Saibal C. Pal
Securities issued under QIP route will have to be listed pursuant to R 19(4) of the Securities Contracts (Regulation) Rules,1957. This is apart form the equity shares already listed. Documents to be submitted for approval under Clause 24(a) of the Listing Agreement.
The compliances can be divided into three stages which are discussed as under:
a) Stage – I – Prior Approval under Clause 24(a) of the Listing Agreement by Stock Exchange.
The company must submit to the SE:
1. Certified true copy of the special resolution passed by the shareholders as per Chapter VIII of ICDR.
2. Copy of notice issued to shareholders.
3. Draft placement document for issue of specified securities to QIBs.
Placement document is to be as per the requirements of Chapter VIII of ICDR with a disclaimer in bold capital letters that “the placement is meant only for QIBs on a private placement basis and is not an offer to the public or to any other class of investors.”
5. Latest shareholding pattern of the Company in the revised Clause 35 format.
6. Net worth Certificate issued by the Statutory Auditors of the Company based on the audited figures of the previous financial year.
7. Confirmation from the Lead Merchant Banker (`LMB’) that the issue is in compliance with Chapter VIII of ICDR.
8. Managing Director/Company Secretary of the issuer company shall confirm to the SE :
a) company complies with the prescribed requirements of minimum public shareholding as required under Clause 40A and Clause 35 of the Listing Agreement;
b) aggregated funds being raised through QIPs in the relevant financial year has not exceeded five times of the net worth of the Company as at the end of the previous financial year;
c) placement of specified securities to the QIBs shall be in accordance with Chapter VIII of ICDR;
d) equity shares arising pursuant to the QIP shall rank pari passu in all respects including dividend entitlement with existing equity shares;
b) STAGE- II – Hosting of Preliminary Placement Document issued to QIB on the website of Stock Exchange.
After the issuing company decides to issue shares to QIB, it is required to submit the Preliminary Placement Document(`PPD’) to be put up on the website of the SE before the PPD is circulated to the QIB(s) or displayed on the website of the Company. Thereafter, the following steps shall be taken:
1. Hard copy of the PPD (not applicable if there is no change after submission of the same at Stage I ).
2. CD of the PPD.
3. Due Diligence Certificate of the LMB in the format prescribed by the SE.
c) STAGE III – LEAD MERCHANT BANKER(S) TO THE ISSUE WITH THEIR SEAL(S).
Document required to be submitted by the issuer to the SE with LMB signaature and seal for final in-principle approval after allotment of the shares are as under:
1. Listing application form for applying for listing of the further securities allotted.
2. Distinctive numbers of the securities issued.
3. Certified true copy of the Board resolution allotting the securities.
4. List of allottees together with addresses and number of equity shares allotted.
5. Shareholding Pattern Form duly completed with relevant enclosures giving details pre and post issue of the equity shares.
6. Certified true copy of the Board resolution in which the securities are allotted.
7. Details of each of the promoter/directors of the company as per the format.
8. Non-refundable Processing fee of Rs 1 lac, to be deposited alongwith the PPD of Rs 1,00,000/- favouring the SE.
9. Additional listing fee on the enhanced capital as per Schedule applicable for payment of such fees of the SE.
10. Auditor’s Certificate ( not necessarily) statutory auditors giving the two confirmations:
a. That the issue price has been arrived as per the pricing formula stipulated under Chapter VIII of ICDR along the workings for arriving at such issue price.
b. Receipt of fund against the said issue in the prescribed format and that the said fund has been credited to the bank account maintained for the purpose.
11. A Certificate from the Company Secretary confirming that:
a) all the legal and statutory formalities have been complied with and no Statutory Authority has restrained the Company from issuing and allotting the equity shares to the QIBs as per the placement document; and .
b) equity shares issued to QIBs in terms of the Placement document shall rank pari passu in all respects including dividend entitlement with the existing equity shares of the Company.
12. Due Diligence Certificate from the LMB confirming compliance with Chapter VIII of ICDR as per the prescribed format. Summary of bids received and details of allocation made to QIBs will have to be included.
13. In case of convertible securities to equity shares the following will have to be stated:
a) terms of conversion of securities;
b) copy of consent letter/notice for conversion of securities received from the QIBs; and
c) statement giving details of outstanding securities issued to QIBs pursuant to the PPD.
On compliance by the company of the above the shares/convertible debentures are listed by the SE.