Clarification in the matter of Illiquid Stock Options

Securities and Exchange Broad of India

WTM/RKA/ISD/107/2016

BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA

CLARIFICATION TO ORDER DATED AUGUST 22, 2016 BEARING REFERENCE NUMBER WTM/RKA/ISD/102/2016 IN THE MATTER OF ILLIQUID STOCK OPTIONS

1. Securities and Exchange Board of India (hereinafter referred to as “SEBI”), vide Order dated August 22, 2016 bearing reference number WTM/RKA/ISD/102/2016 (hereinafter referred to as “the Order”), had confirmed the directions issued vide the interim order dated August 20, 2015 in the matter of Illiquid Stock Options subject to the reliefs provided to the entities vide the said order.

2. In the Order, certain inadvertent errors have been noticed, which are being clarified as under:

a) In paragraph 37 of the Order, the words “December 04, 2014 as against the aforesaid 71 noticees” shall be read as “August 20, 2015 as against the aforesaid 58 Noticees.”

b) In paragraph 38(b), clauses (i) and (ii) shall be substituted with the following :-

i. the sale proceeds may be utilized for investments permitted in paragraph 37;

ii. upto 25% of the value of the portfolio as on the date of the interim order or the amount* in excess of the profit made/loss incurred, whichever is higher, may be utilized for business purposes and ! or for meeting any other exigencies or address liquidity problems etc.

*The amount will include the value of portfolio in the demat account.

c) In paragraph 39(a) of the Order, words “para 14” and “para 2” shall be read as the “para 13” and “para 4”

3. Para 41 of the order shall be omitted.

4. The order dated August 22, 2016 bearing reference number WTM/RKA/ISD/102/2016 in the matter of Illiquid Stock Options shall always be read with this clarification.