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TMI BlogSecurities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2022X X X X Extracts X X X X X X X X Extracts X X X X ..... ) and clause (15) of Part A of Schedule XIII and Schedule XIV shall come into force from April 1, 2022, for issues opening on or after April 1, 2022. 3. In the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 , - I. In regulation 2 , in sub-regulation (1), (a) in clause (r), i. the words and symbol or the offer document: shall be substituted with the words and symbols the offer document, or the letter of offer: . ii. in the proviso, the words and symbol or the offer document; shall be substituted with the words and symbols the offer document, or the letter of offer; . (b) in clause (mm), the words and symbols regulation 2(1)(q) of shall be omitted. (c) in clause (lll), the words wilful defaulter wherever it appears, shall be substituted with the words wilful defaulter or a fraudulent borrower and the words wilful defaulters shall be substituted with the words wilful defaulters or fraudulent borrowers . II. In regulation 5 , in sub-regulation (1), in clause (c), the words and symbol wilful defaulter. shall be substituted with the words and symbol wilful defaulter or a fraudulent b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... older(s) holding, individually or with persons acting in concert, more than twenty per cent of pre-issue shareholding of the issuer based on fully diluted basis, provisions of lock-in as specified under regulation 17 of these regulations shall be applicable, and relaxation from lock-in as provided under clause (c) of regulation 17 of these regulations shall not be applicable. VI. In regulation 15 , (a) in sub-regulation (1), in clause (b), in point (i) of the proviso, the words if the promoters and alternative investment funds , shall be substituted with the words if the promoters and alternative investment funds or foreign venture capital investors or scheduled commercial banks or public financial institutions or insurance companies registered with Insurance Regulatory and Development Authority of India . (b) in sub-regulation (1), in clause (b), in point (ii) of the proviso, the words, numbers and symbol sections 391 to 394 of the Companies Act, 1956 or shall be omitted. (c) in sub-regulation (1), in clause (c), the words the promoters and alternative investment funds , shall be substituted with the words the promoters and alternative investment funds or forei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be reserved for applicants with application size of more than ten lakh rupees: Provided that the unsubscribed portion in either of the sub-categories specified in clauses (a) or (b), may be allocated to applicants in the other sub-category of non-institutional investors. (b) in sub-regulation (4), in clause (ii), the sub-clause (i) and (ii) shall be re-numbered as sub-clause (a) and (b). XI. In regulation 40 , in sub-regulation (1), the words, numbers and symbols it shall appoint underwriters in accordance with the Securities and Exchange Board of India (Underwriters) Regulations, 1993 shall be substituted with the words and symbols it shall appoint merchant bankers or stock brokers, registered with the Board, to act as underwriters. . XII. In regulation 41, (a) in sub-regulation (1), the words and symbol public financial institution or by a scheduled commercial bank named in the offer document as bankers of the issuer: shall be substituted with the words and symbol credit rating agency registered with the Board: . (b) in sub-regulation (2), the words at least ninety five per cent shall be substituted with the words hundred per cent , and the words ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in sub-regulation (3), the words wilful defaulter shall be substituted with the words wilful defaulter or a fraudulent borrower . XVIII. In regulation 69 , sub-regulation (5), in the proviso, the words, numbers and symbols or the Companies Act, 1956 (to the extent applicable) shall be omitted. XIX. In regulation 70, in sub-regulation (6), the words wilful defaulter shall be substituted with the words wilful defaulter or a fraudulent borrower . XX. In regulation 74 , in sub-regulation (2), the words or warrants shall be omitted. XXI. In regulation 81 , in sub-regulation (1), the words, numbers and symbols it shall appoint underwriters in accordance with the Securities and Exchange Board of India (Underwriters) Regulations, 1993. shall be substituted with the words and symbols it shall appoint merchant bankers or stock brokers, registered with the Board, to act as underwriters: . XXII. In regulation 82, (a) in sub-regulation (1), the words and symbol public financial institution or by a scheduled commercial bank named in the letter of offer as a banker of the issuer: shall be substituted with the words and symbol credit rating agency registere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceding the date of filing the relevant offer document, such an issuer shall make further public offer if at least fifty per cent. of the revenue for the preceding one full year has been earned by it from the activity indicated by its new name. (2) An issuer not satisfying the condition stipulated in the proviso to sub-regulation (1), shall make a further public offer only if the issue is made through the book building process and the issuer undertakes to allot at least seventy five per cent. of the net offer, to qualified institutional buyers and to refund full subscription money if it fails to make the said minimum allotment to qualified institutional buyers. . XXX. In regulation 104 , (a) in sub-regulation (1), after clause (d), the following explanation shall be inserted, namely, Explanation. - For the purposes of this regulation finance for the specific project shall mean finance for capital expenditures only. (b) after sub-regulation (2), the following sub-regulation (3) shall be inserted, namely, - (3) The amount for: (i) general corporate purposes, and (ii) such objects where the issuer company has not identified acquisition / investment target, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... numbers and symbols it shall appoint underwriters in accordance with the Securities and Exchange Board of India (Underwriters) Regulations, 1993 shall be substituted with the words and symbols it shall appoint merchant bankers or stock brokers, registered with the Board, to act as underwriters . XXXVI. In regulation 137 , (a) in sub-regulation (1), the words and symbol public financial institution or by a scheduled commercial bank named in the offer document as the bankers of the issuer: shall be substituted with the words and symbol credit rating agency registered with the Board: . (b) in sub-regulation (2), the words at least ninety five per cent shall be substituted with the words hundred per cent , and the words and symbols , excluding the proceeds raised for general corporate purposes, shall be omitted. XXXVII. In regulation 141 , in sub-regulation (2), the words fifteen days shall be substituted with the words four days . XXXVIII. In regulation 145 , (a) in sub-regulation (3), after the words retail individual investors and before the words and anchor , the symbols and words , non-institutional investors shall be inserted; (b) afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosed in the offer document, the issuer shall provide the restated financial statements adjusting for the impact of the audit qualifications. Further, for the qualifications wherein impact on the financials cannot be ascertained, the same shall be disclosed appropriately in the offer document. XLI. In regulation 158 , (a) In sub-regulation (1), in clause (a), the words, symbols and numbers (3) and (4) of sections 81 of the Companies Act, 1956 or sub-section appearing after the word sub-sections and before the symbols and number (3) , shall be omitted. (b) In sub-regulation (1), after clause (a) the following proviso shall be inserted: Provided that the provisions of this chapter shall apply to conversion of a loan or an option attached to convertible debt instruments into equity shares as mentioned in clause (a) subject to the provisions of the proviso to sub-section (3) of section 62 of the Companies Act, 2013. XLII. In regulation 159 , (a) in sub-regulation (1), the words six months appearing after the words during the and before the word preceding , shall be substituted by the numbers and words 90 trading days ; (b) in the explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preferential issue ; (ii) after clause (f), the following clause (fa) shall be inserted namely,- (fa) the percentage of post preferential issue capital that may be held by the allottee(s) and change in control, if any, in the issuer consequent to the preferential issue ; (iii) in clause (i), the words wilful defaulter shall be substituted with the words wilful defaulter or a fraudulent borrower . (iv) after clause (i), the following clause (j) shall be inserted namely,- (j) the current and proposed status of the allottee(s) post the preferential issues namely, promoter or non-promoter. ; (b) in sub-regulation (2), (i) the words its statutory auditors appearing after the words certificate of and before the words before the shall be substituted by the words a practicing company secretary ; (ii) after sub-regulation (2), the following explanation shall be inserted namely,- Explanation.-For the purposes of sub-regulation (2), the issuer shall also host the certificate on its website and provide a link for the same in the notice for the general meeting of the shareholders considering the proposed preferential issue. ; (c) the existing sub-regu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appearing after the words average of the and before the words volume weighted , shall be substituted by the word 10 trading days ; (v) after clause c, the following proviso shall be inserted to sub-regulation (2) namely,- Provided that if the Articles of Association of the issuer provide for a method of determination which results in a floor price higher than that determined under these regulations, then the same shall be considered as the floor price for equity shares to be allotted pursuant to the preferential issue. ; (c) in sub-regulation (3), (i) the words twenty six weeks appearing after the words completion of and before the words from the , shall be substituted by the numbers and words 90 trading days ; (ii) the words, average of the weekly high and low of the appearing after the words reference to and before the words volume weighted shall be substituted by the number, words and symbol 90 trading days ; (iii) the words twenty six weeks appearing after the words during these and before the words and if , shall be substituted by the number and words 90 trading days ; (iv) after sub-regulation (3), the following proviso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be substituted by the numbers and words 90 trading days . XLVII. In regulation 164A , (a) the words average of the weekly high and low of the appearing after the words less than the and before the words volume weighted , shall be substituted by the number, words and symbol 10 trading days ; (b) the words during the two weeks appearing after the word exchange and before the word preceding , shall be omitted. (c) in sub-regulation (3), in clause (a), in sub-clause (ii), the words wilful defaulter shall be substituted with the words wilful defaulter or a fraudulent borrower . XLVIII. In regulation 165 , after the word independent and before the word valuer , the word registered shall be inserted. XLIX. In r egulation 166 , the words and numbers regulation 164 or regulation 165 , shall be substituted with the words, numbers and symbols , regulations 164, 164A, 164B or 165, . L. After regulation 166 , the following regulation 166A shall be inserted namely,- Other conditions for pricing 166A. (1) Any preferential issue, which may result in a change in control or allotment of more than five per cent. of the post issue fully diluted s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of and before the words from the , shall be substituted by the words six months ; (f) in sub-regulation (6), (i) the words six months appearing after the words period of and before the words from the , shall be substituted by the number and words 90 trading days . (ii) In the proviso to sub-regulation (6), the words six months appearing after the words period of and before the words from the , shall be substituted by the number and words 90 trading days . (g) after the proviso to sub-regulation (6), the following sub-regulation (7) shall be inserted namely,- (7) Lock-in requirements for an allottee who has become a promoter due to change in control consequent to the preferential issue shall be the same as those applicable to the promoters and promoter group under this regulation. LII. After regulation 167 , the following regulation 167A shall be inserted namely,- Pledge of locked-in specified securities 167A. Specified securities, except SR equity shares, held by the promoters and locked-in under the provisions of these regulations, may be pledged as collateral for a loan granted by a scheduled commercial bank or a public financial insti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulation (2), in clause (b), the words fifteen days shall be substituted with the words four days . (j) in sub-regulation (3), in clause (a) and in clause (b), the words fifteen days shall be substituted with the words four days . LIX. In regulation 208 , in sub-regulation (2), the words seven days and eight days shall be substituted with the words four days and the words eighth day shall be substituted with the words fourth day . LX. In regulation 228 , in clause (c), the words wilful defaulter shall be substituted with the words wilful defaulter or a fraudulent borrower . LXI. In regulation 230 , after sub-regulation (2), the following sub-regulation (3) shall be inserted, namely, - (3) The amount for: (i) general corporate purposes, and (ii) such objects where the issuer company has not identified acquisition or investment target, as mentioned in objects of the issue in the draft offer document and the offer document, shall not exceed thirty five per cent. of the amount being raised by the issuer: Provided that the amount raised for such objects where the issuer company has not identified acquisition or investment target, as mentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in sub-regulation (2), the words seven days and eight days shall be substituted with the words four days and the words eighth day shall be substituted with the words fourth day . LXIX. Regulation 290A shall be omitted. LXX. In regulation 292 , in sub-regulation (1), in clause (e), the words wilful defaulter shall be substituted with the words wilful defaulter or a fraudulent borrower . LXXI. In Schedule II, in clause (1), in sub-clause (a), the words, numbers and symbols, the Companies Act, 1956 and/or shall be omitted. LXXII. In Schedule VI, in Part A, (a) under the heading Applicability , in proviso (a), the word issue shall be substituted with the words public issue and the words Part B shall be substituted with the words Part D . (b) in Item (1) titled Cover Pages , point (1), shall be substituted with the following, namely,- : (1) Front outside cover page shall contain issue and issuer details, details of selling shareholders in tabular format along with their average cost of acquisition and offer for sale details, and other details as may be specified by the Board from time to time. (c) in Item (1) titled Cover Pages , ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Chartered Accountants . ii. in point (I), in para (A), in clause (i), in sub-clause (d), the word auditor shall be substituted with the words auditor or Chartered Accountants . iii. in point (I), in para (B), in clause (iii), the words statutory auditor appearing after the words as certified by the shall be substituted with the words statutory auditor or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI) . iv. in point (I), in para (B), in clause (iii), the words statutory auditor of the issuer company shall be substituted with the words statutory auditor of the issuer company or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI) appointed by the issuer company. . v. in point (II), in para (A), in clause (i), the word statutory auditor(s) shall be substituted with the words statutory auditor(s) or Chartered Accountants . vi. in point (II), in para (A), in clause (i), in sub-clause (d), the word auditor shall be substituted with the words auditor or Chartered Accountants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the words wilful defaulter or a fraudulent borrower . LXXIV. In Schedule VI , in Part B, (m) in Item (4), in Para (XI) titled Financial Information of the issuer , i. in clause (B), the word statutory auditor appearing after the words as certified by the shall be substituted with the words statutory auditor or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI) . ii. in clause (B), the words statutory auditor of the issuer company shall be substituted with the words statutory auditor of the issuer company or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI). . LXXV. In Schedule VI, in Part B-1, in Item (14), in Para (B) titled Other Financial Information , iii. in clause (iii) titled Proforma financial statements , the word statutory auditor appearing after the words as certified by the shall be substituted with the words statutory auditor or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... / certifications considered by Monitoring Agency for preparation of report shall be inserted after the column Item Head and before the column Amount as proposed in the Offer Document . (e) after point No. 4, a new point No. 5 with the heading Details of utilization of proceeds stated as General Corporate Purpose (GCP) amount in the offer document , shall be inserted. LXXXI. In Schedule XIII , (a) in Part A, (ii) in clause (7), in sub-clause (b), after point (i), the following proviso shall be inserted namely, - Provided that the cap of the price band shall be at least one hundred and five per cent of the floor price. (iii) in clause (10), sub-clause (j) shall be substituted with the following, namely, - j) There shall be a lock-in of 90 days on fifty per cent of the shares allotted to the anchor investors from the date of allotment, and a lock-in of 30 days on the remaining fifty per cent of the shares allotted to the anchor investors from the date of allotment. (iv) in clause (15), in sub-clause (b) , a) the words and symbol and non-institutional investors , appearing after the words institutional buyers and before the symbol and words , o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allotment to a non-institutional investor cannot be less than the minimum application size, subject to availability of shares, the remaining available shares, if any, shall be allotted on a proportionate basis. The actual entitlement shall be as follows: Sr . No . Name of Investor Total Number of specified securities applied for Total number of specified securities eligible to be allotted 1 A 340 340 specified securities (i.e. the minimum applications size) 2 B 500 340 specified securities (i.e. the minimum applications size) + 29 specified securities [{5,00,000 - (500 * 340)} / {20,00,000 - (500 * 340)}] * 160 (i.e. 500-340) 3 C 1,000 340 specified securities (i.e. the minimum lot of ₹ 2 Lakhs) + 119 specified securities [{5,00,000 - (500 * 340)} / {20,00,000 - (500* 340)}] * 660 (i.e. 1,000- 340) 4 D 1,400 340 specified se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... size should be 1,471. In other words, 1,471 applicants shall get the minimum application size and the remaining 48,529 applicants will not get any allotment. The details of the allotment shall be as follows: No . of lots No . of shares at each lot No . of investors applying at each lot Total no . of shares applied for at each lot No . of investors who shall receive lots according to minimum application size ( to be selected by a lottery ) A B C D = ( B * C ) E 17 340 2,500 8,50,000 74= (1,471/50,000) *2,500 18 360 1,000 3,60,000 29 19 380 1,000 3,80,000 29 20 400 1,000 4,00,000 29 21 420 1,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44 880 1,000 8,80,000 29 45 900 1,000 9,00,000 29 46 920 1,000 9,20,000 29 47 940 1,000 9,40,000 29 48 960 1,000 9,60,000 29 49 980 1,000 9,80,000 29 50 1000 1,000 10,00,000 29 51 1020 1,000 10,20,000 29 52 1040 1,000 10,40,000 29 53 1060 1,000 10,60,000 29 54 1080 500 5,40,000 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 500 7,70,000 15 78 1560 500 7,80,000 15 79 1580 500 7,90,000 15 80 1600 500 8,00,000 15 81 1620 500 8,10,000 15 82 1640 500 8,20,000 15 83 1660 500 8,30,000 15 TOTAL 50,000 4,48,50,000 1,471 NOTE: For applications under category 3(b), calculation methodology shall be similar to above. LXXXIII. In Schedule XVI , (a) in clause (1), word and symbol Schedule IV shall be substituted with the word and symbol Schedule III . (b) in clause (2), in sub-clause (a) the word and symbol Schedule IV shall be substituted with the word and symbol S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/11 . (k) June 16, 2020 by the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2020, vide notification No. SEBI/LAD-NRO/GN/2020/17. (l) June 22, 2020 by the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2020, vide notification No. SEBI/LAD-NRO/GN/2020/18 . (m) July 1, 2020 by the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2020, vide notification No. SEBI/LAD-NRO/GN/2020/21 . (n) September 28, 2020 by the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Fourth Amendment) Regulations, 2020, vide notification No. SEBI/LAD-NRO/GN/2020/31. (o) January 8, 2021 by the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2021, vide notification No. SEBI/LAD-NRO/GN/2021/03. (p) May 5, 2021 by the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2021, vide notification No. SEBI/LAD-NRO/GN/2021/18. ..... 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