Promoters' contribution requirement must be secured pre-issue and held in escrow; convertible securities treatment and pricing rules specified. Minimum promoters' contribution requires promoters to subscribe a prescribed portion of the issue either in equity or by subscribing to convertible securities; if conversion price or post-conversion equity price is not pre-determined and disclosed, contribution must be by subscription to the convertible securities with a written undertaking to subscribe on conversion. Where conversion price is pre-determined, promoter equity contribution must not be at a price below the weighted average price on conversion; promoters must satisfy contribution before the issue opens and keep contribution proceeds in an escrow account until issue proceeds are released.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Promoters' contribution requirement must be secured pre-issue and held in escrow; convertible securities treatment and pricing rules specified.
Minimum promoters' contribution requires promoters to subscribe a prescribed portion of the issue either in equity or by subscribing to convertible securities; if conversion price or post-conversion equity price is not pre-determined and disclosed, contribution must be by subscription to the convertible securities with a written undertaking to subscribe on conversion. Where conversion price is pre-determined, promoter equity contribution must not be at a price below the weighted average price on conversion; promoters must satisfy contribution before the issue opens and keep contribution proceeds in an escrow account until issue proceeds are released.
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