SEBI (Issue Of Capital And Disclosure Requirements) Regulations 2009 (Part III)

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(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.
266[In case there are no listed group companies, the financial information shall be given for the five largest unlisted group companies based on turnover:] 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:
267[(1) Litigations involving the issuer/ its directors/promoters/group companies/ subsidiaries:
(i) All criminal proceedings;
(ii) All actions by statutory / regulatory authorities;
(iii) Taxation – Separate disclosures regarding claims related to direct and indirect taxes, in a consolidated manner giving details of number of cases and total amount;
(iv) Other pending litigations – As per policy of materiality defined by the board of the issuer and disclosed in the offer document.
(2) Outstanding dues to creditors:
(i) Based on the policy on materiality of the board of the issuer and as disclosed in the offer document, disclosure for such creditors;
(ii) Consolidated information on outstanding dues to small scale undertakings and other creditors, separately giving details of number of cases and amount involved;
(iii) Complete details about outstanding dues to creditors as per (i) and (ii) above shall be disclosed on the webpage of the company with a web link thereto in the offer document.]
(3) 268[****]
(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 269[***].
(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 270[offer document].
(J) Disclaimer clause of the stock exchanges.
(K) Disclaimer clause of the Reserve Bank of India 271[or Insurance Regulatory and Development Authority] (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-à-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-à-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-à-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 272[***]:
(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 273[/ RTAs / DPs / stock brokers] 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 274[foreign portfolio 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 nonreceipt 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;
275[(ii) In case of other applicants: by dispatch of refund orders by registered post, (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 276[fifteen 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 nonresident 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 subitem(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 277[foreign portfolio 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 278[, if applicable]
(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.

PART B
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;

PART C
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:
279[***]”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 …………. .”
280[(e) 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 subregulation
(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.]

281[ PART D
281 Substituted by SEBI (Issue of Capital and Disclosure Requirements) (Seventh Amendment) Regulations, 2015, w.e.f. 01.12.2015. Prior to its substitution, Part D of Schedule VIII as amended by SEBI (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2011, w.e.f. 01.11.2011, SEBI (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2014, w.e.f. 04.02.2011, and SEBI (Issue of Capital and Disclosure Requirements) (Fifth Amendment) Regulations, 2015, w.e.f. 01.01.2016 read as under:

PART D
[See regulation 58(1)]
DISCLOSURES IN ABRIDGED PROSPECTUS
General Instructions:
(I) Information which is of generic nature and not specific to the issuer shall be brought out in the form of a General Information Document (GID) as specified by the Board.
(II) Abridged Prospectus shall be printed in a booklet form of A4 size paper.
(III) The Abridged Prospectus shall be printed in a font size which shall not be visually smaller than Times New Roman size 10 (or equivalent). Exceptions can be made only where the information is in a tabular form and cannot fit in the table, which shall not be visually smaller than Times New Roman size 8 (or equivalent).
(IV) Information required to be given in Tabular Format should not appear in running text format.
(V) The order in which items appear in the abridged prospectus shall be as specified in this Schedule.
(VI) 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.

Disclosures:
An issuer making a public issue of specified securities shall make the following disclosures in the abridged prospectus:
(I) Cover Page:
(A) Indicate that the issue is 100% Book Building Issue or Fixed Price Issue.
(B) Indicate the total number of pages in the booklet.
(C) Attention of investor should be invited to the following statement:
“Please ensure that you read the Red Herring Prospectus (RHP), the General instructions contained in this Memorandum and the ‘General Information Document (GID) for investing in Public Issues undertaken through the book building process’ before applying in the Issue. Unless otherwise specified, all terms used in this form shall have the meaning ascribed to such terms in the RHP. The investors are advised to retain a copy of RHP/Abridged Prospectus for their future reference”.
(D) If the GID is not appended to the Abridged Prospectus, indicate where the GID would be available for perusal.
(E) Logo of the issuer, name of the issuer, incorporation details including details of change in name (if any), Corporate Identity Number, registered office of the issuer along with telephone number, fax number, email address and website address.
(F) Name, phone number, fax number, email address of Compliance Officer for any pre-issue or post-issue related problems.
(G) All the grades obtained for the public issue, along with the page numbers where rationale or description furnished by the credit rating agency(ies) for each of the grades obtained is contained in this abridged prospectus.
(H) Wherever applicable, the rating for the proposed issue of the convertible debt instruments or preference shares, if any, obtained from the credit rating agencies, shall also be indicated.
(I) The dates of opening, earliest closing and closing of the issue.
(J) Attention of investor should be invited to the following:
“Investors are advised to refer to−
* Exchange Website and Issue advertisement two days prior to Bid Opening Date for information regarding Price band, price discount (if any), Minimum Bid Lot, P/E Ratio, and Revised Price Band (if any, and revised closing date thereof);
* Page …. for Index/ Table of Contents;
* Price Band /Issue Price (which has been determined and justified by Merchant Banker) stated under the paragraph on “Basis of Issue Price”. Information about Qualitative Factors & Quantitative Factors for determining Basis of Issue Price is available on Page …. of this Abridged Prospectus’;
* Page …. of this abridged Prospectus for ‘Price Information of past issues handled by Merchant Bankers’.”
(K) Other statutory details pertaining to Issue (Number of equity shares and/or issue size & percentage of dilution and whether the same is in compliance with post issue dilution requirement).
(L) The name(s) of the recognised stock exchange(s) on which the specified securities are proposed to be listed.
(M) Cover Page should draw attention of investors to read the risk factors & indicate the page number where risk factors are contained in abridged prospectus.
(II) Inside Cover Page:
(A) The name and logo of the lead merchant bankers, along with telephone number, fax number, website address, name of contact person and email address.
(B) The name, logo and address of the registrars to the issue, along with telephone number, fax number, website address, name of contact person and email address.
(C) Names of Syndicate Members.
(D) The name and address along with telephone number, fax number and registration number of the statutory auditors.
(E) The name and address of the collecting bankers, where applicable.
(F) Details regarding website address(es)/link(s) from which the investor can obtain list of designated branches of Self Certified Syndicate Banks.
(FA) Details regarding website address(es)/link(s) from which the investor can obtain list of registrar to issue and share transfer agents, depository participants and stock brokers.
(G) The name and website address of the Credit rating agencies.
(H) 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.
(I) Indicative dates of Bid/ Issue Closing, finalization of basis of allotment with stock exchanges, credit of equity shares to investors’ demat accounts, initiation of refunds and commencement of trading in tabular format. (Attention of investor should be invited to disclaimers with regard to indicative table.)
(III) Table/Index of Contents should be included in tabular format.
(IV) Our History, Promoters and Management:
(A) History of the issuer and the details of any demergers, mergers and acquisitions to be provided.
(B) Promoters and their background to be provided.
(1) Where promoter is individual a complete profile of the promoters, including their name, 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, their business and financial performance to be provided.
(2) Where the promoters are companies, history of the companies and the promoters of the companies shall be furnished.
(C) Board of Directors:
(1) Name, Designation, Date of Appointment and date of expiration of the current term , Qualification, Occupation, Age and a Brief Profile of each Director.
(2) Attention of investor should be invited to refer to RHP for further details.
(3) Change, if any, in the directors during the last three years in tabular format. Particulars of name, date of appointment, date of cessation and reasons, thereof.
(4) 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.
(D) Shareholding Pattern:
(1) The aggregate shareholding of each of the categories as prescribed in terms of Clause 35 of Listing Agreement in the following format:

Category No. of Shareholders Pre-Issue Post-Issue No .of Equity Shares Percentage No. of Equity Shares Percentage

(2) The names of the ten largest shareholders of the issuer , number of equity shares held and percentage of the total pre and post issue capital as on the date of registering the offer document with the Registrar of Companies in tabular format.
(3) The names of public shareholders holding more than 1% of pre-issue capital, number of equity shares held and percentage of the total pre and post issue capital as on the date of registering the offer document with the Registrar of Companies in tabular format.
(4) Sale or Purchase/Subscription of Company’s securities by promoter(s)/promoter group/director(s) within three years immediately preceding the date of registering the offer document with the Registrar of Companies which in aggregate is equal to or greater than 1% of pre-issue capital of company in tabular format. The table shall indicate name of the shareholder, whether the shareholder is a promoter/promoter group/director, total number of shares acquired and total number of shares sold.
(E) Group Companies/Subsidiaries/Joint Ventures:
(1) Name of the group companies, Equity Capital, Turnover, Profit after tax, shareholding of issuer company and listing status to be given in tabular format for preceding financial year or the last period of audited financial statements included in offer document. This information is to be given for the five largest group companies based on turnover. However 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.
(2) Total number of subsidiaries and joint ventures to be indicated.
(3) Name of the Subsidiaries/Joint Ventures, Equity Capital, Turnover, Profit after tax, shareholding of issuer company and listing status to be given in tabular format for Subsidiaries/Joint Ventures which contribute more than 5% of revenue/profits/assets of the issuer company on a consolidated basis in the preceding financial year or the last period of audited financial statements included in offer document.
(F) Details of Material Penal Actions/ Litigations.
(G) Details of Material Related Party Transactions.
(H) Details and reasons for non-deployment or delay in deployment of proceeds or changes in utilization of issue proceeds of past public issues/rights issues, if any, of the Company in the preceding 10 years.
(V) Our Business:
(A) Summary of Our Business as appearing in offer document. Attention of investor should be invited to refer to RHP for details with regards to business.
(B) Industry Overview- Attention of investor should be invited to refer to RHP.
(C) Regulations and Policies-Attention of investor should be invited to refer to RHP.
(D) Details of all pending Government and other Approvals to be indicated. Attention of investor should be invited to refer to RHP for further details.
(VI) Our Financial Information:
(A) Summary Statement of Assets and Liabilities, as restated, appearing in offer document in tabular form. Additionally the following line items shall be included in the table- for initial public offerings, details of bonus issues; and, for further public offerings, details of dividends and bonus issues.
(B) Summary Statement of Profit and Loss Account as restated appearing in offer document in tabular form.
(C) Management’s Discussion and Analysis of Revenues and Profits/Losses.
(D) Material Development: Any material development after the date of the latest balance sheet and its impact on performance and prospects of the issuer.
(E) Aggregate number of shares for Capitalization of Reserves or Profits in the last 5 years.
(F) Revaluation of Assets in the last 5 years.
(G) Change, if any, in the auditors during the last three years in tabular format. Particulars of name of auditor, date of appointment/reappointment, date of cessation and reasons for change, thereof.
(H) The authorized, issued, subscribed and paid-up capital, present issue size, Paid-up Capital after the issue, Paid-up capital after conversion of securities (if applicable), (number of instruments, description, aggregate nominal value) in tabular form. Additionally for further public offerings, details of outstanding convertible instruments if any, to be included.
(I) Notes to the Capital Structure – Attention of investor should be invited to refer to RHP.
(VII) Risk Factors:
(A) The risk factors should be classified under the following heads:
(1) Risks arising out of Offences/Litigations/Losses Etc.
(2) Company/Group Specific Risks- Project/Objects specific risk.
(3) Industry Specific Risks.
(B) The heading of the risk factors should appear in bold and italics. All the risk factors should be highlighted.
(C) Attention of investor should be invited to refer to RHP or to the General Information Document for Other Risks and General Risks.
(VIII) Particulars of the Issue:
(A) Objects of the issue.
(B) Cost of the Project.
(C) Means of financing.
(D) Schedule of Deployment of Issue Proceeds.
(E) Name of Appraising Agency, where applicable.
(F) Name of Monitoring Agency (where applicable), if appointed by the issuer and the disclosure as to whether the appointment is pursuant to regulation 16 of these regulations.
(IX) Basis of Issue Price:
(A) Qualitative Factors for determining the basis of issue price for the issuer as included in offer document.
(B) Quantitative Factors for determining the basis of issue price for the issuer as under:
(1) Earnings per share and Diluted Earnings Per Share pre-issue (and the weight assigned) on consolidated basis (where applicable) in tabular form for the last three years (as adjusted for changes in capital).
(2) Average return on net worth (and the weight assigned) on consolidated basis (where applicable) in tabular form for the last three years.
(3) Net Asset Value on per share on consolidated basis (where applicable) in tabular form for the last three years.
(C) Comparison of following parameters of the issuer with the industry average and with that of the peer group (i.e., companies of comparable size in the same industry) in tabular form:
(1) Name of company.
(2) Revenue.
(3) Earnings per share.
(4) Face Value of Shares.
(5) Average Return on net worth.
(6) P/E Ratio.
(7) Related to Period.
(8) Consolidated/Standalone.
(D) Attention of investor should be invited to refer to/download Issue Advertisement/ Stock Exchange Website/Website of the company and lead merchant bankers or contact the Syndicate Member/Bankers to the Issue for Issue Price related Quantitative Factors.
(E) For further public offerings, stock market data (Price Data), adjusted for all corporate actions, to be given for the stock exchange which recorded the maximum aggregate turnover in terms of the number of shares traded in the last six months. Particulars of month, Highest Closing Price, Lowest Closing Price, Total Volume (separately for all stock exchanges) and Main Index Closing Value to be given in tabular format.
(X) Other Regulatory and Statutory Disclosures:
(A) The disclosure under the heading “IPO Grading”, stating all the grades obtained for the initial public offer, along with the summary of rationale or description furnished by the credit rating agency(ies) for each of the grades obtained. Particulars of Grading Agency, Grades Assigned and assessment in tabular format (if applicable).
(B) Any special tax benefits (if any) for the issuer/project and its shareholders (Only section numbers of the relevant legal provisions should be mentioned, without reproducing the text of the sections).
(C) Authority for the issue.
(D) Eligibility of the Issue-Only Specific Regulation to be indicated without reproducing the text of the regulation.
(E) Expert opinion obtained, if any, except of Auditors and IPO Grading Agencies.
(F) Material Contracts and Documents for Inspection.
(G) Time and Place of Inspection of material contracts (List of material contracts not required).

[See regulation 58(1)]
DISCLOSURES IN ABRIDGED PROSPECTUS
Disclosures:
(I) Information as is material and appropriate to enable the investors to make an informed decision shall be disclosed in the abridged prospectus.
(II) An issuer making a public issue of specified securities shall make the disclosures in the abridged prospectus as per the format specified by the Board from time to time. General Instructions:
(I) The abridged prospectus shall be submitted to the Board (one copy).
(II) The abridged prospectus including the application form shall not exceed 5 sheets (printed both sides).
(III) Information which is of generic nature and not specific to the issuer shall be brought out in the form of a General Information Document (GID) as specified by the Board.
(IV) Abridged Prospectus shall be printed in a booklet form of A4 size paper.
(V) The Abridged Prospectus shall be printed in a font size which shall not be visually smaller than Times New Roman size 11 (or equivalent) with 1.0 line spacing.
(VI) Information required to be given in Tabular Format shall not appear in running text format.
(VII) The order in which items appear in the abridged prospectus shall be as specified by the Board.
(VIII) 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.”]
(H) Price Information of past issues handled by Merchant Bankers, in the format and manner as specified by the Board.
(I) Declaration & Signatories to the Offer Document. Details of Bidding Centres.
PART E
[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 email 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:
282[Provided that such participation shall not result in breach of minimum public shareholding requirement stipulated in the equity listing agreement entered into between the issuer and the recognized stock exchanges where the specified securities of the issuer are listed.]
283[(6A) Disclosure of ex-rights price as referred under clause of (b) of subregulation 4 of regulation 10 of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulation, 2011.]
(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-àvis 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) 284[Interim Use of Funds: Net issue proceeds pending utilization (for the stated objects) shall be deposited only in the scheduled commercial banks included in the Second Schedule of Reserve Bank of India Act, 1934.]
(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.
285[(1) Details of current and past directorship(s) for a period of five years in listed companies whose shares have been/were suspended from being traded on the Bombay Stock Exchange Ltd./National Stock Exchange of India Ltd., as follows:
* Name of the Company:
* Listed on [give name of the Stock Exchange(s)]:
* Date of Suspension on stock exchanges:
* Suspended more than three months: Yes/No. If yes, reasons for suspension and period of suspension:
* Whether suspension revoked: Yes/No. If yes, date of revocation of suspension:
* Date and Term of Director in the above company(ies).
Explanation.—The above details shall be given for a period of five years prior to date of filing of draft offer document and ought to be updated upto the date of filing of the red herring prospectus. In case of offer documents for fast track issues filed under regulation 10, the period of five years shall be reckoned on the date of filing of prospectus with Registrar of Companies or letter of offer with the designated stock exchange.
(2) Details of current and past directorship in listed companies who have been/were delisted from the stock exchange(s):
* Name of the Company:
* Listed on [give name of the Stock Exchange(s)]:
* Date of delisting on the Stock Exchange(s):
* Compulsory or voluntary delisting:
* Reasons for delisting:
* Whether relisted: Yes/No. If yes, date of relisting on [give name of the Stock
Exchange(s)]:
* Date and Term of Director in the above company/ies. ]
(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 286[***].
(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.
287[(BA) Dealing with Fractional Entitlement: Manner of dealing with fractional entitlement viz. payment of the equivalent of the value, if any, of the fractional rights in cash etc.]
(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 288[foreign portfolio investors].
(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.
289[(7) Full disclosures in the draft letter of offer or letter of offer as the case may be shall be made for warrants issued along with rights issues, regarding the objects towards which the funds from conversions of warrants are proposed to be used. In such cases, the provisions of this Part dealing with Objects of the Issue shall apply, mutatis mutandis.]

PART F
[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.
290[(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 II ;
(b) Sub-item (D) of item III;
(c) Item V;
(d) Item VI;
(e) Item VII ;
(f) Item X;
(g) Item XI;
(h) Item XIV;
(i) Item XV;
(j) Item XVI.]
(2) 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.
(3) 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.

291[PART G
[See regulation 4(6)]
DISCLOSURES PERTAINING TO WILLFUL DEFAULTERS
(1) If the issuer or any of its promoters or directors is a wilful defaulter, it shall make the following disclosures:
(a) Name of the bank declaring the entity as a wilful defaulter;
(b) The year in which the entity is declared as a wilful defaulter;
(c) Outstanding amount when the entity is declared as a wilful defaulter;
(d) Name of the party declared as a wilful defaulter;
(e) Steps taken, if any, for the removal from the list of wilful defaulters;
(f) Other disclosures, as deemed fit by the issuer in order to enable investors to take informed decisions;
(g) Any other disclosure as specified by the Board.
(2) The fact that the issuer or any of its promoters or directors is a wilful defaulter shall be disclosed prominently on the cover page with suitable cross-referencing to the pages.
(3) Disclosures specified herein shall be made in a separate chapter or section distinctly identifiable in the Index / Table of Contents.]

SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
292[SCHEDULE IX

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/Instrument | Amount invested Rs. in lakhs | Maturity date | Earnings

(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:

[See regulation 16 (2) and (3)]
FORMAT OF REPORT TO BE SUBMITTED BY MONITORING AGENCY
Front Page:
Report of the Monitoring Agency
Name of the Issuer:
For quarter ended:
Name of the Monitoring Agency:
(a) Deviation from the objects:
– Utilization different from Objects stated in OD but in line with change of objects approved by shareholders’resolution; or
– Utilization neither in line with Objects stated in OD nor approved by shareholders’ resolution
– In case of no deviation, the fact would be stated.
(b) Range of Deviation*:
Indicate range of percentage deviation from the amount of issue proceeds earmarked for objects. For example, up to 10%, 10 – 25%, 25-50%, 50-75%, 75-100%, not ascertainable etc.

* Range of Deviation may be computed by taking weighted average of financial deviation of each object in the ratio of issue proceeds allocated for it. Non-financial deviation may be indicated separately by way of notes. Declaration:

I/We hereby declare that this report is based on the format as prescribed by SEBI (ICDR) Regulations, 2009, as amended. I/We further declare that this report provides true and fair view of the utilization of issue proceeds.

I/We declare that we do not have any direct / indirect interest in or relationship with the issuer/promoters/directors/management and also confirm that we do not perceive any conflict of interest in such relationship / interest while monitoring and reporting the utilization of issue proceeds by the issuer.

Signature:
Name of the Authorized Person/Signing Authority:
Designation of Authorized person/Signing Authority:
Seal of the Monitoring Agency:
Date:

Subsequent Pages:

1) Issuer Details:
Name of the issuer :
The names of the promoters of the issuer :
Industry/sector to which it belongs :

2) Issue Details:
Issue Period :
Type of issue (public/rights) :
Type of specified securities :
Grading :
Issue size (` in Crores) :

3) Details of the arrangement made to ensure the monitoring of issue proceeds:
(Give item by item description for all the objects stated in offer document separately in following format)