-Every unlisted public Company shall issue securities only in dematerialized form and facilitate dematerialization of all its existing securities. [Rule 9A(1) of the companies (Prospectus and Allotment of Securities) Rules, 2014].
-A Private Company can also obtain DEMAT connectivity for the purpose of dematerialization of shares, with one of the depositories or with both provided the Articles of Association of the Company provide for the same.
-For the above said purpose, the Company shall obtain DEMAT connectivity (i.e., ISIN: International Security Identification Number) with the depositories registered with SEBI.
Hold a Board meeting for following matters:
Important Note- Listed or proposed listed Company is required to take DEMAT connectivity from both the depositories whereas unlisted Company can obtain from one or both the depositories.
Company is required to appoint RTA.
Important Note- Company can also obtain a software from depositories to manage the DEMAT connectivity if it doesn’t wish to appoint RTA.
Important Note- No such agreement is required to be entered where the issuer of securities is State or Central Govt.