weeding out
of multiple applications, listing of instruments, despatch of certificates or
demat credit and refunds and co-ordination with various agencies connected with
the post-issue activity such as registrars to the issue, bankers to the issue,
Self Certified Syndicate Banks, etc. Ordinarily, one lead merchant banker shall
be responsible for the post-issue activities.
(5)
The designated
lead merchant banker shall be responsible for ensuring compliance with these
regulations and other requirements and formalities specified by the Registrar
of Companies, the Board and the recognised stock exchanges where specified
securities being offered are proposed to be listed.
(6)
Even if many of
the post-issue activities are handled by other intermediaries, the designated
lead merchant banker shall be responsible for ensuring that these
intermediaries fulfil their functions and enable him to discharge this
responsibility through suitable agreements with the issuer.
(7)
In case of
under-subscription in an issue, the lead merchant banker responsible for
underwriting arrangements shall be responsible for invoking underwriting
obligations and ensuring that the notice for devolvement containing the obligations
of the underwriters is issued in terms of these regulations.
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE II
[See
regulations 5(5) and 101(1)]
FORMAT OF
AGREEMENT BETWEEN LEAD MERCHANT BANKERS TO THE ISSUE AND ISSUER/ISSUING COMPANY
This
Agreement made BETWEEN....... (name of the issuer), having its registered
office at ......... (registered office address of the issuer) (hereinafter
referred to as "the issuer") AND ............. (name of the lead
merchant bankers), having their registered office at...................... with
the branch office at ��.
WHEREAS:
(1)
The issuer is
taking steps for the issue of ...................... (particulars of the issue)
to the public/ existing shareholders of the issuer (the said issue of specified
securities hereinafter referred to as "the issue"); AND
(2)
The issuer has
approached the lead merchant bankers to manage the issue and the lead merchant
bankers have accepted the engagement inter-alia,
subject to the issuer entering into an agreement for the purpose being these
presents;
NOW,
THEREFORE, the issuer and the lead merchant bankers do hereby agree as follows:
(1)
Besides the lead
merchant bankers, ..........,�
............, and ................. would be acting as the co-managers
to the issue.
(2)
The issuer hereby
declares that it has complied with or agrees to comply with all the statutory
formalities under the Companies Act, 1956, the Securities and Exchange Board of
India (Issue of Capital and Disclosure Requirements) Regulations, 2009 and
other conditions, instructions and�
advices issued by Securities and Exchange Board of India (hereinafter
referred to as "the Board") and other relevant statutes to enable it
to make the issue and in particular in respect of the following matters:
(Give details
and particulars of statutory compliances which the issuer has to fulfil before
making the issue)
Consent of the shareholders has been obtained vide
........... (details of the resolution) passed in the general meeting held on
.............. (date of the meeting).
(3)
The issuer
undertakes and declares that any information made available to the lead
merchant banker or any statement made in the offer document shall be complete
in all respects and shall be true and correct and that under no circumstances
it shall give or withhold any information or statement which is likely to
mislead the investors.
(4)
The issuer also
undertakes to furnish complete audited annual reports, other relevant
documents, papers, information relating to pending litigations, etc. to enable
the lead merchant banker to corroborate the information and statements given in
the offer document.
(5)
The issuer shall,
if so required, extend such facilities as may be called for by the lead
merchant banker to enable them to visit the plant site, office of the issuer or
such other places to ascertain for themselves the state of affairs of the
issuer including the progress made in respect of the project implementation,
status and other facts relevant to the issue.
(6)
The issuer shall
extend all necessary facilities to the lead merchant banker to interact on any
matter relevant to the issue with the solicitors / legal advisors, auditors,
consultants, advisors to the issue, financial institutions, banks or any other
organisation and any other intermediary associated with the issue in any
capacity whatsoever.
(7)
The issuer shall
ensure that all advertisements prepared and released by the advertising agency
or otherwise in connection with the issue conform to the Securities and
Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009 and the instructions given by the lead merchant banker from
time to time and that it shall not make any misleading or incorrect statement
in any public communication or
publicity material including corporate, product and issue advertisements of the
issuer, interviews by its promoters, directors, duly authorized employees or
representatives of the issuer, documentaries about the issuer or its promoters,
periodical reports and press releases issued
by the issuer or research report made
by the issuer, any intermediary concerned with the issue or their
associates or at any press, brokers� or investors� conferences.
(8)
The issuer shall
not, without the prior consent of the lead merchant banker, appoint other
intermediaries (except Self Certified Syndicate Banks) or other persons
associated with the issue such as advertising agencies, printers, etc. for
printing the application forms, allotment advices, allotment letters, share
certificates / debenture certificates, refund orders or any other instruments,
circulars, or advices.
(9)
The issuer shall,
whenever required and wherever applicable, in consultation with the lead
merchant banker, enter into an agreement with the intermediaries associated
with the issue, clearly setting forth their mutual rights, responsibilities and
obligations. A certified true copy of such agreements shall be furnished to the
lead merchant banker.
(10) The issuer shall take such steps as are necessary to
ensure completion of allotment and despatch of letters of allotment and refund
orders to the applicants including non�resident Indians soon after the basis of
allotment is approved by designated stock exchanges but not later than the
specified time limit and in the event of failure to do so, pay interest to the
applicants as provided under the Companies Act, 1956 as disclosed in the offer
document.
(11) The issuer shall take steps to pay the underwriting
commission and brokerage to the underwriters, stock brokers, etc. within the
time specified in any agreement with such underwriters, stock brokers, etc. or
within a reasonable time.
(12) The issuer undertakes to furnish such information and
particulars regarding the issue as may be required by the lead merchant banker
to enable them to file a report with the Board in respect of the issue.
(13) The issuer shall keep the lead merchant banker
informed if it encounters any problems due to dislocation of communication
system or any other material adverse circumstance which is likely to prevent or
which has prevented the issuer from complying with its obligations, whether
statutory or contractual, in respect of the matters pertaining to allotment,
dispatch of refund orders, share certificates or debenture certificates, demat
credit, etc.
(14) The issuer shall not resort to any legal proceedings
in respect of any matter having a bearing on the issue except in consultation
with and after receipt of advice from the lead merchant banker.
(15) The issuer shall not access the moneys raised in the
issue till finalisation of the basis of allotment or completion of issue
formalities.
(16) The issuer shall refund the moneys raised in the issue
to the applicants, if required to do so for any reason such as failing to get
listing permission or under any direction or order of the Board. The issuer
shall pay requisite interest amount if so required under the laws or direction
or order of the Board.
(17) (Rights of lead merchant banker vis-�-vis the issuer
)------------- (give details).
(18) (Consequences of breach) --------- (give details).
In Witness whereof the parties hereto have put their
hands on this ----------- (date)� day of
��(month) of ���� (year).
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE III
[See
regulation 5(6) and 101(7)]
MANDATORY COLLECTION CENTRES
(1)
The minimum
number of collection centres shall be as follows:
(a)
The four
metropolitan centres situated at Mumbai, Delhi, Kolkata and Chennai.
(b)
All such places
where the recognised stock exchanges are located in the region in which the
registered office of the issuer is situated;
(c)
The region-wise
collection centres are as indicated hereunder:
|
Sr. No. |
Name of the Recognised Stock Exchange |
City |
|
(A)
|
NORTHERN REGION |
|
|
(i)
|
Ludhiana Stock
Exchange Ltd. |
Ludhiana |
|
(ii)
|
Delhi Stock
Exchange Ltd. |
Delhi |
|
(iii)
|
Jaipur Stock
Exchange Ltd. |
Jaipur |
|
(iv)
|
U.P. Stock
Exchange Ltd. |
Kanpur |
|
(B)
|
SOUTHERN REGION |
|
|
(i)
|
Bangalore Stock
Exchange Ltd. |
Bangalore |
|
(ii)
|
Cochin Stock
Exchange Ltd. |
Cochin |
|
(iii)
|
Madras Stock
Exchange Ltd. |
Madras |
|
(C)
|
EASTERN REGION |
|
|
(i)
|
Calcutta Stock
Exchange Association Ltd. |
Kolkata |
|
(ii)
|
Gauhati Stock
Exchange Ltd. |
Gauhati |
|
(iii)
|
Bhubaneswar
Stock Exchange Ltd. |
Bhubaneswar |
|
(D)
|
WESTERN REGION |
|
|
(i)
|
Bombay Stock
Exchange Ltd. |
Mumbai |
|
(ii)
|
National Stock
Exchange of India Ltd. |
Mumbai |
|
(iii)
|
OTC Exchange of
India Ltd. |
Mumbai |
|
(iv)
|
Pune Stock
Exchange Ltd. |
Pune |
|
(v)
|
M P� Stock Exchange Ltd. |
Indore |
|
(vi)
|
Vadodara Stock
Exchange Ltd. |
Vadodara |
|
(vii)
|
Ahmedabad Stock
Exchange Ltd. |
Ahmedabad |
(2)
In addition to
the collection centres specified in para (1), all designated branches of Self
Certified Syndicate Banks, as displayed on the websites of such banks and of
the Board, shall be deemed to be mandatory collection centres
(3)
The issuer may
appoint any other collection centre/s as it may deem fit in addition to the
minimum collection centre specified in this Schedule.
SECURITIES
AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009
SCHEDULE IV
[See regulations 6(1), 10(2) and
11(4)]
FEES TO BE PAID ALONG WITH OFFER
DOCUMENT
(1)
There shall be charged in respect of every draft offer document, every
offer document (in case of a fast track issue)�
and in case of updation of any draft offer document, fees at the rate as
specified in Part A and Part B of this Schedule.
(2)
The
fees shall be paid by means of a
demand draft drawn in favour of �the Securities and Exchange Board of India�
payable at the place where the draft offer document or offer document or
updated draft offer document, as the case may be, is filed with the Board.
PART A
FEES TO BE PAID ALONG WITH DRAFT OFFER DOCUMENT OR IN CASE OF A FAST TRACK ISSUE,
ALONG
WITH OFFER
DOCUMENT
(1)
There shall be charged in respect of every draft offer document or in
case of a fast track issue, every offer document filed by a lead merchant
banker with the Board in terms of these regulations, a fee at the following
rate:
(a)
In case of a public issue:
|
Size of
the issue, including intended retention of oversubscription |
Amount
/ Rate of fees |
|
Less than or equal to
ten crore rupees. |
A flat charge of twenty
five thousand rupees (Rs.25,000/-). |
|
More than ten crore rupees, but less than or equal to five thousand crore rupees. |
0.025 per cent. of the issue size. |
|
More than five thousand
crore rupees, but less than or equal to twenty five
thousand crore rupees. |
One crore
twenty five lakh rupees (Rs.1,25,00,000/-)
plus 0.00625 per cent of the portion of the issue size in excess of five
thousand crore rupees (Rs.5000,00,00,000/-). |
|
More than twenty five
thousand crore rupees. |
A flat charge of three crore rupees (Rs.3,00,00,000/-). |
(b)
In case of a rights issue:
|
Size of
the issue, including intended retention of oversubscription |
Amount / Rate of fees |
|
Less than or equal to
ten crore rupees. |
A flat charge of twenty
five thousand rupees (Rs.25,000/-). |
|
More than ten crores rupees and less than or equal to five hundred crore rupees. |
0.005 per cent. of the issue size. |
|
More than five hundred crore rupees. |
A flat charge of five lakh rupees (Rs.5,00,000/-). |
(2)
Where the issue
size is not determined at the time of submission of the draft offer document or
the offer document (in case of a fast track issue), the issuer shall pay fees
mentioned at para (1), based on the estimated issue size.
(3)
If the issue size
estimated by the issuer differs from eventual issue size and thereby:�
(a)
the fees paid by
the issuer is found to be deficient, the balance fee shall be paid by the
issuer within seven days of registering the prospectus with the Registrar of
Companies or filing the letter of offer with the recognised stock exchanges, as
the case may be; and
(b)
if any excess fee
is found to have been paid, it shall be refunded by the Board to the issuer.
FEES TO BE PAID ALONG WITH UPDATED OFFER DOCUMENT
Where updations or changes are made in any of the
sections specified in para 3 of Schedule VII of these regulations, there shall be charged a fee of ten thousand rupees (Rs.10,000/-) for updations or changes per
section, subject to total fee not exceeding one fourth (1/4th) of
the filing fees paid at the time of filing the draft document with the Board
or rupees fifty thousand, whichever is higher.
�
SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE V
[See regulations 6(6) and
101(4)]
MANNER OF SUBMISSION OF SOFT COPY OF DRAFT OFFER
DOCUMENT AND OFFER DOCUMENT TO THE BOARD
(1)
The soft copies of draft and final offer document shall be submitted in
PDF format in a compact disk placed in a sealed envelope.
(2)
One compact disk shall contain the draft or final offer document of
only one issue and in single file.
(3)
While submitting the compact disk, the lead merchant banker shall, inter alia, certify to the Board that
the information contained in the compact disk contains all text and data in a
systematic order, matches exactly with the contents of the hard copy of the
offer document and satisfies the requirements of this Schedule.
(4)
The compact disk containing the offer document shall have a sticker
duly pasted giving the following information:
(a)
The name of the merchant banker;
(b)
Name of the issuer;
(c)
Type of the issue ;
(d)
Signature of the person who has signed the due diligence certificate.
(5)
The sticker on the compact disk containing final offer document shall
mention all the information as stated in clause (4) and the following
additional information:
(a)
Date of registering red herring prospectus or the prospectus with the
Registrar of Companies or filing the letter of�
offer with the designated stock exchanges
(b)
Issue opening date.
(6)
If the requirements of this Schedule are not fulfilled, the offer
document would be liable to be rejected.
(7)
The lead merchant bankers shall, within one day of the hosting of offer
document on the website (if the next day is a holiday, on the first working
day), confirm to the Board in writing that the contents of the offer document
appearing on the website are in order.
(8)
The following information shall also be submitted with soft copies of
the offer documents:
|
Sr. No. |
Particulars |
Comments |
|
(i)
|
Soft copy
submitted by: |
|
|
(ii)
|
Content Title: |
|
|
(iii)
|
Whether the
Documents are in PDF Format? |
YES/NO |
|
(iv)
|
Whether the
tabular data in the PDF format are in order? |
YES/NO/N.A. |
|
(v)
|
Whether the Sr.
Numbers of paragraph/points are in order and matches with the printed copy? |
YES/NO/N.A. |
|
(vi)
|
Whether the
alignments of all paragraphs are in order? |
YES/NO |
|
(vii)
|
Whether all
relevant image files, if any are available in the compact disk? |
YES/NO/N.A. |
|
(viii)
|
Whether the
contents of the PDF format and hard copy of the offer document have been
compared and found to be in order? |
YES/NO |
|
(ix)
|
Whether the
spacing between lines and paragraphs is uniform? |
YES/NO |
|
(x)
|
Remarks, if any��������������������������������������������������� |
|
Prepared by: ������������������������������������� ����������������������������������Verified by:
Date:����������������������������������������������������������������������������������������������
SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE VI
FORMATS OF DUE DILIGENCE
CERTIFICATES
FORM A
[See regulations 8(1)(c) and
10(3)(a)]
FORMAT OF DUE DILIGENCE CERTIFICATE TO BE GIVEN BY MERCHANT BANKER
ALONG WITH DRAFT OFFER DOCUMENT
To,
Securities and Exchange Board of India
Dear Sirs,
Sub.:�
Public/Rights Issue of ������� by���������. (Name of the Issuer)
We, the lead
merchant banker(s) to the above mentioned forthcoming issue, state and confirm
as follows:
�����������
(1)
We have examined various documents including those relating to
litigation like commercial disputes, patent disputes, disputes with
collaborators, etc. and other material in connection with the finalisation of
the draft red herring prospectus (in case of a book built issue) / draft
prospectus (in case of a fixed price issue) / letter of offer (in case of a
rights issue) pertaining to the said issue;
(2)
On the basis of such examination and the discussions with the issuer,
its directors and other officers, other agencies, and independent verification
of the statements concerning the objects of the issue, price justification and
the contents of the documents and other papers furnished by the issuer, WE
CONFIRM that:
(a)
the draft red herring prospectus/ draft prospectus/ draft letter of
offer filed with� the Board is in
conformity with the documents, materials and papers relevant to the issue;
(b)
all the legal requirements relating to the issue as also the
regulations guidelines, instructions, etc. framed/issued by the Board, the
Central Government and any other competent authority in this behalf have been
duly complied with; and
(c)
the disclosures made in the draft red herring prospectus/draft
prospectus/draft letter of offer are true, fair and adequate to enable the
investors to make a well informed decision as to the investment in the proposed
issue and such disclosures are in
accordance with the requirements of the Companies Act, 1956, the Securities and
Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009 and other applicable legal requirements.
(3)
We confirm that besides ourselves, all the intermediaries named in the
draft red herring prospectus/ draft prospectus/ draft letter of offer are
registered with the Board and that till date such registration is valid.
(4)
We have satisfied ourselves about the capability of the underwriters to
fulfil their underwriting commitments.
(5)
We certify that written consent
from promoters has been obtained for inclusion of their specified securities as
part of promoters� contribution subject to lock-in and the specified securities proposed to form part of promoters�
contribution subject to lock-in shall not be disposed / sold / transferred by
the promoters during the period starting from the date of filing the draft red
herring prospectus/draft prospectus with the Board till the date of
commencement of lock-in period as stated in the draft red herring
prospectus/draft prospectus.
(6)
We certify that regulation 33 of the Securities and Exchange Board of
India (Issue of Capital and Disclosure Requirements) Regulations, 2009, which
relates to specified securities ineligible for computation of promoters
contribution, has been duly complied with and appropriate disclosures as to
compliance with the said regulation have been made in the draft red herring
prospectus/draft prospectus.
(7)
We undertake that sub-regulation (4) of regulation 32 and clause (c)
and (d) of sub-regulation (2) of regulation 8 of the Securities and Exchange
Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009
shall be complied with. We confirm that
arrangements have been made to ensure that promoters� contribution shall be
received at least one day before the opening of the issue. We undertake that
auditors� certificate to this effect shall be duly submitted to the Board. We
further confirm that arrangements have been made to ensure that promoters�
contribution shall be kept in an escrow account with a Scheduled Commercial
Bank and shall be released to the issuer along with the proceeds of the public
issue.
(8)
We certify that
the proposed activities of the issuer for which the funds are being raised in
the present issue fall within the �main objects� listed in the object clause of
the Memorandum of Association or other charter of the issuer and that the
activities which have been carried out until now are valid in terms of the
object clause of its Memorandum of Association.
(9)
We confirm that
necessary arrangements have been made to ensure that the moneys received
pursuant to the issue are kept in a separate bank account as per the provisions
of sub-section (3) of section 73 of the Companies Act, 1956 and that such moneys
shall be released by the said bank only after permission is obtained from all
the stock exchanges mentioned in the prospectus/ letter of offer. We further
confirm that the agreement entered into between the bankers to the issue and
the issuer specifically contains this condition.
(10)
We certify that a
disclosure has been made in the draft red
herring prospectus/draft prospectus/ draft letter of offer that the
investors shall be given an option to get the shares in demat or physical mode.
(11)
We certify that
all the applicable disclosures mandated in the Securities and Exchange Board of
India (Issue of Capital and Disclosure Requirements) Regulations, 2009 have
been made in addition to disclosures which, in our view, are fair and adequate
to enable the investor to make a well informed decision.
(12)
We certify that
the following disclosures have been made in the draft red herring prospectus/ draft prospectus/ draft letter of offer:
(a)
An undertaking
from the issuer that at any given time, there shall be only one denomination
for the equity shares of the issuer and
(b)
An undertaking
from the issuer that it shall comply with such disclosure and accounting norms
specified by the Board from time to time.
(13)
We undertake to
comply with the regulations pertaining to advertisement in terms of the
Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009 while making the issue.
(14)
We enclose a note explaining how the process of due diligence has been
exercised by us in view of the nature of current business background or the
issuer, situation at which the proposed business stands, the risk factors,
promoters experience ,etc.
(15)
We enclose a
checklist confirming regulation-wise compliance with the applicable provisions
of the Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009, containing details such as the regulation
number, its text, the status of compliance, page number of the draft red herring prospectus/ draft prospectus/
draft letter of offer where the regulation has been complied with and
our comments, if any.
Place:�������������������������� ���������������������������������������������������������� ���Merchant Banker(s) to the Issue
Date:�������������������������������������������������������������� ������������� ��������� with
Official Seal(s)�������������
Note: The requirements in items 5, 6 and 7 are not applicable in case of a rights issue.
���������������������������������������������������������������������������������������������������������������������������������������������
FORM B
[See regulations 8(1)(d) and
10(3)(b)]
FORMAT OF DUE DILIGENCE CERTIFICATE TO BE GIVEN BY DEBENTURE TRUSTEE ALONG WITH DRAFT OFFER DOCUMENT
To,�����������������������������������������������������������������������������������������������������������������������
Securities and Exchange Board of India
Dear
Sirs,
Sub.: Public/Rights Issue of ��������.
by ���������.. (Name of the Issuer)
We,
the debenture trustees to the above mentioned forthcoming issue, state as
follows:
(1)
We have examined the documents pertaining to
the said issue.
(2)
We have also examined the relevant documents pertaining to the security to be created.
(3)
On the basis of such examination and of the
discussions with the issuer, its directors and other officers, other agencies
and of independent verification of the various relevant documents, WE CONFIRM that:
(a)
The issuer has made adequate provisions for
and/or has taken steps to provide for adequate security/asset cover for the
secured convertible debt instruments to be issued.
(b)
The issuer has obtained the permissions /
consents necessary for creating security on the property as second charge/pari
passu charge (wherever applicable)
(c)
The issuer has made all the relevant
disclosures about the security/asset cover
(d)
The issuer has made all the relevant
disclosures about its continued obligations towards the holders of convertible
debt instruments.
(e)
All disclosures made in the draft
prospectus/letter of offer with respect to the convertible debt instruments are
true, fair and adequate to enable the investors to make a well informed
decision as to the investment in the proposed issue.
(4)
We have satisfied ourselves about the ability
of the issuer to service the debt securities.
Place:
������������������������������������������������������������������������������������ Debenture
Trustee to the Issue
Date:��������������������������������� ���������������������������������������������������������������� with
his Official Seal
Note: With respect to the issue of unsecured convertible debt instruments, the debenture trustee
shall not certify and confirm the requirements stated in item 2 and sub-item
(a), (b) and (c) of item 3 above.
FORM C
[See regulation 8(2)(b)]
FORMAT OF DUE DILIGENCE CERTIFICATE TO BE GIVEN BY
MERCHANT BANKER AT THE TIME OF REGISTERING OFFER DOCUMENT WITH THE REGISTRAR OF
COMPANIES / FILING LETTER OF OFFER WITH THE DESIGNATED STOCK
EXCHANGE
To,
Securities and Exchange Board of India
Dear Sirs,
Sub.: Public/Rights Issue of ������..
by ��������� (Name of the Issuer)
(1)
This is to
certify that the red herring prospectus (in
case of a book built issue) / prospectus (in case of a fixed price issue)
registered with the Registrar of Companies / letter of offer filed with the
designated stock exchange (in case of a rights issue) on �. (date) was
suitably updated under intimation to the Board and that the said� red herring prospectus/prospectus or letter
of offer contains all the material disclosures in respect of the issuer as on
the said date.
(2)
We confirm that
the registrations of all the intermediaries named in the red herring
prospectus/prospectus or letter of offer are valid as on date and that none of
these intermediaries have been debarred from functioning by any regulatory
authority.
(3)
We confirm that
written consent from promoters has been obtained for inclusion of their
securities as part of promoters� contribution subject to lock-in.
(4)
We further confirm that the securities proposed to form part of
promoters� contribution and subject to lock-in, have not been disposed / sold /
transferred by the promoters during the period starting from the date of filing
the draft prospectus with the Board till date.
(5)
We confirm that
agreements have been entered into with both the depositories for dematerialisation
of the securities of the issuer.
(6)
We certify that
as per the requirements of first proviso to sub-regulation (4) of regulation 32
of Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009, cash flow statement has been prepared and
disclosed in the red herring prospectus and/or prospectus.
Place:�������������������������� ���������������������������������������������������������� ���Merchant Banker(s) to the Issue
Date:�������������������������������������������������������������� ������������� ��������� with
Official Seal(s)�������������
Note:
The requirements in items 3, 4 and 6
above are not applicable in case of a rights issue.
FORM D
[See regulation 8(2)(e)]
To,
Securities and Exchange Board of India
Dear Sirs,
Sub.: Public/Rights Issue of
��������.. by ��������. (Name of the Issuer)
(1)
This is to
certify that all the material disclosures in respect of the issuer as on the
date of opening of the issue have been made through the red herring prospectus (in case of a book built issue) / prospectus (in
case of a fixed price issue) registered with the Registrar of Companies /
letter of offer filed with the designated stock exchange (in case of a rights
issue) on��� �.. (date) and
subsequent amendments/ advertisements (if applicable) dated �...... (Details of
advertisements to be enclosed), We confirm:
(a)
that the
registrations of all the intermediaries named in the red herring
prospectus/prospectus /letter of offer, are valid as on date and that none of
these intermediaries have been debarred from functioning by any regulatory
authority as on date.
(b)
that� the securities proposed to form part of
promoters� contribution and subject to lock-in, have not been� disposed / sold / transferred by the
promoters during the period starting from the date of filing the draft
prospectus with the Board till date.
(c)
that the abridged
prospectus/letter of offer contains all the disclosures as specified in the
Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009.
Place:�������������������������� ���������������������������������������������������������� ���Merchant Banker(s) to the Issue
Date:��� ���������������������������������������������������������������������������������������������� with
Official Seal(s)
Note:
The requirements in item 2(b) above
are not applicable in case of a rights issue.
FORM E
[See regulation 8(2)(f)]
To,
Securities and Exchange Board of India
Dear Sirs,
Sub.: Public/Rights Issue of ��������
by �������� (Name of the Issuer)
(1)
This is to
certify that all the material disclosures in respect of the issuer as on date
have been made through the red herring
prospectus (in case of a book built issue) / prospectus (in case of a fixed
price issue) registered with the Registrar of Companies / letter of offer filed
with the recognised stock exchange (in case of a rights issue) on ���
(date) and subsequent amendments/ advertisements (if applicable) dated ���..
(Details of advertisements to be enclosed).
(2)
We confirm that
the registrations of all the intermediaries named in the red herring
prospectus/prospectus/letter of offer, are valid as on date and that none of
these intermediaries have been debarred from functioning by any regulatory
authority as on date.
(3)
We also confirm that the specified
securities proposed to form part of
promoters� contribution and subject to lock-in, have not been disposed / sold /
transferred by the promoters during the period starting from the date of filing
the draft prospectus with the Board till date.
Place:�������������������������� ���������������������������������������������������������� ���Merchant Banker(s) to the Issue
Date:��� ���������������������������������������������������������������������������������������������� with
Official Seal(s)
Note:
The requirement in item 3 above is
not applicable in case of a rights issue.
FORM F
[See regulation 10(3)(a)]
ADDITIONAL CONFIRMATIONS/ CERTIFICATION TO BE GIVEN BY MERCHANT BANKER IN DUE DILIGENCE CERTIFICATE TO BE GIVEN
ALONG WITH OFFER DOCUMENT FOR FAST TRACK
ISSUE
(1)
We confirm that
none of the intermediaries named in the red
herring prospectus (in case of a book built issue) / prospectus (in case of a
fixed price issue) / letter of offer (in case of a rights issue) have
been debarred from functioning by any regulatory authority.
(2)
We confirm that the issuer is eligible to make fast track issue in
terms of regulation 10 of the Securities and Exchange Board of India (Issue of
Capital and Disclosure Requirements) Regulations, 2009. The fulfilment of the
eligibility criteria as specified in that regulation, by the issuer, has also
been disclosed in the red herring prospectus (in case of a book built issue) /
prospectus (in case of a fixed price issue) / letter of offer (in case of a
rights issue).�
(3)
We confirm that
all the material disclosures in respect of the issuer have been made in the red herring prospectus (in case of a book built
issue) / prospectus (in case of a fixed price issue) / letter of offer (in case
of a rights issue) and certify that any material development in the
issuer or relating to the issue up to the commencement of listing and trading
of the specified securities offered through this issue shall be informed
through public notices/ advertisements in all those newspapers in which
pre-issue advertisement and advertisement for opening or closure of the issue
have been given.
(4)
We confirm that
the abridged prospectus / abridged letter of offer contains all the disclosures
as specified in the Securities and Exchange
Board of India (Issue of Capital and Disclosure Requirements) Regulations,
2009.
(5)
We confirm that
agreements have been entered into with the depositories for dematerialisation
of the specified securities of the issuer.
(6)
We certify that
as per the requirements of first proviso to sub-regulation (4) of regulation 32
of Securities and Exchange board of India
(Issue of Capital and Disclosure Requirements) Regulations, 2009, cash
flow statement has been prepared and disclosed in the red herring prospectus
and / or prospectus.
Place:�������������������������� ���������������������������������������������������������� ���Merchant Banker(s) to the Issue
Date:��� ���������������������������������������������������������������������������������������������� with
Official Seal(s)
FORM G
[See regulation 65(3)]
To,
Securities
and Exchange Board of India
Dear Sirs,
Sub.:�� Public
issue of �������� by ��������� (Name of Issuer)
We, the under noted post issue lead
merchant bankers to the abovementioned issue state as follows:
(1)
We confirm that �
(a)
the certificates
in respect of locked-in specified securities have been stamped �not
transferable� indicating the period of non-transferability;
(b)
if the specified
securities offered for lock-in are in dematerialised form, non transferability
details have been informed to the depositories;
(c)
details of
lock-in have been provided to all the stock exchanges on which specified
securities are to be listed, before the listing of the specified securities.
(2)
We certify that
specified securities included as minimum promoters� contribution and the
specified securities in excess of minimum promoters� contribution have been
locked-in in terms of regulation 36 of Securities and Exchange Board of India
(Issue of Capital and Disclosure Requirements) Regulations, 2009.
(3)
We certify that
provisions regarding lock-in of specified securities held by persons other than
promoters have been duly complied with in accordance with regulation 37 of the
Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009.�
�����������������������
Place:�������������������������� ���������������������������������������������������������� ���Merchant Banker(s) to the Issue
Date:��� ���������������������������������������������������������������������������������������������� with
Official Seal(s)
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE
OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE VII
[See regulation 11(4)]
NATURE OF UPDATION/CHANGES IN THE OFFER DOCUMENT AND
CONSEQUENT STEPS THEREIN REQUIRING FILING OF UPDATED OFFER DOCUMENT
(1)
Changes which
require fresh filing of the draft offer document with the Board, along with
fees: If changes are made in the
offer document with respect to the following, the issuer shall file fresh draft
offer document with the Board in terms of regulation 6, along with the fees as
specified in Part A of Schedule IV:
(a)
Change in
promoter or persons in control of the issuer.
(b)
Change in more
than half of the board of directors of the issuer.
(c)
Change in main
object clause of the issuer.
(d)
Any addition or
deletion to objects of the issue resulting in a change in estimated issue size
or estimated means of finance by more than ten per cent.
(e)
Any increase or
decrease in estimated issue size by more than ten per cent
(f)
Any increase or
decrease in estimated deployment in any of the objects of the issue by more
than ten per cent.
(g)
Changes which may
result in non-compliance with the provisions of the Securities and Exchange
Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009
and the lead merchant banker intends to seek relaxation under regulation 109 of
the said regulations.
(2)
Changes which
require filing of the updated offer document with the Board, along with
fees:
(a)
If changes are
made in the offer document with respect to the following, the issuer shall file
an updated offer document with the Board, along with payment of fees as
specified in Schedule IV of these regulations:
(i)
Section 1: Risk Factors: Any material development which may result in potential
risk and may require updation in this section.
(ii)
Section 2: Capital Structure: An aggregate increase
of 5% or more in the shareholding of the promoter or promoter group or an
aggregate increase of 5% or more in the shareholding of the top ten
shareholders.
(iii)
Section 3: Issue Size: Any addition or deletion to
the objects of the issue resulting in a
change in the estimated issue size or estimated means of finance by not more
than 10%.��
(iv)
Section 4: Management: Appointment of any new director.
(v)
Section 5: Promoter Group: Any addition to the
promoter group or group companies.
(vi)
Section 6: Financial Statements: Any variation in net
profit after tax or net loss after tax and/ or extraordinary items in excess of
10% over the last updated financials submitted to SEBI.
(vii)
Section 7: Legal and other information: Any new litigation or any development about a pending litigation which
is material in view of the merchant bankers.
(b)
After filing the
updated offer document with the Board, the issuer shall proceed with the issue
after receiving a conformation to this effect from the Board.�
(3)
Changes which require filing of updated offer document
with the Board, without fees: All other changes/ updations in the offer document
which are not covered under paras (1) and (2) above shall be carried out in the
offer document and updated offer document shall be filed with the Board without
fees.
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE
VIII
[See
regulations 14(3), 37(a), 44, 45(1)(f), 57(2)(a), 57(2)(b), 58(1) and 58(2)]
DISCLOSURES IN OFFER DOCUMENT, ABRIDGED PROSPECTUS AND ABRIDGED
LETTER OF OFFER
The words "group companies", wherever they
occur, shall mean companies, firms,
ventures, etc. promoted by the promoters of the issuer, irrespective of whether
such entities are covered under section 370 (1)(B) of the Companies Act, 1956
or not.
[See
regulations 14(3), 37(a), 44, 45(1)(f), 57(2)(a)) and 57(2)(b)]
DISCLOSURES IN RED HERRING
PROSPECTUS, SHELF PROSPECTUS AND PROSPECTUS
(1)
Instructions:
(a)
Only relevant and
updated information and statistics shall be disclosed in the offer document.
Further, the source and basis of all statements or claims made shall be
disclosed. Terms such as �market leader�, �leading player�, etc. shall not be
used unless they can be substantiated by proper source of information which
shall be disclosed.
(b)
All blank spaces
in the draft offer document shall be filled up with appropriate data before
registering the offer document with the Registrar of Companies or filing the
same with the recognised stock exchanges.
(c)
Simple English
for easy understanding of the contents of the offer document may be used. The
technical terms used in explaining the business of the issuer may be clarified
using simple terms to ensure better understanding by investors.
(d)
Wherever it is
mentioned in the offer document that details are given elsewhere in the
document, the same shall be adequately cross-referenced by indicating the page
and paragraph numbers.
(e)
The offer
document should not make any forward looking statements that cannot be substantiated.�
(f)
Consistency may
be ensured in the style of disclosures. If first person is used, the same may
be used through out. Sentences that contain a combination of first and third
persons may be avoided.
(g)
The issuer shall
ensure that all material matters informed or reports circulated prior to the
issue or thereafter by the issuer or any person on its behalf or attributed or
attributable to the issuer having a material bearing in taking an informed
decision shall also be covered in the offer document, except to the extent
specifically disallowed under the regulations.
(2)
An issuer making a public issue of specified securities shall make the
following disclosures in the offer document. However, an issuer making a fast
track issue of specified securities may not make the disclosures specified in
Part B of this Schedule in the offer document. Further, an issuer making a further public offer of specified securities may not
make the disclosures
specified in Part C of this Schedule, in the offer document, if it satisfies the conditions specified in para 2 of that Part:
(I)
Cover
Pages: The cover page shall be of
adequate thickness (preferably minimum hundred gcm. quality).
(A) Front Cover Pages:
(1)
The front outside
and inside cover pages of the offer document shall be white and no patterns or
pictures shall be printed on these pages.
(2)
The front outside
cover page of the offer document shall contain only the following issue
details:
(a)
The type of offer
document (�Red Herring Prospectus� / �Shelf Prospectus� /
"Prospectus").
(b)
The name of the
issuer, date and place of its incorporation, its logo, address of its
registered office, its telephone number, fax number, contact person, website
address, e-mail address and where there has been any change in the address of
the registered office or the name of the issuer, reference to the page of the
offer document where details thereof are given.
(c)
The names of the
promoters of the issuer.
(d)
The nature,
number, price and amount of specified securities offered and issue size, as may
be applicable.
(e)
The aggregate
amount proposed to be raised through all the stages of offers of specified
securities made through the shelf prospectus.
(f)
The following
clause on �Risks in relation to the First Issue� (wherever applicable) shall be
incorporated in a box format in case of an initial public offer:
"This being the first issue of the issuer, there
has been no formal market for the securities of the issuer. The face value of the equity shares is
(-----) and the issue price / floor price / price band is �X-times� of the face
value. The issue price / floor price / price band (has been
determined and justified by the lead merchant banker and the issuer as stated
under the paragraph on �Basis for Issue Price�) should not be taken to be
indicative of the market price of the specified securities after the specified
securities are listed. No assurance can be given regarding an active or
sustained trading in the equity shares of the issuer nor regarding the price at
which the equity shares will be traded after listing."
(g)
The following
clause on �General Risk' shall be incorporated in a box format:
"Investment in equity and equity related
securities involve a degree of risk and investors should not invest any funds
in this offer unless they can afford to take the risk of losing their
investment. Investors are advised to read the risk factors carefully before
taking an investment decision in this offering. For taking an investment
decision, investors must rely on their own examination of the issuer and the
offer including the risks involved. The securities have not been recommended or
approved by the Securities and Exchange Board of India (SEBI) nor does SEBI
guarantee the accuracy or adequacy of this document. Specific attention of
investors is invited to the statement of �Risk factors� given on page number(s)
�.. under the section �General Risks�"
(h)
The following
clause on �Issuer�s Absolute Responsibility� clause shall be incorporated in a
box format:
"The issuer, having made all reasonable
inquiries, accepts responsibility for and confirms that this offer document
contains all information with regard to the issuer and the issue which is
material in the context of the issue, that the information contained in the
offer document is true and correct in all material aspects and is not
misleading in any material respect, that the opinions and intentions expressed
herein are honestly held and that there are no other facts, the omission of
which make this document as a whole or any of such information or the
expression of any such opinions or intentions misleading in any material
respect."
(i)
The names, logos
and addresses of all the lead merchant bankers with their titles who have
signed the due diligence certificate and filed the offer document with the
Board, along with their telephone numbers, fax numbers, website addresses and
e-mail addresses.
(j)
The name, logo
and address of the registrar to the issue, along with its telephone number, fax
number, website address and e-mail address.
(k)
Issue schedule:
(i)
Date of opening
of the issue.
(ii)
Date of closing
of the issue.
(iii)
Date of earliest
closing of the issue, if any.
(l)
Credit rating, if applicable.
(m)
The following details under the heading �IPO Grading� shall be
incorporated in case of an initial public offer: All the grades obtained for
the initial public offer and reference to the page number(s) on which the
details of IPO grading are given.
(n)
The name(s) of the recognised stock exchanges where the specified
securities are proposed to be listed and the details of in-principle approval
for listing obtained from these stock exchanges.
(B) Back Cover Pages: The back inside cover page and back outside cover page shall be in
white.
(II)
Table of
Contents: The table of contents shall
appear immediately after the front inside cover page.
(III) Definitions and Abbreviations:
(A) Conventional or general terms.
(B) Issue related terms.
(C) Issuer and industry related terms.
(D) Abbreviations.
(IV)
Risk Factors:
(A) The risk factors, other than
those specified in sub-paras. (f), (g) and (h) of para. (2) of sub-item (A) of
Item (I) above, shall be printed in clear readable font (preferably of minimum
point ten size).
(B) The risk factors shall be
classified as those which are specific to the project and internal to the
issuer and those which are external and beyond the control of the issuer.
(C) The
risk factors shall be determined on the basis of their materiality. In determining the materiality of risk factors, the
following shall be considered :
(1)
Some risks may
not be material individually but may be material when considered collectively.
(2)
Some risks may
have an impact which is qualitative though not quantitative.
(3)
Some risks may
not be material at present but may have a material impact in the future.
(D) The risk factors shall
appear in the offer document in the following manner: �
(1)
The risks
envisaged by the management.
(2)
The proposals, if
any, to address the risks and the manner in which the same are proposed to be
addressed.
(E)
The proposals to
address risks shall not contain any speculative statement on the positive
outcome of any litigation, etc.
(F)
The proposals to
address risks shall not be given for
any matter that is sub-judice before any Court / Tribunal.�����
(G) The risk
factors shall be disclosed in the descending order of materiality. Wherever
risks about material impact are stated, the financial and other implications of
the same shall be disclosed. If it cannot be quantified, a distinct statement
about the fact that the implications cannot be quantified shall be made.
(H) The disclosures of�
Risk factors shall include, where applicable, the following:
(1)
The criminal
charges under Indian Penal Code and violations of securities law;
(2)
All statutory
clearances and approval that are yet to be received by the issuer;
(3)
The seasonality
of the business of the issuer;�
(4)
The issue of
specified securities by the issuer within the last twelve months at a price
lower than the issue price;
(5)
The
non-identification of acquisition targets, where any object of the issue is to
finance acquisitions, along with the details of interim use of funds and the
probable date of completing the acquisitions;
(6)
If the industry
segment for which the issue is proposed by the issuer has contributed to less
than twenty five per cent. of the revenues of the issuer in the last three
fiscal years.
(7)
The dependence of
the issuer or any of its business segments, upon a single customer or a few
customers, the loss of any one or more of which would have a material adverse
effect on the issuer.�
(8)
The refusal of
listing of any securities of the issuer or any of its subsidiaries or
associates at any time by any of the recognised stock exchanges in India or
abroad.
(9)
The failure
of� the issuer or any of its subsidiary
or group companies to meet the listing requirements of any recognised stock
exchange(s) in India or abroad and the details of penalty, if any including
suspension of trading, imposed by such exchange(s).
(10) The trading of any securities of the issuer on stock
exchanges or in OTC market, if limited or sporadic.�
(11) In case of outstanding debt instruments issued to
public or to any person on private placement basis by the issuer, the default
in compliance with the material covenants such as in creation of full security
as per terms of issue, default in payment of interest, default in redemption,
non-creation of debenture redemption reserve, default in payment of penal
interest wherever applicable, non-availability or non-maintenance of asset
cover, interest cover, debt-service cover, etc.�
(12) The fact that the unsecured loans taken by the issuer,
promoter, group companies or associates can be recalled by the lenders at any
time.
(13) The default in repayment of
deposits or payment of interest thereon. The roll over of liability, if any.
(14) The potential conflict of
interest, if the promoters or directors of the issuer are involved with one or
more ventures which are in the same line of activity or business as that of the
issuer.
(15) The shortfall in performance
vis-�-vis objects stated in the previous issues of the issuer and group
companies, as disclosed under the heading "Performance vis-�-vis
Objects" in the section "Other Regulatory and Statutory
Disclosures", quantifying such shortfall or delays.
(16) The interests of the
promoters, directors or key management personnel of the issuer, other than
reimbursement of expenses incurred or normal remuneration or benefits.
(17) The portion of the issue
proceeds, if proposed to be paid to the promoters, directors or key management
personnel of the issuer or the group companies.
(18) The relationship, if any, of the entities from whom
the issuer has acquired the land or proposes to acquire land, with any of the
promoters or directors of the issuer, along with the relevant details.
(19) The lack of adequate
background and experience of the promoters of the issuer in the activities for
which the issue is proposed.
(20) The excessive dependence on
key management personnel for the project for which the issue is proposed
(21) The loss making group
companies of the issuer.
(22) Any investment in debt instruments which are unsecured
or which carry interest rate lower than the market rate.
(23) The non-provision for decline in the value of
investments.
(24) A summary of the outstanding
litigations, disputes, non-payment of statutory dues, overdues to banks or
financial institutions, defaults against banks or financial institutions,
contingent liabilities not provided for, the details of proceedings initiated for economic offences or civil
offences (including the past cases, if found guilty), any disciplinary action
taken by the Board or recognised stock exchanges, etc., pertaining to the issuer, promoter and wholetime directors of the
issuer and group companies, along with the nature of the litigation, quantum of
funds involved, with a cross reference to the page where the detailed
disclosures have been made in the offer document. If any the above mentioned litigations, etc.,
arise after the filing the draft offer document, the facts shall be
incorporated appropriately in the offer document.
(25) The delay, if any, in the schedule of the
implementation of the project for which the funds are being raised in the
public issue.
(26) The fact that the
deployment of the issue proceeds is entirely at the discretion of the issuer
and is not subject to any monitoring by any independent agency.
(27) Negative cash flow, if any.
(28) The fact that the land is not registered in the name
of the issuer.�
(29) Any lack of arrangements in place for borrowings, bank
finance or institutional finance in respect of working capital requirements.
(30) Any restrictive covenants, as regards interests of
equity shareholders, in a shareholders' agreement, promoters' agreement or any
agreement for short term (secured and unsecured) and long term borrowings.
(31) All disputed or contested tax demands and other
government claims, along with the disclosures of amount, period for which such
demands or claims are outstanding, financial implications and the status of the
case.
(32) The existence of large number of pending investor
grievances against the issuer and other listed companies under the same
management within the meaning of section 370 (1B) of the Companies Act, 1956.
(33) The risks associated with second or residual charge or
subordinated obligation created on the asset cover, in case of issue of secured
convertible debt instruments.
(34) The risk associated with orders not having been placed
for plant and machinery indicating the percentage and value terms of the plant
and machinery for which orders are yet to be placed
(V)
Prominent
Notes: This section shall contain notes which are required to be
given prominence and shall also include the following:
(A) A disclosure to the effect that �the investors may
contact any of the merchant bankers who have submitted the due diligence
certificate to the Board, for any complaint pertaining to the issue".
(B) The net worth before the issue (as per latest audited
financial� statement disclosed in the
offer document) and issue size.
(C) The cost per share to the promoters and book value per
share.
(D) The details of the group companies having business
interests or other interests in the issuer.
(E)
The details of
transaction by the issuer with group or subsidiary companies during the last
year, the nature of transactions and the cumulative value of transactions.
(F)
If there is a
change in the name of the issuer at any time during the last three years
immediately preceding the date of filing draft offer document with the Board,
the reasons for the change and whether and when the objects clause of
Memorandum of Association was amended to carry on activities as reflected by
the new name.
(G) The details of all financing arrangements whereby the
promoter group, the directors of the company which is a promoter of the issuer,
the directors of the issuer and their relatives have financed the purchase by
any other person of securities of the issuer other than in the normal course of
the business of the financing entity during the period of six months
immediately preceding the date of filing draft offer document with the Board.
(VI)
Introduction:
(A) Summary:
(1)
The summary of
the industry and business of the issuer. The summary shall not be one-sided to
disclose the highlights of the issuer or issue.
(2)
Issue details in
brief.
(3)
Summary
consolidated financial, operating and other data.
(B) General
Information:
(1)
The name and
address of the registered office and the registration number of the issuer,
along with the address of the Registrar of Companies where the issuer is
registered.
(2)
The board of
directors of the issuer.
(3)
The brief details
of the chairman, managing director, whole time directors, etc. of the issuer.
(4)
The names,
addresses, telephone numbers, fax numbers and e-mail addresses of the Company
Secretary, legal advisor and bankers to the issuer.
(5)
The name,
address, telephone number, fax number and e-mail address of the compliance
officer.
(6)
The names,
addresses, telephone numbers, fax numbers, contact person, website addresses
and e-mail addresses of the merchant bankers, co-managers, registrars to the
issue, bankers to the issue, brokers to the issue, syndicate members, Self
Certified Syndicate Banks, etc.
(7)
The names,
addresses, telephone numbers, fax numbers and e-mail addresses of the auditors
of the issuer.
(8)
The statement of
inter-se allocation of responsibilities among lead merchant bankers, where more
than one merchant banker is associated with the issue.
(9)
The following
details of credit rating, in case of a public issue of convertible debt
instruments:
(a)
The names of all
the credit rating agencies from which credit rating including unaccepted rating
has been obtained for the issue of convertible debt instruments.
(b)
The details of
all the credit ratings including unaccepted rating obtained for the issue of
convertible debt instruments.
(c)
All the credit
ratings obtained during three years prior to the filing the offer document for
any of the issuer�s listed convertible debt instruments at the time of
accessing the market through a convertible debt instrument.
(10) The following details of IPO
Grading:
(a)
The names of all
the credit rating agencies from which grading has been obtained for the initial
public offer of specified securities.�
(b)
The details of
all the grades obtained from such credit rating agencies.
(c)
The rationale or
description of the grading(s) so obtained, as furnished by the credit rating
agency(ies).
(11) The names, addresses, telephone numbers, fax numbers,
website addresses and e-mail addresses of the trustees under debenture trust
deed, in case of a public issue of convertible debt instruments.
(12) The name of the monitoring agency, if appointed and
the disclosure as to whether the appointment is pursuant to regulation 16 of
these regulations.
(13) The name, address, telephone number and e-mail address
of the appraising entity, in case the project has been appraised.
(14) Where the issue is being made through the book
building process, the details in brief explaining the book building process.
(15) The details of underwriting, if any:
(a)
The names,
addresses, telephone numbers, fax numbers and e-mail addresses of the
underwriters and the amount underwritten by them.
(b)
Declaration by
the board of directors of the issuer that the underwriters have sufficient
resources to discharge their respective obligations.
(c)
In case of
partial underwriting of the issue, the extent of underwriting.
(d)
The details of final underwriting arrangement indicating actual number
of specified securities underwritten, in the prospectus or red herring
prospectus before it is registered with Registrar of Companies.
(e)
The underwriting agreement shall list out the role and
obligations of each syndicate member and inter-alia contain a clause stating
that margin collected from categories other than qualified institutional buyers
shall be uniform across the book runner(s) or syndicate members for each such
category, indicating the percentage to be paid as margin by the investor at the
time of bidding.��
(C) Green Shoe
Option, if applicable:
(1)
The name of the
stabilising agent.
(2)
The maximum
number of equity shares, in number and as a percentage of the proposed issue
size, proposed to be over-allotted by the issuer.
(3)
The period for
which the issuer proposes to avail of the stabilisation mechanism.
(4)
The maximum
increase in the equity share capital of the issuer and the shareholding
pattern, post-issue, in case the issuer is required to allot further equity
shares to the extent of over-allotment in the issue.
(5)
The maximum
amount of funds to be received by the issuer in case of further allotment and
the use of these additional funds shall be disclosed in the offer document.
(6)
The details of
the agreement or arrangement entered into by the stabilising agent with the
promoters or shareholders to borrow equity shares from the latter. The details
shall, inter-alia, include the name of the promoters or shareholders, their
existing shareholding in the issuer, the number and percentage of equity shares
to be lent by them and other important terms and conditions including rights
and obligations of each party.
(7)
The exact number
of equity shares to be allotted pursuant to the public issue, stating
separately the number of equity shares to be borrowed from the promoters or
shareholders and over-allotted by the stabilising agent and the percentage of
such equity shares in relation to the total issue size.
(D) Capital
Structure:
(1)
The capital
structure shall be presented in the following manner in a tabular form:
(a)
The authorised,
issued, subscribed and paid up capital (number of securities, description and
aggregate nominal value).
(b)
Size of the
present issue, giving separately the promoters� contribution, reservation for
specified categories and net offer to public (number of securities,
description, aggregate nominal value and issue amount (to be disclosed in that
order), names of the group companies if reservation has been made for
shareholders of the group companies and applicable percentages may be given in
case of a book built issue).�
(c)
Paid up capital:
(i)
After the issue.
(ii)
After conversion
of convertible instruments (if applicable).
(d)
Share premium
account (before and after the issue).
(2)
The following
notes shall be incorporated after the details of capital structure:
(a)
The details of
the existing share capital of the issuer in a tabular form, indicating therein
with regard to each allotment, the date of allotment, the number of shares
allotted, the face value of the shares allotted and the form of consideration.
(b)
Where shares have
been issued for consideration other than cash or out of revaluation reserves at
any point of time, the details shall be furnished in a separate table, indicating
the date of issue, persons to whom issued, price, reasons for the issue and
whether any benefits have accrued to the issuer out of the issue.
(c)
Where shares have
been allotted in terms of any scheme approved under sections 391-394 of the
Companies Act, 1956, the fact shall be distinctly stated and the details of
such shares allotted shall be given, along with the page numbers of the offer
document where extensive details of such scheme is given.
(d)
In case of bonus
shares made out of revaluation reserves, the same shall be separately mentioned
indicating the date of issue and the date of revaluation of assets.
(e)
The disclosures
specified at paras (a) to (d) above shall be subject to the following:
(i)
Where the issuer has issued equity shares under one or more employee
stock option schemes, particulars of equity shares issued under the employee
stock option schemes may be aggregated quarter-wise, indicating the aggregate
number of equity shares issued and the price range within which equity shares
have been issued in each quarter.
(ii)
Where item (i) is applicable, a document giving date-wise details of
equity shares issued under employee stock option schemes, including the price
at which such equity shares were issued, shall be made available as a material
document for inspection.
(f)
If the issuer has
made any issue of specified securities at a price lower than the issue price
during the preceding one year, specific details of the names of the persons to
whom such specified securities have been issued, whether they are part of
promoters group, reasons for such issue and the price shall be given.
(g)
The proposal or
intention, negotiations and consideration of the issuer to alter the capital
structure by way of split or consolidation of the denomination of the shares,
or issue of specified securities on a preferential basis or issue of bonus or
rights or further public issue of specified securities or qualified
institutions placement, within a period of six months from the date of opening
of the present issue.
(h)
The total shareholding of the promoters in a tabular form, clearly
stating the name of the promoter, nature
of issue, date of allotment, number of
shares, face value, issue price/ consideration, date when the shares
were made fully paid up, percentage of the
total pre and post issue capital, the lock in period, if any and the number and percentage of pledged shares, if any, held by
each promoter.
(i)
The details of:
(i)
the aggregate
shareholding of the promoter group and of the directors of the promoters, where
the promoter is a body corporate.
(ii)
the aggregate
number of specified securities purchased or sold by the promoter group and/or
by the directors of the company which is a promoter of the issuer and/or by the
directors of the issuer and their immediate relatives (as defined in sub-clause
(ii) of clause (zc) of sub-regulation (1) of regulation 2 within six months
immediately preceding the date of filing draft offer document with the Board..
(iii)
all financing
arrangements whereby the promoter group, the directors of the company which is
a promoter of the issuer, the directors of the issuer and their relatives have
financed the purchase by any other person of securities of the issuer other
than in the normal course of the business of the financing entity during the
period of six months immediately preceding the date of filing draft offer
document with the Board.
(iv)
the maximum and
minimum price at which purchases and sales referred to in clause (ii) were
made, along with the relevant dates.
(j)
Promoters�
contribution:
(i)
The details of promoters�
contribution and lock-in period in a tabular form, separately in respect of
each promoter, stating the date of allotment of specified securities, the date
when fully paid up, the nature of allotment (rights, bonus, preferential etc.),
the number, face value and issue price, the percentage of promoters�
contribution to total issued capital and the date upto which the specified
securities are subject to lock-in.
(ii)
In the case of an
initial public offer, the details regarding individual allotments shall be
given from the date of incorporation of the issuer. In the case of a listed
issuer, the details shall be given for five years immediately preceding the
date of filing the draft offer document.
(iii)
The shares
acquired by promoters through public issue, rights issue, preferential issue,
bonus issue, conversion of depository receipts or under any employee stock
option scheme or employee stock purchase scheme shall be shown separately from
the shares acquired in the secondary market. The aggregate cost of shares
acquired in the secondary market, if available.
(iv)
The details of
compliance with regulation 32 has been complied with.
(v)
If the issuer is
exempt from the requirements of promoters� contribution, the relevant
provisions under which it is exempt.
(vi)
A statement that
promoters� contribution has been brought in to the extent of not less than the
specified minimum lot and from persons defined as promoters under these
regulations.
(vii)
A statement that
the promoters undertake to accept full conversion, if the promoters� contribution
is in terms of the same optionally convertible debt instrument as is being
offered to the public.
(k)
A statement that
the issuer, its directors or the lead merchant bankers have not entered into
any buy back arrangements for purchase of the specified securities of the
issuer, other than the arrangements, if any, entered for� safety net facility as permitted in the
Regulations. In case any safety net is provided in the issue, the lead merchant
banker shall certify that the person offering the safety net has the ability to
honour the commitments and disclose the same in the offer document. Further,
complete details shall be given regarding safety net arrangements such as
number of specified securities covered, duration, price, complete terms of guarantee,
if any, given by any person, including conditions subject to which the
guarantee may be invoked.
(l)
A statement that
an over-subscription to the extent of ten per cent. of the net offer to public
can be retained for the purpose of rounding off to the nearer multiple of
minimum allotment lot.
(m)
A disclosure to
the effect that all securities offered through the issue shall be made fully
paid-up or may be forfeited for non-payment of calls within twelve months from
the date of allotment of securities
(n)
A disclosure
stating that:
(i)
The unsubscribed
portion in any reserved category may be added to any other reserved category.
(ii)
The unsubscribed
portion, if any, after such inter se adjustments among the reserved categories
shall be added back to the net offer to the public portion.
(iii)
In case of
under-subscription in the net offer to the public portion, spill-over to the
extent of under subscription shall be permitted from the reserved category to
the net offer to public portion.
(o)
The following
details regarding major shareholders:
(i)
The names of the
ten largest shareholders of the issuer as on the date of registering the offer
document with the Registrar of Companies.
(ii)
The number of
equity shares held by the shareholders specified in clause (i) including number
of equity shares which they would be entitled to upon exercise of warrant,
option or right to convert a debenture, loan or other instrument.
(iii)
The particulars
specified in items (i) and (ii) as on a date two years prior to the date of
registering the offer document with the Registrar of Companies.
(iv)
The particulars
specified in items (i) and (ii) as on a date ten days prior to the date of
registering the offer document with the Registrar of Companies.
(v)
If the issuer has
made an initial public offer of specified securities within the immediately
preceding two years prior to filing draft offer document with the Board, the
particulars specified in items (i), (ii), (iii) and (iv) shall be disclosed to
indicate separately the names of the persons who acquired equity shares by
subscription to the public issue and those who acquired the equity shares by
allotment on a firm basis or by private placement.
(p)
The details of
shareholding, if any, of the lead merchant bankers and their associates in the
issuer.
(q)
In case it is not
possible to obtain information regarding sales and purchases of specified
securities by any relative of the promoters, the information shall be disclosed
on the basis of the transfers as recorded in the books of the issuer and/or the
depository, as applicable and a statement to such effect shall be made in the
offer document.
(r)
The details of
options granted or equity shares issued under any scheme of employee stock
option or employee stock purchase of issuer, in last three years (separately
for each year) and on a cumulative basis for all options or equity shares
issued prior to the date of the offer document, including the following details
in cases where options granted to employees in pursuance of any employee stock
option scheme existing prior to the initial public offer, are outstanding at
the time of the initial public offer:
(i)
options granted;
(ii)
the pricing
formula;
(iii)
options vested;
(iv)
options
exercised;
(v)
the total number
of shares arising as a result of exercise of option;
(vi)
options lapsed;
(vii)
variation of
terms of options;
(viii)
money realised by
exercise of options;
(ix)
total number of
options in force;
(x)
employee-wise
details of options granted to:
� senior managerial personnel;
� any other employee who receives a grant in any one
year of options amounting to five per cent or more of options granted during
that year;
� identified employees who were granted options, during
any one year, equal to or exceeding one per cent. of the issued capital
(excluding outstanding warrants and conversions) of the issuer at the time of
grant;
(xi)
diluted Earnings
Per Share pursuant to issue of equity shares on exercise of options calculated
in accordance with Accounting Standard (AS) 20 �Earnings Per Share�.
(xii)
where the issuer
has calculated the employee compensation cost using the intrinsic value of the
stock options, the difference between the employee compensation cost so
computed and the employee compensation cost that shall have been recognised if
it had used the fair value of the options and the impact of this difference on
profits and on the Earnings Per Share of the issuer.
(xiii)
weighted average
exercise prices and weighted average fair values of options whose exercise
price either equals or exceeds or is less than the market price of the stock.
(xiv)
a description of
the method and significant assumptions used during the year to estimate the
fair values of options, including weighted-average information, namely,
risk-free interest rate, expected life, expected volatility, expected
dividends, and the price of the underlying share in market at the time of grant
of the option.
(xv)
the impact on the
profits and on the Earnings Per Share of the last three years if the issuer had
followed the accounting policies specified in clause 13 of the Securities and
Exchange Board of India (Employee Stock Option Scheme and� Employee Stock Purchase Scheme) Guidelines,
1999 in respect of options granted in the last three years.
(xvi)
the intention of
the holders of the equity shares allotted on exercise of options granted under
an employee stock option scheme or allotted under an employee stock purchase
scheme, to sell their equity shares within three months after the date of
listing of the equity shares in the initial public offer (aggregate number of
equity shares intended to be sold by the holders of options), if any. In case
of an employee stock option scheme, this information same shall be disclosed
regardless of whether equity shares arise out of options exercised before or
after the initial public offer.
(xvii)
specific
disclosures about the intention to sell equity shares arising out of an
employee stock option scheme or allotted under an employee stock purchase
scheme within three months after the date of listing, by directors, senior
managerial personnel and employees having equity shares issued under an
employee stock option scheme or employee stock purchase scheme amounting to
more than one per cent. of the issued capital (excluding outstanding warrants
and conversions), which inter-alia shall include name, designation and quantum
of the equity shares issued under an employee stock option scheme or employee
stock purchase scheme and the quantum they intend to sell within three months.
(s)
In case of a
listed issuer, which has earlier (after being a listed issuer) made any
preferential allotment or bonus issue of specified securities or qualified
institutions placement of eligible securities, a confirmation that the relevant
provisions of the regulations have been complied with.
(VII)
Particulars of the Issue:
(A) Objects of
the Issue:
(1)
The objects of
the issue shall be disclosed.
(2)
If one of the
objects is investment in a joint venture or a subsidiary or an acquisition, the
following additional disclosures shall be made:
(a)
Details of the
form of investment, i.e., equity, debt or any other instrument
(b)
If the form of
investment has not been decided, a statement to that effect;
(c)
If the investment
is in debt instruments, complete details regarding rate of interest, nature of
security, terms of repayment, subordination, etc.
(d)
If the investment
is in equity, whether any dividends are assured;
(e)
The nature of
benefit expected to accrue to the issuer as a result of the investment;
(3)
If one of the
objects of the issue is the grant of a loan to any entity, details of the loan
agreements, including the rate of interest, whether secured or unsecured,
duration, nature of security, terms of repayment, subordination etc. and the
nature of benefit expected to accrue to the issuer as a result of the
investment. If such loan is to be granted to a subsidiary, group or associate
company, details of the same.
(4)
If one of the
objects of the issue is utilisation of the issue proceeds for long term working
capital, the following additional disclosures shall be made.
(a)
Basis of
estimation of working capital requirement along with the relevant assumptions.
(b)
Reasons for
raising additional working capital substantiating the same with relevant facts
and figures.
(c)
Details of the
projected working capital requirement, including detailed assessment of working
capital after implementation of the project or achievement of objects of the
issue, as the case may be, capacity utilisation assumptions, break up of
expected current assets into raw materials, finished goods, work in progress,
sundry debtors etc., with assumption about the holding norms for each type of
current asset, total current liabilities, net current assets and envisaged
sources of finance for net current assets, i.e., bank finance, institutional
finance, own funds ,etc..
(d)
The total
envisaged working capital requirement in a tabular form, the margin money
thereof and the portion to be financed by any bank(s) or otherwise.
(e)
A complete
perspective on the present working capital position vis-�-vis the projected one
based on which the money is proposed to be raised in the public issue.
(f)
Details of the
existing working capital available to the issuer with a break up for total
current assets into raw materials, finished goods, work in progress, sundry
debtors, etc., total current liabilities, net current assets and sources of
finance for net current assets i.e. bank finance, institutional finance, own
funds etc..
(g)
If no working
capital is shown a part of project, the reasons therefor.
(5)
Disclosure of asset cover etc. in case of public issue of secured
convertible debt instruments: The details of the assets on which security/ asset cover, if
required,� shall be created, the basis
for computation of the security/asset cover, the valuation methods, the
periodicity of such valuation and the ranking of the charge(s).
(B) Requirement
of Funds:
(1)
The requirement
for funds proposed to be raised through the issue.
(2)
Where the issuer
proposes to undertake more than one activity, such as diversification,
modernisation, expansion, etc., the total project cost shall be given
activity-wise or project wise, as the case may be.
(3)
Where the issuer
is implementing the project in a phased manner, the cost of each phase,
including the phase, if any, which has already been implemented, shall be
separately given.
(4)
The details of
all material existing or anticipated transactions in relation to utlisation of
the issue proceeds or project cost with promoters, directors, key management
personnel, associates and group companies. The relevant documents shall be
included in the list of material documents for inspection.
(C) Funding Plan
(Means of Finance):
(1)
An undertaking
shall be given in the offer document by the issuer confirming firm arrangements
of finance through verifiable means towards seventy five per cent. of the
stated means of finance, excluding the amount to be raised through proposed
issue and existing identifiable internal accruals, have been made.
(2)
The balance
portion of the means of finance for which no firm arrangement has been made
shall be mentioned without specification.
(3)
The details of
funds tied up and the avenues for deployment of excess proceeds, if any.
(D) Appraisal:
(1)
The scope and
purpose of the appraisal, if any, along with the date of appraisal.
(2)
The cost of the
project and means of finance shall be as per the appraisal report.
(3)
The revision, if
any, in the project cost and the means of finance after the date of issue of
the appraisal report shall be explained and disclosed.
(4)
The weaknesses
and threats, if any, given in the appraisal report, shall be disclosed by way
of risk factors.
(E)
Schedule of Implementation:
(1)
The schedule of
implementation of the project in a tabular form and the progress made so far,
giving details of land acquisition, civil works, installation of plant and
machinery, trial production, date of commercial production and reasons for
delay, if any.
(F)
Deployment of Funds:
(1)
The details of
the sources of funds and the deployment of these funds on the project (where
the issuer is raising capital for a project), up to a date not earlier than two
months from the date of registering the offer document with the Registrar of
Companies, as certified by a Chartered Accountant, along with the name of the
chartered accountant and the date of the certificate.
(2)
Where the
promoters� contribution has been brought prior to the public issue and has
already been deployed by the issuer, the issuer shall give the cash flow
statement in the offer document disclosing the use of such funds received as
promoters� contribution.
(G) Sources of
Financing of Funds Already Deployed: The
means and source of financing, including details of bridge loan or other
financial arrangement, which may be repaid from the proceeds of the issue.
(H) Deployment
of Balance Funds: Year-wise break up
of the expenditure proposed to be incurred on the project.
(I)
Interim Use of Funds: Investment avenues in which the management proposes
to deploy issue proceeds, pending its utilisation in the proposed project.
(J)
Basic Terms of Issue
(K) Basis for
Issue Price:
(1)
The basis for
issue price, floor price or price band, as the case may be, shall be disclosed
and justified by the issuer in consultation with the lead merchant banker on
the basis of the following information, which shall be also disclosed
separately:
(a)
Earnings Per
Share and Diluted Earnings Per Share, pre-issue, for the last three years (as
adjusted for changes in capital).
(b)
Price Earning
ratio pre-issue.
(c)
Average Return on
Net Worth in the last three years.
(d)
Minimum Return on
Increased Net Worth required to maintain pre-issue Earnings Per Share.
(e)
Net Asset Value
per share based on last balance sheet.
(f)
Net Asset Value
per share after issue and comparison thereof with the issue price.
(g)
An illustrative
format of disclosure in respect of basis for issue price is given hereunder:
|
(1) |
Adjusted Earning Per Share (EPS) and Adjusted
Diluted EPS |
|
|
|
(a) 1992-93�������������������������� |
Rs.�� 0.41 |
|
|
(b) 1993-94�������������������������� |
Rs.�� 8.39 |
|
|
(c) 1994-95�������������������������� |
Rs. 13.82 |
|
|
(d) Weighted Average��������� |
Rs. 10.94 |
|
(2) |
Price/ Earning Ration (P/E) in relation to Issue
Price |
|
|
|
(a) Based on 94/95 EPS������ |
37.63 |
|
|
(b) Industry P/E��������� ���������� |
|
|
|
(i) Highest��������������� |
61.2 |
|
|
(ii) Lowest��������
�������������� |
0.8 |
|
|
(iii) Average���������������� |
25.3 |
|
|
(*Based on
Economic Times of 26/6/95) |
|
|
(3) |
Return on Net Worth |
|
|
|
(a) 1992-93������������������������ |
27.36% |
|
|
(b) 1993-94���������������������� |
28.77% |
|
|
(c) 1994-95������������������������ |
33.45% |
|
|
(d) Weighted Average����������� |
30.88% |
|
(4) |
Minimum Return on Total Net Worth after Issue needed
to maintain EPS at Rs.13.82 |
14.65% |
|
(5) |
Net Asset Value�������� |
|
|
|
(a) As at 31-3-1995�������������� |
Rs.�� 46.40 |
|
|
(b) After issue���������������� |
Rs.�� 94.29 |
|
|
(c) Issue price����������������� |
Rs.
520.00 |
�
(h)
Comparison of all
the accounting ratios of the issuer as mentioned in items (a) to (g) above with
the industry average and with the accounting ratios of the peer group (i.e.,
companies of comparable size in the same industry (the source from which
industry average and accounting ratios of the peer group has been taken shall
be indicated).
(i)
The fact of
dilution of financial ratios consequent upon issue of bonus shares, if any, and
justification of the issue price after taking into account the diluted ratios
with reference to expanded capital.
(j)
In case of a book
built issue, the following statement shall be disclosed in the red herring
prospectus:
"The
issue price has been determined by the issuer in consultation with the book
runner(s), on the basis of assessment of market demand for the offered
securities by way of book-building."
(k)
The face value of
equity shares and the statement that the issue price, floor price or price
band, as the case may be, is �X� times of the face value.
(l)
The accounting
ratios disclosed in the offer document in support of basis of the issue price
shall be calculated after giving effect to the consequent increase in capital
on account of compulsory conversions outstanding, as well as on the assumption
that the options outstanding, if any, to subscribe for additional capital will
be exercised.
(2)
The issuer shall
not proceed with the issue in case the accounting ratios mentioned in items (a)
to (g) above do not justify the issue price.
(3)
In case the
option of differential pricing under regulation 29 has been availed,
justification for the price difference shall be given in the offer document.
(4)
Issue of debt instruments bearing interest less than bank rate: Whenever fully convertible debt instruments are
issued bearing interest at a rate less than the Bank Rate, the offer document
shall contain disclosures about the price that would work out to the investor,
taking into account the notional interest loss on the investment from the date
of allotment of FCDs to the date(s) of conversions).
(L)
Tax Benefits: Any
special tax benefits for the issuer and its shareholders.
(VIII)
About the Issuer:
(A) Industry
Overview
(B) Business
Overview
(1)
Details of the
business of the issuer:
(a)
Location of the
project;
(b)
Plant, machinery,
technology, process, etc.:
(i)
Details shall be
given in a tabular form, which shall include the details of the machines
required to be bought by the issuer, cost of the machines, name of the
suppliers, date of placement of order and the date or expected date of supply,
etc..
(ii)
In case machines
are yet to be delivered, the date of quotations relied upon for the cost
estimates given shall also be mentioned.
(iii)
The percentage
and value terms of the plant and machinery for which orders are yet to be
placed shall be stated.
(iv)
The details of
the second hand machinery bought or proposed to be bought, if any, including
the age of the machines, balance estimated life, etc. shall also be given.
(c)
Collaborations,
any performance guarantee or assistance in marketing by the collaborators: The
following information regarding persons or entities with whom technical and
financial agreements have been entered into shall be given:
(i)
place of
registration and year of incorporation.
(ii)
paid up share
capital.
(iii)
turnover of the
last financial year of operation.
(iv)
general
information regarding such persons relevant to the issuer.
(d)
Infrastructure
facilities for raw materials and utilities like water, electricity, etc.
(e)
Products or
services of the issuer:
(i)
The nature of the
product(s), that is, consumer or industrial and end users.
(ii)
The details about
the market, including details of the competition, past production figures for
the industry, existing installed capacity, past trends and future prospects
regarding exports (if applicable), demand and supply forecasts (if given,
should be essentially with assumptions unless sourced from a market research
agency of repute), etc. The source of data used shall be mentioned.
(iii)
The approach to
marketing and proposed marketing set up.
(iv)
The export
possibilities and export obligations, if any (in case of a issuer providing any
"service" particulars, as applicable).
(2)
Business
strategy:
(a)
A brief statement
about business strategy.
(b)
A brief statement
about future prospects, including the following:
(i)
Capacity and
Capacity Utilisation:
�
A table shall be
incorporated giving the existing installed capacities for each product,
capacity utilisation for these products in the previous three years, proposed
capacities for existing as well as proposed products and the assumptions for
future capacity utilisation for the next three years (from the date of
commencement of commercial production) in respect of existing as well as
proposed products.
�
If the projected
capacity utilisation is higher than the actual average capacity utilisation by
more than 25% during the previous three years, how the issuer proposes to
achieve the projected levels of capacity utilisation in view of its failure to
achieve levels of similar capacity utilisation in the past, shall be stated.
(ii)
No forecast of
projections relating to financial performance of the issuer shall be given in
the offer document.
(3)
Intellectual property rights:
(a)
If the issuer is entitled to certain intellectual
property rights such as trade marks, brand names, etc. whether the same are
legally held by the issuer and whether all formalities in this regard have been
complied with.
(b)
In case the intellectual property rights are not registered in the name
of the issuer, the name of the entity with which they are registered.
(c)
In case the intellectual property rights are registered in the name of
entity in which the promoters are interested, the salient features of the
agreement entered into for the use of the intellectual property rights by the
issuer.
(4)
Property
(5)
Purchase of
property:
(a)
As respects any
property referred to in sub-clause (b):
(i)
the names,
address, descriptions and occupations of the vendors;
(ii)
the amount paid
or payable in cash, shares or debentures to the vendor and, where there is more
than one separate vendor, or the issuer is a sub purchaser, the amount so paid
or payable to each vendor, specifying separately the amount, if any, paid or
payable for goodwill;
(iii)
the nature of the
title or interest in such property acquired or to be acquired by the issuer;
(iv)
short particulars
of every transaction relating to the property completed within the two
preceding years, in which any vendor of the property to the issuer or any
person who is, or was at the time of the transaction, a promoter, or a director
or proposed director of the issuer had any interest, direct or indirect,
specifying the date of the transaction and the name of such promoter, director
or proposed director and stating the amount payable by or to such vendor,
promoter, director or proposed director in respect of the transaction.
(b)
The property to
which sub-clause (a) applies is a property purchased or acquired by the issuer
or proposed to be purchased or acquired, which is to be paid for wholly or
partly out of the proceeds of the issue offered for subscription by the offer
document or the purchase or acquisition of which has not been completed at the
date of issue of the offer document, other than property:
(i)
the contract for
the purchase or acquisition whereof was entered into in the ordinary course of
the issuer�s business, the contract not being made in contemplation of the issue
nor the issue in consequence of the contract; or
(ii)
as respects which
the amount of the purchase money is not material.
�
for the purpose
of this clause, where a vendor is a firm, the members of� the firm shall not be treated as separate
vendors.
�
if the issuer
proposes to acquire a business which has been carried on for less than three
years, the length of time during which the business has been carried.
(6)
Land :
(a)
The names of the entities from whom the land has
been acquired/ proposed to be acquired alongwith the cost of acquisition, along
with the relation, if any, of such entities to any promoter or director of the
issuer.
(b)
Details of
whether the land acquired by the issuer is free from all encumbrances and has a
clear title and whether it is registered in the name of the issuer.�
(c)
Details of
whether the issuer has applied/ received all the approvals pertaining to land.
If no such approvals are required to be taken by the issuer, then this fact may
be indicated by way of an affirmative statement.
(d)
The figures
appearing under this section shall be consistent with the figures appearing
under the section "Cost of the Project".
(C) Key Industry-Regulation (if applicable)
(D) History and Corporate Structure of the issuer:
(1)
History and main
objects and present business of the issuer including the following details:
(a)
Details of the
issuer such as the date of incorporation, date of commencement of business,
date of conversion of partnership into limited company or private limited
company to public limited company, as applicable, dates on which names have
been changed, if applicable, reasons for change of name, changes in registered
offices of the issuer and reasons therefore, dates on which the Memorandum of
Association of the issuer have been amended citing the details of amendment.�
(b)
Details of the
major events in the history of the issuer, including the details of:
(i)
Capacity/facility
creation, location of plant, products, marketing, competition etc.
(ii)
Raising of
capital in form of equity or debt,
(iii)
Time/cost overrun
in setting up projects including the proposed project,
(iv)
Defaults or
rescheduling of borrowings with financial institutions/ banks, conversion of
loans into equity along with reasons thereof, lock out, strikes and reasons for
the same etc.
(v)
Negative features
like time / cost overrun, defaults and lock out / strikes etc
(vi)
Details regarding
the changes in the activities of the issuer during the last five years which
may have had a material effect on the profits/loss, including discontinuance of
lines of business, loss of agencies or markets and similar factors.
(c)
Complete details
of the subsidiaries and holding company, if applicable.
(d)
Corporate profile
of the issuer regarding its history, the description of the activities,
services, products, market of each segment, the growth of the issuer, exports
and profits due to foreign operations together with the country-wise analysis,
the standing of the issuer with reference to the prominent competitors with
reference to its products, management, major suppliers and customers, environmental
issues, segment, i.e. geographical, etc.
(e)
Injunction or
restraining order, if any, with possible implications.��
(f)
The technology,
market, managerial competence and capacity built-up.
(g)
Details regarding
acquisition of business/undertakings, mergers, amalgamation, revaluation of
assets etc, if any.
(h)
The number of members/ shareholders of the issuer.
(2)
Main objects as
set out in the Memorandum of Association of the issuer
(3)
Details regarding
subsidiary(ies) of the issuer including:
(a)
Name of the
subsidiary;
(b)
nature of
business;
(c)
capital
structure;
(d)
shareholding of
the issuer;
(e)
amount of
accumulated profits or losses of the subsidiary(ies) not accounted for by the
issuer;
(f)
amount of
accumulated profits or losses of the subsidiary(ies) not accounted for by the issuer
(4)
Shareholders'
agreements:
(a)
Key terms of
subsisting shareholders� agreements, if any (to be provided even if the issuer
is not a party to such an agreement, but is aware of such an agreement).
(b)
Guarantees, if
any, given to third parties by the promoters offering their shares in the
proposed offer for sale, stating reasons, amount, obligations on the issuer,
period of guarantee, financial implications in case of default, security
available, consideration etc.
(c)
All such
agreements shall be included in the list of material contracts required under
sub-item (A) of Item (XII)
(5)
Other agreements:
(a)
The dates,
parties to, and general nature of every other material contract, not being a
contract entered into in the ordinary course of the business carried on or intended
to be carried on by the issuer or a contract entered into more than two years
before the date of the offer document.
(b)
All such
agreements shall be included in the list of material contracts required under
sub-item (A) of Item (XII)
(6)
Strategic partners.
(7)
Financial partners.
(E)
Management:
(1)
Board of Directors:
(a)
Name, age,
qualifications, Director Identification Number, experience, address, occupation
and date of expiration of the current term of office of manager, managing
director, and other directors (including nominee directors, whole-time
directors), giving their directorships in other companies.
(b)
The nature of any
family relationship between any of the directors.
(c)
Any arrangement
or understanding with major shareholders, customers, suppliers or others,
pursuant to which of the directors was selected as a director or member of
senior management.
(d)
Details of
service contracts entered into by the directors with the issuer providing for
benefits upon termination of employment and a distinct negative statement in
the absence of any such contract.
(e)
Details of
borrowing powers.
(2)
Compensation of Managing Directors/ Whole time
Directors:
(a)
The dates,
parties to, and general nature of every contract appointing or fixing the
remuneration of a Director, Whole-time Director, Managing Director or Manager
whenever entered into within or more than, two years before the date of the
offer document.�� During the last
financial year, the amount of compensation paid, and benefits in kind granted
on an individual basis to all such persons, by the issuer for services in all
capacities to the issuer. The disclosure shall also cover contingent or
deferred compensation accrued for the year, even if the compensation is payable
at a later date.
(b)
If any portion of
the compensation was paid pursuant to a bonus or profit-sharing plan, a brief
description of the plan and the basis upon which the directors participate in
the plan.
(c)
All such
contracts shall be included in the list of material contracts required under
sub-item (A) of Item (XII).
(3)
Shareholding of
directors, including details of qualification shares held by them, wherever
applicable.
(4)
Interest of directors:
(a)
Full particulars
of the nature and extent of the interest, if any, of every Director.
(i)
in the promotion
of the� issuer; or
(ii)
in any property
acquired by the issuer within two years of the date of the offer document or
proposed to be acquired by it.
(b)
Where the
interest of such a director consists in being a member of a firm or company,
the nature and extent of the interest of the firm or company, with a statement
of all sums paid or agreed to be paid to him or to the firm or company in cash
or shares or otherwise by any person either to induce him to become, or to
qualify him as, a director, or otherwise for services rendered by him or by the
firm or company, in connection with the promotion or formation of the issuer
shall be disclosed.
(5)
Change, if any,
in the directors during the last three years, and reasons, thereof.
(6)
Management
Organisation Structure.
(7)
Corporate Governance:�
(a)
A disclosure to
the effect that the issuer has complied with the requirements of Corporate
Governance contained in the Equity Listing Agreement, particularly those
relating to composition of board of directors, constitution of committees such
as Audit Committee, Shareholder / Investor Grievance Committee, etc
(b)
Details relating
to the issuer's audit committee and remuneration committee, including the names
of committee members and a summary of the terms of reference under which the
committees operate shall also be disclosed.
(8)
Key Management Personnel:
(a)
Details of the
key management personnel as on the date of filing the offer document with the
Board indicating name, date of joining, qualification, term of office with date
of expiration of term and details of service contracts including
termination/retirement benefits, if any, details of previous employment, etc.
(b)
Name, business
experience, functions and areas of experience in the issuer.
(c)
The nature of any
family relationship between any of the key managerial personnel.
(d)
Any arrangement
or understanding with major shareholders, customers, suppliers or others,
pursuant to which any of the key managerial personnel, was selected as a
director or member of senior management.
(e)
During the last
financial year, the amount of compensation paid, and benefits in kind granted,
to the key managerial personnel on an individual basis, by the issuer for
services in all capacities to the company. The disclosure shall also cover
contingent or deferred compensation accrued for the year, even if the
compensation is payable at a later date.
(f)
If any portion of
the compensation was paid pursuant to a bonus or profit-sharing plan, a brief
description of the plan and the basis upon which the key management personnel
participate in the plan.
(g)
Disclose status
of key management personnel, whether they are in the employment as permanent
employees or otherwise.
(h)
The shareholding
of the key management personnel.
(i)
Bonus or Profit
Sharing Plan for the key management personnel.
(j)
Changes in the Key Management Personnel: Any change otherwise than by way of retirement in the
normal course in the senior key management personnel particularly in charge of
production, planning, finance and marketing during the last three years prior
to the date of filing the offer document with the Board shall be disclosed. If
the turnover of key management personnel is high compared to the industry,
reasons should be discussed.
(9)
Employees:
(a)
Refer the page of
the offer document where disclosures regarding employees stock option scheme/
employees stock purchase scheme of the issuer, if any, as required by the
Regulations or Regulations of the Board relating to Employee Stock Option
Scheme and Employee Stock Purchase Scheme, is given.
(b)
Payment or
Benefit to Officers of the issuer (non-salary related): Any amount or benefit paid or given within the two
preceding years or intended to be paid or given to any officer and
consideration for payment of giving of the benefit.
(F)
Promoters/
Principal Shareholders:
(1)
Where the
promoters are individuals:
(a)
A complete
profile of the promoters, including their name, age, personal addresses,
educational qualifications, experience in the business or employment and in the
line of business proposed in the offer document, positions/posts held in the
past, Directorship held, other ventures of each promoter, special achievements,
their business and financial activities, photograph, voter ID number, driving
license number shall be disclosed.
(b)
A declaration,
confirming that Permanent Account Number, Bank Account Number and Passport
Number of the promoters have been submitted to the recognised stock exchanges
on which the specified securities are proposed to be listed, at the time of
filing the draft offer document with them;
(2)
Where the
promoters are companies:
(a)
History of the
companies and the promoters of the companies shall be furnished. Where the
promoters of such companies are again companies or bodies corporate, names of
natural persons in control (i.e., holding fifteen per cent. or more voting
rights) or who are on the board of directors of such bodies corporate shall be
disclosed.
(b)
Details of change
in control or management of the promoter companies, if any, including details
of the persons who held the controlling interest in the three years immediately
preceding the filing the draft offer document.
(c)
A declaration,
confirming that the Permanent Account Numbers, Bank Account Numbers, the
Company Registration Numbers and the addresses of the Registrars of Companies
where the companies are registered have been submitted to the recognised stock
exchanges on which the specified securities are proposed to be listed, at the
time of filing the draft offer document with them;
(3)
If the present
promoters are not the original promoters and control of the issuer was acquired
within five years immediately preceding the date of filing draft offer document
with the Board, disclosure shall be made of the details regarding the
acquisition of control, date of acquisition, terms of acquisition,
consideration paid for acquisition and compliance with the provisions of the
SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 and
Listing Agreement as applicable.
(4)
If there is no
identifiable promoter, such fact shall be disclosed and a further disclosure
shall be made of the shareholders who control individually or as a group,
fifteen per cent. or more of the voting rights of the issuer and of persons, if
any, who have the right to appoint director(s) on the board of directors of the
issuer.
(5)
If the promoters
do not have experience in the proposed line of business, that fact shall be
disclosed explaining how the proposed activities would be carried out/managed.
(6)
If the promoters
have any interest in the issuer other than as promoters, brief details of the
interest shall be given along with cross-reference to the pages on which
extensive details have been given in the offer document.
(7)
The following
information in respect of all the group companies shall be given wherever
applicable:
(a)
the name and type
of organisation
(b)
brief description
of the business;
(c)
nature and extent
of interest of the promoters
(8)
Full particulars
of the nature and extent of the interest, if any, of every promoter, directors
or group companies :
(a)
in the promotion
of the� issuer; or
(b)
in any property
acquired by the issuer within two years of the date of filing draft offer
document with the Board or proposed to be acquired by it.
(c)
Where the
interest of such a director or promoter consists in being a member of a firm or
company, the nature and extent of the interest of the firm or company, with a
statement of all sums paid or agreed to be paid to him or to the firm or
company in cash or shares or otherwise by any person either to induce him to
become, or to qualify him as, a director, or otherwise for services rendered by
him or by the firm or company, in connection with the promotion or formation of
the issuer.
(d)
in any
transaction in acquisition of land, construction of building and supply of
machinery, etc. with full details of the transaction and the amount involved
(9)
Payment or benefit to promoters of the issuer: Any amount or benefit paid or given within the two
years preceding the date of filing draft offer document with the Board or
intended to be paid or given to any promoter or promoter group� and consideration for payment of giving of
the benefit.
(G) Currency of presentation: One standard financial unit shall be used in the
offer document.
(H) Dividend policy
(IX)
Financial Statements:
[14][[Notes:
1.
The financial informations specified in this item
shall be certified by only those auditors who have subjected themselves to the
peer review process of the Institute of Chartered Accountants of India (ICAI)
and hold a valid certificate issued by the �Peer Review Board� of the ICAI.
2.
All financial informations specified in this item must
be reaudited for one full financial year and the stub period, by the auditor
certifying them in case where the financial statements were audited by an
auditor who had not been subjected to peer review process of ICAI.]]
(A) Selected Consolidated Financial and Operating data: �
(1)
The consolidated financial statement prepared on the basis of Accounting
Standard 21(AS 21) �Consolidated Financial Statements� issued by the Institute of Chartered Accountants of
India shall be incorporated in the
offer document.
(2)
All the notes to the accounts, significant accounting policies as well as
the auditors� qualifications shall be incorporated.
(B) Financial Information of the issuer:
(1)
A report by the auditors of the issuer with respect to:
(a)
profits and
losses and assets and liabilities, in accordance with para (2) or (3) of
sub-item (B) of Item (IX), as the case may require; and
(b)
the rates of
dividends, if any, paid by the issuer in respect of each class of shares in the
issuer for each of the five financial years immediately preceding the issue of
the offer document, giving particulars of each class of shares on which such
dividends have been paid and particulars of the cases in which no dividends
have been paid in respect of any class of shares for any of those years;
and, if no accounts have been made up in respect of
any part of the period of five years ending on a date three months before the
issue of the offer document, containing a statement of that fact (and
accompanied by a statement of the accounts of the issuer in respect of that part
of the said period up to a date not earlier than six months of the date of
issue of the offer document indicating the profit or loss for that period and
the assets and liabilities position as at the end of that period together with
a certificate from the auditors that such accounts have been examined and found
correct by them. The said statement may indicate the nature of provision or
adjustments made or are yet to be made).
(2)
If the issuer has
no subsidiaries, the report shall:
(a)
so far as regards
profits and losses, deal with the profits or losses of the issuer
(distinguishing items of a non- recurring nature) for each of the five
financial years immediately preceding the issue of the offer document; and
(b)
so far as regards
assets and liabilities, deal with the assets and liabilities of the issuer at
the last date to which the accounts of the issuer were made up.
(3)
If the issuer has
subsidiaries, the report shall:
(a)
so far as regards
profits and losses, deal separately with the issuer�s profits or losses as
provided by para (2) of sub-item (B) of Item (IX) and in addition, deal either:
(i)
as a whole with
the combined profits or losses of its subsidiaries, so far as they concern the
members of the issuer; or
(ii)
individually with
the profits or losses of each subsidiary, so far as they concern the members of
the issuer;
or, instead of dealing separately with the issuer�s
profits or losses, deal as a whole with the profits or losses of the issuer,
and, so far as they concern the members of the issuer, with the combined profits
or losses of its subsidiaries; and
(b)
so far as regards
assets and liabilities, deal separately with the issuer�s assets and
liabilities as provided by para (2) of sub-item (B) of Item (IX) and in
addition, deal either:
(i)
as a whole with
the combined assets and liabilities of its subsidiaries, with or without the
issuer�s assets and liabilities; or
(ii)
individually with
the assets and liabilities of each subsidiaries;
and shall indicate as respects the assets and
liabilities of the subsidiaries, the allowance to be made for persons other
than the members of the issuer.
(4)
If the proceeds,
or any part of the proceeds, of the issue of the shares or debentures are, or
is, to be applied directly or indirectly:
(a)
in the purchase
of any business; or
(b)
in the purchase
of an interest in any business and by reason of that purchase, or anything to
be done in consequence thereof, or in connection therewith; the issuer will
become entitled to an interest as respects either the capital or profits and
losses or both, in such business exceeding fifty percent, thereof;
a report made by accountants (who shall be named in
the offer document) upon:
(i)
the profits or
losses of the business of each of the five financial years immediately
preceding the issue of the offer document; and
(ii)
the assets and
liabilities of the business at the last date to which the accounts of the
business were made up, being a date not more than one hundred and twenty days
before the date of the issue of the offer document.
(5)
�
(a)
If:
(i)
the proceeds, or
any part of the proceeds, of the issue of the shares or debentures are or is to
be applied directly or indirectly in any manner resulting in the acquisition by
the issuer of shares in any other body corporate; and
(ii)
by reason of that
acquisition or anything to be done in consequence thereof or in connection
therewith, that body corporate will become a subsidiary of the issuer;
a report shall be made by accountants (who shall be
named in the offer document) upon:
�
the profits or
losses of the other body corporate for each of the five financial years
immediately preceding the issue of the offer document; and
�
the assets and
liabilities of the other body corporate at the last date to which its accounts
were made up.
(b)
The said report
shall:
(i)
indicate how the
profits or losses of the other body corporate dealt with by the report would,
in respect of the shares to acquired, have concerned members of the issuer and
what allowance would have fallen to be made, in relation to assets and
liabilities so dealt with for holders of other shares, if the issuer had at all
material times held the shares to be acquired; and
(ii)
where the other
body corporate has subsidiaries, deal with the profits or losses and the assets
and liabilities of the body corporate and its subsidiaries in the manner
provided by sub-clause (a) (ii) above in relation to the issuer and its
subsidiaries.
(6)
Principal terms
of loan and assets charged as security: Brief terms and conditions of the term
loans including re-schedulement, prepayment, penalty, default, etc.
(7)
(a)��� Age-wise analysis of sundry debtors shall be
given.
(b)� Aggregate book value of quoted investments as
well as aggregate market value of quoted investments shall be disclosed.
(8)
All significant
accounting policies and standards followed in the preparation of the financial
statements shall be disclosed including all notes thereto and the auditors�
qualifications shall be incorporated.
(9)
Statements of
Assets and Liabilities and Profit and Loss or any other financial information
shall be incorporated after making the following adjustments, wherever
quantification is possible:
(a)
Adjustments/
rectification for all incorrect accounting practices or failures to make
provisions or other adjustments which resulted in audit qualifications.. Audit
qualifications, which have not been given effect to, if any, shall be
highlighted along with the management comments. If the impact of non-provisions
is not considered ascertainable, then a statement to that effect by the
auditors
(b)
Material amounts
relating to adjustments for previous years shall be identified and adjusted in
arriving at the profits of the years to which they relate irrespective of the
year in which the event triggering the profit or loss occurred.
(c)
Where there has
been a change in accounting policy, the profits or losses of the earlier years
(required to be shown in the offer document) and of the year in which the
change in the accounting policy has taken place shall be recomputed to reflect
what the profits or losses of those years would have been if a uniform
accounting policy was followed in each of these years.
(d)
If an incorrect
accounting policy is followed, the re-computation of the financial statements
shall be in accordance with correct accounting policies.
(e)
Statement of
profit or loss shall disclose the profit or the loss arrived at before
considering extraordinary items and after considering the profit or loss from
extraordinary items. An illustrative format of the disclosure of profits and
losses on this basis is specified hereunder:
|
Year ended March 31, �. |
||||||
|
|
20X1 |
20X2 |
20X3 |
20X4 |
20X5 |
|
|
����������� (Rupees In lakhs) |
||||||
|
Income |
|
|
|
|
|
|
|
Sales - |
|
|
|
|
|
|
|
of products
manufactured by the issuer |
1000 |
1240 |
1640 |
1800 |
1800 |
|
|
of products
traded in by the issuer�� |
100 |
��� 60 |
��� 60 |
� 200 |
� 200 |
|
|
Total |
1100 |
1300 |
1700 |
2000 |
2000 |
|
|
Other
income��� |
10 |
��� 30 |
��� 40 |
�� �60 |
� 100 |
|
|
Increase
(decrease) in inventories��� |
40 |
�� (70) |
��� 60 |
� 180 |
� 310 |
|
|
|
1150 |
1260 |
1800 |
2240 |
2410 |
|
|
Expenditure |
|
|
|
|
|
|
|
Raw materials
consumed� |
400 |
� 480 |
� 630 |
1110 |
1200 |
|
|
Staff
costs� |
200 |
� 220 |
� 240 |
� 340 |
� 400 |
|
|
Other
manufacturing expenses� |
250 |
� 260 |
� 280 |
� 540 |
� 650 |
|
|
Administration
expenses��� |
40 |
��� 42 |
��� 60 |
��� 80 |
��� 85 |
|
|
Selling and
distribution expenses� |
110 |
� 120 |
� 130 |
� 190 |
� 250 |
|
|
Interest��� |
60 |
��� 55 |
��� 90 |
� 200 |
� 140 |
|
|
|
1095 |
1227 |
1495 |
2635 |
2795 |
|
|
Net profit
before tax and extraordinary items��� |
55 |
�� 33 |
� 305 |
(295) |
(385) |
|
|
Taxation��� |
25 |
�� 12 |
� 144 |
(185) |
(235) |
|
|
Net profit
before extraordinary items��� |
30 |
�� 21 |
� 161 |
(110) |
(150) |
|
|
Extraordinary
items (net of tax)���� - |
|
�� 49 |
� (64) |
�800 |
1000 |
|
|
Net Profit after Extraordinary Items� �� |
30 |
��
70 |
��
97 |
�700 |
�
850 |
|
(f)
The statement of
assets and liabilities shall be prepared after deducting the balance
outstanding on revaluation reserve account from both fixed assets and reserves
and the net worth arrived at after such deductions. An illustrative format of
assets and liabilities is specified hereunder:
����������������������
|
As at March 31, �. |
||||||
|
|
|
20X1 |
20X2 |
20X3 |
20X4 |
20X5 |
|
|
|
(Rupees in lakhs) |
||||
|
(1) |
Fixed Assets |
|
|
|
|
|
|
|
Gross Block |
�440 |
�750 |
�900 |
�922 |
�1350 |
|
|
Less
Depreciation |
�(55) |
(107) |
(170) |
(250) |
� (320) |
|
|
Net Block |
�385 |
�643 |
�730 |
�672 |
�1030 |
|
|
Less:
Revaluation Reserve |
(100) |
�(95) |
� (89) |
� (83) |
�� (75) |
|
|
Net Block after adjustment for Revaluation Reserve |
� 285 |
�548 |
�641 |
589 |
� 955 |
|
(2) |
Current Assets, Loans and Advances |
|
|
|
|
|
|
|
Inventories |
� 485 |
�420� |
�720 |
�1030 |
�3200 |
|
|
Sundry Debtors |
��� 28 |
�� 30 |
�� 30 |
�� 500 |
�2500 |
|
|
Cash and Bank
Balances |
��� 13 |
�� 14 |
�� 22 |
�� 200 |
�� 400 |
|
|
Loans and
Advances |
��� 78 |
�100 |
�� 85 |
�1100 |
�2000 |
|
|
Other Current
Assets |
��� 70 |
�� 80 |
�� 55 |
�� 200 |
�� 220 |
|
|
Total |
� 674 |
�644 |
�912 |
�3080 |
�8320 |
|
(3) |
Liabilities and Provisions: |
|
|
|
|
|
|
|
Secured Loans |
�376 |
�607 |
�616 |
�� 620 |
�� 460 |
|
|
Unsecured Loans
|
���� 3 |
���� 3 |
� - |
��� - |
�4000 |
|
|
Current
Liabilities and Provisions |
�250 |
�180 |
�330 |
�� 460 |
�1100 |
|
|
Total |
(629) |
(790) |
(946) |
(1080) |
(5560) |
|
(4) |
Net worth |
�330 |
�402 |
�607 |
� 2589 |
�3715 |
|
(5) |
Represented by���������� |
|
|
|
|
|
|
|
Share Capital |
�300 |
�300 |
�400 |
�1600 |
�2000 |
|
|
Reserves |
�130 |
�197 |
�296 |
�1072 |
�1790 |
|
|
Less:
Revaluation Reserve |
(100) |
�(95) |
�(89) |
�� (83) |
�� (75) |
|
|
Reserves (Net of revaluation reserves) |
�� 30 |
�102 |
�207 |
�� 989 |
�1715 |
|
|
Net worth |
�330 |
�402 |
�607 |
�2589 |
�3715 |
(g)
Relevant details
of all the contingent liabilities.
(10) The turnover disclosed in the Profit and Loss
Statement shall be bifurcated into:
(a)
turnover of
products manufactured by the issuer;
(b)
turnover of
products traded in by the issuer; and
(c)
turnover in
respect of products not normally dealt in by the issuer but included in (b)
above, shall be mentioned separately.
(11) The offer document shall disclose details of `Other
Income' in all cases where such income (net of related expenses) exceeds twenty
per cent. of the net profit before tax, including:
(d)
the sources and
other particulars of such income; and
(e)
an indication as
to whether such income is recurring or non-recurring, or has arisen out of
business activities/ other than the normal business activities.
(12) Related Party Transactions: The issuer shall disclose the following details of
related party transactions and make disclosures in accordance with the
requirements of Accounting Standard (AS 18) �Related Party Disclosures� issued
by the Institute of Chartered Accountants of India:
(a)
Information with
respect to transactions or loans between the issuer and
(i)
enterprises that
directly or indirectly through one or more intermediaries, control or are
controlled by, or are under common control with, the issuer;
(ii)
associates;
(iii)
individuals
owning, directly or indirectly, an interest in the voting power of the company
that gives them significant influence over the issuer, and close members of any
such individual�s family;
(iv)
key managerial
personnel, that is, those persons having authority and responsibility for
planning, directing and controlling the activities of the issuer, including
directors and senior management of companies and close members of such
individuals� families;
(v)
enterprises in
which a substantial interest in the voting power is owned, directly or
indirectly, by any person described in (c) or (d) or over which such a person
is able to exercise significant influence and includes enterprises owned by
directors or major shareholders of the issuer.
(b)
The nature and
extent of any transactions which are material to the issuer or the related
party, or any transactions that are unusual in their nature or conditions,
involving goods, services, or tangible or intangible assets, to which the
issuer or any of its parent companies was a party.
(c)
The amount of
outstanding loans (including guarantees of any kind) made by the issuer or any
of its parent companies to or for the benefit of any of the directors or key
managerial personnel. The information given should include the amount
outstanding as of the latest date, the nature of the loan and the transaction
in which it was incurred, and the interest rate on the loan.
(13) Accounting and other ratios:
(a)
The following key
accounting ratios shall be given for each of the accounting periods for which
financial information is given.
(b)
Earnings per
Share and Diluted Earnings Per Share: This ratio shall be calculated after
excluding extra ordinary items.
(c)
Return on net
worth: This ratio shall be calculated after excluding revaluation reserves and
extra-ordinary items.
(d)
Net Asset Value
per share. This ratio shall be calculated excluding revaluation reserves.
(e)
�Accounting and
other Ratios� shall be based on the Financial Statements prepared on the basis
of Indian Accounting Standards.
(f)
In the event of
capital structure undergoing a change on account of capitalisation of reserves,
its impact on the key ratios should be distinctly brought out. The impact of
outstanding financial instruments, if any, on the ratios, should also be
disclosed.
(14) Capitalisation Statement:
(a)
A Capitalisation
Statement showing total debt, net worth, and the debt/ equity ratios before and
after the issue is made shall be incorporated.
(b)
In case of any
change in the share capital since the date as of which the financial
information has been disclosed in the offer document, a note explaining the
nature of the change shall be given.
(c)
An illustrative
format of the Capitalisation Statement is specified hereunder:
|
Particulars |
Pre-issue
as at 30-6-20X1 |
As
Adjusted for issue |
|
� (Rupees in lakhs) |
||
|
Short-Term Debt����������������������������������� � |
1870 |
1870 |
|
Long Term Debt����������������������������������� �� |
4370 |
4370 |
|
Shareholders
Funds |
|
|
|
Share Capital����������������������������������� ������� |
4000 |
4450 |
|
Reserves��������������������������������� ���������������� |
14570 |
� 37520 |
|
Total
Shareholders Funds |
18570 |
41940 |
|
Long
Term Debt/Equity |
0.24:1 |
0.10:1 |
|
Note: Since 31-3-20X1
(which is the last date as of which financial information has been given in
para of this document) share capital was increased form Rs.3000 lacs to
Rs.4000 lacs by the issue of bonus shares in the ratio of 1 share for every 3
shares. |
||
���������������������������������������������������������������
(15) Presentation of financials in case of change of denomination: In
case of change in standard denomination of equity shares, the compliance with
the following shall be ensured while making disclosure in the offer document:
(a)
all the financial
data affected by the change in denomination of shares shall be clearly and
unambiguously presented in the offer document.
(b)
comparison of
financial ratios representing value per share and comparison of stock market
data in respect of price and volume of securities shall be clearly and
unambiguously presented in the offer document.
(c)
the capital
structure incorporated in the offer document shall be clearly presented giving
all the relevant details pertaining to the change in denomination of the
shares.
(16) Unsecured loans:
(a)
�Break-up of total outstanding unsecured loans
taken by the issuer shall be given in the offer document into the amount borrowed
from promoters/group companies/subsidiaries / material associate companies and
amount borrowed from others. Further, in respect of each such loan of the
former category, terms and conditions shall be disclosed including the interest
rates and repayment schedule. If the loans can be recalled by the lenders at
any time, the same shall be disclosed.
(b)
Break-up of the
total outstanding unsecured loans taken by the promoters, group companies,
related parties, material associate companies and others shall be disclosed.
(c)
If the loans can
be recalled by the lenders at any time, the same shall be disclosed along with
details of such loans.
(17) For a proper understanding of the future tax
incidence, the following factors shall be identified and explained through proper
disclosures:
(a)
Profits after tax
are often affected by the tax shelters which are available.
(b)
Some of these are
of a relatively permanent nature (for example, arising out of export profits)
while others may be limited in point of time (for example, tax holidays for new
undertakings).
(c)
Tax provisions
are also affected by timing differences which can be reversed in the future
(for example, the difference between book depreciation and tax depreciation).
(d)
In respect of
provision for taxation, adjustment shall be made for deferred tax assets and
deferred tax liabilities in accordance with the requirements of Accounting
Standard (AS 22) �Accounting for Taxes on Income� issued by the Institute of
Chartered Accountants of India and a reconciliation of taxable income and book
profits shall be disclosed in accordance with the illustrative format given
hereunder:
|
Year ended March 31, �. |
|||||
|
|
20X1 |
20X2 |
20X3 |
20X4 |
20X5 |
|
(Rupees in lakhs) |
|||||
|
Tax at Notional Rate |
28 |
70 |
89 |
546 |
675 |
|
Adjustments: |
|
|
|
|
|
|
Export Profits |
(4) |
(5) |
(20) |
(100) |
(120) |
|
Difference
between Tax Depreciation and Book Depreciation |
(6) |
(8) |
(9) |
(10) |
(10) |
|
Other
Adjustments |
3 |
3 |
4 |
4 |
5 |
|
Net Adjustments
|
(7) |
(10) |
(25) |
(106) |
(125) |
|
Tax Saving
thereon |
(3) |
(5) |
(13) |
(49) |
(58) |
|
Total Taxation |
25 |
65 |
76 |
497 |
617 |
|
Taxation on
Extraordinary Items- |
|
53 |
(68) |
682 |
852 |
|
Tax on Profits
before Extraordinary Items |
25 |
12 |
144 |
(185) |
(235) |
(18) The issuer, if it so desires, may include in the offer
document, the financial statements prepared on the basis of more than one
accounting practices, subject to disclosure of the material differences arising
because of differences in the accounting policies of different accounting
practices.
(19) In respect of the periods, within the period of five
years, when the relevant Accounting Standard issued by the Institute of
Chartered Accountants of India was mandatory in respect of such issuers:
(a)
Where, in respect
of listed issuers, the auditors report does not deal with the profits and
losses and assets and liabilities of the issuer and its subsidiaries as a
whole, the consolidated balance sheets and profit and loss accounts shall be
presented in respect of the periods, within the period of five years, when
preparation of such statements was mandatory in respect of such issuers under
the listing agreement with the recognised stock exchanges.
(b)
In respect of
business segments, disclosure shall be made of segment revenue, segment result
and net capital employed and where the primary segment is a geographic segment,
similar details by geographic segments shall be given.
(20) The latest statement of audited/unaudited quarterly
financial results published by the issuer in accordance with clause 41 of the
equity listing agreement with the stock exchanges shall be reproduced.
(21) It shall be disclosed in the offer document whether
any of the sundry debtors is related to the directors or promoters or the
issuer in any way. Similar disclosures shall be made in case of loans and
advances.
[15][(22) If the issuer has entered into any scheme of arrangement
during the period for which the financials are disclosed in the offer document,
lead merchant banker to the issue shall ensure that the following disclosure
requirements as specified in Accounting Standard 14 has been complied with:-
(a)����� A description of the accounting treatment
followed in respect of financials contained in the schemes of arrangement and
the reasons for following the treatment if it is different from those, which
has been prescribed in applicable Accounting Standards.
(b)����� In case of deviations, disclosure of the
accounting treatment had the applicable standard been followed.
(c)��� Impact on the financials, if any, arising
due to such deviation.]
[16][(BA) ���Alternate Financial Information of the
issuer in further public offers:
(1)
An issuer making
further public offer may disclose the financial information specified in clause
(2) of this sub-item , in lieu of information specified under sub-item (B) if:
(i)
the issuer is
making� further public offer� in accordance with provisions of regulation
10;
(ii)
the specified
securities offered in further public offer�
are of the same class of those �already listed on a recognised stock exchange;
(iii)
financial reports
of the issuer are available on the
website of any recognised stock exchange having nationwide trading terminals or
on a common e-filing platform specified by the Board;
(iv)
there has not
been any change in management of the issuer;
(v)
specified
securities of issuer have not been listed pursuant to relaxation granted from clause
(b) of sub-rule (2) of rule 19 of Securities Contracts (Regulation) Rules,
1957.
(2)
The issuer satisfying
the conditions specified in� clause (1)
may disclose its financial statements as under:
(i)
Stand-alone and consolidated financial
statements of the issuer:
(1)
A report by the auditors of the issuer with
respect to profit or loss and assets and liabilities (indicating changes in
accounting policies, if any) in respect of the last completed accounting year
for which audit has been completed.
(2)
A report by the auditors of the issuer on a
limited review of the profit or loss and assets and liabilities (indicating
changes in accounting policies, if any), as at a date not earlier than six
months prior to the date of the opening of the issue, where audited accounts as
at such date are not available.
(3)
For the purpose of sub-clauses (1) and (2)
above, it shall be sufficient if:
(a)
���In
the statement of the assets and liabilities, the main heads of assets and
liabilities as provided in Part I of Schedule VI of the Companies Act, 1956
have been provided. If an issuer is governed by a statute other than the
Companies Act, 1956, the main heads of assets and liabilities as specified in
such statute shall be provided in the statement of assets and liabilities.
(b)
���In
the statement of profit or loss, the information required to be disclosed under
the heads of income and expenditure as per clause 41 of the equity listing
agreement in respect of quarterly financial information to be filed with the
recognised stock exchanges, has been provided.
(ii)
In addition, the following information for the
period between the last date of the balance sheet and profit and loss account
sent to the shareholders and up to the end of the last but one month preceding
the date of the offer document shall be furnished.
(1)
Working results of the issuer under following
heads:
(a)
(i) Sales / turnover
������� ��������(ii) Other income
(b)
Estimated gross profit / loss (excluding
depreciation and taxes)
(c)
(i) Provision for depreciation
������ � ��������(ii) Provision for taxes
(d)
Estimated net profit / loss
(2)
Material changes and commitments, if any affecting
financial position of the issuer.
(3)
Week-end prices for the last four weeks;
current market price; and highest and lowest prices of equity shares during the
period with the relative dates.
(iii)
Stock market quotation of shares/ convertible
instruments of the company (high/ low price in each of the last three years and
monthly high/low price during the last six months).
(iv)
Accounting and other ratios: The following
accounting ratios shall be given for each of the accounting periods for which
financial information is given:
(1)
Earnings per share: This ratio shall be
calculated after excluding extra ordinary items.
(2)
Return on Networth: This ratio shall be
calculated excluding revaluation reserves.
(3)
Net Asset Value per share: This ratio shall be
calculated excluding revaluation reserves.
(4)
Accounting and other ratios shall be based on
the financial statements prepared on the basis of Indian Accounting Standards.
(v)
Capitalisation Statement:
(1)
A Capitalisation
Statement showing total debt, net worth, and the debt/ equity ratios before and
after the issue is made shall be incorporated.
(2)
In case of any
change in the share capital since the date as of which the financial
information has been disclosed in the prospectus, a note explaining the nature
of the change shall be given.
(3)
An illustrative
format of the Capitalisation Statement is specified hereunder:
|
Particulars |
Pre-issue
as at 30-6-1995 |
As
Adjusted for issue |
|
� (Rupees in lakhs) |
||
|
Short-Term Debt����������������������������������� ������������������� |
1870 |
1870 |
|
Long Term Debt������������������� ����������������������������������� |
4370 |
4370 |
|
Shareholders Funds |
|
|
|
Share Capital����������������������������������� ������������������� |
4000 |
4450 |
|
Reserves��������������������������������� ������������������� |
14570 |
�
37520 |
|
Total Shareholders Funds |
18570 |
41940 |
|
Long Term Debt/Equity |
0.24:1 |
0.10:1 |
|
Note: Since 31-3-1995 (which is the last date as of which
financial information has been given in para � of this document), share
capital was increased from Rs.3000 lacs to Rs.4000 lacs by the issue of bonus
shares in the ratio of 1 share for every 3 shares. |
||
(vi)
One standard financial unit shall be used in
the offer document.]��������������������������������������������������������������������������������������������������������������������������������������������������������������
(C) Financial
Information of Group Companies:
(1)
In case of an
issuer not being a government company,
statutory authority or corporation or any special purpose vehicle set up
by any of them, the following information for the last three years, based on
the audited statements, in respect of all the group companies for past three
years shall be given, wherever applicable, along with significant notes of auditors.
(a)
Date of
Incorporation;
(b)
Nature of
activities;
(c)
Equity Capital;
(d)
Reserves
(excluding revaluation reserve);
(e)
Sales;
(f)
Profit after tax;
(g)
Earnings per
share and Diluted Earnings Per Share;
(h)
Net Asset Value;
(i)
The highest and
lowest market price of shares during the preceding six months with suitable
disclosures for changes in capital structure during the period and the market
value on the date of registering the offer document with the Registrar of
Companies.
(j)
If any of the
companies has made public or rights issue in the preceding three years, the
issue price of the security, the current market price and particulars of
changes in the capital structure, if any, since the date of issue and a
statement regarding the cost and progress of implementation of the project in
comparison with the cost and implementation schedule given in the offer
document.
(k)
Information
regarding significant adverse factors related to the group companies and in
particular regarding:
(i)
whether the
company has become a sick company within the meaning of the Sick Industrial
Companies (Special Provisions) Act, 1995 or is under winding up;
(ii)
whether the
company has made a loss in the immediately preceding year and if so, the profit
or loss figures for the immediately preceding three years.
(l)
Disclosure shall
be made about group companies which had remained defunct and for which
application was made to the Registrar of Companies for striking off the name of
the company, during the five years preceding the date of filing draft offer
document with the Board. The disclosure shall include reasons for the company
having become defunct as also all pending litigations, if any, in respect of
such companies.
(m)
The information
under items (e), (f), (g) and (k)(ii) need not be given in respect of a company
which is a private limited company not being a subsidiary of a public limited
company.
(2)
In case there are
more than five listed group companies, the financial information may be
restricted to the five largest listed group companies to be determined on the
basis of the market capitalization one month before the date of filing the
draft offer document or in case of a
fast track issue, one month before the
reference date referred to in Explanation (I) to sub-regulation (1) of regulation
10. In case there are less than five listed group companies, the
financial information shall be given for all the listed group companies and in
addition for the largest unlisted group companies (based on turnover) so that
the total number of listed and unlisted group companies for which the
information is required to be given does not exceed five.
�Provided that the financial information
regarding every such group company which has become a sick industrial company
or is under winding up or has a negative net worth shall be given.
(3)
If the promoters
have disassociated themselves from any of the companies or firms during the
three years preceding the date of filing the draft offer document , the reasons
therefor and the circumstances leading to the disassociation shall be furnished
together with the terms of such disassociation.
(4)
Common Pursuits:
(a)
In case there are
common pursuits among the group- companies/ subsidiaries/associates companies
and the issuer, the reasons and justification for the same shall be spelt out
and the conflict of interest situations shall be stated.
(b)
The related
business transactions within the group and their significance on the financial
performance of the issuer.
(5)
Sales or purchase
between group companies/subsidiaries/ associate companies when such sales or
purchases exceed in value in the aggregate ten per cent. of the total sales or
purchases of the issuer and also disclose material items of income or
expenditure arising out of such transactions
(6)
If any of the
other group companies/subsidiaries/associate companies has business interests in the issuer then the amount of commercial
business that the said company has /proposes to have with the issuer may be
quantified. If no, a distinct negative statement may be incorporated to this
effect.
(D) Changes in
accounting policies in the last three years
(E)
Management�s Discussion and Analysis of Financial
Condition and Results of Operations as
Reflected in the Financial Statements.
(1)
Overview of the
business of the issuer.
(2)
Significant developments subsequent to the last
financial year: A statement by the
directors whether in their opinion there have arisen any circumstances since
the date of the last financial statements as disclosed in the offer document
and which materially and adversely affect or is likely to affect the trading or
profitability of the issuer, or the value of its assets, or its ability to pay
its liabilities within the next twelve months.
(3)
Factors that may
affect the results of operations.
(4)
Discussion on the
results of operations: This
information shall inter-alia contain the following:
(a)
A summary of the
past financial results after adjustments as given in the auditor�s report for
the past three years containing significant items of income and expenditure
shall be given.
(b)
A summary of
major items of income and expenditure for the last three years and most recent
entering period
(c)
The income and
sales on account of major product/ main activities.
(d)
In case, other
income constitutes more than 10% of the total income, the break up of the same
along with the nature of the income, i.e., recurring or non-recurring shall be
stated.
(e)
If a material
part of the income is dependant upon a single customer or a few major
customers, disclosure of this fact along with relevant data. Similarly if any
foreign customer constitutes a significant portion of the issuer�s business,
disclosure of the fact along with its impact on the business on account of
exchange rate fluctuations.
(f)
In case the issuer
has followed any unorthodox procedure for recording sales and revenues, its
impact may be analysed and disclosed.
(g)
The nature of
miscellaneous income and miscellaneous expenditure for the interim period and
the preceding years
(5)
Comparison of
recent financial year with the previous financial years (last three years) on
the major heads of the profit and loss statement, including an analysis of
reasons for the changes in significant items of income and expenditure shall
also be given, inter-alia, containing the following:
(a)
unusual or
infrequent events or transactions including unusual trends on account of business activity, unusual items of income,
change of accounting policies and discretionary reduction of expenses etc.
(b)
significant
economic changes that materially affected or are likely to affect income from
continuing operations;
(c)
known trends or
uncertainties that have had or are expected to have a material adverse impact
on sales, revenue or income from continuing operations;
(d)
future changes in
relationship between costs and revenues, in case of events such as future
increase in labour or material costs or prices that will cause a material
change are known;
(e)
the extent to
which material increases in net sales or revenue are due to increased sales
volume, introduction of new products or services or increased sales prices;
(f)
total turnover of
each major industry segment in which the issuer operated;
(g)
status of any
publicly announced new products or business segment;
(h)
the extent to
which business is seasonal;
(i)
any significant
dependence on a single or few suppliers or customers;
(j)
competitive
conditions.
(6)
�Management�s
Discussion and Analysis of Financial Condition and Results of Operations as Reflected in the Financial Statements�
shall be based on the financial statements prepared on the basis of Indian
accounting practices and may additionally be presented based on other
accounting practices and shall also include the post audit period..
(X)
Legal and Other Information:
(A) Outstanding
Litigations and Material Developments:
(1)
Outstanding
litigations involving the issuer:
(a)
Litigations
against the issuer or against any other company whose outcome could have a
materially adverse effect of the position of the issuer;
(b)
All litigations
against the directors involving violation of statutory regulations or alleging
criminal offence;
(c)
Any criminal/
civil prosecution against the directors for any litigation towards tax
liabilities.
(d)
Pending
proceedings initiated for economic offences against the issuer or its directors
along with their present status;
(e)
adverse findings,
if any, in respect of the issuer as regards compliance with the securities
laws.
(f)
The details of
the past cases in which penalties were imposed by the authorities concerned on
the issuer or its directors;
(g)
Outstanding
litigations, defaults, etc. pertaining to matters likely to affect operations
and finances of the issuer, including disputed tax liabilities, prosecution
under any enactment in respect of Schedule XIII to the Companies Act, 1956 (1
of 1956) etc.;
(h)
The information
regarding pending litigations, defaults, non payment of statutory dues,
proceedings initiated for economic offences or civil offences (including the
past cases, if found guilty), any disciplinary action taken by the Board or
stock exchanges against the issuer or its directors shall be appropriately
disclosed under this head and as risk factor(s);
(i)
The name(s) of
the small scale undertaking(s) or any other creditors to whom the issuer owes a
sum exceeding Rs. one lakh which is outstanding more than thirty days.
(2)
The information
regarding outstanding litigations as specified sub-para. (g) of para. (1) of
sub-item (A) of Item (X) shall also be furnished in respect of the subsidiaries
of the issuer.
(3)
Outstanding
litigations involving the promoter and group companies:
(a)
In case of an
issuer not being a government company,
statutory authority or corporation or any special purpose vehicle set up
by any of them, all pending litigations in which the promoters are involved,
defaults to the financial institutions or banks, non-payment of statutory dues
and dues towards instrument holders such as debt instrument holders, fixed
deposits and arrears on cumulative preference shares, by the promoters and
group companies, together with the amounts involved and the present status of such
litigations or defaults and the details of proceedings initiated for economic
offences or civil offences (including the past cases, if found guilty), any
disciplinary action taken by the Board or recognised stock exchanges against
the promoters and group companies. The likely adverse effect of these
litigations, defaults, etc. on the financial performance of the issuer shall
also be mentioned.
(b)
The cases of
pending litigations, defaults, etc. in respect of group companies with which
the promoters were associated in the past but are no longer associated shall
also be disclosed in case their name(s) continue to be associated with the
particular litigation(s).
(c)
If any of the
group companies had faced/is facing any litigations/ defaults/ over dues or
labour problems/ closure etc., the same shall be disclosed
(d)
All the
litigations against the promoter involving violation of statutory regulations
or alleging criminal offence shall be furnished in the offer document.
(e)
Pending
proceedings initiated for economic offences against the promoters, group
companies shall be disclosed separately indicating their present status.
(f)
adverse findings,
if any, in respect of the persons/entities connected with the issuer/promoter/
group companies� as regards compliance
with the securities laws
(g)
The details of
the past cases in which penalties were imposed by the concerned authorities.
(4)
If any the above
mentioned litigations, etc., arise after the filing the offer document, the
facts shall be incorporated appropriately in the offer document. In case there
are no such cases, a distinct negative statement is required to be made in this
regard in the offer document.
(5)
Material
developments since the last balance sheet date.
(B) Government
Approvals or Licensing Arrangements:
(1)
Investment
approvals (FIPB/ RBI, etc.).
(2)
All government
and other approvals.
(3)
Technical
approvals.
(4)
Letter of intent
or industrial license and declaration of the Central Government, Reserve Bank
of India or any regulatory authority about the non-responsibility for financial
soundness or correctness of the statements.
(XI)
Other Regulatory and Statutory Disclosures:
(A) Authority for the issue and details of resolution
passed for the issue.
(B) Prohibition by the Board: A specific confirmation that
there is no prohibition on the issuer, promoters, promoter group, directors,
group companies or on the natural persons behind the body corporate if the
promoter is� a body corporate, from
accessing the capital market for any reasons by the Board or any other authorities.
(C) A confirmation whether any of the directors of the
issuer are associated with the securities market in any manner, if yes, whether
the Board has initiated any action against the said entities and the related
details.
(D) Eligibility of the issuer to enter the capital market.
Details of compliance with eligibility requirements to make a fast track issue,
if applicable.
(E)
It may be
disclosed whether the issuer, promoters, group companies, the relatives (as per
Companies Act, 1956) of promoters, group companies are identified as wilful
defaulters by Reserve Bank of India or other authorities.
(F)
Compliance with
Part B of this Schedule, as the case may be, if applicable.
(G) Disclaimer clauses:
(1)
The offer
document shall contain the following disclaimer clause in bold capital letters:
"It is to be distinctly understood that
submission of offer document to the Securities and Exchange Board of India
(SEBI) should not in any way be deemed or construed that the same has been
cleared or approved by SEBI. SEBI does not take any responsibility either for
the financial soundness of any scheme or the project for which the issue is
proposed to be made or for the correctness of the statements made or opinions
expressed in the offer document. The lead merchant banker, ______________ has
certified that the disclosures made in the offer document are generally
adequate and are in conformity with the SEBI (Issue of Capital and Disclosure
Requirements) Regulations, 2009 in force for the time being. This requirement
is to facilitate investors to take an informed decision for making investment
in the proposed issue.
It should also be clearly understood that while the
Issuer is primarily responsible for the correctness, adequacy and disclosure of
all relevant information in the offer document, the lead merchant banker is
expected to exercise due diligence to ensure that the issuer discharges its
responsibility adequately in this behalf and towards this purpose, the lead
merchant banker _______________ has furnished to SEBI a due diligence
certificate dated ______________ which
reads as follows:
(due diligence certificate submitted to the Board to
be reproduced here)
The filing of the offer document does not, however,
absolve the issuer from any liabilities under section 63 or section 68 of the
Companies Act, 1956 or from the requirement of obtaining such statutory or
other clearances as may be required for the purpose of the proposed issue. SEBI
further reserves the right to take up, at any point of time, with the lead
merchant banker
any irregularities or lapses in offer document."
(2)
Disclaimer Statement from the issuer and lead merchant banker: A statement to the effect that the issuer and the
lead merchant banker accept no responsibility for statements made otherwise
than in the offer document or in the advertisement or any other material issued
by or at the instance of the issuer and that anyone placing reliance on any
other source of information would be doing so at his own risk.
(H) Caution.
(I)
Disclaimer in
respect of jurisdiction: A brief paragraph mentioning the jurisdiction under which provisions of
law and the rules and regulations are applicable to the letter of offer.
(J)
Disclaimer clause
of the stock exchanges.
(K) Disclaimer clause of the Reserve Bank of India (if
applicable).
(L)
Filing or
registering of the offer document with the Board and the Registrar of
Companies:
(1)
Under this head,
the office of the Board where the offer document has been filed shall be
mentioned.
(2)
Address of the
Registrar of Companies, where copy of the offer document, having attached
thereto the material contracts and documents referred to elsewhere in the offer
document, has been registered.
(M) Listing: Names of the designated stock exchange and
other recognised stock exchanges to which application has been made for listing
of the specified securities offered in the present issue.
(N) Consent of the Directors, auditors, solicitors or
advocates, merchant bankers to the issue, registrar to the issue, bankers to
the issuer, lenders and experts.
(O) Expert opinion obtained, if any.
(P)
Expenses of the
issue along with a break up for each item of expense and shall include details
of fees payable to .(in terms of amount, as a percentage of total issue
expenses and as a percentage of total issue size) separately as under:
(1)
Lead merchant
bankers.
(2)
Co-lead merchant
bankers, if any
(3)
Co-managers, if
any
(4)
Other merchant
bankers
(5)
Registrars to the
issue.
(6)
Advisors
(7)
Bankers to issues
(8)
Trustees for the
debt instrument holders.
(9)
Underwriting
commission, brokerage and selling commission.
(10) Others, if any (specify).
(Q) Previous public or rights issues, if any (during the
last five years):
(1)
Closing Date.
(2)
Date of
allotment.
(3)
Date of refunds.
(4)
Date of listing
on the recognised stock exchange.
(5)
If the issue(s)
was at premium or discount and the amount thereof.
(6)
The amount paid
or payable by way of premium, if any, on each equity share which had been
issued within the two years preceding the date of the offer document or is to
be issued, stating the dates or proposed dates of issue and, where some shares
have been or are to be issued at a premium and other shares of the same class
at a lower premium, or at par or at a discount, the reasons for the
differentiation and how any premiums received have been or are to be disposed
of.
(R) Previous issues of securities otherwise than for cash.
(S)
Commission or
brokerage on previous issues.
(T)
Following
particulars in regard to the issuer and other listed group- companies/
subsidiaries/associates which made any capital issue during the last three
years shall be given:
(1)
Name of the
company.
(2)
Year of Issue.
(3)
Type of Issue
(public/ rights/ composite).
(4)
Amount of issue.
(5)
Date of closure
of issue.
(6)
Date of
completion of delivery of share/ debenture certificates.
(7)
Date of
completion of the project, where object of the issue was financing the project.
(8)
Rate of dividend
paid.
(U)
Performance vis-�-vis objects:
(1)
Issuer:
(a)
A list of all the public/rights issues made during the period of ten years immediately preceding the date
of filing the draft offer document with the Board, along with the year of
issue.
(b)
A separate para
entitled "Performance vis-�-vis objects - Last three issues of the
issuer" shall be given, indicating whether all the objects mentioned in
the respective offer documents of the last three issues of the issuer during
the period of ten years immediately preceding the date of filing draft offer
document with the Board were met.
(c)
If not,
non-achievement of objects shall be brought out distinctly.� Shortfall and delays shall be quantified.
(2)
Listed Group Companies/Subsidiaries/Associates companies :
(a)
A separate
paragraph entitled "Performance vis-�-vis objects - Last one issue of
group companies/subsidiaries / associate companies� " shall be given, indicating whether all
the objects mentioned in the offer document of the last one issue of each of
such companies during the period of� ten
years immediately preceding the date of filing draft offer document with the
Board were met.
(b)
If not,
non-achievement of objects shall be brought out distinctly. Shortfall and
delays shall be quantified.
(V) Outstanding debentures or bonds and redeemable
preference shares and other instruments issued by the issuer outstanding as on
the date of offer document and terms of issue.
(W) Stock market data for equity shares of the issuer, if
listed: The particulars of:
(1)
high, low and
average market prices of the share of the issuer during the preceding three
years;
(2)
monthly high and
low prices for the six months preceding the date of filing the draft offer
document with the Board which shall be updated till the time of registering the
offer document with the Registrar of Companies;
(3)
number of shares
traded on the days when high and low prices were recorded in the relevant stock
exchange(s) during the said period of (a) and (b) above and indicating the
total number of days of trading during the six months preceding the date of
filing the draft offer document and the average volume of shares traded during
that period and if the shares were not actively traded, such fact shall be
disclosed;
(4)
the stock market
data referred to above shall be shown separately for periods marked by a change
in capital structure, with such period commencing from the date the relevant
stock exchange recognises the change in the capital structure (e.g. when the
shares have become ex-rights or ex-bonus);
(5)
the market price
immediately after the date on which the resolution of the board of directors
approving the issue was approved;
(6)
the volume of
securities traded in each month during the six months preceding the date on
which the offer document is registered with the Registrar of Companies; and
(7)
the volume of
shares traded along with high, low and average prices of shares of the issuer
shall also be stated for respective periods.
(X) Mechanism evolved for redressal of investor
grievances:
(1)
The arrangements
or mechanism evolved by the issuer for redressal of investor grievances.
(2)
the number of investor
complaints received during the three years preceding the filing draft offer
document with the Board and the number of complaints disposed off during that
period
(3)
the number of
investor complaints pending on the date of filing draft offer document with the
Board
(4)
the number of
investor complaints pending on the date of filing draft offer document with the
Board in respect of the five largest (in terms of market capitalization) listed
group companies.
(5)
The time normally
taken by the issuer for disposal of various types of investor grievances.
(6)
Similar
disclosure shall be made in regard to the listed companies under the same
management within the meaning of section 370 (1B) of the Companies Act, 1956
for the period of three years prior to the date of registering the offer
document with the Registrar of Companies.
(Y) Change, if any, in the auditors during the last three
years, and reasons, thereof.
(Z)
Capitalisation of
reserves or profits (during last five years).
(A) Revaluation of assets, if any (during the last five years)
(XII)
Offering Information:
(A) Terms of the
Issue:
(1)
Ranking of equity
shares: The shares issued in the issue shall be pari passu with the existing
shares in all respects including dividends.�
(2)
In the case of
offer for sale, the dividend for the entire year shall be payable to the
transferees. Further, disclose name of the entity bearing the cost of making
offer for sale along with reasons.
(3)
Mode of payment
of dividend.
(4)
Face value and
issue price/ floor price/ price band.
(5)
Rights of the
instrument holders.
(6)
Market lot.
(7)
Nomination
facility to investor.
(8)
The period of
operation of subscription list of public issue.
(9)
Minimum
subscription:
(a)
For
Non-underwritten Public Issues: The
following statement shall appear:
"If the issuer does not receive the minimum
subscription of ninety per cent. of the offer through offer document on the
date of closure of the issue, or if the subscription level falls below ninety
per cent. after the closure of issue on account of cheques having being
returned unpaid or withdrawal of applications, the issuer shall forthwith
refund the entire subscription amount received. If there is a delay beyond
eight days after the issuer becomes liable to pay the amount, the issuer shall
pay interest as per section 73 of the Companies Act, 1956."
(b)
For Underwritten
Public Issues: The following statement shall
appear:
"If the issuer does not receive the minimum
subscription of ninety per cent. of the offer through offer document including
devolvement of Underwriters within sixty days from the date of closure of the
issue, the issuer shall forthwith refund the entire subscription amount
received. If there is a delay beyond eight days after the issuer becomes liable
to pay the amount, the issuer shall pay interest prescribed under section 73 of
the Companies Act, 1956."
(c)
For Composite
Issues:
(i)
The lead merchant
banker shall ensure that the requirement of �minimum subscription� is satisfied
both jointly and severally, i.e., independently for both rights and public
issues.
(ii)
If the issuer
does not receive the minimum subscription in either of the issues the issuer
shall refund the entire subscription received.
(10) Arrangements
for Disposal of Odd Lots:
(a)
Any arrangements
made by the issuer for providing liquidity for and consolidation of the shares
held in odd lots, particularly when such odd lots arise on account of issues by
way of rights, bonus, conversion of debentures or warrants, etc., shall be
intimated to the shareholders or investors.
(b)
The issuer is
free to make arrangements for providing liquidity in respect of odd lot shares
through any investment or finance company, broking firms or through any other
agency and the particulars of such arrangement, if any, may be disclosed in the
offer document related to the concerned issue of capital.
(c)
The lead merchant
banker shall ascertain whether the issuer coming for fresh issue of capital
proposes to set up trusts in order to provide service to the investors in the
matter of disposal of odd lot shares of the issuer held by them and if so,
disclosures relating to setting up and operation of the trust shall be
contained in the offer document.
(d)
Whenever any
issue results in issue of shares in odd lots, the issuer, shall as far as
possible issue certificates in the denomination of 1-2-5-10-20-50 shares.
(11) Restrictions, if any, on transfer and transmission of
shares or debentures and on their consolidation or splitting.
(12) New Financial Instruments:
(a)
The lead merchant banker shall ensure that
adequate disclosures in the offer document, more particularly relating to the
terms and conditions, redemption, security, conversion and any other relevant
features of any new financial instruments such as Deep Discount Bonds,
Debentures with Warrants, Secured Premium Notes etc.
(13) Option to Receive Securities in Dematerialised Form:
(a)
A statement in the offer document and in the
application form to the effect that the investors have an option to either
receive securities in the form of physical certificates or hold them in a
dematerialised form.
(B) Issue
Procedure: The following disclosures
shall be made:
(1)
Fixed price issue
or book building procedure as may be applicable, including details regarding
bid form / application form, who can bid/apply, maximum and minimum
bid/application size, bidding process, bidding, bids at different price levels,
etc.
(2)
Option to
subscribe in the issue:
(a)
The details of
option, if any, to receive the specified securities subscribed for either in
demateralised form or physical form. If the issue size, in case of a public
issue is equal to rupees ten crores or more, the specified securities issued in
the public issue shall be only in dematerialized form in compliance with
Section 68B of the Companies Act, 1956.�
It shall be disclosed that furnishing details of depositories account is
mandatory and applications without depositories account shall be treated as
incomplete and rejected.� Investors will
not have the option of getting the allotment of specified securities in
physical form. However, they may get the specified securities rematerialised
subsequent to allotment.�
(b)
It shall be
specifically disclosed that the specified securities, on allotment, shall be
traded on stock exchanges in demat segment only.
(c)
Disclosure that single bid from any investor shall not
exceed the investment limit/minimum number of specified securities that can be
held by him/her/it under the relevant regulations/statutory guidelines.
(3)
The following
details shall be disclosed in the offer document and application form:
(a)
the correct
procedure for applications by Hindu Undivided Families and the fact that
applications by Hindu Undivided Families would be treated as on par with
applications by individuals;
(b)
a statement that
providing bank account details in the space provided in the application form is
mandatory and applications that do not contain such details are liable to be rejected;
(c)
the instances
when an application would be rejected on technical grounds (e.g., absence of
signature, age, etc.)
(d)
Applications by
mutual funds:
(i)
The necessary
disclosures under the heads "Procedure for applications by mutual
funds" and "Multiple Applications" shall be incorporated to
indicate that a separate application can be made in respect of each scheme of
an Indian mutual fund registered with the Board and that such applications
shall not be treated as multiple applications.
(ii)
A disclosure that
the applications made by asset management companies or custodians of a mutual
fund shall clearly indicate the name of the concerned scheme for which
application is being made.
(e)
Applications by
non-resident Indians: The following
disclosures shall be made:
(i)
the name and
address of at least one place in India from where individual non-resident
Indian applicants can obtain the application forms.
(ii)
A statement that:
"non-resident Indian applicants may please note that only such
applications as are accompanied by payment in free foreign exchange shall be
considered for allotment under the reserved category. The non-resident Indians
who intend to make payment through Non-Resident Ordinary (NRO) accounts shall
use the form meant for Resident Indians and shall not use the forms meant for
reserved category."
(f)
Application by
ASBA investors:
(i)
Disclosures
regarding details of Application Supported by Blocked Amount process including
specific instructions for submitting Application Supported by Blocked Amount
shall be made in the offer document.
(ii)
Disclosure that the application form shall bear the
stamp of the syndicate member / SCSBs and if not, the same shall be rejected.
(4)
Escrow mechanism:
(a)
Escrow account of
the issuer.
(b)
Escrow account of
the syndicate member.
(5)
Terms of payment
and payment into the escrow collection account.
(6)
Electronic
registration of bids.
(7)
Build up of the
book and revision of bids. In this regard, it may be specifically disclosed
that qualified institutional buyers shall not be allowed to withdraw their bids
after the closure of the issue
(8)
Price discovery
and allocation.
(9)
Signing of
underwriting agreement.
(10) Filing of the offer document with the Registrar of
Companies.
(11) Announcement of pre-issue advertisement.
(12) Issuance of Confirmation of Allocation Note (�CAN�)
and allotment in the Issue.
(13) Designated date.
(14) General instructions:
(a)
Do�s and don�ts.
(b)
Instructions for
completing the bid form.
(c)
Bidders� bank
account details.
(d)
Bids by
non-resident Indians or foreign institutional investors on� repatriation basis
(15) Payment instructions:
(a)
Payment into
escrow account of the issuer.
(b)
Payment into
escrow account of the syndicate member.
(c)
Payment
instructions for Application Supported by Blocked Amount.
(16) Submission of bid form.
(17) Other instructions:
(a)
Joint bids in the
case of individuals.
(b)
Multiple bids.
(c)
Instruction to
applicants to disclose Permanent Account Number in the application form,
irrespective of the amount for which application or bid is made, along with the
instruction that applications without Permanent Account Number would be
rejected.
(d)
Rejection of
Bids.
(e)
Equity shares in
demat form with the depositories registered with the Board.
(f)
The investor�s
attention shall also be invited to contact the compliance officer in case of
any pre-issue or post-issue related problems such as non-receipt of letters of
allotment or share certificates or refund orders, etc.
(18) The application form shall contain space for
indicating number of specified securities subscribed for in demat and physical
form.
(19) No separate applications for demat and physical is to
be made.� If such applications are made,
the applications for physical shares shalll be treated as multiple applications
and rejected accordingly.
(20) In case of partial allotment, allotment shall be done
in demat option for the specified securities sought in demat form and balance,
if any, will be allotted in physical form.
(21) Disposal of application and application moneys.
(22)
Provisions of
sub-section (1) of section 68A of the Companies Act, 1956 relating to
punishment for fictitious applications, shall be mentioned, including the
disclosures that any person who:
(1)
makes in a fictitious name an application to a
company for acquiring, or subscribing for, any shares therein, or
(2)
otherwise induces a company to allot, or
register any transfer of, shares therein to him, or any other person in a
fictitious name, shall be punishable with imprisonment for a term which may
extend to five years.
(23) Interest on refund of excess bid amount.
(24) Basis of allotment or allocation: Disclose the names
of entities responsible for finalising the basis of allotment in a� fair and proper manner.
(25) Procedure and time of schedule for allotment and issue
of certificates.
(26) Method of proportionate allotment.
(27) Letters of Allotment or refund orders or instructions
to Self Certified Syndicate Banks in Application Supported by Blocked Amount
process. Ensure that �at par� facility is provided for encashment of refund
orders for Applications other than Application Supported by Blocked Amount
process.
(28) Mode of making refunds:
(a)
The mode in which
the issuer shall refund the application money to applicants in case of
oversubscription shall be disclosed in the offer document.
(b)
If the issuer
proposes to use more than one mode of making refunds to applicants, the
respective cases where each such mode will be adopted shall be disclosed. The
permissible modes of making refunds are as follows:
(i)
In case of applicants residing in any of the centres
specified by the Board: by crediting of refunds to the bank accounts of
applicants through electronic transfer of funds by using ECS (Electronic
Clearing Service), Direct Credit, RTGS (Real Time Gross Settlement) or NEFT
(National Electronic Funds Transfer), as is for the time being permitted by the
Reserve Bank of India;
(ii)
In case of other applicants: by despatch of refund
orders by registered post, where the value is Rs 1500/- or more, or under
certificate of posting in other cases, (subject however to postal rules); and
(iii)
In case of any category of applicants specified by the
Board: crediting of refunds to the applicants in any other electronic manner
permissible under the banking laws for the time being in force which is
permitted by the Board from time to time.
(29) Interest in
Case of Delay in Despatch of Allotment Letters or Refund Orders/instruction to Self
Certified Syndicate Banks by the Registrar in Case of Public Issues: The caption "Interest in Case of Delay in
Despatch of Allotment Letters/ Refund Orders in Case of Public Issues"
shall appear and shall contain the following statement:
(a)
Where it is a fixed price issue: "The issuer agrees that as far as possible
allotment of securities offered to the public shall be made within fifteen days
of the closure of public issue. The issuer further agrees that it shall pay
interest at the rate of fifteen per cent. per annum if the allotment letters or
refund orders have not been despatched to the applicants or if, in a case where
the refund or portion thereof is made in electronic manner, the refund
instructions have not been given to the clearing system in the disclosed manner
within thirty days from the date of the closure of the issue. However
applications received after the closure of issue in fulfilment of underwriting
obligations to meet the minimum subscription requirement, shall not be entitled
for the said interest."
(b)
Where it is a book-built issues: "The issuer agrees that allotment of securities
offered to the public shall be made not later than fifteen days of the closure
of public issue. The issuer further agrees that it shall pay interest at the
rate of fifteen per cent. per annum if the allotment letters or refund orders
have not been despatched to the applicants or if, in a case where the refund or
portion thereof is made in electronic manner, the refund instructions have not
been given to the clearing system in the disclosed manner within fifteen days
from the date of the closure of the issue."
(30) Undertaking
by the issuer:
(a)
The following
undertaking by the issuer shall be incorporated in the offer document:
(i)
that the complaints received in respect of the issue
shall be attended to by the issuer expeditiously and satisfactorily;
(ii)
that all steps for completion of the necessary
formalities for listing and commencement of trading at all stock exchanges
where the securities are to be listed are taken within seven working days of
finalisation of basis of allotment;
(iii)
that the issuer shall apply in advance for the listing
of equities on the conversion of debentures/ bonds;
(iv)
that funds required for making refunds to unsuccessful
applicants as per the mode(s) disclosed shall be made available to the
registrar to the issue by the issuer;
(v)
that where refunds are made through electronic transfer
of funds, a suitable communication shall be sent to the applicant within
fifteen days of closure of the issue giving details of the bank where refunds
shall be credited along with amount and expected date of electronic credit of
refund;
(vi)
that the promoters� contribution in full, wherever
required, shall be brought in advance before the Issue opens for public
subscription and the balance, if any, shall be brought in pro rata basis before
the calls are made on public;
(vii)
that the certificates of the securities or refund
orders to the non-resident Indians shall be despatched within specified time;
(viii)
that no further issue of securities shall be made till
the securities offered through this offer document are listed or till the
application moneys are refunded on account of non-listing, under subscription,
etc.;
(ix)
that adequate arrangements shall be made to collect all
Applications Supported by Blocked Amount and to consider them similar to
non-ASBA applications while finalizing the basis of allotment;
(b)
In case of an
issue of convertible debt instruments, the issuer shall also give undertakings
to the following effect in the offer document:
(i)
that the issuer shall forward the details of utilisation
of the funds raised through the convertible debt instruments duly certified by
the statutory auditors of the issuer, to the debenture trustees at the end of
each half-year.
(ii)
that the issuer shall disclose the complete name and
address of the debenture trustee in the annual report.
(iii)
that the issuer shall provide a compliance certificate
to the convertible debt instrument holders (on yearly basis) in respect of
compliance with the terms and conditions of issue of convertible debt
instruments as contained in the offer document, duly certified by the debenture
trustee.
(iv)
that the issuer shall furnish a confirmation
certificate that the security created by the issuer in favour of the
convertible debt instrument holders is properly maintained and is adequate to meet
the payment obligations towards the convertible debt instrument holders in the
event of default.
(v)
that necessary cooperation with the credit rating
agency(ies) shall be extended in providing true and adequate information till
the debt obligations in respect of the instrument are outstanding.
(c)
Disclosure that the issuer reserves the right not to
proceed with the issue after the bidding and if so, the reason thereof shall be
given as a public notice within two days of the closure of the issue.� The public notice shall be issued in the same
newspapers where the pre-issue advertisement had appeared. The stock exchanges
where the specified securities were proposed to be listed shall also be
informed promptly.
(d)
Disclosure that if the issuer withdraws the issue after
closure of bidding, the issuer shall be required to file a fresh draft offer
document with the Board.
(31) Utilisation of Issue Proceeds:
(a)
A statement by
the board of directors of the issuer to the effect that:
(i)
all monies received out of issue of specified
securities to public shall be transferred to separate bank account other than
the bank account referred to in sub-section (3) of section 73 of the Companies
Act, 1956;
(ii)
details of all monies utilised out of the issue
referred to in sub-item(i) shall be disclosed and continue to be disclosed till
the time any part of the issue proceeds remains unutilised under an appropriate
separate head in the balance-sheet of the issuer indicating the purpose for
which such monies had been utilised; and
(iii)
details of all unutilised monies out of the issue of
specified securities referred to in sub-item (i) shall be disclosed under an
appropriate separate head in the balance sheet of the issuer indicating the
form in which such unutilised monies have been invested.
(b)
The prospectus
for an issue other than an offer for sale or a public issue made by any bank or
public financial institution shall contain a statement of the board of
directors of the issuer to the effect that:
(i)
the utilisation of monies received under promoters�
contribution and from reservations shall be disclosed and continue to be
disclosed under an appropriate head in the balance sheet of the issuer, till
the time any part of the issue proceeds remains unutilised, indicating the
purpose for which such monies have been utilised;
(ii)
the details of all unutilised monies out of the funds
received under promoters� contribution and from reservations shall be disclosed
under a separate head in the balance sheet of the issuer, indicating the form
in which such unutilised monies have been invested
(32) Restrictions on foreign ownership of Indian securities, if any:
(a)
Investment by
non-resident Indians.
(b)
Investment by
foreign institution investors.
(XIII)
Description of Equity Shares and Terms of the Articles
of Association:
(A) Rights of members regarding voting, dividend, lien on
shares and the process for modification of such rights and forfeiture of
shares.
(B) Main provisions of the Articles of Association.
(XIV)Any other material
disclosures, as deemed necessary.
(XV) In case of a fast track
issue, the disclosures specified in this Part, which have been indicated in
Part B, need not be made.
(XVI)Other Information:
(A) List of material contracts and inspection of documents
for inspection:
(1)
Material contracts.
(2)
Documents:
(3)
Time and place at which the contracts, together with documents, will be
available for inspection from the date of offer document until the date of
closing of the subscription list.
(4)
IPO grading reports for each of the grades obtained by the unlisted
issuer
(B) Declaration:
(1)
The draft offer document (in case of issues other than fast track issues)
and offer document shall be approved by the Board of Directors of the issuer
and shall be signed by all directors, the Chief Executive Officer, i.e., the
Managing Director or Manager within the meaning of the Companies Act, 1956 and
the Chief Financial Officer, i.e., the whole-time finance director or any other
person heading the finance function and discharging that function.
(2)
The signatories shall further certify that all disclosures made in the
offer document are true and correct.
CERTAIN DISCLOSURES NOT MANDATORY IN CASE OF FAST TRACK PUBLIC ISSUE
An issuer making a fast track public issue of specified securities may
not make the disclosures indicated hereunder and specified in Part A of this
Schedule, in the offer document:
(1)
Sub-para (a) of para (2) of sub-item (D) of item (VI);
(2)
Sub-para (o) of para (2) of sub-item (D) of item (VI);
(3)
Para (8) of sub-item (E) of item (VIII);
(4)
Sub-para (b) of para (1) of sub-item (F) of item (VIII);
(5)
Sub-para (c) of para (2) of sub-item (F) of item (VIII);
(6)
Para (1) of
sub-item (C) of item (IX), in respect of entities not covered under section 370
(1)(B) of the Companies Act, 1956;
CERTAIN DISCLOSURES NOT MANDATORY IN CASE OF FURTHER PUBLIC OFFER
(1)
An issuer making a further public offer of
specified securities may not make the disclosures indicated hereunder and specified in
Part A of this Schedule, in the offer document, subject to
fulfilment of the conditions specified in para 2:
(i)
Sub-para (a) of para (2) of sub-item (D) of item (VI);
(ii)
Sub-para (o) of para (2) of sub-item (D) of item (VI);
(iii) Para (8) of sub-item (E) of
item (VIII);
(iv) Para (1) of sub-item (C) of item (IX), in respect of
entities not covered under section 370 (1)(B) of the Companies Act, 1956;
(2)
The conditions referred to in para (1) above
are as follows:
(a)
The issuer has been filing periodic statements in regard to financial
results and shareholding pattern with the designated stock exchange and also
with the Registrar of Companies (in case of a public issue), for the last three
years and such statements are available on the website of the designated stock
exchange or on a common e-filing platform;
(b)
The issuer has in place an investor grievance handling mechanism, which
includes meeting of the Shareholders / Investors� Grievance Committee at
frequent intervals, appropriate delegation of power by the board of directors
of the issuer with regard to share transfer and clearly laid out systems and
procedures for timely and satisfactory�
redressal of investor grievances;
(c)
The lead merchant banker has certified that the conditions specified at
(a) and (b) above have been complied with;
(d)
The issuer has furnished to the Board the following undertaking along
with the draft offer document, which shall also be incorporated in the offer
document:
(e)
�We confirm that other than the disclosures made in the instant offer
document, nothing material has changed in respect of disclosures made by us at
the time of our previous issue made on ����. .�
(f)
The issuer has made the offer document of its immediately preceding
public or rights issue public in the manner specified in sub-regulation (1) of
regulation 9 and sub-regulation (1) of regulation 61 and has also kept this
document for public inspection in the manner specified in sub- para (c) of para
4 of sub-item (D) of Item (VIII) of Part A of this Schedule.
[See regulation 58(1)]
DISCLOSURES IN ABRIDGED PROSPECTUS
General
Instructions:
(I)
The information
to be provided under each of the heads specified below shall be as per the requirements
of Part A of this Schedule except when specified otherwise.
(II)
The abridged
prospectus shall be printed in a font size which shall not be visually smaller
than Times New Roman size 10.
(III)
The order in
which items appear in the abridged prospectus shall correspond, wherever
applicable, to the order in which items appear in the prospectus.
(IV)
The application
form shall be so positioned that on the tearing-off of the application form, no
part of the information given in the abridged prospectus is mutilated.
(V)
The abridged
prospectus shall be printed at least in point seven size with proper spacing.
merchant banker shall ensure that the application form contains sufficient
space for writing the name and address of the applicant as also other important
details such as the name of the bank branch, specimen signature etc. The para
on risk factors shall appear verbatim, as a box item, in the abridged
prospectus.
As issuer making a public issue of specified
securities shall make the following disclosures in the abridged prospectus:
(I)
General Information:
(A) The name of the issuer and address of the registered
office of the issuer, along with telephone number, fax number, email address
and website address, and where there has been a change in the address of the
registered office or name of the issuer, details thereof.
(B) The name(s) of the recognised stock exchange(s) in
which the specified securities are proposed to be listed.
(C) The dates of opening, earliest closing and closing of
the issue.
(D) The disclosure under the heading �IPO Grading�,
stating all the grades obtained for the initial public offer, along with the
rationale or description furnished by the credit rating agency(ies) for each of
the grades obtained.
(E)
The disclaimer
clause of� the Board
(F)
The consolidated
disclaimer clause of the recognised stock exchanges: The disclaimer clauses of
the recognised stock exchanges shall be combined into a single disclaimer
clause with appropriate reference to individual recognised stock exchanges.
(G) The disclaimer statement of the issuer and merchant
banker(s)
(H) The name and address of the lead merchant bankers,
along with telephone number, fax number, website address, name of contact
person and email address.
(I)
The name and
address of the brokers, along with phone numbers.
(J)
The name and
address of the collecting bankers and/or the designated branches of Self
Certified Syndicate Banks.
(K) The name and address of the registrars to the issue,
along with telephone number, fax number, website address, name of contact
person and email address.
(L)
The name and
address of the trustee under debenture trust deed (in case of a debenture
issue), along with telephone number, fax number, website address, name of
contact person and email address.
(M) The name and address of the statutory auditors.
(N) The rating for the proposed issue of the convertible
debt instruments or preference shares, if any, obtained from the credit rating
agencies.
(O) The name and address of the underwriters and the
amount underwritten by them, if applicable.
(P)
The details of
the compliance officer:
(1)
The name,
address, telephone number, fax number and email address of the compliance
officer.
(2)
Investor�s
attention shall be invited to contact the compliance officer in case of any
pre-issue or post-issue related problems such as non-receipt of letters of allotment
or share certificates, credit of securities in depositories beneficiary account
or despatch of refund orders, etc.
(Q) The provisions of sub-section (1) of section 68A of
the Companies Act, 1956 relating to punishment for impersonation.
(R) The declaration about the issue of allotment letters
or refunds within a period of fifteen days and interest in case of delay in
dispatching refund or allotment letters at the rate of fifteen per cent. per
annum or at the rate as may be specified.
(S)
The risk factors
and proposals to address the same.
(II)
Capital Structure of the issuer:
(A) The following details shall be furnished:
(1)
The authorised,
issued, subscribed and paid-up capital (number of instruments, description,
aggregate nominal value).
(2)
The size of the
present issue. Promoters� contribution, reservation for specified categories
and net offer to public shall be disclosed separately.
(3)
The number of
instruments, description, aggregate nominal value and issue amount (to be
disclosed in this order). The name(s) of the group companies, in case
reservation has been made for shareholders of the group companies.
(4)
Paid-up capital:
(a)
after the issue
(b)
after conversion
of securities (if applicable).
(5)
Share Premium
Account (before and after the issue).
(B) Complete notes to the capital structure.
(C) A disclosure to the effect that the specified
securities offered through this public/ rights issue shall be made fully paid
up or forfeited within twelve months from the date of allotment of the
specified securities in a manner as specified in regulation 17.
(III)
Terms of the Present Issue:
(A) Authority for the issue, terms of payment and
procedure and time schedule for allotment and issue of certificates or refund
orders.
(B) The clause "Interest in Case of Delay in Despatch
of Allotment Letters/ Refund Orders /instruction to Self Certified Syndicate
Banks by the Registrar in Case of Public Issues" shall appear.
(C) Instructions for applicants:
(1)
How to apply,
availability of prospectus, abridged prospectus and application forms, mode of
payment and book building procedure, as may be applicable if relevant.
(2)
Applicants shall
be advised to read carefully the offer document and general instructions
contained in this abridged prospectus and to satisfy themselves of the
disclosures before making an application for subscription of the specified
securities offered through the issue. For a copy of the offer document, the
applicants may request the issuer and/or lead managers or brokers to the issue.
Further, investors shall be advised to retain the copy of the offer document or
abridged prospectus for their future reference. �applicants are advised to read
the Prospectus and the general instructions carefully and to satisfy themselves
of the disclosures before making an application for subscription.� For a copy of the prospectus the applicant
may request the issuer and/or lead manager/brokers to the issue.� Further, investors are advised to retain the
copy of the prospectus/abridged prospectus for their future reference�.
(3)
Residents: In the
application form meant for Indian public, the declaration relating to
nationality and residentship shall be shown prominently as� under:
�����
"Nationality and Residentship (Tick whichever is applicable):
(a)
I am / We are
Indian National(s) resident in India and I am/we are not applying for the said
equity shares as nominee(s) of any person resident outside India or Foreign
National(s).
(b)
I am / We are
Indian National(s) resident in India and I am / We are applying for the said
equity shares as Power of Attorney holder(s) of Non- Resident Indian(s) mentioned
below on non-repatriation basis.
(c)
I am / We are
Indian National(s) resident outside India and I am/we are applying for the said
equity shares on my / our own behalf on non-repatriation basis."
(4)
Non-Resident
Indians: The application form meant for non-resident Indians shall not contain
provision for payment through NR(O) accounts. On the face of the form, the
following legend shall be printed in a box:
"Attention NRI Applicants: Payment must be made
through their Non Resident External (NRE) / Foreign Currency Non Resident
(FCNR) accounts or through cheques / drafts sent from abroad and drawn on
convertible rupee accounts in India. Forms accompanied by cheques drawn on
NR(O) accounts are liable to be rejected".
(5)
Attention of the
non-resident Indians shall be invited to the following:
(a)
the name and
address of at least one place in India from where individual non-resident
Indian applicants can obtain the application forms;
(b)
Such applications
as are accompanied by payment in free foreign exchange shall be considered for
allotment under the reserved category;
(c)
Such non-resident
Indians who wish to make payment through NRO accounts shall use the form meant
for resident Indians and shall not use the form meant for reserved category. As
regards applications in case of reservations to non-resident Indians, a
disclosure shall be made in the abridged prospectus incorporating the fact that
payment for such allotments shall come through external source only and that
payments through NRO account will not be permitted.
(6)
The instances
when an application would be rejected on technical grounds (e.g. absence of
signature, age etc.) shall be disclosed.
(7)
The application
form should contain necessary instructions or provisions regarding the
following:
(a)
Instructions to
applicants to mention the number of application form on the reverse of the
instruments to avoid misuse of instruments submitted along with the
applications for shares/ debentures in public issues;
(a)
Provision in the
application form other than Applications Supported by Blocked Amount for
inserting particulars relating to bank account number and the name of the bank
with whom such account is held, to enable printing of these details in the
refund orders or for refunds through electronic clearing system, subject to the
condition that in case of an issue of specified securities which is wholly
required to be made in the dematerialized form:
(i)
it would not be
necessary to require bank account details in the application form;
(ii)
the application
form shall contain a statement that the bank account details of the applicant
would be taken from the data provided by him to the depository;
(b)
Provision in the
application form for Applications Supported by Blocked Amount, for inserting
particulars relating to bank account number which is authorised to be blocked
and other particulars as specified by the Board in this regard;
(c)
Instruction to
applicants to disclose Permanent Account Number in the application form,
irrespective of the amount for which application or bid is made, along with the
instruction that applications without Permanent Account Number would be
rejected.
(d)
Details of
options, if any, to receive specified securities subscribed for, either in
demateralised or physical form and a statement that trading of specified
securities on the stock exchanges in physical form will be available only
subject to limits prescribed by the Board for time to time.
(e)
The application
form shall contain full and specific disclosures and instructions relating to
demat account details of the applicant with the depositories. The application
form shall specifically and clearly indicate as to where the demat account
details of the applicant are to be filled in.�
There shall be specific and distinct space in application form for filling
up the demat account details. The application form shall contain clear and
specific instructions regarding the manner of filling up the respective demat
account details
(f)
Brief mention of
the various intended modes of making refunds (as disclosed in the offer
document)
(8)
Application by
Mutual Funds.
(D) Any special tax benefits for the issuer and its
shareholders (Only section numbers of the Income Tax Act, 1961 and their
substance should be mentioned, without reproducing the text of the sections).
(IV)
�Particulars of
the Issue:
(A) Objects of the issue
(B) Project cost
(C) Means of financing
(D) Name of Appraising Agency, if any.
(E)
Name of
Monitoring Agency, if appointed by the issuer and the disclosure as to whether
the appointment is pursuant to regulation 16 of these regulations.
(V)
Issuer, Management and Project:
(A) History and main objects and present business of the
issuer.
(B) Promoters and their background.
(C) Names, address and occupation of manager, managing
director, and other Directors (including nominee-directors and whole-time
directors) giving their directorships in other companies.
(D) Location of the project.
(E)
Plant and
machinery, technology, process, etc.
(F)
Collaboration,
any performance guarantee or assistance in marketing by the collaborators.
(G) Infrastructure facilities for raw materials and
utilities like water, electricity, etc.
(H) Schedule of implementation of the project and progress
made so far, giving details of land acquisition, civil works, installation of
plant and machinery, trial production, date of commercial production, etc.
(I)
Products or
Services:
(1)
Nature of the products
or services and end users
(2)
Existing,
licensed and installed capacity of the product, demand of the
product,-existing, and estimated in the coming years as estimates by a
Government authority or by any other reliable institution, giving source of the
information. In case the issuer is providing services, relevant information in
regard to nature/ extent of services, etc., have to be furnished.
(3)
Approach to
marketing and proposed marketing set up.
(4)
Export
possibilities and export obligations, if any.
(5)
Stock Market
Data: Particulars of:
(a)
high,. low and
average market prices of the equity shares of the issuer during the preceding
three years;
(b)
monthly high and
low prices for the six months preceding the date of filing the offer document;
(c)
number of equity
shares traded on the days when high and low prices were recorded in the
relevant stock exchange during period specified in clause (a) and (b) above and
the total volume traded on those dates;
(d)
the stock market
data shall be shown separately for periods marked by a change in capital
structure, with such period commencing from the date the stock exchange
concerned recognizes the change in the capital structure (e.g., when the equity
shares have become ex-rights or ex-bonus);
(e)
the market price
immediately after the date on which the resolution of the Board of Directors
approving the issue was approved;
(f)
the volume of
specified securities traded in each month during the six months preceding the
date on which the offer document is registered with Registrar of Companies;
(g)
Along with high,
low and average prices of shares of the issuer, details relating to volume of
business transacted should also be stated for respective periods.
(VI)
Following particulars in regard to the listed
companies under the same management which made any capital issue in the last
three years:
(A) Name of the issuer
(B) Year of issue
(C) Type of issue (public/ rights/ composite)
(D) Amount of issue
(E)
Date of closure
of issue
(F)
Date of despatch
of share/ debenture certificate completed
(G) Date of completion of the project, where object of the
issue was financing of a project
(H) Rate of dividend paid, if any.
(VII)
Basis for Issue Price:
(A) Earnings per share and Diluted Earnings Per Share,
pre-issue, for the last three years (as adjusted for changes in capital);
(B) P/E pre-issue
(C) Average return on net worth in the last three years
(D) Minimum return on increased net worth required to
maintain pre-issue EPS;
(E)
Net Asset Value
per share based on last balance sheet;
(F)
Net Asset Value
per share after issue and comparison thereof with the issue price.
(G) Comparison of all the accounting ratios of the issuer
as mentioned above with the industry average and with the accounting ratios of
the peer group (i.e., companies of comparable size in the same industry.
(Indicate the source from which industry average and accounting ratios of the
peer group has been taken), subject to the following:
(1)
the projected
earnings shall not be used as a justification for the issue price in the offer
document.
(2)
the accounting
ratios disclosed in the offer documents in support of basis of the issue price
shall be calculated after giving effect to the consequent increase in capital
on account of compulsory conversions outstanding, as well as on the assumption
that the options outstanding, if any, to subscribe for additional capital will
be exercised.
(H) The face value of shares (including the statement
about the issue price being �X� times of the face value)
(VIII)
Outstanding Litigations and Defaults: Whether all payment/refunds, debentures, deposits of
banks or companies, interest on deposits, debenture interest, institutional
dues have been paid up to date. If not, details of the arrears, if any, to be
stated.
(IX)
Material Development: Any material development after
the date of the latest balance sheet and its impact on performance and
prospects of the issuer.
(X)
Expert opinion obtained, if any.
(XI)
Change, if any, in directors and auditors during the
last three years and reasons thereof.
(XII)
Time and Place of Inspection of material contracts
(List of material contracts not required)
(XIII)
Financial Performance of the Issuer for the Last Five
Years (Figures to be taken from the audited annual accounts in a tabular form)
(A) Balance Sheet Data: Equity Capital, Reserves (State
Revaluation Reserve, the year of revaluation and its monetary effect on assets)
and borrowings
(B) Profit and Loss data: Sales, Gross profit, Net profit,
dividend paid, if any
(C) Any change in accounting policies during the last
three years and their effect on the profits and the reserves of the issuer
(D) Following information as extracted from the report of
the auditors reproduced in the main offer document in terms of clause B above:
(1)
net profit before
accounting for extra ordinary items
(2)
extra ordinary
items
(3)
net profit after
accounting for extra ordinary items
(E)
Management
Discussions and Analysis on Accounts
(XIV)Listed Ventures of Promoters
(XV)
Previous Public or Rights Issues, if any , during last
five years
(XVI)Disclosure on Investor Grievances &
Redressal System
(XVII)
Statement regarding minimum subscription clause: The following statements shall appear depending upon
the type of issue:
(A) For Non-underwritten Public Issues:
�If the issuer does not receive the minimum
subscription of ninety per cent. of the offer through offer document on the
date of closure of the issue, or if the subscription level falls below ninety
per cent. after the closure of issue on account of cheques having being
returned unpaid or withdrawal of applications, the issuer shall forthwith
refund the entire subscription amount received. If there is a delay beyond 8
days after the issuer becomes liable to pay the amount, the issuer shall pay
interest as per Section 73 of the Companies Act 1956.�
(B) For Underwritten Public Issues:
�If the issuer does not receive the minimum
subscription of 90% of the offer through offer document including devolvement
of underwriters within 60 days from the date of closure of the issue, the
issuer shall forthwith refund the entire subscription amount received. If there
is a delay beyond 8 days after the issuer becomes liable to pay the amount, the
issuer shall pay interest prescribed under Section 73 of the Companies Act
1956.�
(C) For Composite Issues:
(1)
The Lead Merchant
Banker shall ensure that the requirement of "minimum subscription" is
satisfied both jointly and severally, i.e., independently for both rights and
public issues.
(2)
If the issuer
does not receive the minimum subscription in either of the issues the issuer
shall refund the entire subscription received.
(XVIII)
Signatories to the Offer Document.
[See regulation 57(2)(b)]
DISCLOSURES IN LETTER OF OFFER
(1) A listed issuer making a
rights issue of specified securities shall make disclosures, as specified in
clause (5) of this Part, in the letter of offer, if it satisfies the following
conditions:
(a) the issuer has been filing
periodic reports, statements and information in compliance with the listing
agreement for the last three years immediately preceding the date of filing the letter of offer with the
designated stock exchange in case of a
fast track issue and in any other case, the date of filing the draft letter of
offer with the Board;
(b) the reports, statements and
information referred to in sub-clause (a) above are available on the website of
any recognised stock exchange with nationwide trading terminals or on a common
e-filing platform specified by the Board;
(c) the issuer has investor
grievance-handling mechanism which includes meeting of the Shareholders� or
Investors� Grievance Committee at frequent intervals, appropriate delegation of
power by the board of directors of the issuer as regards share transfer and
clearly laid down systems and procedures for timely and satisfactory redressal
of investor grievances.
��
(2) If the listed issuer does
not satisfy the conditions specified in clause (1), it shall make disclosures
in the letter of offer:
(a) as specified in Part A,
except for disclosures as specified in clause (4);
(b) as specified in items
(XVI)(B)(4), (5) and (6) in clause (5) of this Part.
(3) Irrespective of whether the
conditions specified in clause (1) are satisfied or not, the following listed
issuers shall make disclosures in the letter of offer as specified in Part A,
except for disclosures as specified in clause (4):
(a) a listed issuer whose
management has undergone change pursuant to acquisition of control in
accordance with the provisions of Securities and Exchange Board of India (Substantial
Acquisition of Shares and Takeovers) Regulations, 1997 and is making a rights
issue of specified securities for the first time subsequent to such change;
(b) an issuer whose specified
securities have been listed consequent to relaxation granted by the Board under
sub-rule (7) of rule 19 of the Securities Contracts (Regulation) Rules, 1957
for listing of its specified securities pursuant to a scheme sanctioned by a
High Court under sections 391 to 394 of the Companies Act, 1956 and is making a
rights issue of specified securities for the first time subsequent to such
listing.
(4) In respect of an issuer
making disclosures in terms of clauses (2) and (3) above, the disclosures
specified in the following items in Part (A) shall not be applicable:
(a) Sub-item (C) of item (V);
(b) Sub-para (b) of para (2) of
sub-item (B) of item (XII);
(c) Sub-para (a) of para (3) of
sub-item (B) of item (XII);
(d) Sub-para (b) of para (3) of
sub-item (B) of item (XII);
(e) Sub-para (c) of para (3) of
sub-item (B) of item (XII);
(f)
Para (18) of sub-item (B) of item (XII);
(g) Para (19) of sub-item (B)
of item (XII).
(5) A listed issuer referred to
in clause (1) shall make the following disclosures in the letter of offer, as far as possible, in the order in which the
disclosures are specified in this clause:
(I)
Cover
Pages: The cover page paper shall be
of adequate thickness (preferably minimum hundred gcm. quality).
(A)
Front Cover Pages:
(1)
The front outside and inside cover pages of
the letter of offer shall be white and no patterns or pictures shall be printed
on these pages.
(2)
The front outside cover page of the letter of
offer shall contain only the following details:
(a) The
words "Letter of Offer".
(b)
The name of the
issuer, its logo, address of its registered office, its telephone number, fax
number, contact person, website address and e-mail address.
(c) The nature, number, price and amount of specified
securities offered and issue size, as may be applicable.
(d) The
following clause on general risk :
"Investment in equity and equity related securities involve a
degree of risk and investors should not invest any funds in this offer unless
they can afford to take the risk of losing their investment. Investors are
advised to read the risk factors carefully before taking an investment decision
in this offering. For taking an investment decision, investors must rely on
their own examination of the issuer and the offer including the risks involved.
The securities being offered in the issue have not been recommended or approved
by Securities and Exchange Board of India (SEBI) nor does SEBI guarantee the
accuracy or adequacy of this document."
Specific attention of investors shall be invited to the statement of
�Risk factors� given on page number(s) �.. under the section �General Risks�.
(e)
The following
clause on �Issuer�s Absolute Responsibility� shall be incorporated in a box
format:
"The issuer, having made all reasonable inquiries, accepts
responsibility for and confirms that this letter of offer contains all
information with regard to the issuer and the issue, which is material in the
context of the issue, that the information contained in the letter of offer is
true and correct in all material aspects and is not misleading in any material
respect, that the opinions and intentions expressed herein are honestly held
and that there are no other facts, the omission of which make this document as
a whole or any of such information or the expression of any such opinions or
intentions misleading in any material respect."
(f)
The names, logos and addresses of all the lead
merchant bankers with their titles who
have signed the due diligence certificate and filed the letter of offer with the Board, along with
their telephone numbers, fax numbers, website addresses and e-mail addresses.
(g) The
name, logo and address of the registrar to the issue, along with its telephone
number, fax number, website address and e-mail address.
(h) Issue
schedule:
(i)
Date of opening of the issue.
(ii)
Date of closing of the issue.
(iii)
Last date for request for split.
(i)
The names of the recognised stock exchanges
where the specified securities of the issuer are listed and the details of
in-principle approval for listing of the specified securities proposed to be
offered in the rights issue.
(B)
Back Cover Pages: The
back inside cover page and back outside cover page shall be in white.
(II)
Table of Contents: The
table of contents shall appear immediately after the front inside cover page.
(III)
Definitions and
Abbreviations:
(A)
Conventional or general terms.
(B)
Issue related terms.
(C)
Issuer and industry related terms.
(D)
Abbreviations.
(IV)
Risk Factors:
(A)
The risk factors shall be printed in clear
readable font (preferably of minimum point ten size).
(B)
The risk factors shall be in relation to the
following:
(1)
the issue and objects of the issue;
(2)
the issuer and its ongoing business
activities;
(3)
the material
litigations which impact the business of the issuer.
(C)
The risk factors shall be determined on the
basis of their materiality. In
determining the materiality of risk factors, the following shall be considered:
(1)
Some events may not be material individually
but may be found material collectively.
(2)
Some risks may have an impact which is
qualitative though not quantitative.
(3)
Some risks may not be material at the time of
making the disclosures in the letter of
offer but may have a material impact in the future.
(D)
The risk factors shall appear in the letter of
offer in the following manner:
(1)
The risks envisaged by the management.
(2)
The proposals, if any, to address the risks and the manner in which the
same are proposed to be addressed.
(E)
The proposals to
address risks shall not contain any speculative statement on the positive
outcome to any litigation, etc.
(F)
The proposals to
address risks shall not be given for
any matter that is sub-judice before any Court or Tribunal.
(G)
The risk factors shall be disclosed in the
descending order of materiality. Wherever risks about material impact
are stated, the financial and other implications of the same shall be
disclosed. If it cannot be quantified, a distinct statement about the fact that
the implications cannot be quantified shall be made.
(V)
Prominent notes: This section shall contain notes which are required to be
given prominence and shall also include the following:
(A)
The net worth before the issue (as per latest
audited financial statement disclosed in the letter of offer) and issue size.
(B)
The details of transactions by the issuer with
group or subsidiary companies during one year immediately preceding the date of filing the letter of offer with the
designated stock exchange, in case of a fast track issue and in any other case,
the date of filing draft letter of offer with the Board, the nature of transactions and the
cumulative value of transactions.
(C) The details of all financing arrangements whereby the
promoter group, the directors of the company which is a promoter of the issuer,
the directors of the issuer and their relatives have financed the purchase by
any other person of securities of the issuer other than in the normal course of
the business of the financing entity during the period of six months
immediately preceding the date of filing the letter of offer with the
designated stock exchange, in case of a fast track issue and in any other case,
the date of filing draft letter of offer with the Board.
(VI)
Introduction:
(A)
Summary:
(1)
Issue details in brief.
(2)
Summary consolidated financial, operating and
other data.
(B)
General Information:
(1)
The name and
address of the registered office and the registration number of the issuer,
along with the address of the Registrar of Companies where the issuer is
registered.
(2)
The names, addresses,
telephone numbers, fax numbers and e-mail addresses of the Company Secretary
and compliance officer of the issuer.
(3)
The names, addresses,
telephone numbers, fax numbers, contact person, website addresses and e-mail
addresses of the bankers to the issue, Self Certified Syndicate Bankers and legal
advisors to the issue.
(4)
The statement of
inter-se allocation of responsibilities
among lead merchant bankers, where more than one merchant banker is
associated with the issue.
(5)
The following details of credit rating, in case of a rights issue of
convertible debt instruments:
(a) �The
details of all the credit ratings including unaccepted rating obtained for the
issue of convertible debt instruments.
(b) All
credit ratings obtained during the three previous years before filing the
letter of offer for any of its listed convertible debt instruments at the time
of accessing the market through a convertible debt instrument.
(6)
The names, addresses, telephone numbers, fax
numbers, website addresses and e-mail addresses of the trustees under debenture
trust deed, in case of a rights issue of convertible
debt instruments.
(7)
The name of the monitoring agency, if appointed and the disclosure as to whether the
appointment is pursuant to regulation 16 of these regulations.
(8)
The name, address, telephone number and e-mail
address of the appraising entity, in case the project has been appraised.
(9)
The details of underwriting, if any:
(a) The
names, address, telephone numbers, fax numbers and e-mail address of the
underwriters and the amount underwritten by them.
(b) A
declaration by the board of directors of the issuer that the underwriters have
sufficient resources to discharge their respective obligations.
(c) In case of partial underwriting of the issue, the
extent of underwriting.
(d) The details of final
underwriting arrangement in the letter of offer filed with the designated stock
exchange, indicating actual number of specified securities underwritten.
(10)
The principal terms of loan and assets charged
as security.
(C)
Capital Structure:
(1)
The authorised, issued and subscribed capital
after suitable incorporation of the outstanding convertible securities (number
of securities, description and aggregate nominal value).
(2)
Paid-up capital.
(3)
The following details of outstanding
instruments:
(a) Details
of options, if any.
(b) Details
of convertible securities, if any.
(4)
The details of specified securities held by
promoter and promoter group including the details of lock-in, pledge of and
encumbrance on such specified securities.
(5)
The details of shares acquired by promoters
and promoter group in the last one year immediately preceding the date of
filing the letter of offer with the designated stock exchange, in case of a
fast track issue and in any other case, the date of filing draft letter of
offer with the Board.
(6)
The intention and extent of participation by
promoters and promoter group in the issue with respect to:
(a) their
rights entitlement.
(b) the
unsubscribed portion over and above their rights entitlement.
(7)
The shareholding pattern as per the latest
filing with the recognised stock exchange(s).
(8)
The details of the shareholders holding more
than one per cent. of the share capital of the issuer.
�����������������������������
(VII)
�Particulars of the Issue
(A)
Objects of the Issue:
(1)
The objects of
the issue shall be disclosed.
(2)
If one of the
objects is investment in a joint venture or subsidiary or an acquisition, the
following additional disclosures shall be made:
(a)
The details of
the form of investment, i.e., equity, debt or any other instrument
(b)
If the form of
investment has not been decided, a statement to that effect;
(c)
If the investment
is in debt instruments, complete details regarding the rate of interest, nature
of security, terms of repayment, subordination, etc.
(d)
If the investment
is in equity, whether any dividends are assured;
(e)
The nature of
benefit expected to accrue to the issuer as a result of the investment;
(3)
If one of the
objects of the issue is the grant of a loan to any entity, details of the loan
agreements including the rate of interest, whether secured or unsecured,
duration, nature of security, terms of repayment, subordination, etc. and the
nature of benefit expected to accrue to the issuer as a result of the
investment. If such loan is to be granted to a subsidiary, group or associate
company, details of the same.
(4)
If one of the
objects of the issue is utilisation of the issue proceeds for long term working
capital, the following additional disclosures shall be made.
(a)
Basis of
estimation of working capital requirement, along with relevant assumptions.
(b)
Reasons for
raising additional working capital, substantiating the same with relevant facts
and figures.
(c)
Details of the
projected working capital requirement including detailed assessment of working
capital after implementation of the project or achievement of objects of the
issue, as the case may be, capacity utilisation assumptions, break-up of
expected current assets into raw materials, finished goods, work in progress,
sundry debtors etc., along with the assumption about the holding norms for each
type of current asset, total current liabilities, net current assets and
envisaged sources of finance for net current assets, i.e., bank finance,
institutional finance, own funds, etc.
(d)
The total
envisaged working capital requirement in a tabular form, the margin money
thereof and the portion to be financed by any bank(s) or otherwise.
(e)
A complete
perspective on the present working capital position vis-�-vis the projected
working capital position based on which the money is proposed to be raised in
the public issue.
(f)
Details of the
existing working capital available with the issuer, along with a break-up of
total current assets into raw materials, finished goods, work in progress,
sundry debtors, etc., total current liabilities, net current assets and sources
of finance for net current assets, i.e., bank finance, institutional finance,
own funds, etc.
(g)
If no working
capital is shown as part of the project for which issue is being made, the
reasons therefor.
(B)
Requirement of Funds:
(2)
The requirement
for funds proposed to be raised through the issue.
(3)
Where the issuer
proposes to undertake more than one activity or project, such as
diversification, modernisation, expansion, etc., the total project cost shall
be given activity-wise or project wise, as the case may be.
(4)
Where the issuer
is implementing the project in a phased manner, the cost of each phase
including the phase, if any, which has already been implemented, shall be
separately given.
(5)
The details of
all material existing or anticipated transactions in relation to the utlisation
of the issue proceeds or project cost with promoters, directors, key management
personnel, associates and group companies. The relevant documents shall be
included in the list of material documents for inspection.
(6)
If object of the
issue is to fund a project, the following details shall be given:
(a) location
of the project
(b) plant
and machinery, technology, process, etc.
(c) collaboration,
performance guarantee if any, or assistance in marketing by the collaborators.
(d) infrastructure
facilities for raw materials and utilities like water, electricity, etc.
(7)
If the proceeds, or any
part of the proceeds, of the issue are, or is, to be applied directly or
indirectly:
(a) in
the purchase of any business; or
(b) in
the purchase of an interest in any business and by reason of that purchase, or
anything to be done in consequence thereof, or in connection therewith; the
issuer will become entitled to an interest as respects either the capital or
profits and losses or both, in such business exceeding fifty percent, thereof;
a report made by accountants (who shall be named in the letter of
offer) upon:
(i)
the profits or losses of the business of each
of the five financial years immediately preceding the issue of the letter of
offer; and
(ii)
the assets and liabilities of the business at
the last date to which the accounts of the business were made up, being a date
not more than six months before the date of the issue of the letter of offer.
(8)
If:
(a) the
proceeds, or any part of the proceeds, of the issue of the shares or debentures
are or is to be applied directly or indirectly in any manner resulting in the
acquisition by the issuer of shares in any other body corporate; and
(b) by
reason of that acquisition or anything to be done in consequence thereof or in
connection therewith, that body corporate will become a subsidiary of the
issuer;
a report made by accountants (who shall be
named in the letter of offer) upon:
(i)
the profits or losses of the other body
corporate for each of the five financial years immediately preceding the issue
of the Letter of Offer; and
(ii) the
assets and liabilities of the other body corporate at the last date to which
its accounts were made up.
(9)
Strategic partners, if applicable, to the
project or objects of the issue.
(10) Financial
partners, if applicable to the project or objects of the issue.
(D)
Funding Plan (Means of
Finance):
(1)
An undertaking
shall be given in the letter of offer by the issuer confirming that firm
arrangements of finance through verifiable means towards seventy five per cent.
of the stated means of finance, excluding the amount to be raised through
proposed issue and existing identifiable internal accruals, have been made.
(2)
The balance portion of the means of finance
for which no firm arrangement has been made
shall be mentioned without specification.
(3)
The details of funds tied up and the avenues for
deployment of excess proceeds, if any.
(E)
Appraisal:
(1)
The scope and
purpose of the appraisal, if any, along with the date of appraisal.
(2)
The cost of the
project and means of finance as per the appraisal report.
(3)
Explanation
regarding revision, if any, in the project cost and the means of finance after
the date of issue of the appraisal report.
(4)
The weaknesses and threats, if
any, given in the appraisal report, by way of risk factors.
(F)
Schedule of Implementation:
The schedule of implementation of the project in a tabular form and the progress made so far, giving details
of land acquisition, civil works, installation of plant and machinery, trial
production, date of commercial production and reasons for delay, if any.
(G)
Deployment of Funds:
(1)
The details of
the sources of funds and the deployment of these funds on the project (where
the issuer is raising capital for a project), up to a date not earlier than two months from the
date of filing the letter of offer with the designated stock exchange, as
certified by a Chartered Accountant, along with the name of the chartered
accountant and the date of the certificate.
(2)
Where
share application money brought in advance by the promoters is deployed in the
project and the same is being adjusted towards their rights entitlement in the
rights issue, the extent of deployment and utilisation of the funds brought in
by the promoters shall be disclosed.
(H)
Sources of Financing of
Funds Already Deployed: Means and source of financing, including
details of "bridge loan" or other financial arrangement, which may be
repaid from the proceeds of the issue.
(I)
Details of Balance Fund
Deployment: Year wise break up of the expenditure proposed to
be incurred on the said project.
(J)
Interim Use of Funds: Investment
avenues in which the management proposes to deploy issue proceeds, pending its
utilisation in the proposed project.
(K)
Any special tax benefits
for the issuer and its shareholders.
(L)
Key Industry Regulations
for the proposed objects of the issue (if different from existing business of
the issuer)
(M)
Interest of promoters and
directors, as applicable to the project or objects of the issue
(VIII) History and Corporate Structure about the Issuer: In
case the issuer has not come out with any issue in the past ten years or more,
a brief statement about the history and corporate structure of the issuer, main
objects of the issuer and major events in the past.
(IX)
Management (Board of
Directors):
(A)
Name, age,
qualifications, Director Identification Number, experience, address, occupation
and date of expiration of the current term of office of manager, managing
director, and other directors (including nominee directors, whole-time
directors), giving their directorships in other companies.���������
(B) The nature of any family relationship between any of
the directors.
(C) Any arrangement or understanding with major
shareholders, customers, suppliers or others, pursuant to which of the
directors was selected as a director or member of senior management.
(D)
Details of
service contracts entered into by the directors with the issuer providing for
benefits upon termination of employment and a distinct negative statement in
the absence of any such contract.
(X)
Financial Information of
the Issuer:
(A)
Stand-alone and consolidated financial
statements of the issuer:
(4)
A report by the auditors of the issuer with
respect to profit or loss and assets and liabilities (indicating changes in
accounting policies, if any) in respect of the last completed accounting year
for which audit has been completed.
(5)
A report by the auditors of the issuer on a
limited review of the profit or loss and assets and liabilities (indicating
changes in accounting policies, if any), as at a date not earlier than six
months prior to the date of the opening of the issue, where audited accounts as
at such date are not available.
(6)
For the purpose of clauses (1) and (2) above,
it shall be sufficient if:
(a) In
the statement of the assets and liabilities, the main heads of assets and
liabilities as provided in Part I of Schedule VI of the Companies Act, 1956
have been provided. If an issuer is governed by a statute other than the
Companies Act, 1956, the main heads of assets and liabilities as specified in
such statute shall be provided in the statement of assets and liabilities.
(b) In
the statement of profit or loss, the information required to be disclosed under
the heads of income and expenditure as per clause 41 of the equity listing
agreement in respect of quarterly financial information to be filed with the
recognised stock exchanges, has been provided.
(B)
In addition, in accordance with Ministry of
Finance Circular no.F.2/5/SE/76 dated February 05, 1977 and amended further on
March 08, 1977, the following information for the period between the last date
of the balance sheet and profit and loss account sent to the shareholders and
up to the end of the last but one month preceding the date of the letter of
offer shall be furnished.
(2)
Working results of the issuer under following
heads:
(a) (i)
Sales / turnover
������� ��������� ��������(ii) Other income
(b) Estimated
gross profit / loss (excluding depreciation and taxes)
(c) (i)
Provision for depreciation
������ ���������� ��������(ii) Provision for taxes
(d) Estimated
net profit / loss
(3)
Material changes and commitments, if any
affecting financial position of the issuer.
(4)
Week-end prices for the last four weeks;
current market price; and highest and lowest prices of equity shares during the
period with the relative dates
(C)
Stock market quotation of shares/ convertible
instruments of the company (high/ low price in each of the last three years and
monthly high/low price during the last six months).
(D)
Accounting and other ratios: The following accounting
ratios shall be given for each of the accounting periods for which financial
information is given:
(5)
Earnings per share: This ratio shall be
calculated after excluding extra ordinary items.
(6)
Return on Networth: This ratio shall be
calculated excluding revaluation reserves.
(7)
Net Asset Value per share: This ratio shall be
calculated excluding revaluation reserves.
(8)
Accounting and other ratios shall be based on
the financial statements prepared on the basis of Indian Accounting Standards.
(E)
Capitalisation Statement:
(4)
A Capitalisation
Statement showing total debt, net worth, and the debt/ equity ratios before and
after the issue is made shall be incorporated.
(5)
In case of any
change in the share capital since the date as of which the financial
information has been disclosed in the prospectus, a note explaining the nature
of the change shall be given.
(6)
An illustrative
format of the Capitalisation Statement is specified hereunder:
|
Particulars |
Pre-issue as at 30-6-1995 |
As Adjusted for issue |
|
� (Rupees
in lakhs) |
||
|
Short-Term Debt����������������������������������� � |
1870 |
1870 |
|
Long Term Debt����������������������������������� �� |
4370 |
4370 |
|
Shareholders
Funds |
|
|
|
Share Capital����������������������������������� ������� |
4000 |
4450 |
|
Reserves��������������������������������� ���������������� |
14570 |
� 37520 |
|
Total
Shareholders Funds |
18570 |
41940 |
|
Long
Term Debt/Equity |
0.24:1 |
0.10:1 |
|
Note: Since 31-3-1995
(which is the last date as of which financial information has been given in
para � of this document), share capital was increased from Rs.3000 lacs to
Rs.4000 lacs by the issue of bonus shares in the ratio of 1 share for every 3
shares. |
||
(F)
One standard financial unit shall be used in
the Letter of Offer
(XI)
A statement to the effect that the price has
been arrived at in consultation between the issuer and the Merchant banker.
(XII)
Outstanding Litigations and
Defaults: The following details shall be disclosed by the
issuer:
(A)
Pending matters which, if they result in an
adverse outcome, would materially and adversely affect the operations or the
financial position of the issuer.
(B)
Matters which are pending or which have arisen
in the immediately preceding ten years involving:
(1)
Issues of moral turpitude or criminal
liability on the part of the issuer
(2)
Material violations of statutory regulations
by the issuer
(3)
Economic offences where proceedings have been
initiated against the issuer.
(C)
For the purpose of determining materiality,
the following tests or parameters shall be applied:
(1)
For the outstanding litigations which may not
have any impact on the future revenues, the disclosure is required:
(a)
Where the aggregate amount involved in such
individual litigation exceeds one per cent. of the net worth of the issuer as
per last completed financial year; or
(b)
Where the decision in one case is likely to
affect the decision in similar cases, even though the amount involved in single
case individually may not exceed one per cent. of the net worth of the issuer
as per the last completed financial year.
(2)
For the outstanding litigations which may have
any impact on the future revenues, the disclosure is required:
(a)
Where the aggregate amount involved in such
individual litigation is likely to exceed one per cent. of the total revenue of
the issuer as per last completed financial year; or
(b)
Where the decision in one case is likely to
affect the decision in similar cases, even though the amount involved in single
case individually may not exceed one per cent. of the total revenue of the
issuer, if similar cases put together collectively exceed one per cent. of
total revenue of the issuer as per last completed financial year.
(D)
These disclosures shall be made in respect of
the issuer and the subsidiary companies of the issuer whose financial
statements are included in the offer document, either separately or in
consolidated form.
(XIII) Government Approvals or Licensing
Arrangements: In case of a new line of activity/project, all
pending government and regulatory approvals; In case of an existing line of
activity/project, al pending regulatory and government approvals and pending
renewals of licences.
(XIV)
Material
Development: Any material development
after the date of the latest balance sheet and its impact on performance and
prospects of the issuer.
(XV)
Other Regulatory and
Statutory Disclosures:
(A) Authority for the issue and
details of resolution passed for the issue.
(B) A statement by the issuer
that the issuer, promoters, promoter group, directors or person(s) in control
of the promoter have not been prohibited from accessing or operating in the
capital markets or restrained from buying, selling or dealing in securities
under any order or direction passed by the Board.
(C) A confirmation whether any of the directors of the
issuer are associated with the securities market in any manner, if yes, whether
the Board has initiated any action against the said entities and the related
details.
(D) It may be disclosed whether the issuer, promoters,
group companies, the relatives (as per Companies Act,1956) of promoters, group
companies are identified as willful defaulters by Reserve Bank of India or
other authorities.
(E) A statement to the effect
that the issuer is in compliance with provisions specified in Part E of this
Schedule.
(F) Details of compliance with
eligibility requirements to make a fast track issue, if applicable.
(G) Disclaimer clauses:
(1)
The letter of offer shall contain the following disclaimer clause in bold
capital letters:
"It is to be distinctly understood that
submission of Letter of Offer to SEBI should not in any way be deemed or
construed that the same has been cleared or approved by SEBI. SEBI does not
take any responsibility either for the financial soundness of any scheme or the
project for which the issue is proposed to be made or for the correctness of
the statements made or opinions expressed in the Letter of Offer. Lead merchant
banker, �� has certified that the disclosures made in the Letter of Offer are
generally adequate and are in conformity with SEBI (Issue of Capital and
Disclosure Requirements) Regulations, 2009 in force for the time being. This
requirement is to facilitate investors to take an informed decision for making
investment in the proposed issue.
����������� It should also be clearly understood that while the
issuer is primarily responsible for the correctness, adequacy and disclosure of
all relevant information in the letter of offer, the lead merchant banker is expected
to exercise due diligence to ensure that the issuer discharges its
responsibility adequately in this behalf and towards this purpose, the lead
merchant banker ��. has furnished to the
Securities and Exchange Board of India (SEBI) a due diligence certificate dated ��.which
reads as follows:
(due diligence certificate
submitted to the Board to be reproduced here)
����������� The filing of the letter of offer does not, however,
absolve the issuer from any liabilities under section 63 or section 68 of the
Companies Act, 1956 or from the requirement of obtaining such statutory or
other clearances as may be required for the purpose of the proposed issue. SEBI
further reserves the right to take up, at any point of time, with the lead
merchant banker any irregularities or lapses in letter of offer."
(2)
Disclaimer Statement from the issuer and lead merchant
banker:
A statement to the effect that the issuer and
the lead merchant banker accept no
responsibility for statements made otherwise than in the Letter of Offer or in
the advertisement or any other material issued by or at the instance of the
issuer and that anyone placing reliance on any other source of information
would be doing so at his own risk.
Investors who invest in the issue will be
deemed to have been represented by the issuer and lead manager and their
respective directors, officers, agents, affiliates and representatives that
they are eligible under all applicable laws, rules, regulations, guidelines and
approvals to acquire equity shares of our company, and are relying on
independent advice / evaluation as to their ability and quantum of investment
in this issue.
(3)
Disclaimer in respect of jurisdiction: A brief
paragraph mentioning the jurisdiction under which provisions of law and the
rules and regulations are applicable to the letter of offer.
(4)
Disclaimer clause of the stock exchanges, if
any
(5)
Disclaimer clause of the Reserve Bank of India
(if applicable).
(H) The fact of filing the
letter of offer with the Board and the stock exchange(s) and the office of the
Board where the letter of offer has been filed
(I)
Details of fees payable to (in terms of amount, as a percentage of
total issue expenses and as a percentage of total issue size):
(1)
Lead merchant bankers.
(2)
Co-lead merchant bankers, if any
(3)
Co-managers, if any
(4)
Other merchant bankers
(5)
Registrars to the issue
(6)
Advisors
(7)
Bankers to the issue
(8)
Trustees for the debt instrument holders.
(9)
Others
(10)
Underwriting commission, brokerage and selling
commission.
(J)
Arrangements or any mechanism evolved by the issuer for redressal of
investor grievances and the time normally taken by it for disposal of various
types of investor grievances.
(XVI)
Offering Information:
(A)
Terms of payments and procedure and time
schedule for allotment and issue of certificates, credit of specified
securities to the investors� demat account.
(B) How to apply, availability
of application forms and letter of offer and mode of payment, including the
following:
(1)
Applications by mutual funds:
(a) The necessary disclosures under the heads
"Procedure for applications by mutual funds" and "Multiple
Applications" shall be incorporated to indicate that a separate
application can be made in respect of each scheme of an Indian mutual fund
registered with the Board and that such applications shall not be treated as
multiple applications.
(b)
A disclosure that
the applications made by asset management companies or custodians of a mutual
fund shall clearly indicate the name of the concerned scheme for which
application is being made.
(2)
Applications by
non-resident Indians: The following
disclosures shall be made:
(a) the name and address of at least one place in India
from where individual non-resident Indian applicants can obtain the application
forms.
(b) A statement that: "non-resident Indian applicants
may please note that only such applications as are accompanied by payment in
free foreign exchange shall be considered for allotment under the reserved
category. The non-resident Indians who intend to make payment through
Non-Resident Ordinary (NRO) accounts shall use the form meant for Resident
Indians and shall not use the forms meant for reserved category."
(3)
Application by ASBA investors: Disclosures
regarding eligible ASBA investors and ASBA process including specific
instructions for submitting Application
Supported by Blocked Amount.
(4)
A statement that the shareholders who have not
received the application form may, along with the requisite application money,
apply in writing on a plain paper.
(5)
The format to enable the shareholders to make
the application on plain paper specifying therein necessary particulars such as
name, address, ratio of rights issue, issue price, number of equity shares
held, ledger folio numbers, depository participant ID, client ID, number of
equity shares entitled and applied for, additional shares if any, amount to be
paid along with application, and particulars of cheque, etc. to be drawn in
favour of the issuer�s account;
(6)
A statement that the shareholders making the
application otherwise than on the application form shall not renounce their
rights and shall not utilise the application form for any purpose including
renunciation even if it is received subsequently.
(C)
Provisions of
sub-section (1) of section 68A of the Companies Act, 1956 relating to
punishment for fictitious applications, including the disclosures that any person who:
(1)
makes in a fictitious name an application to a
company for acquiring, or subscribing for, any shares therein, or
(2)
otherwise induces a company to allot, or
register any transfer of, shares therein to him, or any other person in a
fictitious name, shall be punishable with imprisonment for a term which may
extend to five years.
(D)
Declaration about the credit of specified
securities to the demat account / refunds within a period of fifteen days and
interest in case of delay in refund at the prescribed rate.
(E)
Mode of making refunds:
(1)
The mode in which the issuer shall make
refunds to applicants in case of oversubscription.
(2)
If the issuer proposes to use more than one
mode of making refunds to applicants, the respective cases where each such mode
will be adopted shall be disclosed.
(3)
The permissible modes of making refunds are as
follows:
(a)
In case of applicants residing in any of the
centres specified by the Board: by crediting of refunds to the bank accounts of
applicants through electronic transfer of funds by using ECS (Electronic
Clearing Service), Direct Credit, RTGS (Real Time Gross Settlement) or NEFT
(National Electronic Funds Transfer), as is for the time being permitted by the
Reserve Bank of India;
(b)
In case of other applicants: by despatch of refund
orders by registered post, where the value is Rs 1500/- or more, or under
certificate of posting in other cases, (subject however to postal rules); and
(c)
In case of any category of applicants specified by
the Board: crediting of refunds to the applicants in any other electronic
manner permissible under the banking laws for the time being in force which is
permitted by the Board from time to time.
(XVII)
Undertakings by the issuer
in connection with the issue: The issuer shall
undertake that:
(A)
the complaints received in respect of the
Issue shall be attended to by the issuer expeditiously and satisfactorily.
(B)
that steps for completion of the necessary
formalities for listing and commencement of trading at all stock exchanges
where the specified securities are to be listed are taken within seven working
days of finalisation of basis of allotment.
(C)
funds required for making refunds to
unsuccessful applicants as per the mode(s) disclosed shall be made available to
the Registrar to the issue by the issuer.
(D)
that where refunds are made through electronic
transfer of funds, a suitable communication shall be sent to the applicant
within 15 days of closure of the issue giving details of the bank where refunds
shall be credited along with amount and expected date of electronic credit of
refund.
(E)
that adequate arrangements shall be made to
collect all ASBA applications and to consider them similar to non-ASBA
applications while finalizing the basis of allotment.
(F)
In case of convertible debt instruments, the
issuer shall additionally undertake that:
(1)
the issuer shall forward the details of
utilisation of the funds raised through the convertible debt instruments duly
certified by the statutory auditors of the issuer, to the debenture trustees at
the end of each half-year.
(2)
the issuer shall disclose the complete name
and address of the debenture trustee in the annual report.
(3)
the issuer shall provide a compliance
certificate to the convertible debt instrument holders (on yearly basis) in
respect of compliance with the terms and conditions of issue of debentures as
contained in the Letter of Offer, duly certified by the debenture trustee.
(4)
the issuer shall furnish a confirmation
certificate that the security created by the company in favour of the
convertible debt instrument holders is properly maintained and is adequate to
meet the payment obligations towards the convertible debt instrument holders in
the event of default.
(5)
necessary cooperation with the credit rating
agency (ies) shall be extended in providing true and adequate information till
the debt obligations in respect of the instrument are outstanding.
(XVIII)
Utilisation of Issue
Proceeds: The letter of offer for an
issue other than a rights issue made by any bank or public financial
institution shall contain a statement of the board of directors of the issuer
to the effect that:
(A)
all monies received out of issue of shares or
specified securities to public shall be transferred to separate bank account.
(B)
details of all monies utilised out of the
issue referred to in clause (A) shall be disclosed under an appropriate
separate head in the balance sheet of the issuer indicating the purpose for
which such monies had been utilised; and
(C)
details of all unutilised monies out of the
issue of specified securities referred to in clause (A) shall be disclosed
under an appropriate separate head in the balance sheet of the issuer
indicating the form in which such unutilised monies have been invested.
(XIX)
Restrictions on foreign
ownership of Indian securities, if any:
(A)
Investment by NRIs.
(B)
Investment by FIIs.
(XX)
Statement regarding minimum
subscription clause: The following
statement shall appear in the letter of offer:
(A)
"If the issuer does not receive the
minimum subscription of ninety per cent. of the issue (including devolvement of
underwriters where applicable), the entire subscription shall be refunded to
the applicants within fifteen days from the date of closure of the issue."
(B)
"If there is delay in the refund of
subscription by more than 8 days after the issuer becomes liable to pay the
subscription amount (i.e. fifteen days after closure of the issue), the issuer
will pay interest for the delayed period, at rates prescribed under
sub-sections (2) and (2A) of Section 73 of the Companies Act, 1956."
(XXI)
Statutory and other
information:
(A)
Option to
subscribe in the issue:
(1)
The details of option,
if any, to receive the specified securities subscribed for either in
demateralised form or physical form.
(2)
The lead merchant banker shall incorporate a
statement in the offer document and in the application form to the effect that
the investor shall have an option either
to receive the security certificates or to hold the securities in
dematerialised form with a depository.
(B)
Material contracts
and time and place of inspection which shall include copies of the Annual
Reports of the issuer for the last five years.
(XXII)
Any other material disclosures, as deemed necessary.������
(XXIII)
Declaration:
(A)
The draft letter of offer (in case of issues other than fast track
issues) and letter of offer shall be approved by the Board of Directors of the
issuer and shall be signed by all directors, the Chief Executive Officer, i.e.,
the Managing Director or Manager within the meaning of the Companies Act, 1956
and the Chief Financial Officer, i.e., the whole-time finance director or any
other person heading the finance function and discharging that function.
(B)
The following statement shall be disclosed:
�No
statement made in this letter of offer contravenes any of the provisions of the
Companies Act, 1956 and the rules made thereunder. All the legal requirements
connected with the issue as also the guidelines, instructions, etc., issued by
SEBI, Government and any other competent authority in this behalf, have been
duly complied with.�
(C)
The signatories shall further certify that all
disclosures made in the letter of offer are true and correct.
(6) A listed issuer making
disclosures in the letter of offer as per this Part shall make a copy of the
offer document of the immediately preceding public issue or rights issue
available to the public in the manner specified in sub-regulation (1) of regulation
61 and shall also make such document available as a material document for
inspection.
[See regulation 58(2)]
DISCLOSURES IN ABRIDGED LETTER OF OFFER
(1)
A listed issuer making a rights issue of specified securities shall
make disclosures, as specified in Part D of this Schedule, in the abridged
letter of offer.
(2)
However, if the conditions specified in clause (1) in Part E of this
Schedule are satisfied, the disclosure requirements specified in the following
clauses in Part D of this Schedule, shall not be applicable to such issuer:
(a)
Sub-item (B) of item VII;
(b)
Sub-item (D) of item VIII;
(c)
Item X;
(d)
Item XI,
(e)
Item XII ,
(f)
Item XV,
(g)
Item XVI�
(h)
Item XIX�
(i)
Item XX and
(j)
Item XXI�
(3)
The order in which items shall appear in the abridged letter of offer
shall correspond, wherever applicable, to the order in which items appear in
the letter of offer.
(4)
The abridged letter of offer shall also include
the following disclosures:
(a)
Provisions pertaining to applications referred to in sub-regulations
(2), (3) and (4) of regulation 54;
(b)
Rights entitlement ratio;
(c)
Fractional entitlements;
(d)
Renunciation;
(e)
Application for Additional equity shares;
(f)
Intention of promoters to subscribe to their rights entitlement;
(g)
Statement that a copy of the offer document of the immediately
preceding public or rights issue is made available to the public as specified
under sub-regulation (1) of regulation 61 and also as a document for public
inspection.
�
SECURITIES
AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009
SCHEDULE IX
[See regulation 16(2)]
FORMAT OF
REPORT TO BE SUBMITTED BY MONITORING AGENCY
NAME
OF THE MONITORING AGENCY�������������������������� :
MONITORING
REPORT FOR THE HALF YEAR ENDED ���..
(1)
Name of the Issuer�������������������������������� ������������������������:
(2)
About the issue whose proceeds to be monitored
(a)
Issue date�������������������������������������������������������������
:
(b)
Type of issue (public/rights)������������������������������� :�����������
(c)
Type of specified securities�����
���������������������������:
(d)
Issue size�������������������������������������������������������������
: ( Rs-----------(in� crores)
(e)
Amount collected�����������������������������������������������
: ( Rs. ---------( in crores)
(3)
Details of the arrangement made to ensure the monitoring of issue
proceeds.
(4)
Project details (to be monitored)������������������������������������ :
(a)
Name of the project (particulars and location)������� :
(b)
Cost of the project details��������������������������������������� :�� (Rs. ------( in crores)
(As mentioned in the offer document)��������
|
Item Head |
Original Cost |
Revised |
Remarks |
|
|
|
|
|
|
|
|
|
|
(c)
Proposal to finance cost overrun, if any.
(d)
Progress in the project:
(i)
Expenditure incurred during the six months period (Rs. crores)
������������
|
Item Head |
During Six
months |
����������� Cumulative |
|
|
|
|
(ii)
Means of finance raised during six months period (Rs. Crores)
(e)
If total cumulative amount raised is more than the expenditure incurred
on the project, explain how the surplus funds are utilised/ proposed to be
utilised. Give details on investment like instruments, maturity, earnings and
other conditions. Indicate name of the party/ company in which amounts have
been invested. The following data shall be given separately for investment in
group companies and others:
Type of instrument/������ Amount invested���������� Maturity���������������������������� Earnings
Instrument������������������� Rs.
in lakhs�������������������� date
(f)
Comments of monitoring agency on utilisation of funds.
(g)
If there is any delay in implementation of the project, the same may be
specified along with the reason thereof and the proposed course of action.
(Please give the comparative statement of schedule of various activities as
mentioned in the offer document and their actual implementation).
(h)
Status of Government/ statutory approvals related to the project as
disclosed in offer document.
(i)
Technical assistance/ collaboration (Please mention arrangements
contemplated at the time of issue and the progress thereafter)
(j)
Major� deviations from the
earlier progress reports.
(k)
Any favourable/ unfavourable events improving /affecting� project viability.
(l)
Any other relevant information.
��
Signature of the Authorised
person:
Name:
Designation:
Date:
SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
[See Explanation to regulations
26(6), 31, 33(1)(b) and 41(2)(b)]
FACILITIES OR SERVICES INCLUDED IN THE TERM �INFRASTRUCTURE SECTOR�
For the purposes
of these regulations, the expression �infrastructure sector� shall include the
following facilities/services:
(1)
Transportation (including inter modal transportation), including the
following:
(a)
Roads, national highways, state highways, major district roads, other
district roads and village roads, including toll roads, bridges, highways, road
transport providers and other road-related services;
(b)
Rail system, rail transport providers, metro rail roads and other
railway related services;
(c)
Ports (including minor ports and harbours), inland waterways, coastal
shipping including shipping lines and other port related services;
(d)
Aviation, including airports, heliports, airlines and other airport
related services;
(e)
Logistics services;
(2)
Agriculture, including the following:
(a)
Infrastructure related to storage facilities;
(b)
Construction relating to projects involving agro-processing and supply
of inputs to agriculture;
(c)
Construction for preservation and storage of processed agro-products,
perishable goods such as fruits, vegetables and flowers including testing
facilities for quality;
(3)
Water management, including the following:
(a)
Water supply or distribution;
(b)
Irrigation;
(c)
Water treatment, etc.
(4)
Telecommunication, including the following:
(a)
Basic or cellular, including radio paging;
(b)
Domestic satellite service (i.e., satellite owned and operated by an
Indian company for providing telecommunication service);
(c)
Network of trunking, broadband network and internet services;
(5)
Industrial, Commercial and Social development and maintenance,
including the following:
(a)
Real estate development, including an industrial park or special
economic zone;
(b)
Tourism, including hotels, convention centres and entertainment
centres;
(c)
Public markets and buildings, trade fair, convention, exhibition,
cultural centres, sports and recreation infrastructure, public gardens and
parks;
(d)
Construction of educational institutions and hospitals;
(e)
Other urban development, including solid waste management systems,
sanitation and sewerage systems, etc.;
(6)
Power, including the following:
(a)
Generation of power through thermal, hydro, nuclear, fossil fuel, wind
and other renewable� sources;
(b)
Transmission ,distribution or trading of power by laying a network of
new transmission or distribution lines;
(7)
Petroleum and natural gas, including the following:
(a)
Exploration and production;
(b)
Import terminals;
(c)
Liquefaction and re-gasification;
(d)
Storage terminals;
(e)
Transmission networks and distribution networks including city gas
infrastructure;
(8)
Housing, including the following:
(a)
Urban and rural housing including public / mass housing, slum
rehabilitation etc;
(b)
Other allied activities such as drainage, lighting, laying of roads,
sanitation facilities etc.;
(9)
Other miscellaneous facilities/services, including the following:
(a)
Mining and related activities;
(b)
Technology related infrastructure;
(c)
Manufacturing of components and materials or any other utilities or
facilities required by the infrastructure sector like energy saving devices and
metering devices, etc;
(d)
Environment related infrastructure;
(e)
Disaster management services;
(f)
Preservation of monuments and icons;
(g)
Emergency services (including medical, police, fire, and rescue);
(10) Such other facility/service
which, in the opinion of the Board, constitutes infrastructure sector.
SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
[See regulation 28(3) and 102]
BOOK BUILDING
PROCESS
(1)
An issuer
proposing to issue specified securities through book building process shall
comply with the requirements of this Schedule.
(2)
Lead Book Runner.
(a)
The issuer shall
appoint one or more merchant banker(s) as book runner(s) and their name(s)
shall be disclosed in the draft red herring prospectus.
(b)
The lead merchant
banker shall act as the lead book runner and shall be primarily responsible for
the book building.
(c)
There shall be only one lead book runner and other
merchant bankers appointed, if any, shall either be co-book runners or
syndicate members.
(d)
Other terms such as joint lead merchant bankers etc.
shall not be used.
(e)
In case of
appointment of more than one lead merchant banker or book runner, the rights,
obligations and responsibilities of each shall be delineated in the inter-se
allocation of responsibility as specified in Schedule I
(3)
Syndicate Members.
The book runner(s)
may appoint syndicate members.
(4)
Underwriting.
(a)
The lead book runner and co-book runners shall
compulsorily underwrite the issue and the syndicate members shall
sub-underwrite with the lead book runner /co-book runners.
(b)
The lead book runners/ syndicate members shall enter
in to underwriting/ sub underwriting agreement on the date of allocation and
furnish details forthwith to the Board.
(c)
The details of final underwriting arrangement
indicating actual numbers of shares underwritten shall be disclosed and printed
in the Prospectus before it is registered with the Registrar of Companies.
(d)
In case of an under subscription in an issue, the
shortfall shall have to be made good by the book runner(s) to the issue and the
same shall be incorporated in the inter-se allocation of responsibility as
specified� in Schedule II.
(5)
Agreement with the stock exchange.
(a)
The issuer shall
enter into an agreement with one or more of the stock exchange(s) which have
the system of on-line offer of securities.
(b)
The agreement
shall specify inter-alia, the rights, duties, responsibilities and obligations
of the issuer and recognised stock exchange(s) inter se.
(c)
The agreement may
also provide for a dispute resolution mechanism between the issuer and the
stock exchange.
(6)
Appointment of stock brokers as bidding/collection
centres.
(a)
The book
runner(s)/syndicate members shall appoint stock brokers who are members of the
recognised stock exchange and registered with the Board, for the purpose of
accepting bids, applications and placing orders with the issuer and ensure that
the stock brokers so appointed are financially capable of honouring their commitments
arising out of defaults of their clients/investors, if any;
Provided
that in case of Application Supported by Blocked Amount, Self Certified
Syndicate Banks shall also accept and upload the details of such applications
in electronic bidding system of the stock exchange(s).
(b)
The stock brokers
and Self Certified Syndicate Bank accepting applications and application monies
shall be deemed as �bidding/collection centres�.
(c)
The issuer shall
pay to the book runners/syndicate members/stock brokers/ Self Certified
Syndicate Banks a commission/fee for the services rendered by them.
(d)
The stock
exchange shall ensure that any stock broker does not levy a service fee on his
clients/investors in lieu of his services in this regard.
(7)
Price not to be disclosed in red herring prospectus.
(a)
Where the issue
size is specified the red herring prospectus may not contain the price and the
number of specified securities.
(b)
The draft red
herring prospectus containing all the disclosures including total issue size,
if applicable, as specified in Schedule VIII, except that of price and the
number of specified securities to be offered through it shall be filed with the
Board by the lead merchant banker;
�Provided that in case of a fast track issue
the draft red herring prospectus shall not be filed with the Board.
(8)
Floor Price and Price Band.
Subject to the
provisions of regulation 30 and the provisions of this clause, the issuer may
mention the floor price or price band in the red herring prospectus.
(a)
where the issuer
opts not to make the disclosure of the price band or floor price in the
red-herring prospectus, the following shall also be disclosed in the
red-herring prospectus:
(i)
a statement that
the floor price or price band, as the case may be, shall be disclosed at least
two working days (in case of an initial public offer) and at least one working
day (in case of a further public offer) before the opening of the bid;
(ii)
a statement that
the investors may be guided in the meantime by the secondary market prices (in
case of a further public offer);names and editions of the newspapers where the
announcement of the floor price or price band would be made;
(iii)
names of websites
(with address), journals or other media in which the said announcement will be
made.
(b)
�Where the issuer decides to opts for price band instead of floor price,
the issuer shall� also ensure compliance
with the following conditions:
(i)
The cap of the
price band should not be more than 20% of the floor of the band; i.e cap of the
price band shall be less than or equal to 120% of the floor of the price band;
(ii)
The price band
can be revised during the bidding period in which case the maximum revision on
either side shall not exceed 20% i.e floor of price band can move up or down to
the extent of 20% of floor of the price band disclosed in the red herring
prospectus and the cap of the revised price band will be fixed in accordance
with clause (i) above;
(iii)
Any revision in
the price band shall be widely disseminated by informing the stock exchanges,
by issuing press release and also indicating the change on the relevant website
and the terminals of the syndicate members.
(iv)
In case the price
band is revised, the bidding period shall be extended as per provisions of
sub�regulation (2) of regulation 46.
(v)
The manner in
which the shortfall, if any, in the project financing, arising on account of
lowering of price band to the extent of 20% will be met shall be disclosed in
the red herring prospectus. It shall also be disclosed that the allotment shall
not be made unless the financing is tied up.
(9)
Application-cum-Bidding form.
(a)
The issuer shall
provide the application-cum-bidding forms to the syndicate members and Self
Certified Syndicate Banks.
(b)
The issuer shall
make arrangement for collection of the applications-cum-bidding from mandatory
collection centres as provided in sub-regulation (6) of regulation 5.
(c)
For the purpose
of �bidding� the document should be printed and circulated as "Red Herring
Prospectus'" The same nomenclature shall be used throughout the document.
(d)
Under "Red
Herring Prospectus", add "Please read Section 60B of the Companies
Act, 1956.
(e)
�Bid � should be
defined as �indication to make an offer and not as �an offer�
(f)
State the manner
of bidding by corporate bodies and submission/deposit of supporting documents
at the time of bidding. In the case of bids/ applications by HUF, state the
manner of making application and that HUF would be considered as 'individual'.
(g)
Ensure that the
application-cum-bidding form meant for Applications Supported by Blocked Amount
or otherwise, provides for all the relevant information including the one
specified in this regard in the relevant Acts/ Regulations.
(h)
The
application-cum-bidding form, other than the form meant for Applications
Supported by Blocked Amount, shall satisfy the following conditions:
(i)
the bidding form
shall be standard to ensure uniformity in bidding and accuracy;
(ii)
the bidding form
shall contain information about the investor, the price and the number of
securities that the investor wishes to bid;
(iii)
before being
issued to the investors the bidding form shall be serially numbered and date
and time stamped at the bidding centres;
(iv)
the serial number
may be system generated or stamped with an automatic numbering machine;
(v)
the bidding form
shall be issued in duplicate signed by the investor and countersigned by the
syndicate member, with one form for the investor and the other for the
syndicate member(s)/book runner(s);
(i)
The
application-cum-bidding form for Applications Supported by Blocked Amount shall
contain all the relevant details and shall be uniform for all ASBA investors.
(10) Anchor
investors [17][***].
(a)
An Anchor Investor shall make an application of a value of at least Rs.
10 crore in the public issue.
(b)
Allocation to Anchor Investors shall be on a discretionary basis and
subject to a minimum number of 2 such investors for allocation of upto Rs. 250
crore and 5 such investors for allocation of more than Rs. 250 crore.
(c)
Upto thirty per cent. of the portion available for allocation to
qualified institutional buyers shall be available to anchor investor(s) for allocation/allotment
(�anchor investor portion�).
(d)
One-third of the anchor investor portion shall be reserved for domestic mutual funds.�
(e)
The bidding for Anchor Investors shall open one day before the issue
opening date.
(f)
Anchor Investors shall pay a margin of at least 25% on application with
the balance to be paid within two days of the date of closure of the
issue.�
(g)
Allocation to Anchor Investors shall be completed on the day of bidding
by Anchor Investors
(h)
If the price fixed as a result of book building is higher than the price
at which the allocation is made to Anchor Investor, the Anchor Investor shall
bring in the additional amount. However, if the price fixed as a result of book
building is lower than the price at which the allocation is made to Anchor
Investor, the excess amount shall not be refunded to the Anchor Investor and
the Anchor Investor shall take allotment at the price at which allocation was
made to it. ���� �
(i)
The number of shares allocated to Anchor Investors and the price at which
the allocation is made, shall be made available in public domain by the
merchant banker before opening of the issue
(j)
There shall be a lock-in of 30 days on the shares allotted to the Anchor
Investor from the date of allotment in the public issue.
(k)
Neither the merchant bankers nor any person related to the
promoter/promoter group/merchant bankers in the concerned public issue can
apply under Anchor Investor category. The parameters for selection of Anchor
Investor shall be clearly identified by the merchant banker and shall be
available as part of records of the merchant banker for inspection by the
Board..
(l)
The applications made by qualified institutional buyers under the Anchor
Investor category and under the Non Anchor Investor category may not be
considered as multiple applications.
(11) Margin
Money.
(a)
The margin
collected from categories other than Qualified Institutional Buyers shall be
uniform across the book runner(s)/syndicate members /Self Certified Syndicate
Banks for each such investor category.
(b)
An amount of not
less than ten percent of the application money in respect of bids placed by
qualified institutional buyers and not less than twenty five percent of the
application money from the Anchor investors shall be taken as margin money.�
(c)
An amount to the
extent of entire application money as margin money may be collected from the
applicants before they� place an order on
their behalf
(d)
Amount of margin
charged from an investor shall be entered and printed in the TRS.
(e)
The payment
accompanied with any revision of Bid, shall be adjusted against the payment
made at the time of the original bid or the previously revised bid.
(f)
Bids for
specified securities beyond the investment limit prescribed under relevant laws
shall not be accepted by the syndicate members/stock brokers from any category
of clients/ investors.
(g)
The stock brokers
shall collect the money from their client for every order placed by them and in
case the clients/investors fails to pay for specified securities allocated as
per these regulations, the stock brokers shall pay such amount;
�Provided that in case of
Applications Supported by Blocked Amount, the Self Certified Syndicate Banks
shall follow the procedure specified in this regard by the Board.
(12) Bidding
Process
(a)
Bidding process shall be only through an electronically linked
transparent bidding facility provided by recognised stock exchange (s).
(b)
The lead book runner shall ensure the availability of adequate
infrastructure with syndicate members for data entry of the bids in a timely
manner.
(c)
The syndicate members shall be present at the bidding centres so that
at least one electronically
linked computer terminal at all the bidding centres is available for the
purpose of bidding.
(d)
During the period
the issue is open to the public for bidding, the applicants may approach the
stock brokers of the stock exchange/s through which the securities are offered
under on-line system or Self Certified Syndicate Banks, as the case may be, to
place an order for bidding for the specified securities.
(e)
Every
stock broker shall accept orders from all clients/investors who place orders
through him and every Self Certified Syndicate Bank shall accept Applications
Supported by Blocked Amount from ASBA investors.
(f)
Applicants who
are qualified institutional buyers shall place their bids only through the
stock brokers who shall have the right to vet the bids;
(g)
The bidding
terminals shall contain an online graphical display of demand and bid prices
updated at periodic intervals, not exceeding thirty minutes.
(h)
At the end of
each day of the bidding period, the demand including allocation made to anchor
investors,� shall be shown graphically on
the bidding terminals of syndicate members and websites of recognised stock
exchanges offering electronically linked
transparent bidding facility, �for
information of public.
(i)
The investors
(except ASBA investors) may revise their bids;
(j)
The qualified
institutional buyers shall not withdraw their bids after closure of bidding.
(k)
The identity of
qualified institutional buyers making the bidding shall not be made public.
(l)
The stock
exchanges shall continue to display on their website, the data pertaining to
book built issues in an uniform format, inter alia giving category-wise details
of bids received, for a period of atleast three days after closure of bids. Such
display shall be as per the format specified in Part B of this Schedule.�
(13) Determination
of Price.
(a)
The issuer shall,
in consultation with lead book runner,�
determine the issue price based on the bids received
(b)
On determination
of the price, the number of specified securities to be offered shall be
determined (i.e. issue size divided by the price to be determined).
(c)
Once the final
price (cut-off price) is determined, all those bidders whose bids have been
found to be successful (i.e. at and above the final price or cut-off price)
shall be entitled for allotment of specified securities.
(d)
Retail individual
investors may bid at "cut off" price instead of their writing the
specific bid price in the bid forms.
(e)
The lead book
runner may reject a bid placed by a qualified institutional buyer for reasons
to be recorded in writing provided that such rejection shall be made at the
time of acceptance of the bid and the reasons therefor shall be disclosed to
the bidders. Necessary disclosures in this regard shall also be made in the red
herring prospectus.
(14) Registering
of prospectus with Registrar of Companies.
The final
prospectus containing all disclosures in accordance with the provisions of
these regulations including the price and the number of specified securities
proposed to be issued shall be registered with the Registrar of Companies.
(15) Manner of
Allotment/ Allocation.
(a)
Allotment to
retail individual investors, non-institutional investors and qualified
institutional buyers other than anchor investors shall be made proportionately
as illustrated in this Schedule.
(b)
In case of under
subscription in any category, the undersubscribed portion in that category shall be allocated to the bidders as per disclosures made in the
red herring prospectus;
�Provided that the unsubscribed portion in
qualified institutional buyer category shall not be available for subscription
to other categories, in case the book building process is undertaken for the
purpose of compliance of eligibility conditions for public issue.
(c)
On receipt of the
sum payable on application for the amount towards minimum subscription, the
issuer shall allot the specified securities to the applicants as per these
regulations.
(d)
Definition of CAN
to be modified to state that it is for �allocation of shares� and not �confirmation
of shares
(16) Application
for listing.
Subject to the
provisions of these regulations, the issuer may apply for listing of specified
securities on a stock exchange other than the stock exchange through which it
offers its specified securities to public through the on-line system.
(17) Maintenance
of Books and Records.
(a)
A final book of
demand showing the result of the allocation process shall be maintained by the
lead book runner.
(b)
The book runner/s
and other intermediaries associated in the book building process shall maintain
records of the book building prices.�
(c)
The Board shall
have the right to inspect the records, books and documents relating to the book
building process and such person shall extend full co-operation.
(18) Applicability to fast track issues.
Unless the context otherwise requires, in relation to
fast track issues all references in this
Schedule� to �draft prospectus� shall be
deemed to have been made to �red herring prospectus�.
FORMAT OF
BID DATA DISPLAYED ON STOCK EXCHANGE
������������������������������������ <NAME OF THE ISSUE> - BID DETAILS
(1)
Details of Allocation to Anchor Investors
|
S. No. |
Name of Anchor Investor |
No. of equity shares available under
Anchor Investor portion |
Details of Allocation |
|
|
No of equity shares |
No. of equity shares allocated as a
percentage of no. of equity shares under Anchor Investor portion |
|||
|
(a) |
AI 1 AI 2 |
|
|
|
|
|
Total (a) +
(b) |
|
|
|
(2)
Details of Allocation to Investors other than Anchor
Investors
|
S. No. |
Category of Investor |
No. of equity shares offered /
reserved |
No of equity shares bid for/allocated |
No of times of the total meant for
the category |
|
1. |
QIBs |
|
|
|
|
�� (a) |
FIIs |
|
|
|
|
|
Domestic Financial Institutions
(Banks/FIs/Insurance Companies, etc.) |
|
|
|
|
�� (b) |
Mutual Funds |
|
|
|
|
�� (c) |
Others |
|
|
|
|
2. |
Non Institutional Investors |
|
|
|
|
�� (a) |
Corporates |
|
|
|
|
�� (b) |
Individuals (other than RIIs) |
|
|
|
|
�� (c) |
Others |
|
|
|
|
3. |
Retail Individual Investors (RIIs) |
|
|
|
|
� (a)���
|
Cut off |
|
|
|
|
� (b) |
Price bids |
|
|
|
|
4. |
Reservation categories, if
any |
|
|
|
|
� (a)���
|
Cut off |
|
|
|
|
� (b) |
�Price bids |
|
|
|
Notes:
(1)
The graph should
have the title �Graphical display of bids received�.
(2)
A statement to
the effect that the position indicated above is only bids position and does not
necessarily convey the subscription to the issue.
(3)
Statement as to how the multiple bids are accounted for in the data and graph.
(4)
Time of updation.
(5)
Additional comments, if any.
ILLUSTRATION
REGARDING ALLOTMENT TO QUALIFIED INSTUTIONAL BUYERS OTHER THAN ANCHOR INVESTORS
������������������������������������������
(1)
Issue Details
|
Sr. No. |
Particulars |
Issue details |
|
1 |
Issue size |
200 crores equity
shares |
|
2 |
Portion
available to QIBs* |
100 crore
equity shares |
|
3 |
Anchor Investor
Portion |
30 crores |
|
4 |
Portion
available to QIBs* other than anchor investors [(2) � (3)] |
70 crores
equity shares |
|
|
Of which |
|
|
�� a. |
�Reservation to MF (5%) |
3.5� crores equity shares |
|
�� b. |
Balance for all QIBs including MFs |
66.5� crores equity shares |
|
5 |
No. of QIB
applicants |
10 |
|
6 |
No. of shares
applied for |
500 crores
equity shares |
* Where 50% of the issue size is
required to be allotted to QIBs.
(2)
Details Of QIB Bids
|
S. No. |
Type of QIB bidders |
No. of shares bid for (in crores) |
|
1 |
A1 |
50 |
|
2 |
A2 |
20 |
|
3 |
A3 |
130 |
|
4 |
A4 |
50 |
|
5 |
A5 |
50 |
|
6 |
MF1 |
40 |
|
7 |
MF2 |
40 |
|
8 |
MF3 |
80 |
|
9 |
MF4 |
20 |
|
10 |
MF5 |
20 |
|
� |
TOTAL |
500 |
A1-A5���������� (QIB bidders other than MFs)
MF1-MF5���� (QIB bidders which are MFs)
(3)
Details of Allotment to QIB
Bidders/Applicants
������������������������������������������������������������������
(No. of equity shares in crores)
|
Type of QIB
bidders |
Equity shares
bid for |
Allocation of
3.5 crores equity shares to MFs proportionately (See Note 2) |
Allocation of
balance 66.5 crores equity shares to QIBs�
proportionately (See Note 4) |
Aggregate
allocation to MFs |
|
A1 |
50 |
0 |
6.65 |
0 |
|
A2 |
20 |
0 |
2.66 |
0 |
|
A3 |
130 |
0 |
17.29 |
0 |
|
A4 |
50 |
0 |
6.65 |
0 |
|
A5 |
50 |
0 |
6.65 |
0 |
|
MF1 |
40 |
0.7 |
5.32 |
6.02 |
|
MF2 |
40 |
0.7 |
5.32 |
6.02 |
|
MF3 |
80 |
1.4 |
10.64 |
12.04 |
|
MF4 |
20 |
0.35 |
2.66 |
3.01 |
|
MF5 |
20 |
0.35 |
2.66 |
3.01 |
|
|
500 |
3.5 |
66.5 |
30.1 |
Notes:
(1)
The illustration
presumes compliance with the provisions of regulation 51(1) pertaining to
minimum allotment.
(2)
Out of 70 crore
equity shares allocated to QIBs, 3.5 crores (i.e. 5%) will be allocated on
proportionate basis among 5 mutual fund applicants who applied for 200 shares
in QIB category.
(3)
The balance 66.5
crore equity shares [i.e. 70 � 3.5 (available for MFs)] will be allocated on
proportionate basis among 10 QIB applicants who applied for 500 shares
(including 5 MF applicants who applied for 200 shares).
(4)
The figures at
Col. No. IV are arrived as under :
(a)
For QIBs other
than mutual funds (A1 to A5) = No. of shares bid for (i.e Col II) X�� 66.5 / 496.5
(b)
For mutual funds
(MF1 to MF5) = {(No. of shares bid for (i.e Col II) less shares allotted (i.e.,
col. III )} X 66.5 / 496.5
(c)
The numerator and
denominator for arriving at allocation of 66.5 crore shares to the 10 QIBs are
reduced by 3.5 crore shares, which has already been allotted to mutual funds at
Col. No. (III).
Alternate
method of book building
In case of further public offers, the issuer may opt
for an alternate method of book building, as given in this part subject to the
following:
(a)
Issuer shall
follow the procedure laid down in Part A of this Schedule except clause (13)
and clause (15) (a) thereof.
(b)
The issuer shall
disclose a floor price in the red herring prospectus.
(c)
Investors other
than retail individual investors shall bid at any price above the floor price.
(d)
The bidder who
bids at the highest price shall be allotted the number of securities that he
has bided for and then the bidder who has bided at the second highest price and
so on, until all the specified securities on offer are exhausted.
(e)
Allotment shall
be on price priority basis for investors other than retail individual
investors.
(f)
Allotment to
retail individual investors shall be made proportionately as illustrated in
this Schedule.���
(g)
Where, however
the number of specified securities bided for at a price is more than available
quantity, then allotment shall be done on proportionate basis.
(h)
Retail individual
investors shall be allotted specified securities at the floor price.
(i)
The issuer may
place a cap either in terms of number of specified securities or percentage of
issued capital of the issuer that may be allotted to a single bidder.]
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
SCHEDULE XII
[See regulation 45(10)]
FORMAT OF REPORT FOR GREEN SHOE OPTION
The
report for Green Shoe Option shall be filed in the following format:-
(1)
Name of the
issuer:
(2)
Name of the
Stabilising Agent (Registration No. as merchant banker with SEBI):
(3)
Issue size (No.
of equity shares) :
(4)
Issue opened on :
(5)
Issue closed on :
(6)
Over-allotment in
issue (%):
(7)
Date of
commencement of trading :
(8)
Amount in the
�Green Shoe Option Bank Account� (in rupees) :
(9)
Details of
promoter(s) from whom shares borrowed (Name & Number of shares borrowed):
(10) Date on which the stabilisation period ended :
(11) Number of shares bought during the stabilization
period :
(12) Date on which issuer allotted further shares to the
extent of shortfall:
(13) Date when the shares in the Green Shoe Option Demat
Account were returned to the promoter(s):
(14) Date when the money in the Green Shoe Option Bank
Account was remitted to the issuer:
(15) Details of the Depository account (Special account for
Green Shoe Option securities) where shares purchased from the market were kept
inter-alia the following:
(a)
Depository Participant
(b)
Account No.
(c)
Number of shares
purchased, date wise.
(d)
Number of shares
taken out, date wise.
(16) Details of amount transferred to the Investor
Protection and Education Fund established by the Board.
|
Amount (in rupees) |
Cheque/Pay Order details |
|
|
|
Place:�������������������������� ���������������������������������������������� ���Stabilising Agent with
Official Seal
Date:
SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
FORMATS OF ADVERTISEMENTS FOR PUBLIC ISSUE
[See regulations 47(2), 60(7)(m)
and 60(7)(n)]
FORMAT OF PRE-ISSUE ADVERTISEMENT FOR PUBLIC ISSUE
(FIXED PRICE / BOOKBUILT)
��������� This is only an advertisement for
information purposes and not a prospectus announcement.
ABC LTD.(name of the�
issuer)
(Incorporated on
____________________ under the ------- Act as _____________________ and
subsequently renamed as _____________( if applicable)__________ on
________________)
Registered Office:
__________________________________ Tel:
_______________
Fax ______________
Corporate Office:
_________________________________________________________________
Tel: _________ Fax: _______ e-mail: ______ Website:
THE ISSUE
Public issue of
___________ ( give nature of specified securities)� of Rs. ____ each at a price of Rs._____ (
Floor price or price band or as the case may be in case of� book built issue) for cash aggregating
Rs._________ (appropriate� disclosure for
book built issue)
Disclosure with respect to face value of shares as per
sub-regulation (2) of regulation 31
(The disclosure about details of allocation shall be
given in case of book built issues on these lines)
The issue is being made through the
book building process wherein at least____ % shall be allocated to qualified
institutional buyers including upto ___% of the issue to anchor investors.
Further, not less than ___% of the issue shall be available for allocation to
non-institutional investors and the remaining ____% of the issue shall be
available for allocation to retail individual investors as per the allotment
procedure specified in the Regulations, subject to valid bids being received at
or above the issue price.
�������������������������������������������������������������������������������
PROMOTERS
[__XYZ__]
PROPOSED LISTING
Names of Stock
Exchanges
Disclaimer Clause of the Securities and Exchange Board
of India (SEBI)
�SEBI only gives its observations on
the offer documents and this does not constitute approval of either the issue
or the specified securities the offer document.�
LEAD MERCHANT BANKERS / BOOK RUNNING LEAD MERCHANT
BANKERS / CO-BOOK RUNNING LEAD MERCHANT BANKERS (as the case may be)
Name, address,
telephone and fax numbers, email ID, website address and contact person
COMPLIANCE OFFICER OF THE ISSUER
Name, address,
telephone and fax numbers, email ID, website address
CREDIT RATING
(only if applicable)
DEBENTURE TRUSTEES (if applicable)
IPO GRADING
AVAILABILITY OF APPLICATION FORMS
Names of issuer,
lead merchant bankers, book runners, syndicate members, stock brokers and
bankers to the issue, Self Certified Syndicate Banks (as the case may be) (Addresses
optional).
Application Supported by Blocked Amount
forms shall be available with designated branches of Self Certified Syndicate
Banks, the list of which is available at websites of the stock exchanges and
Board.
AVAILABILITY OF PROSPECTUS
Investors are advised to refer to the
prospectus, and the risk factors contained therein, before applying in the
issue. Full copy of the prospectus is available at www.sebi.gov.in
and websites of issuer / lead merchant banker/s / stock exchange/s at www��
ISSUE / BID OPENS ON:
ISSUE / BID CLOSES ON:
Issued by
Directors of Issuer
[See regulations 48, 60(7)(m)
and 60(7)(n)]
FORMAT OF ISSUE OPENING ADVERTISEMENT FOR PUBLIC ISSUE
(FIXED PRICE / BOOKBUILT)
This is only an advertisement for information purposes
and not a prospectus announcement.
ABC LTD.� (name
of issuer)
(Incorporated on
____________________ under the Companies Act as __________________________ and
subsequently renamed _______________________ on ________________)
Registered Office:
__________________________________ Tel: _______________ Fax ______________
Corporate Office:
_________________________________________________________________
Tel: _________ Fax: _______ e-mail: ______ Website:
_____________________________
THE ISSUE
Public issue of ___________ equity
shares / debentures (if applicable) of Rs. ___ each at a price of Rs._____ (Floor price or price band or as the
case may be for book built issue) for
cash aggregating Rs._________� (appropriate disclosure for book built
issue)
Disclosure with respect to face value of shares as per
sub-regulation (2) of regulation 31
(The
disclosure about details of allocation shall be made in case of book built
issues in these lines)
The issue is being made through the
book building process wherein at least____ % shall be allocated to qualified
institutional buyers including upto ___% of the issue to anchor investors.
Further, not less than ___% of the issue shall be available for allocation to
non-institutional investors and the remaining ____% of the issue shall be
available for allocation to retail individual investors as per the allotment
procedure specified in the Regulations, subject to valid bids being received at
or above the issue price.
PROMOTERS
[__XYZ__]
PROPOSED LISTING
Names of Stock
Exchanges
Disclaimer Clause of Securities and Exchange Board of
India (�SEBI�)
�SEBI only gives its observations on
the offer documents and this does not constitute approval of either the issue
or the offer document.�
LEAD MERCHANT BANKERS / BOOK RUNNING LEAD MERCHANT
BANKERS / CO-BOOK RUNNING LEAD MERCHANT BANKERS (as the case may be)
Name, address,
telephone and fax numbers, e-mail ID, website address and contact person
COMPLIANCE OFFICER OF ISSUER
Name, address, telephone
and fax numbers, e-mail ID, website address
CREDIT RATING
(only if applicable)
DEBENTURE TRUSTEES (only if applicable)
IPO GRADING
AVAILABILITY OF APPLICATION FORMS
Names of Issuer,
lead merchant bankers, book runners and bankers to the issue, Self Certified
Syndicate Banks (as the case may be) (Addresses optional)
AVAILABILITY OF PROSPECTUS
Investors are advised to refer to the
prospectus, and the risk factors contained therein, before applying in the
issue. Full copy of the prospectus is available at www.sebi.gov.in
and websites of issuer / lead merchant banker/s / Stock Exchange/s at www��
ISSUE / BID OPENS TODAY
����������� ��������������������������������������������������������
����������������������������� ��������������������������������������������������������������������Issued
by
����������������������������������������������������������������������������������������������������������� Directors
of Issuer
[See
regulation 48, 60(7)(m) and 60(7)(n)]
FORMAT OF
ISSUE CLOSING ADVERTISEMENT FOR PUBLIC ISSUE
(FIXED PRICE
/ BOOKBUILT)
This is only an advertisement for information purposes
and not a prospectus announcement.
ABC LTD. (name
of issuer)
(Incorporated on
____________________ under the Companies Act as __________________________ and
subsequently renamed _______________________ on ________________)
Registered Office:
__________________________________ Tel: _______________ Fax ______________
Corporate Office:
_________________________________________________________________
Tel: _________ Fax: _______ e-mail: ______ Website:
_____________________________
THE ISSUE
Public issue of
___________ equity shares (if applicable) of Rs. ____ each at a price of
Rs._____ (Floor price or price band
or as the case may be for Book built issue)��
for cash aggregating Rs._________�
(appropriate disclosure for Book Built issue)
Disclosure with respect to face value of shares� as per sub-regulation (2) of regulation 31
[The disclosure about details of allocation
shall be made in case of book built issues in these lines].
The issue is being made through the
book building process wherein at least____ % shall be allocated to qualified
institutional buyers including upto ___% of the issue to anchor investors.
Further, not less than ___% of the issue shall be available for allocation to
non-institutional investors and the remaining ____% of the issue shall be
available for allocation to retail individual investors as per the allotment
procedure specified in the Regulations, subject to valid bids being received at
or above the issue price.
PROMOTERS
[__XYZ__]
PROPOSED LISTING
Names of Stock
Exchanges
Disclaimer Clause of Securities and Exchange Board of
India (�SEBI�)
�SEBI only gives its observations on
the offer documents and this does not constitute approval of either the issue
or the offer document.�
LEAD MERCHANT BANKERS / LEAD BOOK RUNNERS / CO-BOOK
RUNNERS (as the case may be)
Name, address,
telephone and fax numbers, email ID, website address and contact person
COMPLIANCE OFFICER OF ISSUER
Name, address,
telephone and fax numbers, email ID, website address
CREDIT RATING (only
if applicable)
DEBENTURE TRUSTEES (only if applicable)
IPO GRADING
AVAILABILITY OF APPLICATION FORMS
Names of Issuer,
Lead Merchant bankers, book runners, Bankers to the issue, Self Certified
Syndicate Banks (as the case may be) (Addresses optional)
AVAILABILITY OF PROSPECTUS
Investors are advised to refer to the
prospectus, and the risk factors contained therein, before applying in the
issue. Full copy of the prospectus is available at www.sebi.gov.in
and websites of issuer / lead merchant banker/s / Stock Exchange/s at www��
ISSUE / BID CLOSES TODAY
������������������������������
��������������
����������������������������������������������������������������������
Issued by
���������������������������������������������������������������������������������������������������� Directors
of Issuer
SECURITIES
AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009
[See regulation 49(2)]
ILLUSTRATION EXPLAINING MINIMUM APPLICATION SIZE
For inviting
applications in multiples of the minimum value as referred to in sub-regulation
(2) of regulation 49, the procedure is clarified by following example:
Assuming an issue is being made at a
price of Rs.390 per equity share. In this case, the issuer in consultation with
the lead merchant banker can determine the minimum application lot within the
range of 13 � 17 equity shares (in value terms between Rs.5000- Rs.7000), as
explained hereunder:
|
Options |
I |
II |
III |
IV |
V |
|
Lot Size @
Rs.390/- per share |
13 shares |
14 shares |
15 shares |
16 shares |
17 shares |
|
Application /
Bid amount for 1 lots |
5070 |
5469 |
5850 |
6240 |
6630 |
|
Application /
Bid amount for 2 lots |
10140 |
10920 |
11700 |
12480 |
13260 |
|
Application /
Bid amount for 4 lots |
20280 |
21840 |
23400 |
24960 |
26520 |
|
Application /
Bid amount for 8 lots |
40560 |
43680 |
46800 |
49920 |
--- |
|
Application /
Bid amount for 9 lots |
45630 |
49140 |
--- |
--- |
-- |
The options given above are only
illustrative and not exhaustive.
Where the issuer in consultation with
the lead� merchant banker decides to fix
the minimum application / bid size as 14 (Option II), necessary� disclosures�
to the effect that the applicant can make an application for 14 shares
and in multiples thereof shall be made in the offer document.
SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
[See regulations 50(2), 107 and
Schedule XI]
ILLUSTRATION EXPLAINING PROCEDURE OF
ALLOTMENT
(1)
Total no. of
specified securities on offer@ Rs. 600 per share: 10 crore specified securities
(2)
Specified securities on offer for retail
individual investors� category: 2.5 crore specified securities
(3)
The� issue is over subscribed 4
times whereas the retail individual
investors� category is over subscribed 8.25�
times
(4)
Issuer decides to
fix the minimum application / bid size as 9 specified securities (falling
within the range of Rs. 5000 - 7000). Application can be made for a minimum of
9 specified securities and in multiples thereof.
(5)
Assume there are
three retail individual investors A, B & C. A has applied for 81 specified
securities. B has applied for 72 specified securities and C has applied for 45
specified securities. As per allotment procedure, the allotment to retail
individual investors shall be on
proportionate basis i.e., at 1/8.25th of the total number of specified
securities applied for. The actual
entitlement shall be as follows:
|
Sr. No. |
Name of Investor |
Total Number of �specified
securities �applied for |
Total number of �specified
securities eligible to be allotted� No. of �specified
securities �applied for / 8.25) |
|
1 |
A |
81 |
81/8.25 = 9.82 specified
securities ��rounded off to 10 specified
securities. |
|
2 |
B |
72 |
72/8.25 = 8.73 specified
securities rounded off to 9 specified
securities (i.e. minimum application
size). |
|
3 |
C |
45 |
45/8.25=5.45 specified
securities. Application
liable to be rejected. (as the entitlement is less than the minimum
application size). However,
the successful applicants out of the
total applicants shall be determined by drawal of lots. |
Note: For the purpose of IDR,
minimum application size shall be twenty thousand rupees.
SECURITIES AND
EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009
FORMATS OF POST
ISSUE REPORTS
[See regulation 65(2)(a) and 104(2)(a)]
FORMAT OF
INITIAL POST ISSUE REPORT FOR PUBLIC ISSUE
Subscription Status:
(Subscribed/ Undersubscribed)
Note:
It is the
responsibility of lead merchant banker to give correct information after
verifying it from the issuer and the registrar to the issue.
(1)
Name of the Issuer��������� :
(2)
Issue opening date���������� :
(3)
Earliest closing date�������� :
(4)
Actual closing date �������� :
(5)
Date of filing prospectus with RoC���������� :
(6)
Issue Details (as per the
prospectus)
(a)
Nature of specified securities�������� :
(equity shares/fully convertible debentures/partly convertible debentures,
etc.)
(b)
Offer price per security for different categories������������������������������������������ :
(c)
Amount per security on application for different categories������������� :
(d)
Issue size�������������������������������������������������������������������������������������������������� :
(Rs lakhs)
(i)
Promoters' contribution������������������������������������������������������������������� :
(ii)
Date of submission of auditors' certificate to the Board for
receipt of promoters' contribution���������������������������������������������������� :
(iii)
Amount through offer document (including reserved categories
and net public offer)������������������������������������������������������������ :
(iv)
Reserved Category������������� Amount
reserved on competitive basis (Rs lakhs)
���
Employees
Others (Please specify)
(v) ���� Net
public offer������� :����������������������������������
(7)
(a) Provisional subscription details of net public offer (including
unsubscribed portion of reserved categories�������������
(i)
Total amount to be collected on application������������������������������������� :����� Rs lakhs
(ii)
Amount collected on application������������������������������������������������������ :���� Rs lakhs
(iii)
% subscribed i.e. % of (ii) to (i)������������������������������������������������������� :������������ (%)
����������� (b)�� Amount subscribed by the reserved categories������������������������������������������ :��� Rs. lakhs
(8)
Please tick mark whether 90% minimum subscription of the amount through
offer document is collected.�� (i)
YES�������������������������������� (ii)
NO
Signed by������������������������������������������� Signed
by ������������������������������ Signed
by
Registrars to the Issue �������������������� Issuer������������������������������������� Lead
Merchant Banker(s)
Date:��������������������������������������������������������������������������������������������������������������������������
Place:�������������������������������������������������������������������������������������������������
[See regulations 65(2)(a) and 104(2)(a)]
FORMAT OF
INITIAL POST ISSUE REPORT FOR RIGHTS ISSUE
Subscription
Status: (Subscribed / Undersubscribed)
Note:
It is the
responsibility of lead merchant banker to give correct information after
verifying it from the issuer and the registrar to the issue.
(1)
Name of the issuer��������� :
(2)
Issue opening date���������� :
(3)
Actual closing date �������� :
(4)
Date of filing letter of offer with the stock exchange��������� :
(5)
Issue details (as per the letter
of offer)��������� :
(a)
Basis of offer (ratio)���������������������� :
(b)
Nature of specified securities ������� :�� (equity shares/fully convertible
debentures/partly convertible debentures, etc.)�������
(c)
Offer price per instrument������������� :
(d)
Amt. per instrument on application :
(e)
�Issue size :� Rs.
lakhs
(6)
Record date������� :��
(7)
Provisional subscription details of the issue���������� :
(a)
Total amount to be collected on application��� : Rs. lakhs
(b)
Amount collected on application�������������������� : Rs. lakhs
(c)
% subscribed i.e. % of (ii) to (i)������������ ����������:�
(%)
(d)
Please tick mark whether 90% minimum subscription collected : (i)
YES� (ii) NO
Signed by������������������������������� Signed by ������������������������������ Signed by�������������������
Registrars to the Issue �������� Issuer ������������������������������������ Lead
merchant banker
Place:��������������������������������������������������������
�����������������������������������������
Date:
[See regulations 65(2)(b) and 104(2)(b)]
FORMAT OF FINAL
POST ISSUE REPORT FOR PUBLIC ISSUE
Subscription Status: (Subscribed
/ Undersubscribed)
Notes:
(1)
It is the responsibility of lead merchant banker to give correct
information after verifying the facts from the issuer and the registrar to the
issue.
(2)
The lead merchant banker shall enclose a certificate from the refund
banker that the amount of refund due from the issuer to investors is deposited
in a separate account giving details of the total amount deposited in the
account and date of deposit.
(I)
IN CASE OF SUBSCRIBED ISSUE:
(1)
Name of the issuer��������� :����������
(2)
Issue opening date���������� :���������������������� �����������
(3)
Actual closing date��������� :
(4)
Issue Details (as per the prospectus)������� :
(a)
Nature of instrument��������� :
(equity shares/fully convertible debentures/partly convertible debentures,
etc.)��������
(b)
Offer price per instrument� �������������� :
(c)
Amount per instrument on application�������������������� :
(d)
Issue Size������������� : Rs. in
lakhs
(5)
3-Day Report :
(a)
Due on����� :
(b)
Submitted on�������� :
(6)
No. of collecting banks��� :
(Also specify no. of bank branches)
(7)
Bank-wise names of branches which did not submit final consolidated
certificates from closure of issue and mention the dates when they actually
submitted�� :
(8)
Subscription Details :
(a)
Public Offer (Net) (Including unsubscribed portion of reserved category added back to net
public offer)
(i)
No. of applications recd.����������������������������� :
(ii)
No. of instruments applied for��������������������� :
(iii)
Amount of subscription received������������������ :
Rs.
(iv)
No. of times issue subscribed���������������������� :
(b)
Information relating to reserved categories
Reservations���������������� No. of applications��� No. of instruments����� Amount ���������������������� ������������������������ ����������������������������������� applied
for������������������������������������������������� subscribed
Employees
Others
(Specify)
(9)
Actual Date of finalisation of Basis of Allotment (enclose copy)��� :
(10) Allotment Details :
(a)
No. of successful allottees per 1 lakh shares�������� :
(b)
No. of unsuccessful allottees����������������� :
(8)
Actual Date(s) of completion of despatch of :
(a)
Refund Orders����������� :
(b)
Certificates/Allotment Letters����������
:�������������������������������������������������������������������������������������������������������� :
(c)
Reasons for delay in despatch, if any����� :
(d)
Whether interest paid for delayed period, if so, for which period����������� :
(9)
Amount of refund due��������������������� :� Rs.
(10) Refund Banker(s) (Name and
Address)������ :
(11) Date of transfer of refund
amount to Refund Banker, if any����������
:
(12) Date of completion of despatch
of refund orders��������������� :
(13) Name of Designated Stock
Exchange��������� :
(14) Names of other stock exchanges
where listing is sought������������� :
(15) Date on which application was
filed with each stock exchange for listing of instruments������� :
(16) Date when listing and trading
permission given by each stock exchange (Enclose copies of permission letters
of stock exchanges)����������� :
(17) Reasons for delay in listing for
trading, if any�������� :
�
(II)
IN CASE OF UNDER SUBSCRIBED
ISSUE:
(1)
If the issue is underwritten, mention the amount of� issue underwritten� ���������������� :��
(2)
Extent of under subscription on the date of closure of the issue
(a)
Percentage����������������������� :
(b)
Amount���������������������������� :
(3)
Total no. of underwriters������������������������������������������������������������������������������������ :
(4)
If devolvement notices had not been issued, mention how the shortfall
was met���� :����������
(5)
No. of underwriters to whom devolvement notices had been issued��������������������� :
(6)
Date of issue of devolvement notices������������������������������������������������������������������� :
(7)
No. of underwriters who did not pay devolvement (Please give names,
amount underwritten and reasons for not paying)����� ��������������������������������������������������������������������������������������������������������� :
(8)
In case of default from underwriters, mention how the� shortfall was met�������������� :
(9)
In case where FIs/ MFs had subscribed to make up shortfall not as
underwriter��� :
(a)
Name of FI/MF��������������� :
(b)
No. of securities applied for���������
:
(c)
Amount received�������������� :
Certified that
the information given above and also in the enclosures are true to the best of
our knowledge and no refund orders / allotment letters / certificates are
pending for despatch in respect of the issue.
Certified that
specified securities to be locked in are duly inscribed with the words
�specified securities cannot be hypothecated / transferred / sold till
.........�
Signed by ������������������������������ Signed
by ������������������������������ Signed
by
Registrars to the Issue������������� Issuer ������������������������������� Lead Merchant Banker(s)
Place:
Date:
[See regulations 65(2)(b) and 104(2)(b)]
FORMAT OF FINAL
POST ISSUE REPORT FOR RIGHTS ISSUE
Subscription
Status: (Subscribed / Undersubscribed)
Notes:
(1)
It is the responsibility of lead merchant banker to give correct
information after verifying it from the issuer and the registrar to the issue.
(2)
The lead merchant banker shall enclose a certificate from the banker to
issue that the amount of refunds due from the issuer to investors is deposited
in a separate account giving details of the total amount deposited in the
account and date of deposit.
(I)
IN CASE OF SUBSCRIBED ISSUE:
(1)
Name of the issuer��������� :
(2)
Issue Opening date��������� :
(3)
Actual closing date �������� :
(4)
Issue Details (as per the letter of offer)
(a)
Basis of offer�������������������������������������������������������� :
(b)
Nature of instrument �������������������������������������������� :
(equity shares/fully convertible debentures/partly convertible debentures,
etc.)�������� Offer price per instrument���������������������������������������������������������������������������� :
(c)
Amt. per instrument on application������������������������ :
(d)
Issue Size������������������������������������������������������������� :
Rs. in lakhs
(5)
3-Day Report
(a)
Due on����� :
(c)
Submitted on�������� :
(6)
No. of collecting banks (Also specify no. of bank branches)�������� :
(7)
Bank-wise names of� branches
which did not submit final consolidated certificate from closure of� issue and mention the dates when they
actually submitted�� :
(8)
Details of subscription���������
:
(a)
Percentage of rights taken up by�
:�
(i)
Promoters��������������� �������� :
(ii)
Other Shareholders� �������� :
(b)
Percentage of rights renounced by:
(i)
Promoters��������������� :
(ii)
Others�������������������� :
(c)
Percentage of rights taken by shareholders/ renounces������� :
(d)
Percentage at the disposal of the Board����� :
(e)
Out of the unsubscribed portion as in above, taken by������ :
(i)
Promoters��������������� :
(ii)
Others�������������������� :
(9)
Promoters� shareholding�����������
������������� �: No. of Shares����������������������� Percentage
(a)
Prior to the Issue�� :����������������������
(b)
On Expanded Capital after the rights issue:
(10) Date of finalisation of
allotment (enclose copy of the basis of allotment)���������������� :
(11) (a)���� Name and Address of Refund Banker���������� :
(b)
Amount of refund due ������ ����������:
(c)
Date of transfer of refund amount to refund banker, if any�� :
(12) Actual date(s) of completion of
despatch of:
(a)
Refund orders������ :
(b)
Certificate/ allotment letters/ demat credit � :
(c)
Reasons for delay in despatch, if any��������� :
(d)
Whether interest paid for delayed period, � if so, for which period�� :����������������������
(13) Name of designated stock
exchange������������������������������������������������������������������������������� :
(14) Names of other stock exchanges
where listing is sought��������������������������������������������������� :
(15) 15th day from the
date of closure of the issue������������������������������������������������������������������� :
(16) Date on which application was
filed with each stock exchange for listing of instruments����� :
(17) Date when listing and trading
permission given by each stock exchange (Enclose copies of� permission letters of stock exchanges)������������������������������������������������������������������������������������������������������������������ :
(18) Reason for delay in listing for
trading, if any��������������������������������������������������������������������� :
(II)
IN CASE OF UNDER SUBSCRIBED
ISSUE:
(1)
Extent of under-subscription on the date of closure of the issue
(a)
Percentage����������������������� :
(b)
Amount���������������������������� :
(2)
Details of standby assistance, if any���������������������������������������������������������������������������������
(a)
No. of Underwriters��������� :
(b)
No. of Underwriters who did not pay devolvement (Please give names,
amount underwritten and reasons for not paying)�
:�������������������� :
(3)
In case where FIs/ MFs had subscribed to make up shortfall not as
underwriter���������������
(a)
Name of FI/MF��������������� :
(b)
No. of� securities applied
for��������� :
(c)
Amount Received������������� :
�����������������������������
CERTIFIED
that the information given above and also in the enclosures are true to the
best of our knowledge and no refund orders / allotment letters / certificates
are pending for despatch in respect of the issue.
�������������������������������������������������������������������������������������������������
Certified
that specified securities to be locked- in are duly inscribed with the words
"specified securities can not be hypothecated / transferred / sold till
.........�
Signed by������������������������������� Signed
by ������������������������������������������ Signed
by
Registrars to the issue �������������������� Issuer ������������������������������������ Lead
Merchant Banker(s)
Place:
Date:
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
[See regulation 67(4) and 105]
FORMAT OF UNDERWRITING
DEVOLVEMENT STATEMENT
(1)
Name of the
merchant banker����������������������������������������� ������������������� :
(2)
Name of the
issuer��������������������������������������������������������� ������������������� :
(3)
Issue size����������������������������������������������������������������������� ������������������� :
(4)
Issue-wise
statement of non-acceptance of underwriting devolvement���� :
|
Sr. No. |
Name of the Underwriter |
Amount underwritten |
Amount devolved |
Date of issue of notice of
devolvement, if any |
Reasons for not accepting devolvement |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
[See regulation 84(1)]
DISCLOSURES
IN PLACEMENT DOCUMENT
(1)
Disclaimer to the effect that the Memorandum
relates to an issue made to qualified institutional buyers under Chapter VIII
of the Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirement) Regulations, 2009 and that no offer is being made to the public or
any other class of investors.
(2)
Glossary of terms/abbreviations
(3)
Financial statements contained herein
(4)
Merchant bankers/merchant bankers to the
placement and other advisors
(5)
Summary of the offering and eligible security
(6)
Risk factors
(7)
Market price information: Disclose particulars
of:-
(a)
high, low and
average market prices of equity shares of the issuer during the preceding three
years;
(b)
monthly high and
low prices for the six months preceding the date of filing of the prospectus;
(c)
number of equity
shares traded on the days when high and low prices were recorded in the
relevant stock exchange during period of (i) and (ii) above, and total volume
traded on those dates;
(d)
the stock market
data referred to above shall be shown separately for periods marked by a change
in capital structure, with such period commencing from the date the concerned
stock exchange recognizes the change in the capital structure (e.g., when the
equity shares have become ex-rights or ex-bonus)
(e)
the market price
immediately after the date on which the resolution of the board of directors
approving the issue was approved
(f)
the volume of
securities traded in each month during the six months preceding the date on
which the offer document is filed with Registrar of Companies;
(g)
along with high,
low and average prices of shares of the issuer, details relating to volume of
business transacted should also be stated for respective periods.
(8)
Use of proceeds:
(a)
purpose of the
issue;
(b)
break-up of the
cost of project for which the money is raised through issue;
(c)
the means of
financing such project; and
(d)
proposed
deployment status of the proceeds at each stage of the project.
(9)
Capitalization Statement
(10) Dividends
(11) Selected
Financial and other Information
(12) The
audited consolidated or unconsolidated financial statements prepared in
accordance with Indian GAAP shall contain the following:
(a)
Report of
Independent Auditors on the Financial Statements
(b)
Balance sheets
(c)
Statements of
income
(d)
Schedules to
accounts
(e)
Statements of
changes in stockholders� equity
(f)
Statements of
cash flows
(g)
Statement of
accounting policies
(h)
Notes to
financial statements
(i)
Statement
relating to subsidiary companies (in case of unconsolidated financial
statements)
(13) Management�s
Discussion and Analysis of financial condition and results of operations
(14) Industry
description
(15) Business
description
(16) Organizational
structure and major shareholders
(17) Board
of directors and senior management
(18) Taxation
aspects relating to the eligible securities
(19) Legal
proceedings
(20) Accountants
(21) General
Information
(22) Such
other information as is material and appropriate to enable the investors to
make an informed decision.
SECURITIES AND
EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS,
2009
[See regulations 103(2)(b) and 103(3)]
DISCLOSURES
IN PROSPECTUS AND ABRIDGED PROSPECTUS FOR ISSUE OF INDIAN DEPOSITORY RECEIPTS
[See regulation 103(2)(b)]
DISCLOSURES
IN PROSPECTUS FOR ISSUE OF INDIAN DEPOSITORY RECEIPTS
A prospectus for issue of Indian
Depository Receipts (IDR) shall contain all details as specified herein.
(1)
GENERAL INSTRUCTIONS WITH RESPECT TO CONTENTS OF THE
PROSPECTUS:
(a)
The merchant
banker has the option to file the draft prospectus as a public filing or a
confidential filing, accompanied with fees as prescribed in Rule 5(1)(ii) of
the Companies (Issue of Indian Depository Receipts) Rules, 2004.
(b)
Where the
merchant banker opts for confidential filing of the draft prospectus, it shall
subsequently file an updated draft prospectus with the Board (without payment
of any additional fees), after incorporating therein changes, if any, suggested
or specified by the Board. The updated draft prospectus shall be made public
for a period of twenty one days from the date of its filing with the Board.
(c)
The contents of
the prospectus including the financial statements of the issuing company, its
subsidiaries and associates shall be in plain English.
(d)
The term
�associate� for the purpose of this Schedule would mean �associate� as defined
in Indian GAAP, or IFRS or US GAAP in which the financial statements of the
issuing company are disclosed.
(e)
The prospectus
shall contain all material information which shall be true and adequate so as
to enable the investors to make informed decision on the investments in the
issue.
(f)
The prospectus
shall also contain the information and statements specified herein.
(g)
The issuing
company shall, through a merchant banker file a prospectus certified by two
authorized signatories of the issuing company, one of whom shall be a
whole-time director and other the Chief Accounts Officer or the Chief Financial
Officer, stating the particulars of the resolution of the Board or the
shareholders by which it was approved, with the Board and Registrar of Companies,
New Delhi, before such issue. They shall also certify that all the disclosures
made in the prospectus are correct and adequate.
(h)
The agreement
made with the domestic depository shall also be furnished along with the
prospectus.
(i)
The lead merchant
banker who is responsible for conducting due diligence exercise with respect to
contents of the offer document, as per inter-se allocation of responsibilities,
shall sign the due diligence certificate
(j)
A statement shall
be made by the merchant banker in the prospectus (including a due diligence
certificate) in the format as specified in format specified in Part C.
(k)
�A statement will be made by the issuing
company, disclaiming responsibility for statements made otherwise than in the
prospectus, as follows:
�The issuing
company, its directors and the merchant banker accept no responsibility for
statements made otherwise than in the prospectus or in the advertisements or
any other material issued by at our instance and anyone placing reliance on any
other source of information including our website______ shall be doing so at
his or her own risk.�
(2)
THE ISSUE: Summary
of the terms of offer shall be incorporated, including:
(a)
Offer and listing
details
(b)
Plan of
distribution
(c)
Markets
(d)
Selling
shareholders, if any
(e)
Dilution
(f)
Expenses of the
Issue
(3)
FORWARD LOOKING STATEMENTS: A paragraph on the statements that are forward looking
statements and not matters of historical facts shall be incorporated. A
statement on the sources of data used in the prospectus and their accuracy shall
also be incorporated. A line should also be incorporated on whether these have
been independently verified.
(4)
GENERAL INFORMATION:
(a)
Definitions/terms
used in the prospectus
(b)
Name, address and
contact information of the registered office of the issuing company;
(c)
Name, address and
contact information of the domestic depository, the overseas custodian bank
with the address of its office in India, the merchant banker, the underwriter
to the issue, advisors to the issue and any other intermediary which may be appointed
in connection with the issue of IDR;
(d)
Names, addresses
and contact information of experts and counsel;
(e)
Name, address and
contact information of the compliance officer in relation to the issue of
IDR.� [The compliance officer should be placed in India].
(f)
Name, address and
contact information of stock exchanges where applications are made or proposed
to be made for listing of the IDR;
(g)
Disclosure about
provisions relating to punishment for fictitious applications;
(h)
Statement/declaration
for refund of excess subscription
(i)
Statement that an
interest of 15% p.a. would be paid to the investors if the allotments letters /
refund orders are not despatched within fifteen days of the closure of the
public issue
(j)
Declaration about
issue of allotment letters/certificates/ IDR within the stipulated period;
(k)
Date of opening
of issue;
(l)
Date of closing
of issue;
(m)
Method and
expected timetable of the issue
(n)
A statement that
subscription to the issue shall be kept open for at least three working days
and not more than ten working days
(o)
Date of earliest
closing of the issue;
(p)
Declaration by
the merchant banker with regard to adequacy of resources of underwriters to
discharge their respective obligations, in case of being required to do so;
(q)
A statement by
the issuing company that all moneys received out of issue of IDR shall be
transferred to a separate domestic bank account, name and address of the bank
and the nature and number of the account to which the amount shall be credited;
(r)
Details of
availability of prospectus and forms, i.e., date, time, place etc;
(s)
Amount and mode
of payment seeking issue of IDR
(t)
Disclosure on
Investor Grievances and Redressal System:
(i)
The arrangements
or any mechanism evolved by the issuing company for redressal of investor
grievances.
(ii)
The past record
(for a minimum period of three years before the date of the prospectus) of
investor grievance redressal of the issuing company and its listed
subsidiaries/associates including details as to the time normally taken by it
for disposal of various types of investor grievances.
(iii)
That the company
undertakes to subject itself to the jurisdiction of Indian courts having
jurisdiction over the place where the stock exchange is situated regarding
grievances of the IDR applicants and IDR holders.
(5)
RISK FACTORS AND MANAGEMENT PERCEPTION, IF ANY:
(a)
Risk factors
shall be disclosed as follows:
(i)
Risk factors
associated with the issuing company�s business
(ii)
Risk factors
associated with the country of the issuing company proposing to issue IDR
(iii)
Risk factors
associated with the IDR / underlying shares
(b)
Risk factors shall be classified as those which are specific to the
project and internal to the issuing company and those which are external and
beyond the control of the issuing company.
(c)
Risk factors shall be determined on the basis of their materiality.
(d)
Materiality shall be decided taking the following factors into account:
(i)
Some events may not be material individually but may be found material
collectively.
(ii)
Some events may have material impact qualitatively instead of
quantitatively.
(iii)
Some events may not be material at present but may be having material
impacts in future.
(e)
The Risk factors shall appear in the prospectus in the following
manner:
(i)
Risks envisaged by the management of the issuing company.
(ii)
Proposals, if any, to address the risks.
(iii)
Any �notes� required to be given prominence shall appear immediately
after the risk factors.
(6)
RECENT DEVELOPMENTS: Important events in the recent past (two financial
years preceding the issue) providing details of important developments on three
key areas: Operations & Management,
Shareholding patterns and Business Environment, shall be mentioned.
(7)
MARKET PRICE INFORMATION AND OTHER INFORMATION
CONCERNING THE SHARES IN THE DOMESTIC MARKET OF THE ISSUING COMPANY: The following information should be provided exchange-wise,
if the securities are listed in more than one exchange. This information should
be updated as on last available date before the date of prospectus. This
information shall also b given if it is a further issue of IDR which are
already listed in India:
(a)
Market price of
shares for each quarter of the last three calendar years preceding the calendar
year preceding the year of the issue of Prospectus (High, Low, Average Daily
Trading Volume)
(b)
Market price of
shares for each month of the calendar year preceding� the year of the issue of prospectus (High,
Low, Average Daily Trading Volume)
(c)
Market price of
shares for the month preceding the date of prospectus (High, Low, Average Daily
Trading Volume)
(d)
The opening and
closing price on the last day of the month preceding the date of the prospectus
along with the volume
(8)
DIVIDENDS:
(a)
Dividend policy
of the issuing company
(b)
Rate of dividend
and amount of dividend paid for the last five financial years
(c)
Regulatory
framework in the country of incorporation/share listed concerning dividends
(d)
Details of
arrangement with the depositories for payment of dividend to the IDR holders
(e)
Information about
changes, if any, in dividends announced and dividends paid and time gap between
the dividends announced and dividends paid.
(f)
Information about
dividend yield.
(g)
Taxation aspects
of dividend distribution.
(9)
EXCHANGE RATES:
(a)
Brief history of
the pattern of exchange rates between the country of incorporation/where shares
are listed and India
(b)
High, Low,
Average Rates for the last five years
(c)
High, Low,
Average Rates for the last twelve months
(10) FOREIGN
INVESTMENT AND EXCHANGE CONTROLS OF THE COUNTRY OF INCORPORATION/ WHERE SHARES
ARE LISTED: Information relating to
the relevant foreign investment laws and exchange control regulations of the
country of incorporation or country where the underlying equity shares are
listed.
(11) OBJECTS OF
THE ISSUE / USE OF PROCEEDS: The
following shall be disclosed:
(a)
The purpose of
the issue
(b)
Break-up of the
cost of project for which the money is raised through the IDR issue
(c)
The means of
financing such project and
(d)
The proposed
deployment status of the proceeds at each stage of the project.
(12) CAPITALISATION
STATEMENT
|
����������� Particulars |
Pre-issue as (Figures in Rs. crores) |
|
Short-Term Debt��������� |
|
|
Long� Term Debt �������� |
|
|
Shareholders
Funds �
Share� Capital �
Reserves |
|
|
Total
Shareholders Funds�������� ��������� � |
|
|
Long Term
Debt/Equity |
|
(13) CAPITAL
STRUCTURE:
(a)
Authorised,
issued, subscribed and paid up capital (number of instruments, description,
aggregate nominal value).
(b)
Size of present
issue.
(c)
Paid-up Capital:
(i)
before the issue;
(ii)
after the issue
(if the IDR issue involves issue of fresh equity shares); and
(iii)
share premium
account (before and after the issue)
(d)
Detailed notes to
capital structure
(e)
Information with
respect to Capital Structure shall also contain details regarding holdings of
major shareholders i.e., the person or persons who are in over-all control of
the company.
(14) FINANCIAL
INFORMATION:
(a)
The audited
consolidated or unconsolidated financial statements, prepared in accordance
with Indian GAAP (including all Accounting Standards issued by the Institute of
Chartered Accountants of India) or with the International Financial Reporting
Standards (IFRS) or US GAAP, for a period of three financial years immediately
preceding the date of prospectus shall contain the following:
(i)
Report of
Auditors on the Financial Statements
(ii)
Balance Sheets
(iii)
Statements of
Income
(iv)
Schedules to
Accounts
(v)
Statements of
Changes in Stockholders� Equity
(vi)
Statements of
Cash Flows
(vii)
Statement of
Accounting Policies
(viii)
Notes to
Financial Statements
(ix)
Statement
Relating to Subsidiary Companies (in case of unconsolidated financial
statements)
(x)
Related Party
transactions
(xi)
Liquidity and
Capital Resources.
(b)
The financial
information in the prospectus shall be disclosed in the issuing company�s
functional currency/reporting currency/national currency and the reporting
currency shall be restricted to Sterling Pound/Euro/Yen/US Dollar.
(c)
In case, the
financial results are prepared as per IFRS or US GAAP, the financial results
shall be audited by a professional accountant or certified public accountant or
equivalent (by whatever name called in the home country in accordance with the
International Standards on Auditing (ISA)).
(d)
Where the law of
the home country requires annual statutory audit of the accounts of the issuing
company, a report of the statutory auditor on the audited financial statements
of the issuing company for each of the three financial years immediately
preceding the date of the prospectus including the profits or losses, assets,
liabilities and cash-flow statement of the issuing company at the last date to
which the accounts of the issuing company were made in the specified form:
�Provided the gap between date of opening of
issue and date of report shall not exceed 120 days.
(e)
The report
prepared by the statutory auditors of the issuing company should disclose
financial statements (as per relevant period in the annual report) in Indian
Rupees (at the closing rate of exchange, as at the date on which the financial
information is presented), compiled in a tabular form and include the
consolidated or unconsolidated income statement, consolidated or unconsolidated
cash flow statements, consolidated or unconsolidated balance sheet and the
capitalisation statement required under item (12).
(f)
The interim
audited financial statements in respect of the period ending on a date which is
less than 180 days prior to the date of opening of the issue have to be
included in the report, if the gap between the ending date of the latest
audited financial statements disclosed as above and the date of the opening of
the issue is more than 180 days:
�Provided that if the gap between such date of
latest audited financial statements and the date of opening of issue is 180
days or less, the requirement above shall be deemed to be complied with, if
disclosures in respect of material changes in the financial position of issuing
company for such gap are disclosed in the prospectus:
�Provided further that in case of an issuing
company which is a foreign bank incorporated outside India and which is
regulated by a member of the Bank for International Settlements or a member of
the International Organization of Securities Commissions which is a signatory
to a Multilateral Memorandum of Understanding, the requirement above, in
respect of period beginning with last date of period for which the latest
audited financial statements are made and the date of opening of the issue
shall be satisfied, if the relevant financial statements are based on limited
review report of such statutory auditor.�
(g)
In case the
issuing company opts to prepare and disclose the financial results as per US
GAAP, a reconciliation statement vis-a-vis Indian GAAP and summary of
significant differences between the Indian GAAP and US GAAP has to be annexed
with the report. If financial results are prepared in accordance with IFRS,
then issuing company shall annex the summary of significant differences between
the Indian GAAP and IFRS.
(h)
Where the law of
the home country does not require annual statutory audit of the accounts of the
issuing company, a report, prepared in accordance with Indian GAAP certified by
Chartered Accountant in practice within the terms and meaning of the Chartered
Accountants Act, 1949 on the financial statements/ results of the issuing
company for each of the three financial years immediately preceding the date of
prospectus including the profits or losses, assets, liabilities and cash-flow
statement of the issuing company at the last date to which the accounts of the
issuing company were made in the specified form:
�Provided that the gap between date of opening
of issue and date of report shall not exceed 120 days.�������
(i)
The report
prepared by the Chartered Accountants should disclose financial statements in
Indian Rupees (at the closing rate of exchange, as at the date on which the
financial information is presented), compiled in a tabular form and include the
consolidated or unconsolidated income statement, consolidated or unconsolidated
cash flow statements, consolidated or unconsolidated balance sheet and the
capitalisation statement required under item (12).
(j)
The interim
financial statements in respect of the period ending on a date which is less
than 180 days prior to the date of opening of the issue have to be included in
report, if the gap between the ending date of the latest financial statements
disclosed above and the date of the opening of the issue is more than 180 days:
�Provided that if the gap between such date of
latest audited financial statements and the date of opening of issue is 180
days or less, the requirement above shall be deemed to be complied with if
disclosures in respect of material changes in the financial position of issuing
company for such gap are disclosed in the prospectus.
(k)
If the proceeds
of the IDR issue are used for investing in other body (ies) corporate, then
following details of such body (ies) corporate shall be given:
(i)
Names and
address(es) of the body(ies) corporate;
(ii)
The reports as
stated above in respect of those body(ies) corporate also.
(15) STATEMENT ON
MATERIAL DEVELOPMENTS SUBSEQUENT TO THE DATE OF THE LAST FINANCIAL STATEMENTS
AS DISCLOSED IN THE PROSPECTUS: A
statement by the directors whether in their opinion there have arisen any
circumstances since the date of the last financial statements as disclosed in
the prospectus any which materially and adversely affect or is likely to affect
the trading or profitability of the issuing company, or the value of its
assets, or its ability to pay its liabilities within the next twelve months,
and if so, an outline of such circumstances and an assessment of their likely
impact.
(16) MANAGEMENT
DISCUSSION AND ANALYSIS OF THE FINANCIAL�
STATEMENTS� (BY COMPARING THE
RECENT FINANCIAL YEAR WITH THE PREVIOUS THREE FINANCIAL� YEARS):
(a)
A summary of past
financial results after adjustments as given in the auditors report for the
past three years containing significant items of income and expenditure shall
be given.
(b)
Overview of the
business of the issuing company.
(c)
Factors that may
affect results of the operations.
(d)
An analysis of
reasons for the changes in significant items of income and expenditure shall
also be given, inter alia, containing
the following:
(i)
unusual or
infrequent events or transaction;
(ii)
significant
economic changes that materially affected or are likely to effect income from
continuing operations;
(iii)
known trends or
uncertainties that have had or are expected to have a material adverse impact
on sales, revenue or income from continuing operations;
(iv)
future changes in
relationship between costs and revenues, in case of events such as future
increase in labour or material costs or prices that will cause a material
change are known;
(v)
the extent to
which material increases in net sales or revenue are due to increased sales
volume, introduction of new products or services or increased sales prices;
(vi)
total turnover of
each major industry segment in which the issuing company operated
(vii)
status of any
publicly announced new products or business segment;
(viii)
the extent to
which business is seasonal;
(ix)
any significant
dependence on a single or few suppliers or customers;
(x)
competitive
conditions.
(17) INDUSTRY AND
BUSINESS OVERVIEW: Market including
details of the competition, past production figures for the industry, existing
industry capacity, past trends and future prospects regarding exports (if
applicable), demand and supply forecasts (if given, should be essentially with
assumptions unless sourced from a market research agency of repute), etc. to be
given. Source of data used shall be mentioned.
(18) DETAILS OF
THE ISSUING COMPANY:
(a)
Main object,
history and present business of the issuing company
(b)
Location of the
project, if any
(c)
Installed
capacity and the details of plant and machinery, infrastructure facilities,
technology etc., where applicable
(d)
Schedule of
implementation of project and progress made so far, if applicable;
(e)
Nature of
product(s), consumer(s), industrial users
(f)
Research and
development, patents and licenses, etc.
(g)
Property, plants
and equipment
(h)
Particulars of
financial and other defaults, if any
(i)
Underwriting
(j)
Experts
(k)
Where you can
find additional information
(l)
Enforcement of
civil liabilities against foreign persons
(19) SUBSIDIARIES
AND ASSOCIATES OF THE ISSUING COMPANY:
(a)
The following
information for the last three years based on the audited statements in respect
of subsidiaries and associates of the issuing company:
(i)
Date of
Incorporation
(ii)
Nature of
activities
(iii)
Equity Capital
(iv)
Reserves
(excluding revaluation reserve)
(v)
Sales
(vi)
Profit after tax
(PAT)
(vii)
Earnings per
share (EPS) and
(viii)
Net Asset Value
(NAV)
(b)
If the
subsidiaries and associates are not required to prepare such audited statements
as per the laws prevailing in those countries, the same may be certified as
true and correct by the Board of Directors and the management of such
companies, provided a certificate from a certified public accountant or
equivalent practicing in the concerned country is submitted to the Board.
�����
(20) MANAGEMENT:
(a)
Details with respect to the promoters and their background. If there
are no identifiable promoters, then the details and background of all persons
who hold 5% or more equity share capital of the issuing company.)
(b)
Details of the
Board of Directors and the Key Managerial Personnel (i.e. name, address(es) of
directors, manager, managing director or other principal officers of the
issuing company, age, qualifications, industry experience, other
directorships).
(c)
Remuneration of
the Directors and the Key managerial personnel with detailed breakup, sitting
fees, their relation with promoters / controlling shareholder(s), if any, their
equity holding in the issuing company, duration of their association with the
issuing company.
(d)
Organisational
structure
(e)
Practices of the
Board of Directors
(f)
Employees
(21) SECURITIES
MARKET OF THE COUNTRY OF INCORPORATION WHERE SHARES ARE LISTED:
(a)
Brief History
(b)
Stock exchange
regulation
(c)
Listing
Regulations
(d)
Details of the
securities market regulator of the country of the issuing company
(e)
Whether the
securities market regulator of the country of the issuing company has signed
any MoU with the Board/IOSCO
(f)
Disclosure under
the Companies Act� and Securities
Regulations (or equivalent thereof)
(g)
Stock exchanges
(h)
Takeover Code/Buy
back Code
(i)
Reforms in some
key sectors of the economy
(j)
Restriction on
foreign ownership of securities
(k)
Overview of the
financial sector
(l)
Nature of the
securities trading market in that country
(m)
A statement
of how the enforcement of Indian securities laws would be affected by the fact
that the issuing company is located outside India
(n)
A comparative
analysis of the corporate governance provisions that would be followed by the
issuing company vis-�-vis that is applicable to Indian listed companies.
(22) DESCRIPTION
OF THE IDR AND RIGHTS OF IDR HOLDERS:
(a)
Brief description
of the IDR
(b)
Dividends, other
distributions and rights of IDR holders
(c)
Voting
rights if any and the manner of their exercise by IDR holders, if any.
(d)
Record dates and
how the same will be disclosed.
(e)
Reports and other
communication to which the IDR holders will be entitled.
(f)
Procedure of
conversion of IDR into shares
(g)
Governing law
regarding various aspects of IDR and transactions therein.
(23) PROVISIONS
REGARDING TRANSFER OF SHARES AND DEPOSITORY RECEIPTS:
(a)
Provisions
regarding transfer of IDR
(b)
Outline of
provisions regarding transfer of underlying shares after conversion
(24) INFORMATION
RELATING TO THE DEPOSITARY - INDIAN AND INTERNATIONAL: Brief details of the domestic depository, overseas
custodian bank and depository agreement.
(25) APPROVALS OF
THE GOVERNMENT/REGULATORY AUTHORITIES: Information
relating to statutory and regulatory approvals required in home country for the
issue and the related aspects and their status, and approvals from Indian
regulatory authorities.
(26) TAXATION
FRAMEWORK IN INDIA AND THE COUNTRY OF�
INCORPORATION/ WHERE SHARES ARE LISTED: Information relating to relevant provisions of
taxation law, tax treaties and their impact for IDR holders.
(27) OUTSTANDING
LITIGATIONS AND DEFAULTS:
(a)
Material
litigation / liabilities/defaults including arrears / potential liabilities of
the issuing company, its promoters / controlling shareholders / directors and
its subsidiaries and associates.
(b)
Materiality shall
be determined on the basis of factors which are specific to the project and to
the issuing company, its promoters / controlling shareholders / directors, its
subsidiaries and associates, which may have a bearing on the performance of the
issuing company.�
(c)
Materiality shall
be decided taking the following factors into account:����������������������������������������������������������������
(i)
Some
litigation/defaults may not be material individually but may be found
material�� collectively.
(ii)
Some
litigation/defaults may have material impact qualitatively instead of
quantitatively.
(iii)
Some
litigation/defaults may not be material at present but may be having a material
impact in future.
(28) BASIS OF
ISSUE PRICE:
(a)
Earnings per
share i.e. EPS pre-issue for the last three years (as adjusted for changes in
capital)
(b)
P/E pre-issue
(c)
Average return on
net worth in the last three years
(d)
Minimum return on
increased net worth required to maintain pre-issue EPS
(e)
Net Asset Value
per share based on last balance sheet
(f)
Net Asset Value
per share after issue and comparison thereof with the issue price
(g)
Comparison of all
the accounting ratios of the issuing company as mentioned above with the
industry average and with the accounting ratios of the peer group (i.e.
companies of of shares (including the statement about the issue price being �X�
times of the face value) and that of the IDR. The aggregate face value of the
total equity shares underlying a single comparable size in the same industry. [The source from which industry average and
accounting ratios of the peer group has been taken should be indicated].
(h)
The face value
IDR shall also be given.
�Provided that the projected earnings shall not
be used as a justification for the issue price in the prospectus.
�Provided further that the accounting ratios
disclosed in the prospectus in support of basis of the issue price shall be
calculated after giving effect to the consequent increase in capital on account
of compulsory conversions outstanding, as well as on the assumption that the
options outstanding, if any, to subscribe for additional capital will be
exercised.
(29) MAIN
PROVISIONS OF ARTICLES OF ASSOCIATION / MAIN CHARTER OF THE� ISSUING COMPANY
(30) MATERIAL
CONTRACTS AND DOCUMENTS FOR INSPECTION: Place
at which inspection of the documents specified under rule 7 of the Companies
(Issue of Indian Depository Receipts) Rules, 2004, the prospectus, the
financial statements and auditor's report thereof will be allowed during the
normal business hours.
(31) OTHER
INFORMATION:
(a)
Disclosure of
mandatory vetting of the prospectus by the legal counsel to the issuing company
operating at the place where the registered office of the Issuing company is
situated.
(b)
Consent of
merchant bankers, overseas custodian bank, the domestic depository and all
other intermediaries associated with the issue of IDR.
(c)
Fees and expenses
payable to the intermediaries involved in the issue of IDR
[See regulation 103(3)]
DISCLOSURES
IN ABRIDGED PROSPECTUS FOR ISSUE OF INDIAN DEPOSITORY RECEIPTS
General Instructions:
(1)
The information
to be provided under each of the heads specified below shall be as per the
requirement of Part A of this Schedule except when specified otherwise.
(2)
The abridged
prospectus shall be printed in a font size which shall not be visually smaller
than Times New Roman Size 10.
(3)
The order in
which items appear in the abridged prospectus shall correspond, as far as may
be applicable, to the order in which items appear in the prospectus.
(4)
The application
form shall be so positioned that on the tearing-off of the application form, no
part of the information given in the abridged prospectus is mutilated.
The abridged prospectus for the issue of Indian
Depository Receipts (IDR) shall contain the following disclosures:
(1)
General Information:
(a)
The name of the
issuing company� and address of the
registered office of the issuing company, along with telephone number, fax
number, e-mail address and website address, and where there has been a change
in the address of the registered office or name of the issuing company, details
thereof.
(b)
Name, address and
contact information of the registered office of the issuing company;
(c)
Name, address and
contact information of the domestic depository, the overseas custodian bank
with the address of its office in India, the merchant banker, the underwriter
to the issue, advisors to the issue and any other intermediary which may be
appointed in connection with the issue of IDR;
(d)
Names, addresses
and contact information of experts and counsel;
(e)
Name, address and
contact information of the compliance officer in relation to the issue of IDR.� The compliance officer should be placed in
India
(f)
Name, address and
contact information of Stock Exchanges where applications are made or proposed
to be made for listing of the IDR;
(g)
Disclosure about
provisions relating to punishment for fictitious applications;
(h)
Statement/declaration
for refund of excess subscription
(i)
Statement that an
interest of 15% p.a. would be paid to the investors if the allotments letters /
refund orders are not despatched within 15 days of the closure of the public
issue, as the case may be
(j)
Declaration about
issue of allotment letters/certificates/ IDR within the stipulated period;
(k)
Date of opening
of issue;
(l)
Date of closing
of issue;
(m)
Method and
Expected Timetable of the issue;
(n)
A statement that
subscription to the issue shall be kept open for atleast 3 working days and not
more than 10 working days;
(o)
Date of earliest
closing of the issue;
(p)
Declaration by
the merchant banker with regard to adequacy of resources of underwriters to
discharge their respective obligations, in case of being required to do so;
(q)
A statement by
the issuing company that all moneys received out of issue of IDR shall be
transferred to a separate domestic bank account, name and address of the bank
and the nature and number of the account to which the amount shall be credited;
(r)
Details of
availability of prospectus and forms, i.e., date, time, place etc;
(s)
Amount and mode
of payment seeking issue of IDR
(t)
Disclosure on
Investor Grievances and Redressal System:
(u)
That the issuing
company undertakes to subject itself to the jurisdiction of Indian Courts
having jurisdiction over the place where the stock exchange is situated
regarding grievances of the IDR applicants and IDR holders.
(2)
Capital Structure of the issuing company: Following details to be furnished:
(a)
Authorised,
issued, subscribed and paid up capital (Number of instruments, description,
aggregate nominal value).
(b)
Size of present
issue.
(c)
Paid-up Capital:
(i)
before the issue;
(ii)
after the issue
(if the IDR issue involves issue of fresh equity shares); and
(iii)
share premium
account (before and after the issue)
(d)
Detailed notes to
Capital Structure
(3)
Terms of the Present Issue:
(a)
Authority for the
issue, terms of payment and procedure and time schedule for allotment and issue
of certificates/ refund orders.
(b)
The clause
"Interest in Case of Delay in Despatch of Allotment Letters/ Refund Orders
in case of public issues" shall appear.
(4)
Instructions for applicants:
(a)
How to apply,
availability of prospectus, abridged prospectus and application forms, mode of
payment and book building procedure, if relevant.
(b)
In the
application form, the declaration relating to nationality and residentship
shall be shown prominently as under:
"Nationality
and Residentship (Tick whichever is applicable)
(i)
I am / We are
Indian National(s) resident in India and I am/we are not applying for the said
equity shares as nominee(s) of any person resident outside India or Foreign
National(s).
(ii)
I am / We are
Indian National(s) resident in India and I am / We are applying for the said
equity shares as Power of Attorney holder(s) of Non- Resident Indian(s)
mentioned below on non-repatriation basis.
(iii)
I am / We are
Indian National(s) resident outside India and I am/we are applying for the said
equity shares on my / our own behalf on non-repatriation basis."�
(c)
The application
form should contain necessary instructions/ provisions for the following:
(i)
Instructions to
applicants to mention the number of application form on the reverse of the
instruments to avoid misuse of instruments submitted along with the
applications for shares/ debentures in public issues.
(ii)
Provision in the
application form for inserting particulars relating to bank account number and
the name of the bank with whom such account is held, to enable printing of the
said details in the refund orders or for refunds through Electronic Clearing
System.
(iii)
Instruction to applicants to disclose Permanent Account Number in the
application form, irrespective of the amount for which application / bid is
made, along with the instruction that applications without Permanent Account
Number would be rejected.
(iv)
Disclosure of
PAN/GIR number.
(v)
Details of
options, if any, to receive securities subscribed for and a statement that
trading in securities on the stock exchanges in physical form will be available
only subject to limits prescribed by the Board for time to time.
(d)
Any special tax
benefits for issuing company and its shareholders (Only section numbers of the
Income Tax Act and their substance should be mentioned, without reproducing the
text of the sections)
(e)
Restrictions on
investments in IDR / fungibility of IDR
(5)
Particulars of the Issue:
(a)
Objects of the
issue
(b)
Project cost
(c)
Means of
financing
(d)
Name of
Appraising Agency, if any
(e)
Name of
Monitoring Agency, if any
(6)
Description of the IDR and Rights of IDR Holders:
(a)
Brief description
of the IDR
(b)
Dividends, Other
Distributions and Rights of IDR holders
(c)
Voting rights and
their manner of exercise by IDR holders, if any.
(d)
Record dates and
how the same will be disclosed.
(e)
Reports and other
communication to which the IDR holders will be entitled.
(f)
Conversion
procedure of IDR into shares
(g)
Governing Law
regarding various aspects of IDR and transactions therein.
(7)
Company, Management and Project:
(a)
History and main
objects and present business of the company.
(b)
Promoters /
controlling shareholders and their background.
(c)
Names, address
and occupation of manager, managing director, and other Directors (including
nominee-directors and whole-time directors) giving their directorships in other
companies.
(d)
Location of the
project
(e)
Plant and
machinery, technology, process, etc
(f)
Collaboration,
any performance guarantee or assistance in marketing by the collaborators
(g)
Infrastructure
facilities for raw materials and utilities like water, electricity, etc.
(h)
Schedule of
implementation of the project and progress made so far, giving details of land
acquisition, civil works, installation of plant and machinery, trial
production, date of commercial production etc
(i)
Nature of the
products/services and end users
(j)
Existing,
licensed and installed capacity of the product, demand of the product-existing,
and estimated in the coming years as estimates by a Government authority or by
any other reliable institution, giving source of the information. In case the
company is providing services, relevant information with regard to nature/
extent of services, etc., have to be furnished.
(k)
Approach to
marketing and proposed marketing set up
(l)
Export
possibilities and export obligations, if any.
(m)
Stock Market
Data: Disclose particulars of:-
(i)
Market price of
shares for each quarter of the last three calendar years preceding the calendar
year preceding the year of the issue of Prospectus (High, Low, Average Daily
Trading Volume)
(ii)
Market price of
shares for each month of the calendar year preceding� the year of the issue of Prospectus (High,
Low, Average Daily Trading Volume)
(iii)
Market price of
shares for the month preceding the date of Prospectus (High, Low, Average Daily
Trading Volume)
(iv)
The Opening and
Closing price on the last day of the preceding month of the date of Prospectus
along with the volume
(v)
This information
should be provided, exchange wise, if the securities are listed in more than
one exchange
(vi)
This information
should updated as on last available date before the date of prospectus
(vii)
If it is a
further issue of IDR which are already listed in India, the above information
should be given about such IDR also
(8)
Particulars with regard to the subsidiaries /
associates of the issuing company: The
following information for the last 3 years based on the audited statements in
respect of subsidiaries and associates of the issuing company:
(a)
Date of
Incorporation;
(b)
Nature of
activities;
(c)
Equity Capital;
(d)
Reserves
(excluding revaluation reserve);
(e)
Sales;
(f)
Profit after tax
(PAT);
(g)
Earnings per
share (EPS); and
(h)
Net Asset Value
(NAV);
(9)
Basis for Issue Price:
(a)
Earnings per
share i.e. EPS pre-issue for the last three years (as adjusted for changes in
capital);
(b)
P/E pre-issue
(c)
Average return on
net worth in the last three years
(d)
Minimum return on
increased net worth required to maintain pre-issue EPS;
(e)
Net Asset Value
per share based on last balance sheet;
(f)
Net Asset Value
per share after issue and comparison thereof with the issue price.
(g)
Comparison of all
the accounting ratios of the issuing company as mentioned above with the
industry average and with the accounting ratios of the peer group (i.e.,
companies of comparable size in the same industry. (Indicate the source from
which industry average and accounting ratios of the peer group has been taken)
�Provided that the projected earnings shall not
be used as a justification for the issue price in the prospectus.
�Provided further that the accounting ratios
disclosed in the prospectus in support of basis of the issue price shall be
calculated after giving effect to the consequent increase in capital on account
of compulsory conversions outstanding, as well as on the assumption that the
options outstanding, if any, to subscribe for additional capital will be
exercised.
(h)
The face value of
shares (including the statement about the issue price being �X� times of the
face value) and that of the IDR. The aggregate face value of the total equity
shares underlying a single IDR also shall be given
(10) Outstanding
Material Litigations and Defaults (in
a summarised tabular form): Material Litigation / Liabilities including
arrears/Potential liabilities of the issuing company, its promoters /
controlling shareholders / directors and its subsidiaries and associates.
(11) Material
Development: Any material development
after the date of the latest balance sheet and its impact on performance and
prospects of the company.
(12) Expert
opinion obtained, if any.
(13) Change, if
any, in directors and auditors during the last three years and reasons thereof.
(14) �Time and Place of Inspection of material
contracts (List of material contracts not required)
(15) Financial
Performance of the Issuing company for the last three years (Figures to be taken from the audited annual accounts
in a tabular form):
(a)
Balance Sheet
Data: Equity Capital, Reserves (State Revaluation Reserve, the year of
revaluation and its monetary effect on assets) and borrowings
(b)
Profit and Loss
data: Sales, Gross profit, Net profit, dividend paid, if any
(c)
Any change in
accounting policies during the last three years and their effect on the profits
and the reserves of the issuing company
(d)
Following
information as extracted from the report of the auditors reproduced in the main
prospectus:
(i)
net profit before
accounting� for extra ordinary items
(ii)
extra ordinary
items
(iii)
net profit after
accounting for extra ordinary items
(16) Management
Discussions and Analysis on Accounts
(17) Listed
Ventures of Promoters / controlling shareholders
(18) Disclosure
on Investor Grievances and Redressal System
(19) Statement
regarding minimum subscription clause:
(a)
Following
statements shall appear for non-underwritten IDR issues:
(i)
�If the issuing
company does not receive the minimum subscription of ninety per cent. of the
offer through offer document on the date of closure of the issue, or if the
subscription level falls below ninety per cent. after the closure of issue on
account of cheques having being returned unpaid or withdrawal of applications,
the issuing company shall forthwith refund the entire subscription amount
received.�
(ii)
�If the issuing
company fails to refund the entire subscription amount within fifteen days from
the date of the closure of the issue, it is liable to pay the amount with
interest to the subscribers at the rate of fifteen per cent. per annum for the
period of delay.�
(b)
Following
statement shall appear for underwritten IDR issues:
�If the issuing
company does not receive the minimum subscription of ninety per cent. of the
offer through offer document including devolvement of underwriters within sixty
days from the date of closure of the issue, the issuing company shall forthwith
refund the entire subscription amount received with interest to the subscribers
at the rate of fifteen per cent. per annum for the period of delay beyond sixty
days.�
(20) Information
relating to relevant provisions of Taxation law, Tax Treaties and their impact
for IDR holders.�
(21) Brief
details of the Domestic Depositary, Overseas Custodian Bank and Depositary
Agreement.
(22) Information
relating to statutory and regulatory approvals required in home country for the
issue and the related aspects and their status, and approvals from Indian
regulatory authorities.
(23) Signatories
to the Prospectus.
[See
regulation 101(6)]
FORMAT OF THE DUE DILIGENCE CERTIFICATE TO BE FILED BY
THE LEAD MANAGER FOR IDR ISSUES
To,
Securities and Exchange Board of India
Dear Sirs,
Sub.: Issue of �����.. (hereinafter
referred to as �IDR�) by ����(hereinafter referred to as the �issuing company�)
We, the undernoted, have been appointed as the Merchant Banker
(hereinafter referred to as the �Lead Merchant Banker�) to the proposed issue
of IDR by the Issuing Company and we state as follows:
(1)
The Draft Red
Herring Prospectus (hereinafter referred to as the �DRHP�) is being filed with
the Securities and Exchange Board of India (hereinafter referred to as the
�Board�) in compliance with Securities and Exchange Board of India (Issue of
Capital and Disclosure Requirements) Regulations, 2009 (hereinafter referred to
as the Regulations) or any statutory modification or re-enactment thereof read
with the Companies (Issue of Indian Depository Receipts) Rules, 2004
(hereinafter referred to as �the IDR Rules�), on a public basis, for approval.
(2)
We have examined
the disclosures made by the Issuing Company in jurisdictions where its
underlying equity shares are listed so as to ensure uniformity and parity of
information shared with investors across different regulatory jurisdictions (hereinafter
referred to as �publicly available information�) and participated in
discussions with the senior management of the Issuing Company for the purpose
of preparing disclosures on the Issuing Company in the DRHP.
(3)
We have examined
various documents, more particularly referred to in the Annexure hereto, in
connection with the finalization of the DRHP pertaining to the said issue.
(4)
On the basis of
such examination and the discussions with the Issuing Company, its directors
and other officers and other independent agencies/ experts/ reports, WE CONFIRM
that:
(a)
the DRHP
forwarded to the Board is in conformity with the publicly available information
and information based on representations made by the senior management of the
Issuing Company;
(b)
the requirements under
the IDR Rules and the Regulations DIP Guidelines and other relevant laws framed
by the Board, the Government and any other competent authority in this behalf
have been duly complied with; and
(c)
based on the
publicly available information and representations made by the senior
management of the Issuing Company, the disclosures made in the DRHP are
certified to be true and are adequate to enable the investors to make a well
informed decision as to the investment in the proposed issue.
(5)
We confirm that
besides ourselves, all the other intermediaries named in the DRHP, except
[� ], are registered with the Board and
that till date such registration is valid.
(6)
We have satisfied
ourselves about the worth of the underwriters to fulfil their underwriting
commitments.
(7)
We certify that
the proposed activities of the Issuing Company for which the funds are being
raised in the present issue fall within the �main objects� listed in the object
clause of the Memorandum of Association or other charter of the Issuing Company
and that the activities which have been carried out until now are valid in
terms of the object clause of its Memorandum of Association.
(8)
We confirm that
necessary arrangements have been made to ensure that the moneys received
pursuant to the issue are kept in a separate bank account and that such moneys
shall be released by the said bank only, after permission, for listing of IDR,
is obtained from all the stock exchanges mentioned in the prospectus. We
further confirm that the agreement entered into between the bankers to the
issue and the Issuing Company specifically contains this condition.
(9)
We certify that
no payment in the nature of discount, commission, allowance or otherwise shall
be made by the Issuing Company or the promoters, directly or indirectly, to any
person who receives securities by way of firm allotment in the issue.
(10)
We certify that
disclosure has been made in the prospectus that the investors shall be given an
option to get the IDR in demat or physical mode.
(11)
We certify that
the following disclosures have been made in the draft prospectus:
(a)
An undertaking
from the Issuing Company that at any given time there shall be only one
denomination for the IDR of the Issuing Company and
(b)
An undertaking
from the Issuing Company that it shall comply with such disclosure and
accounting norms specified by the Board from time to time.
(12)
We confirm that
none of the intermediaries named in the red herring prospectus / prospectus
have been debarred from functioning by any regulatory authority.
(13)
We confirm that
all the material disclosures in respect of the Issuing Company have been made
in the red herring prospectus / prospectus and certify that any material
development in the Issuing Company or relating to the issue, up to the
commencement of listing and trading of the IDR offered through this issue,
shall be informed through public notices/ advertisements in all those
newspapers in which pre-issue advertisement and advertisement for opening or
closure of the issue have been given.
(14)
We confirm that
the abridged prospectus contain all the disclosures as specified in the
Regulations.
(15)
We confirm that
agreements have been entered into with both the depositories for
dematerialisation of the IDR of the Issuing Company
Place: ������������������������������������������������������������������������ Lead
Merchant Banker(s) to the Issue
Date: � ����������������������������������������������������������������������������������� with
Official Seal(s)
ANNEXURE TO
THE DUE DILIGENCE CERTIFICATE FOR THE ISSUE OF
����������.
BY ����������.
(1)
Memorandum and
Articles of Association of the Issuing Company.
(2)
Necessary
clearance from governmental, statutory, municipal authorities etc., for
implementation of the project, wherever applicable.
(3)
Documents in
support of the track record and experience of the promoters and their
professional competence.
(4)
Listing Agreement
of the Issuing Company for existing securities on the Stock Exchanges.
(5)
Consent letters
from Issuing Company's auditors, Bankers to issue, Bankers to the Issuing
Company, Lead Merchant Bankers, Brokers and where applicable, proposed
Trustees.
(6)
Applications made
by the Issuing Company to the financial institutions/banks for financial
assistance as per object of the issue and copies of relative sanction letters.
(7)
Underwriting
letters from the proposed underwriters to the issue.
(8)
Audited Balance
Sheets of the Issuing Company/Promoter companies for relevant periods.
(9)
Auditors
certificate regarding tax-benefits available to the Issuing Company,
shareholders and debenture holders.
(10) Certificate from architects or any other competent
authority on project implementation schedule furnished by the Issuing Company,
if applicable.
(11) Reports from Government agencies / expert agencies /
consultants / Issuing Company regarding market demand and supply for the
product, industry scenario, standing of the foreign collaborators, etc.
(12) Documents in support of the infrastructural
facilities, raw material availability, etc.
(13) Auditors' Report for the period for which the accounts
are disclosed in the offer document, indicating summary of audited accounts of
the issuing company and also the summary of the audited accounts of the
subsidiaries of the issuing company.
(14) Stock Exchange quotations of the last 3 years duly
certified by designated stock exchange.
(15) Minutes of the general body meetings and board
meetings of the Issuing Company for matters which are in the prospectus
(16) Revaluation certificate of Issuing Company's assets
given by the Government Valuer or any other approved valuer.
(17) Certificate from solicitors of the Issuing Company in regard to compliance of legal provisions of the
prospectus.
(18) Certificate from Issuing Company's legal counsel,
operating at the place of its registered office, confirming that the legal
counsel has done the mandatory vetting of the prospectus.
(19) A detailed checklist indicating compliance with each
applicable regulation of the Regulations.
Place: ������������������������������������������������������������������������ Lead
Merchant Banker(s) to the Issue
Date: ������������������������������������������������������������������������������������� with
Official Seal(s)
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
[See regulation 110]
AMENDMENTS
TO OTHER REGULATIONS
(1)
Amendment of Securities and Exchange Board of India
(Debenture Trustee) Regulations, 1993.
(i)
in regulation 15,
(a)
in sub-regulation
(1), after clause (c) the following clause shall be inserted, namely:-
�(ca) supervise
the implementation of the conditions regarding creation of security for the
debentures and debenture redemption reserve, wherever applicable;�
(b)
after
sub-regulation (1), the� following
sub-regulation shall be inserted, namely:-
��(1A)� The
debenture trustee shall:
(a)�� obtain reports from the lead
bank regarding progress of the project;
(b) � monitor
utilisation of funds raised in the�
issue;
(c) � obtain a certificate from the issuer's auditors:
(i)��� in
respect of utilisation of funds during the implementation period of the
project; and
(ii)�� in
the case of debentures issued for financing working capital, at the end of each
accounting year.�
(2)
Amendment of Securities and Exchange Board of India
(Merchant Bankers) Regulations, 1992.
(i)
in regulation 9,
after sub-regulation (1A), the following sub-regulation shall be inserted,
namely:
�(1B) The application for renewal under sub-regulation
(1) shall be accompanied by details of the changes that have taken place in the
information that was submitted to the Board while seeking registration or
earlier renewal, as the case may be, and a declaration stating that no changes
other than those as mentioned in such details have taken place.�
(ii)
regulation 18
shall be omitted.
(iii)
in regulation 20,
sub-regulation (2) shall be omitted.
(iv)
after regulation
21, the following regulation shall
be inserted, namely:-
�21A. Merchant banker not to act as such for an
associate.
(1) A merchant banker shall not lead manage any
issue or be associated with any activity undertaken under any regulations made
by the Board, if he is a promoter or a director or an associate of the issuer
of securities or of any person making an offer to sell or purchase securities
in terms of any regulations made by the Board:
�Provided that a merchant banker
who is an associate of such issuer or person may be appointed, if he is
involved only in the marketing of the issue or offer.
Explanation: For the purposes of this
regulation, a merchant banker shall be deemed to be an �associate of the issuer
or person� if:
(i)
either of them controls, directly or indirectly through its subsidiary or
holding company, not less than fifteen per cent. of the� voting rights in� the other; or
(ii)
either of them, directly or indirectly, by itself or in combination with
other persons, exercises control over the other; or
(iii)
there is a common director, excluding nominee director, amongst the
issuer, its subsidiary or holding company and the� merchant banker.�
(v)
regulations 23,
24, 24A and 25 shall be omitted;
(vi)
regulation 28
shall be renumbered as �28.(1)� and after the renumbered sub-regulation (1),
the following sub-regulation shall be inserted, namely:-
�(2) The
merchant banker shall submit a half yearly report for the period ending with 31st
March and 30th September of every year, in the format specified in
schedule IV, within three months from the close of the period to which it corresponds.�
(vii)
in Schedule I ,
Form C shall be omitted;
(viii)
Schedule IV shall
be substituted with the following, namely:-
�SECURITIES AND EXCHANGE BOARD OF INDIA
(MERCHANT BANKERS) REGULATIONS, 1992
SCHEDULE IV
�[Regulation 28(2)]
FORMAT FOR HALF YEARLY REPORT TO BE
SUBMITTED BY MERCHANT BANKERS
(For the period ending September /
March, 20X1)
(1)
Name/Category of
registration.
(2)
SEBI Registration
No.
(3)
Name of the
Compliance Officer.
(4)
Addition /
deletion / change in address etc. of branch offices from last submitted report.
(5)
Change, if any,
in constitution of the organisation (private limited, public limited,
partnership, merges, acquisition etc.)
(6)
Change, if any,
in directorship details since the last report.
|
Name |
Induction/ retirement/ resignation |
Reasons ����������� |
Effective Qualification Date |
Brief
Experience (in case of induction) |
Share in the company |
|
|
|
|
|
|
|
(7)
Change in the key
management personnel since last report (since grant of� registration in case of first report)
|
Name |
Date of App./ Resignation/ Termination |
Qualification |
Experience |
|
|
|
|
|
|
|
|
|
|
(8)
Change including
addition to/in associate concerns
|
Name of Co./ firm |
Nature of change |
Activities Handled |
Nature of interest with Merchant Banker |
|
|
|
|
|
|
|
|
|
|
(9)
New activities
undertaken/discontinuation of any existing activities
Activity����� When
commenced/���������������� Object of the
new activities/
���������������������������������������� discontinued�������������������������� reasons for
discontinuation.
(10)
Details of all
pending litigations involving the merchant banker.
(11)
Issue
management� activities (Attach separate
sheet if required):
Name of issuer����������� Type
of issue��������������������� Instrument
Companies����������������� (public/rights/
���������������������������������� composite)
Offer Amount������������� Issue
Price/������������������������ Issue
opening
(Rs. In Lakhs)������������ Conversion
Price��������������� date
Issue Closing�������������� No.
of times���������������������� Functional�
date��������������������������� oversubscribed��������� �������� Responsibility
Stock Exchanges ������� Reasons
for delay�������������� First date of
where instruments ������ in
listing����������������������������� trading
in
were to be listed��������������������������������������������������� respective
SEs
Opening trading���������� Current
market������������������ Remarks
price at respective������ price
SEs
(12)
Penalty/warnings
given by SEBI, if any.
(13)
Underwriting
activities
(a)
Total number of
issues underwritten during the period.
(b)
Total amount
underwritten during the period (Rs. In lakhs).
(c)
Outstanding
underwriting commitment at the close of the period (Rs. in lakhs).
(d)
Details of
disputed/devolved cases�����
|
Sr. No. |
Name of the issuer |
Instru-ment |
Amount under-written
(Rs. in lakhs) |
Amount devolved� (Rs. in lakhs) |
Devolve-ment met yes/no |
If not met, the reasons thereof & how dispute was settled |
Penalty/ warning if any issued by SEBI |
|
|
|
|
|
|
|
|
|
|
|
|
|
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����������������������������������������
(14)
Redressal of
Investor Grievances
(a)
System of
redressal of investor grievances (a brief write up).
(i)����� Number of investor
grievances received during the period.
(ii)����� Nature of grievances.
(iii)���� Number of grievances
resolved.
(iv)���� Number of grievances
pending.
(v)���� The date of oldest
grievance.����
(15)
Financial information�
Capital Structure����������������������� Year
ended����������� Previous
������������������������������������������������� (Rs
in lakhs)���������� Year ended
������������������������������������������������������������������������������� (Rs.
In lakhs)
(i)
Paid-up capital
(ii)
Free reserves
(iii)
Secured loan
(iv)
Unsecured loan
(v)
Others
�������
������������������� TOTAL
(i)
Fixed Assets (net
block)
(ii)
Quoted investment
at cost/
market price whichever is lower
(iii)
Unquoted
investment
(iv)
Current assets
(v)
Misc. exp. not
written off
(vi)
Others
�������
������������������� TOTAL
(Please
enclose the copy of latest audited financial results along with schedules)
(16)
Changes, if any
in major share holding (more than 5%)
Name of the������������ Investment/������������������������������ Percentage of
total
shareholder������������� disinvestment��������������������������� paid-up capital�
(17)
Name of the major
shareholders holding more than 5%.
(18)
Any capital issue
(rights or public) during the period. If yes, details thereof inclusive of
status of complaints from investors and their redressal.
(19)
Indictment or
involvement in any economic offence by the merchant banker or their directors
or principle officer, if any, during the period.
PLACE:
DATE:���������������������������������������������������������������������������� AUTHORISED
SIGNATORY�
(3)
Amendment of Securities and Exchange Board of India,
(Registrars to an Issue and Share Transfer Agents) Regulations, 1993.�����
(i)
in regulation
13A, in the Explanation in clause (b), after the word �director� the words �or promoter� shall be inserted.
C. B. BHAVE
���������������������������������������������������������������������������������������������������������������������������������������� CHAIRMAN