Maintenance of Security Deposit of 1% of the amount of securities offered to public/shareholders by issuer companies with the designated stock exchanges

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....g Executive Directors of all the Stock Exchanges, Dear Sir/Madam, Sub: Maintenance of Security Deposit of 1% of the amount of securities offered to public/shareholders by issuer companies with the designated stock exchanges 1. Your attention is drawn to Clause 42 of the Listing Agreement which requires that every company proposing to issue new securities, shall, as a condition precedent, deposi....

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....an be released by the concerned stock exchange only after obtaining a 'NOC' from SEBI. 2. It has come to the notice of the SEBI that in many cases, the bank guarantees so kept with the stock exchanges under Clause 42 of the listing agreement, have expired and the exchanges have neither taken any step to prevent such eventuality nor to revive the bank guarantees so expired. By allowing such bank g....

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.... c) To invoke such bank guarantees before it expires, if any issuer company fails to satisfy the shortfall in the deposit amount either by cash or by fresh/renewed bank guarantees, within the time frame given in this regard, inspite of the said advise from the stock exchange. 4. Further, some stock exchanges have sought advice as to whether they can adjust the 1% security deposit against the dues....