TaxTMI 
TaxTMI 
Listing Agreement for Indian Depository Receipts (IDRs)
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.... listing agreement for such issues, which is annexed herewith. The Listing Agreement shall be read in conjunction with the Companies (Issue of Indian Depository Receipts) Rules, 2004 and Chapter VIA of the SEBI (Disclosure & Investor Protection) Guidelines, 2000, the latter having been issued vide SEBI circular no. SEBI/CFD/DIL/DIP/20/2006/3/4 dated April 3, 2006. 3. The Stock Exchanges are hereby directed to: (a) make necessary amendments to the bye-laws for the implementation of the above decision immediately (b) bring the provisions of this circular to the notice of the concerned entities and also to disseminate the same on the website for easy access to the issuers and investors and (c) communicate to SEBI, the status of the implementation of the provisions of this circular in the Monthly Development Report 4. This circular is being issued in exercise of powers conferred by Sections 11(1) and 11A of the Securities and Exchange Board of India Act, 1992 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market. 5. These amendments shall come into force from the date of the circu....
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....ks or the record date fixed for the purpose. b) The Issuer will give notice simultaneously to stock exchange in case any proposal for declaration of bonus issue is to be placed before its Board of Directors and is communicated as part of the agenda. No prior intimation is required about the Board Meeting in case the declaration of bonus issue by the company is not on the agenda of the Board Meeting. c) The Issuers are also required to send the information in the format which is given in Schedule III by e-mail 3. The Issuer will, immediately after the meeting of its Board of Directors has been held to consider or decide the same, intimate to the Stock Exchange, (within 15 minutes of the closure of the board meeting) by phone, fax, telegram, e-mail: a) all dividends and/or cash bonuses recommended or declared or the decision to pass any dividend or interest payment; b) the total turnover, gross profit/loss, provision for depreciation, tax provisions and net profits for the year (with comparison with the previous year) and the amounts appropriated from reserves, capital profits, accumulated profits of past years or other special source to provide wholly or p....
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....for the purpose of making a bonus issue; (ii) letters of right within six weeks of the record date for the purpose of making a rights issue and (iii) advices of allotment within six weeks of the last date fixed by the Issuer for submission of letters of renunciation in case of rights issue. 8. a) The company agrees to obtain 'in-principle' approval for listing from the exchanges where its IDRs are listed, before issuing further IDRs. The company agrees to make an application to the Exchange for the listing of any new issue of IDRs. b) The Issuer agrees to make true, fair and adequate disclosure in the offer documents/draft prospectus/letter of offer in respect of any new or further issue of IDRs. c) The Issuer agrees that it shall not issue any prospectus/ offer document/ letter of offer for public subscription of any IDRs unless the legal and regulatory requirements relating thereto have been fulfilled. d) The Issuer further agrees that the Issuer shall submit to the exchange the following documents to enable it to admit/ list the said IDRs for dealing in SE, such as - i) a copy of letter indicating the observation on draft prospectus/ letter of of....
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....naging Director,; c) of any change of Auditors appointed to audit the books and accounts of the Issuer; d) of any change in the compliance officer and company secretary; e) of any change in the domestic depository or the overseas custodian bank. 12. The Issuer will forward to stock exchange promptly and without application:- a) copies of the Annual Reports, which shall include the Balance Sheet and Profit & Loss Account, Directors' Report and the Auditors Report and of all periodical and special reports as soon as they are issued; b) copies of all notices, resolutions and circulars relating to new issue of capital prior to their dispatch to the equity shareholders or IDR holders; c) copies of all the notices, call letters or any other circulars including notices of meetings at the same time as they are sent to the equity shareholders, IDR holders, debenture holders or creditors or any class of them or as they are advertised in the Press. d) copy of the proceedings at all Annual and Extraordinary General Meetings of the Issuer; e) copy of the deposit agreement as soon as it is executed. f) copies of all notices, circulars, etc., issued or advertis....
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....) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997s. # as defined in Regulation 2(e) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 Note 1: The Name, Number of shares held and percentage shareholding of entities / persons holding more than 1 percent of the shares of the company shall be given under each head. Note 2: The company shall also post this information on its web site and on the EDIFAR website. 15. Apart from complying with all specific requirements as above, the Issuer will intimate to the Stock Exchanges, immediately of events such as strikes, lock outs, closure on account of power cuts, etc. and all events which will have a bearing on the performance / operations of the company as well as price sensitive information both at the time of occurrence of the event and subsequently after the cessation of the event in order to enable the IDR holders and the public to appraise the position of the Issuer and to avoid the establishment of a false market in its IDRs. In addition, the Issuer will furnish to stock exchange on request such information concerning the Issuer as the stock exchange may rea....
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....perations or its profitability. e. Litigation /dispute with a material impact The issuer will promptly after the event inform the Exchange of the developments with respect to any dispute in conciliation proceedings, litigation, assessment, adjudication or arbitration to which it is a party or the outcome of which can reasonably be expected to have a material impact on its present or future operations or its profitability or financials. f. Revision in Ratings The Issuer will promptly notify the Exchange, the details of any rating or revision in rating assigned to any debt or equity instrument of the Issuer or to any fixed deposit programme or to any scheme or proposal of the Issuer involving mobilisation of funds whether in India or abroad provided the rating so assigned has been quoted, referred to, reported, relied upon or otherwise used by or on behalf of the Issuer. g. Any other information having bearing on the operation/performance of the company as well as price sensitive information which includes but not restricted to; i. Issue of any class of IDRs. ii. Acquisition, merger, de-merger, amalgamation, restructuring, scheme of arrangement, sp....
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....delines & regulations in regard to listing of IDRs which now are or hereafter may be in force. As a pre-condition for continued listing the Issuer further undertakes to forthwith comply with such future conditions as may be stipulated by stock exchange from time to time as conditions and requirements for listing of IDRs. 19. The Issuer agrees that it shall be a condition precedent for issuance of new IDRs, that it shall deposit before the opening of subscription list and keep deposited with the stock exchange (in cases where the IDRs are offered for subscription whether through the Issue of a prospectus, letter of offer or otherwise) an amount calculated at 1% of the amount of IDRs offered for subscription to the public and/or to the holders of existing IDRs of the Issuer, as the case may be, for ensuring compliance by the Issuer, within the prescribed or stipulated period, of all prevailing requirements of law and all prevailing listing requirements and conditions as mentioned in, and refundable or forfeitable in the manner stated in the Rules, Bye-laws and Regulations of the stock exchange for the time being in force. 50% of the above mentioned security....
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....en dispatched to the investors within 30 days fro the date of the closure of the issue. 23. The Issuer agrees: (a) to appoint the Company Secretary of the Issuer as Compliance Officer who will directly liaise with the authorities such as SEBI, Stock Exchanges, ROC etc and investors with respect to implementation of various clause, rules, regulations and other directives of such authorities and investor service & complain related matter. (b) to undertake a due diligence survey to ascertain whether the RTA is sufficiently equipped with infrastructure facilities such as adequate manpowe computer hardware and software, office space, documents handling facility etc., to serve the IDR holders (c) to furnish a copy of agreement or MOU entered into with overseas custodian bank, domestic depository, merchant banker and RTA to the stock exchange. 24 Corporate Governance - The company agrees to comply with the corporate governance requirements stipulated in this clause: (i) I. Board of Directors (A) Composition of Board The Board of directors of the company shall have an optimum combination of executive and non-executive directors with not less tha....
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....ested in or lent to the company shall be deemed to be independent directors. Explanation: "Institution' for this purpose means a public financial institution as defined in Section 4A of the Companies Act, 1956 or a "corresponding new bank" as define in section 2(d) of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 or the Banking Companies (Acquisition and Transfer Undertakings) Act, 1980 [both Acts]." (B) Non executive directors' compensation and disclosures All fees/compensation, if any paid to non-executive directors, including independent directors, shall be fixed by the Board of Directors and shall require previou approval of shareholders in general meeting. The shareholders' resolution shall specify the limits for the maximum number of stock options that can be grante to non-executive directors, including independent directors, in any financial year and in aggregate. "Provided that the requirement of obtaining prior approval of shareholders in general meeting shall not apply to payment of sitting fees to non-executive directo if made within the limits prescribed under the Companies Act, 1956 for payment of sitting fees ....
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..... Two-thirds of the members of audit committee shall be independent directors. (ii) All members of audit committee shall be financially literate and at least one member shall have accounting or related financial management expertise. Explanation 1: The term “financially literate†means the ability to read and understand basic financial statements i.e. balance sheet, profit and loss account, ar statement of cash flows. Explanation 2: A member will be considered to have accounting or related financial management expertise if he or she possesses experience in finance accounting, or requisite professional certification in accounting, or any other comparable experience or background which results in the individual's financi sophistication, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities. (iii) The Chairman of the Audit Committee shall be an independent director; (iv) The Chairman of the Audit Committee shall be present at Annual General Meeting to answer shareholder queries; (v) The audit committee may invite such of the executives, as it considers a....
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....l statements f. Disclosure of any related party transactions g. Qualifications in the draft audit report. 5. Reviewing, with the management, the quarterly financial statements before submission to the board for approval 6. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems. 7. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit. 8. Discussion with internal auditors any significant findings and follow up there on. 9. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board. 10. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern. 11. To look into the reasons for substantial defaults in the payment to the....
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....ated turnover or net worth respectively, of the listed holding company and its subsidiaries in the immediately preceding accounting year. Explanation 2: The term "significant transaction or arrangement†shall mean any individual transaction or arrangement that exceeds or is likely to exceed 10% of the total revenues or total expenses or total assets or total liabilities, as the case may be, of the material unlisted subsidiary for the immediately preceding accounting year. Explanation 3: Where a listed holding company has a listed subsidiary which is itself a holding company, the above provisions shall apply to the listed subsidiary insofar as its subsidiaries are concerned. IV. Disclosures (A) Basis of related party transactions (i) A statement in summary form of transactions with related parties in the ordinary course of business shall be placed periodically before the audit committee. (ii) Details of material individual transactions with related parties which are not in the normal course of business shall be placed before the audit committee. (iii) Details of material individual transactions with related parties or others, which are not o....
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.... the performance criteria. (c) Service contracts, notice period, severance fees. (d) Stock option details, if any - and whether issued at a discount as well as the period over which accrued and over which exercisable. (iii) The company shall publish its criteria of making payments to non-executive directors in its annual report. Alternatively, this may be put up on the company website and reference drawn thereto in the annual report. (iv) The company shall disclose the number of shares and convertible instruments held by non-executive directors in the annual report. (v) Non-executive directors shall be required to disclose their shareholding (both own or held by / for other persons on a beneficial basis) in the listed compar in which they are proposed to be appointed as directors, prior to their appointment. These details should be disclosed in the notice to the general meetir called for appointment of such director (F) Management (i) As part of the directors' report or as an addition thereto, a Management Discussion and Analysis report should form part of the Annual Report to th shareholders. This Management Discussion & Analysis should include dis....
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....fer to an officer or a committee or to th registrar and share transfer agents. The delegated authority shall attend to share transfer formalities at least once in a fortnight. V. CEO/CFO certification The CEO, i.e. the Managing Director or Manager appointed in terms of the Companies Act, 1956 and the CFO i.e. the whole-time Finance Director or any other person heading the finance function discharging that function shall certify to the Board that: (a) They have reviewed financial statements and the cash flow statement for the year and that to the best of their knowledge and belief: (i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading; (ii) these statements together present a true and fair view of the company's affairs and are in compliance with existing accounting standards, applicable laws and regulations. (b) There are, to the best of their knowledge and belief, no transactions entered into by the company during the year which are fraudulent, illegal or violative of the company's code of conduct. (c) They accept responsibility for establishing and maintaining in....
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....adoption (and compliance) / non-adoption of the non-mandatory requirements shall be made in the sectic on corporate governance of the Annual Report. 25. (1) The company agrees that it shall file the following information, statements and reports on the Electronic Data Information Filing and Retrieval (EDIFAR) website maintained by National Informatics Centre (NIC), on-line, in such manner and format and within such time as may be specified by SEBI : 1. Full version of annual report including the balance sheet, profit and loss account, director's report and auditor's report; cash flow statements; half yearly financial statements and quarterly financial statements. 2. Corporate governance report. 3. Shareholding pattern statement. 4. Statement of action taken against the company by any regulatory agency. 5. Deposit agreement. 6. Such other statement, information or report as may be specified by SEBI from time to time in this regard. Provided that the requirement of this clause shall be in addition to and not in derogation from the requirements of other clauses of this listing agreement, which may require filing of any statements, reports and info....
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....estor, concerning the IDRs offered and subscribed or bought in India. 32 All correspondence including the periodic reports with the Stock Exchanges and the IDR holders shall be in English. All financial statements required to be disclosed on a continuous basis are to be given in English 33. Annual Report The Issuer agrees to send to its IDR holders a copy of the Annual Report within four months of the end of the financial year. The annual report shall contain the Board's report, Balance Sheet, Profit and Loss Account, Cash Flow Statement and the auditor's report thereon. The Issuer further agrees to simultaneously file the same with the Exchange. The minimum amount of information that is to be contained in the Board's report is given in Schedule V. 34. (1) The issuer agrees either to comply with Indian GAAP (including all Accounting Standards issued by the Institute of Chartered Accountants of India) or with the International Financial Reporting Standards (IFRS) [including the International Accounting Standards (IAS)] or with US GAAP in the preparation and disclosure of its financial results. The Accounting / Reporting Standard followed for the quarterly ....
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....he nature of loans where there is (i) no repayment schedule or repayment beyond seven years or (ii) no interest or interest below section 372A of Companies Act by name and amount. • Loans and advances in the nature of loans to firms/companies in which directors are interested by name and amount 2 Subsidiary 3 Parent Same disclosures as applicable to the parent company in the accounts of subsidiary company. Investments by the loanee in the shares of parent company and subsidiary company, when the company has made a loan or advance in the nature of loan. (4) Issuers who change their name suggesting any new line of business (including software business) shall disclose the turnover and income etc from such new activities separately in the annual accounts for a period of three years from the date of change in name. (5) The cash flow statement shall be a part of the Annual accounts as well as the Annual Report B. Directors Report The Issuer agrees to disclose in the Directors Report the name and address of each Stock Exchange at which the issuer's securities are listed and also confirm that Annual Listing Fee has ....
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....nt year results. (4) The issuer shall follow the applicable IFRS/US GAAP, including those on segment reporting. (5) The issuer agrees that where it has not yet commenced its commercial production, it will make additional quarterly disclosures regarding the balance of unutilised monies raised by issue and the form in which such unutilised funds have been invested by the issuer. (6) The unaudited results should not substantially differ from the audited results of the Issuer. If the sum total of the First, Second, Third and Fourth quarterly results in respect of any item given in the same pro-forma varies by 20 per cent when compared with the audited results for the full year the Issuer shall explain the reasons to the Stock Exchanges and in the annual report. 37. The issuer will submit a cash flow statement along with the Balance Sheet and Profit and Loss Account. The Cash Flow Statement will be prepared in accordance with the Accounting Standard on Cash Flow Statement (AS-3) issued by the Institute of Chartered Accountants of India, and the Cash Flow Statement shall be presented only under the Indirect Method as given in AS-3. The statement shall be issued....
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....1) For the purpose of the above disclosures the terms "parent" and "subsidiary" shall have the same meaning as defined in the Accounting Standard on Consolidated Financial Statement (AS21) issued by ICAI. 2) For the purpose of the above disclosures the terms 'Associate' and 'Related Party' shall have the same meaning as defined in the Accounting Standard on "Related Party Disclosures (AS 18)" issued by ICAI Issuers who change their name suggesting any new line of business (including software business) shall disclose the turnover and income etc from such new activities separately in the annual results. 38. Company agrees that it will furnish audited financial results on a quarterly basis in the following pro-forma within one month from the end of quarter (Quarter means 3 months only) to the Stock Exchange and will make an announcement to the stock exchanges, where the company is listed, within 15 minutes of the closure of the Board Meeting or Meeting of a Sub-Committee of Board of Directors (consisting of not less than one third of the Directors), in which the audited financial results are placed and also within 48 hours of the conclusion of the Board or i....
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....ed in accordance with AS-17, issued by ICAI. c. Accounting for Taxes on Income: • Companies shall be required to comply with the accounting standard on "Accounting for Taxes on Income" in respect of the quarterly un-audited financial results d. Consolidated Financial Results: Publication of consolidated annual financial results along with stand-alone annual financial results shall be mandatory. The companies shall however continue to have the option to publish consolidated financial results along with stand alone financial results on a quarterly/half yearly basis. e. Companies shall be required to publish alongwith quarterly audited financial results, the number of investor complaints pending at the beginning of the quarter, received and disposed off during the quarter and lying unresolved at the end of the quarter The audited quarterly results prepared by the company shall be approved by the Board of Directors Format for publication of Annual audited results Particulars (1) Figures for the 9 months (2) Figures for the last quarter (3) Figures for the corresponding quarter of the previous year (4) ....
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.... to date Previous accounting current period figures for the previous year year d) Other expenditure (Any item exceeding 10% of the total expenditure to be shown separately). Interest 4. 5. Depreciation 6. Profit (+)/Loss(-) before tax (1+2-3-4-5) 7. Provision for taxation 8. Net Profit (+)/Loss (-) (6-7) 9. Paid-up equity share capital (Face Value of the Share shall be indicated) 10. Reserves excluding revaluation reserves (as per balance sheet) of previous accounting year to be given in column (5) 11. Basic and diluted EPS for the period, for the year to date and for the previous year (not to be annualised) 12. *(Applicable for half yearly financial results): Aggregate of non-promoter shareholding - Number of shares - Percentage of shareholding * The companies shall be required to disclose the aggregate non-promoter shareholding along with the half yearly financial results. Companies shall also be required to disclose the aggregate non-promoter shareholding at the end of the corresponding half year in the previous year and at the end of the previous accounting year. No....
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....ion(s) would have had on the profit or loss in the audited quarterly results shall be disclosed. (iii) The company, while furnishing the audited financial results to the exchange, shall also explain to the exchange about the reasons for the qualification(s) referred under (i) and (ii) above, why the company had failed to publish accounts without such audit qualification(s) and when the company will remove the qualification(s) and publish accounts without such qualification(s)." g. If the company is yet to commence commercial production, then instead of the quarterly results, the company should give particulars of the status of the project, its implementation and the expected date of commissioning of the project. h. The audited results sent to Stock Exchange/s and published in newspapers should be based on the same set of accounting policies as those followed in the previous year. In case, there are changes in the accounting policies, the results of previous year will be recast as per the present accounting policies, to make it comparable with current year results. If the period of the Financial Year is more than 12 months and not exceeding 15 months there....
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....of the total expenditure. This information shall be given in respect of all the periods included at the above statement. Any event or transaction that is material to an understanding of the results for the quarter including completion of expansion and diversification programmes, strikes, lock-outs, change in management, change in capital structure etc, shall be disclosed. Similar material event or transactions subsequent to the end of the quarter, the effect whereof is not reflected in the results for the quarter shall also be disclosed. All material non-recurring/abnormal income/gain and expenditure/loss and effect of all changes in accounting practices affecting the profits materially must be disclosed separately. In case of companies whose revenues are subject to material seasonal variations, they shall disclose the seasonal nature of their activities and may also supplement their audited financial results with information for 12 month periods ended at the interim date (last day of the quarter) for the current and preceding years on a rolling basis. Company shall give the following information in respect of dividend paid or recommended for the year ....
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....with current year results. If the period of the Financial Year is more than 12 months and not exceeding 15 months there will be 5 Quarters and is more than 15 months but not exceeding 18 months there will be 6 Quarters and the financial results will be intimated to the Exchange and published in the News papers accordingly. Qualifications in Audit Reports: Companies shall be required to disclose the audit qualifications along with the audited financial results published under the Listing Agreement in addition to the explanatory statement as to how audit qualifications in respect of the audited accounts of the previous accounting year have been addressed in the financial results. 39. Equivalent Information The issuer agrees to disclose to the exchange, any information which is disclosed to any other overseas stock exchange or made public in any other overseas securities market, on which its securities may be listed or quoted, simultaneously with such disclosure or publication, or as soon thereafter as may be reasonably practicable. AND THE ISSUER HEREBY FURTHER AGREES AND DECLARES THAT any of its IDRs listed on the stock exchange shall remain on th....
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....uct of the company or taken an adverse view regarding another enterprise that can have negative implications on the company. 10. Details of any joint venture or collaboration agreement. 11. Transactions that involve substantial payment towards goodwill, brand equity, or intellectual property. 12. Significant labour problems and their proposed solutions. Any significant development in Human Resources/ Industrial Relations front like signing of waç agreement, implementation of Voluntary Retirement Scheme etc. 13. Sale of material nature, of investments, subsidiaries, assets, which is not in normal course of business. 14. Quarterly details of foreign exchange exposures and the steps taken by management to limit the risks of adverse exchange rate movement, if material. 15. Non-compliance of any regulatory, statutory or listing requirements and IDR holders service such as non-payment of dividend, delay in demat credit etc. Format of Quarterly Compliance Report on Corporate Governance Name of the Company: Quarter ending on: Particulars Clause of Listing agreement 241 I. Board of Directors (A)Composition of Board 24(IA) (B)Non-ex....
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....example, promoter, executive, non- executive, independent non-executive, nominee director, which institutic represented as lender or as equity investor. ii. Attendance of each director at the Board meetings and the last AGM. iii. Number of other Boards or Board Committees in which he/she is a member or Chairperson iv. Number of Board meetings held, dates on which held. 3. Audit Committee: i. Brief description of terms of reference ii. Composition, name of members and Chairperson iii. Meetings and attendance during the year 4. Remuneration Committee: i. Brief description of terms of reference ii. Composition, name of members and Chairperson iii. Attendance during the year iv. Remuneration policy V. Details of remuneration to all the directors, as per format in main report. 5. General Body meetings: i. Location and time, where last three AGMs held. ii. Whether any special resolutions passed in the previous 3 AGMs (if applicable) iii. Whether any special resolution passed last year through postal ballot (if applicable) - details of voting pattern iv. Person who conducted the postal ballot exercise (if applicable) v. ....
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....cluding pension rights and any compensation payment. ii. To avoid conflicts of interest, the remuneration committee, which would determine the remuneration packages of the executive directors may comprise of least three directors, all of whom should be non-executive directors, the Chairman of committee being an independent director. iii. All the members of the remuneration committee could be present at the meeting. iv. The Chairman of the remuneration committee could be present at the Annual General Meeting, to answer the shareholder queries. However, it would be É© to the Chairman to decide who should answer the queries. (3) (4) (5) (6) (7) Shareholder Rights A half-yearly declaration of financial performance including summary of the significant events in last six-months, may be sent to each household of ID holders. Audit qualifications Company may move towards a regime of unqualified financial statements. Training of Board Members A company may train its Board members in the business model of the company as well as the risk profile of the business parameters of the compan their responsibilities as directors, and the best way....