DUE DILIGENCE REPORT for [Name of the Listed Entity]

[Pursuant to Regulation 10 (3) of the SEBI (Delisting of Equity Shares) Regulations, 2021]

To,

The Board of Directors

(Company Name)

In terms of Regulation 10 of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021 (“Delisting Regulations“), I/we, _________________________, Peer Reviewed Practicing Company Secretaries, have been appointed vide the Resolution of the Board of Directors passed by _____________________________ Limited (hereinafter referred to as the “Company”) having CIN________________ and having registered office at_______________ in the meeting held on ______, to carry out the due diligence in accordance with Regulation 10(3) and other applicable provisions under the Delisting Regulations and issue a Due Diligence Report (“DDR“).

due diligence business review with paper document and graph

Background:

1. In terms of Regulation 8 of the Delisting Regulations, an Initial Public Announcement dated (“Initial Public Announcement“) was issued on behalf of , the acquirer as defined in the Delisting Regulations (“Acquirer“) inter alia expressing their intention to:

(a) Acquire_______________ fully paid up equity shares of the Company, having a face value of INR_______ each, (“Equity Shares“) representing__________ % of the paid-up capital held by the public shareholders of the Company (as defined under the Delisting Regulations and to be referred to as “Public Shareholders“), either individually / collectively or together with other members of the Promoter Group or along with the persons acting in concert, as the case may be; and

(b) Consequently voluntarily delist the Equity Shares from the stock exchanges where the equity

shares of the company are presently listed namely,_________________ (collectively, “Stock Exchanges“), by making a delisting offer in accordance with the Delisting Regulations (“Delisting Proposal“).

2. The present Capital structure including the details of the Authorised, Subscribed, Issued, Paid up and Listed Equity share Capital of the Company is placed at Annexure I.

3. Shareholding Pattern of the Company as on__________ (current date) is placed at Annexure II.

4. The distribution of public shareholding as on______ (current date) is as per Annexure III.

5. The list of Top Twenty-Five shareholders (other than Acquirer) as on ______ (date previous to Board Meeting date) is placed at Annexure IV.

Verification:

1. On the basis of the information received from/furnished by the Board of Directors of the Company, as required under sub-regulation 2 of Regulation 10 of the Delisting Regulations, for the purpose of carrying out the due diligence, I/we have examined the following:

(a) The details of buying, selling and dealing in the Equity Shares of the Company by the Acquirer(s) and their related entities (including members of Promoter Group) during the period of two years prior to the date of Board Meeting (i.e., ______________ ) held to consider the Delisting Proposal (“Review Period) including the details of the Top Twenty-Five shareholders, for the said period;

(b) The details of off-market transactions of the aforesaid persons/ shareholders for the Review Period;

(c) Relevant additional document/ filing/ records/ information such as ……………….. ( to fill up the additional documents examined) including the information mentioned in clauses (a) and (b) for a longer period of time from______ , as sought and made available to us and the explanations provided by the Company.

The same is placed at Annexure V

2. For the purpose of verifying applicability and compliance of securities laws, we have identified the following regulations and their applicability:

Regulations Acquirer and their related entities (including members of Promoter
Group)
Top 25 Public Shareholders
The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR Regulations) as amended from time to time Applicable/Not Applicable Applicable/Not
Applicable
The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015; (SEBI PIT Regulations) as amended from time to time Applicable/Not Applicable Applicable/Not
Applicable
The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (SEBI SAST Regulations) as amended from time to time Applicable/Not Applicable Applicable/Not
Applicable
The Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (SEBI SBEB
Regulations)
Applicable/Not Applicable Applicable/Not
Applicable

Observation:

Basis review of the aforesaid information/ document, set out below is our analysis/ observations:

a) For Acquirer and their related entities:

a. During the Review Period, we did not notice any change in the shareholding of the Acquirer and their related entities, except as follows:

Name of shareholder Date of Dealing Number of shares Buy/ Sell/ Pledge Mode

b. As on date, the Acquirer hold_____________ Equity Shares, representing to__________ % paid up equity share capital of the Company.

b) For Top Twenty-Five Shareholders:

i) During the Review Period, Top Twenty-Five Public Shareholders have overall (net) bought______ Equity Shares of the Company.

Name of shareholder Date of Dealing Number of shares Buy Mode

ii) The Acquirer has confirmed that neither of them nor their related entities or other members of the Promoter Group have any connection, direct or indirect, with the Top Twenty-Five Public Shareholders.

Certification:

I/We hereby certify that, during the Review Period:

  • The buying, selling and dealing in the equity shares of the company carried out by the Acquirer or its related entities and the Top Twenty-Five Shareholders is in compliance with the applicable provisions of securities laws;
  • The Acquirer has not, directly or indirectly, –
  • employed any device, scheme or artifice to defraud any shareholder or other person; or
  • engaged in any transaction or practice that operates as a fraud or deceit upon any shareholder or other person; or
  • engaged in any act or practice that is fraudulent, deceptive or manipulative –

in connection with delisting of equity shares of the Company sought or permitted or exit opportunity given or other acquisition of equity shares made under Delisting Regulations.

Assumption & Limitation of Scope & Review:

1. Ensuring the authenticity of documents and information furnished is the responsibility of the Board of Directors of the Company.

2. This DDR is based on due diligence of documents/ information shared with us by the Company for our review. Our responsibility is to give report based upon our examination of relevant documents and information. This is neither an audit nor an expression of opinion.

3. Various concepts viz. defraud, deceit, fraudulent, deceptive, manipulative are used in the SEBI Delisting Regulations, however parameters/methodology for determining the same are not prescribed therein. By reading these terminologies it can be construed that the Acquirer shall not directly or indirectly cause any loss to the Public Shareholders by adopting any malpractice. Based on publicly available information, we have checked whether the Acquirer or the Company has common registered office or directorship. We do not have any negative observation.

From the above details, we can conclude that the Acquirer has not;

(i) Employed any device, scheme or artifice to defraud any shareholder or other person;

(ii) Engaged in any transaction or practice that operates as a fraud or deceit upon any shareholder or other person; and

(iii) Engaged in any act or practice that is fraudulent, deceptive or manipulative.

4. We are not expressing any opinion on the Floor price and/or the price at which the shares would ultimately be delisted. We have assumed that the Company/ Acquirer would comply with the applicable provisions related to floor price. Further, we are not an investment adviser or tax advisor or a broker/ dealer. This report should not be construed as investment/ disinvestment advise.

5. This DDR is solely for the intended purpose of delisting of equity shares of the Company and for your information and it is not to be used, circulated, quoted or otherwise referred to for any purpose other than Delisting purposes and as required under the Delisting Regulations.

For XYZ & Associates Company Secretaries

Name…………………………………

FCS…………………………………

CP………………………..

PR………………………..

Date …………………………………………………………………..

Place ………………………………………………………………….

UDIN:

ANNEXURE I

CAPITAL STRUCTURE OF THE COMPANY AS ON THE DATE OF THIS REPORT

AUTHORISED CAPITAL

Particulars Number of shares Nominal Value per share Total Authorised Capital
Equity
Preference
Unclassified

ISSUED CAPITAL

Particulars Number of shares Nominal Value per share Total Issued Capital
Equity
Preference
Unclassified

SUBSCRIBED CAPITAL

Particulars Number of shares Nominal Value per share Total Subscribed Capital
Equity
Preference
Unclassified

PAID UP CAPITAL

Particulars Number of shares Nominal Value per share Total Paid Up Capital
Equity
Preference
Unclassified

LISTED CAPITAL

Particulars Number of shares Nominal Value per share Total Listed Capital Name of the Stock Exchange where listed
Equity
Preference
Unclassified

Note : In case of a difference between issued and listed capital, the reasons for the same may be given over here.

ANNEXURE II

SHAREHOLDING PATTERN AS ON _______ (CURRENT DATE)
Category No. of shares %
Acquirer:

(a)  who decides to make an offer for delisting of equity shares and Persons acting in concert in accordance with regulation 5A of the Takeover Regulations or

(b)  who is a Promoter or part of Promoter Group along with persons acting in concert

Public Shareholders
Total

ANNEXURE III

The distribution of Shareholding as on _______ (current date):

Range of shareholding No. of
shareholders
% of shareholders No. of shares held %  of     total shares
1-500
501-1000
1001-2000
2001-3000
3001-4000
4001-5000
5001-10000
Above 10000
Acquirer:

(a) who decides to make an offer for delisting of equity shares and Persons acting in concert in accordance with regulation 5A of the Takeover Regulations or

(b) who is a Promoter or part of Promoter Group along with persons acting in concert

Total

ANNEXURE IV

Details of Top Twenty-Five shareholders (other than Acquirer) as on ______ (date previous to Board Meeting date):

Name of shareholder No. of shares % to paid up equity capital
Total

ANNEXURE V

Details of Share Transactions during the Review Period:

Date of buying, selling and dealing Nature of tran-saction (buying, selling and dealing) Category (Acquirer /Pro moter / Promoter Group  / PACs /  top 25 share-holder) Mode of acqui-sition (market purchase / public rights/ prefe-rential offer / off market / Inter-se transfer etc. Pre Transaction Post Transaction Whether off market / on Exch-ange
Number of Secu-rities % age of share hol-ding Number of Secu-rities % age of share-holding

Surce : ICSI

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