TaxTMI 
TaxTMI 
Securities and Exchange Board of India (Issue and Listing of Non- Convertible Securities) (Second Amendment) Regulations, 2023
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (1) in regulation 2, (a) in sub-regulation (1), (i) after clause (s) and before clause (t), the following clause (sa) shall be inserted, namely - "(sa) "key managerial personnel" means key managerial personnel as defined in sub-section (51) of section 2 of the Companies Act, 2013 (18 of 2013);"; (ii) in clause (bb), the words and symbol "including a shelf placement memorandum," shall be omitted; (iii) after clause (ii) and before clause (jj), the following clause (iia) shall be inserted, namely - "(iia) "senior management" shall mean the officers and personnel of the issuer who are members of its core management team, excluding the Board of Directors, and shall also comprise all the members of the management one level below the Chief Executive Officer or Managing Director or Whole Time Director or Manager (including Chief Executive Officer and Manager, in case they are not part of the Board of Directors) and shall specifically include the functional heads, by whatever name called and the Company Secretary and the Chief Financial Officer;"; (iv) clause (jj) shall be omitted; and (v) clause (pp) shall be omitt....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing a general information document instead of a placement memorandum for private placement of non-convertible securities sought to be listed, until March 31, 2024. In case the entity is not able to achieve full compliance with the provisions, till such time, it shall explain the reasons for such non-compliance or partial compliance, and the steps initiated to achieve full compliance, in such form and manner as may be specified by the Board from time to time. Explanation II. - Nothing in this regulation shall exempt an entity undertaking a scheme of arrangement, under regulation 37 or regulation 59A or both of the listing regulations, from the filing of a general information document under sub-regulation (1), to be filed by the resultant entity, post implementation of such scheme of arrangement. Explanation III. - For the purposes of this regulation, "shelf placement memorandum" means a placement memorandum in relation to the first issuance of non-convertible securities issued on a private placement basis, issued prior to this regulation coming into force and valid as on the date of this regulation coming into force. (2) The general information document sh....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (8) The issuer shall ensure that the audited financial statements disclosed under this regulation are not more than six months old from the date of filing draft placement memorandum or the issue opening date, as applicable: Provided that issuers: (a) whose non-convertible securities or specified securities are listed on recognised stock exchange(s), who are in compliance with the listing regulations, or (b) who are subsidiaries of entities who have listed their specified securities, and are in compliance with the listing regulations, may disclose unaudited financial information instead of audited financial statements for the interim period in the format as specified under the listing regulations, along with the limited review report, as filed with the stock exchange(s), subject to necessary disclosures, including risk factors, in this regard. CHAPTER V B REQUIREMENTS FOR LARGE CORPORATES 50B. (1) A listed entity, fulfilling the criteria as may be specified by the Board, shall be considered as a 'Large Corporate'. (2) Such Large Corporates shall comply with the conditions or requirements, as may be specified by the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ecurities" in this Schedule shall refer to debt securities and nonconvertible redeemable preference shares. 2.2. In the case of public issuance of non-convertible securities, all references to "issue document" shall mean the offer document. 2.3. In the case of a private placement of non-convertible securities, all references to "issue document" shall mean the placement memorandum or the general information document, as the case may be. 3. Disclosures 3.1. The disclosures stipulated herein are applicable to public issuance and private placement of non-convertible securities, unless specified otherwise. 3.2. The front page of the issue document shall contain the following information: (a) Name of the issuer, its logo (if any), corporate identity number, permanent account number, date and place of incorporation, latest registration/identification number issued by any regulatory authority which regulates such issuer (i.e., Reserve Bank of India, Insurance Regulatory Development Authority of India etc.), if applicable, address of its registered and corporate offices, telephone number, website address and e-mail address. (b) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the issue document: 3.3.1. Issuer's Absolute Responsibility: 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 issue document 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 issue document is true and correct in all material aspects and is not misleading, that the opinions and intentions expressed herein are honestly stated 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." 3.3.2. Details of Promoters of the Issuer: (a) A complete profile of all the promoters, including their name, date of birth, age, personal addresses, educational qualifications, experience in the business or employment, positions/posts held in the past, directorships held, other ventures of each promoter, special achievements, their business and financial activities, photograph, permanent accoun....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or units where the issuer carries on its business activities, if any; (e) Project cost and means of financing, in case of funding of new projects. 3.3.9. Expenses of the Issue: Expenses of the issue along with a break up for each item of expense, including details of the fees payable to separately as under (in terms of amount, as a percentage of total issue expenses and as a percentage of total issue size), as applicable: (a) Lead manager(s) fees, (b) Underwriting commission, (c) Brokerage, selling commission and upload fees, (d) Fees payable to the registrars to the issue, (e) Fees payable to the legal Advisors, (f) Advertising and marketing expenses, (g) Fees payable to the regulators including stock exchanges, (h) Expenses incurred on printing and distribution of issue stationary, (i) Any other fees, commission or payments under whatever nomenclature. 3.3.10. Financial Information: (a) The audited financial statements (i.e. profit and loss statement, balance sheet and cash flow statement) both on a standalone and consolidated basis for a period of three comp....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Financial Assets (Current and Non-Current) Other Non-Current assets Current assets Total Assets Financial Liabilities (Current and Non-Current) • Borrowings (including interest) • Other Financial Liabilities Non-Current Liabilities Current Liabilities Provisions Total Liabilities Equity (Equity Share Capital and Other Equity) Total Equity and Liabilities Profit and Loss Total revenue from operations Other Income Total Income  ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Total revenue from operations Other Income Total Income Total Expenses Profit / loss for the period Other Comprehensive income Total Comprehensive Income Earnings per equity share: (a) basic; and (b) diluted Cash Flow Net cash (used in)/ generated from operating activities (A) Net cash (used in) / generated from investing activities (B) Net cash (used in)/ generated from financing activities (C) Net Increase/ (decrease) in Cash and Cash Equivalents Opening Balance of Cash and Cash Equivalents &nbs....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rrowings (other than Debt Securities) -Subordinated liabilities -Other financial liabilities Non-Financial Liabilities -Current tax liabilities (net) -Provisions -Deferred tax liabilities (net) -Other non-financial liabilities Equity (Equity Share Capital and Other Equity) Total Liabilities and Equity PROFIT AND LOSS Revenue from operations Other Income Total Income &nb....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lidated basis: Particulars BALANCE SHEET Assets Property, Plant and Equipment Financial Assets Non-financial Assets excluding Property , Plant and Equipment Total Assets Liabilities Financial Liabilities -Derivative financial instruments -Trade Payables -Other Payables -Debt Securities -Borrowings (other than Debt Securities) -Deposits -Subordinated liabilities -Lease liabilities &nbs....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Cash and cash equivalents Loans Total Debts to Total Assets Interest Income Interest Expense Impairment on Financial Instruments Bad Debts to Loans (f) Details of any other contingent liabilities of the issuer, based on the latest audited financial statements including amount and nature of liability. (g) The amount of corporate guarantee or letter of comfort issued by the issuer along with details of the counterparty (viz. name and nature of the counterparty, whether a subsidiary, joint venture entity, group company etc.) on behalf of whom it has been issued. 3.3.11. A brief history of the issuer since its incorporation giving details of its following activities: (a) Details of Share Capital as at last quarter end: Share Capital Amount Authorized Share Capital Issued, Subscribed and Paid-up Sha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l years): (i) Remuneration payable or paid to a director by the issuer, its subsidiary or associate company; shareholding of the director in the company, its subsidiaries and associate companies on a fully diluted basis; (ii) Appointment of any relatives to an office or place of profit of the issuer, its subsidiary or associate company; (iii) Full particulars of the nature and extent of interest, if any, of every director: A. in the promotion of the issuer company; or B. in any immoveable property acquired by the issuer company in the two years preceding the date of the issue document or any immoveable property proposed to be acquired by it; or C. where the interest of such a director consists in being a member of a firm or company, the nature and extent of his interest in the firm or company, with a statement of all sums paid or agreed to be paid to him or to the firm or company in cash or shares or otherwise by any person either to induce him to become, or to help him qualify as a director, or otherwise for services rendered by him or by the firm or company, in connection with the promotion or formation of the issuer company s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....outstanding Date of Allotment Redemption Date/ Schedule Credit Rating Secured/ unsecured Security Other details viz. details of Issuing and Paying Agent, details of Credit Rating Agencies (e) List of top ten holders of non-convertible securities in terms of value (on a cumulative basis): S. No. Name of holders Category of holder Face value of holding Holding as a % of total outstanding nonconvertible securities of the issuer (f) List of top ten holders of Commercial Paper in terms of value (in cumulative basis): Sl. No. Name of holder Category of holder Face value of holding Holding as a % of total commercial paper outstanding of the issuer (g) Details of the bank fund based facilities/ rest of the borrowing (if any, including hybrid debt like Foreign Currency Convertible Bonds (FCCB), Optionally Convertible Debentur....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Details of borrowers Geographical location wise 6. Details of Gross NPA Segment wise 7. Details of Assets and Liabilities Residual maturity profile wise into several bucket 8. Additional details of loans made by issuer where it is a Housing Finance Company 9. Disclosure of latest ALM statements to stock exchange 3.3.18. Details of all default/s and/or delay in payments of interest and principal of any kind of term loans, debt securities, commercial paper (including technical delay) and other financial indebtedness including corporate guarantee or letters of comfort issued by the company, in the preceding three years and the current financial year. 3.3.19. Any material event/ development or change having implications on the financials/credit quality (e.g. any material regulatory proceedings against the issuer/promoters, litigations resulting in material liabilities, corporate restructuring event etc.) at the time of issue which may affect the issue or the investor's decision to invest / continue to invest in the non-convertible securities/ commercial paper. 3.3.20. Any litigation or legal action pendin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tries/ sectors to which borrowings have been granted by NBFCs. (ii) Quantum and percentage of secured vis-à-vis unsecured borrowings granted by NBFCs. (iii) Any change in promoters' holdings in NBFCs during the preceding financial year beyond the threshold specified by the Reserve Bank of India from time to time. 3.3.29. Declaration in case of public issue with regards to the following: (a) procedure of allotment of debt securities and non-convertible redeemable preference shares and unblocking of funds in case of refund; (b) a statement by the Board of Directors about the separate bank account where all monies received out of the issue are to be transferred, and disclosure of details of all monies including utilised and unutilised monies out of the previous issue in the prescribed manner; (c) the details of all utilized and unutilised monies out of the monies collected in the previous issue made by way of public offer shall be disclosed and continued to be disclosed in the balance sheet till the time any part of the proceeds of such previous issue remains unutilized, the purpose for which such monies have been utilized, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....enture trustee. 3.3.33. If the security is backed by a guarantee or letter of comfort or any other document of a similar nature, a copy of the same shall be disclosed. In case such document does not contain the detailed payment structure (procedure of invocation of guarantee and receipt of payment by the investor along with timelines), the same shall be disclosed in the issue document. 3.3.34. Disclosure of cash flow with date of interest/dividend/ redemption payment as per day count convention: (a) The day count convention for dates on which the payments in relation to the non-convertible securities which need to be made, should be disclosed. (b) Procedure and time schedule for allotment and issue of securities should be disclosed. (c) Cash flows emanating from the non-convertible securities shall be mentioned in the issue document, by way of an illustration. 3.3.35. Undertaking by the Issuer: (a) Investors are advised to read the risk factors carefully before taking an investment decision in this issue. For taking an investment decision, investors must rely on their own examination of the issuer and the offer includin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e of security cover or full recovery of the security in case of enforcement (vii) A risk factor to state that while the debenture is secured against a charge to the tune of 100% of the principal and interest amount in favour of debenture trustee, and it is the duty of the debenture trustee to monitor that the security is maintained, however, the possibility of recovery of 100% of the amount shall depend on the market scenario prevalent at the time of enforcement of the security. (viii) All covenants including the accelerated payment covenants given by way of side letters shall be incorporated in the issue document by the issuer. (c) The issuer shall make a declaration about the compliance and a statement to the effect that nothing in the issue document is contrary to the provisions of Companies Act, 2013 (18 of 2013), the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and the Securities and Exchange Board of India Act, 1992 (15 of 1992) and the rules and regulations made thereunder. 3.3.37. The directors in case of a body corporate and such authorized persons in case the issuer is not a body corporate shall attest that: (a) the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (a) Creation of Debenture Redemption Reserve (DRR) / Capital Redemption Reserve (CRR) - relevant legislations and applicability (b) Issue/instrument specific regulations - relevant details (Companies Act, 2013 (18 of 2013), guidelines issued by the Reserve Bank of India, etc.) (c) Default in payment (d) Delay in listing (e) Delay in allotment of securities (f) Issue details (g) Application process (h) Disclosure required under form PAS-4 under Companies (Prospectus and Allotment of Securities), Rules, 2014 but not contained in this schedule, if any. (i) Project details: gestation period of the project; extent of progress made in the project; deadlines for completion of the project; the summary of the project appraisal report (if any), schedule of implementation of the project; 3.3.40. Other Details in case of non-convertible redeemable preference shares issue: (a) Nature of the instrument: whether cumulative or non-cumulative and complete details thereof; (b) Terms of Redemption: Out of distributable profits or out of fresh issue of shares for the purpose of redemption or both. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....than five, then the disclosures as required above shall be on an aggregated basis, specifying the immoveable property being acquired on a contiguous basis with mention of the location/total area and the number of vendors from whom it is being acquired and the aggregate value being paid. Details of minimum amount, the maximum amount and the average amount paid/ payable should also be disclosed for each immovable property. (c) If: (i) the proceeds, or any part of the proceeds, of the issue of the debt securities/non-convertible redeemable preference shares are or are to be applied directly or indirectly and in any manner resulting in the acquisition by the company of shares in any other body corporate; and (ii) by reason of that acquisition or anything to be done in consequence thereof or in connection therewith, that body corporate shall become a subsidiary of the company, a report shall be made by a Chartered Accountant (who shall be named in the issue document) upon - A. the profits or losses of the other body corporate for each of the three financial years immediately preceding the issue of the issue document; and B. the asset....
X X X X Extracts X X X X
X X X X Extracts X X X X
....osed to be taken by the company for each of the said reservations or qualifications or adverse remarks. (j) The details of: • any inquiry, inspections or investigations initiated or conducted under the securities laws or Companies Act, 2013 (18 of 2013) or any previous companies law; • prosecutions filed, if any (whether pending or not); and • fines imposed or offences compounded, in the three years immediately preceding the year of issue of issue document in the case of the issuer being a company and all of its subsidiaries. (k) The details of acts of material frauds committed against the issuer in the preceding three financial years and current financial year, if any, and actions taken by the issuer. Summary of terms - Terms to be included in the issue document: Security Name (Name of the non-convertible securities which includes (Coupon/dividend, Issuer Name and maturity year) e.g. 8.70% XXX 2015. Issuer Type of Instrument Nature of Instrument (Secured or Unsecured) Seniority (Senior or Subordinated) Eligible Investors Listing (nam....
X X X X Extracts X X X X
X X X X Extracts X X X X
.....), type of charge (pledge/ hypothecation/ mortgage etc.), date of creation of security/ likely date of creation of security, minimum security cover, revaluation Replacement of security, interest to the debenture holder over and above the coupon rate as specified in the Trust Deed and disclosed in the issue document Transaction Documents Conditions Precedent to Disbursement Condition Subsequent to Disbursement Event of Default (including manner of voting /conditions of joining Inter Creditor Agreement) Creation of recovery expense fund Conditions for breach of covenants (as specified in Debenture Trust Deed) Provisions related to Cross Default Clause Role and Responsibilities of Debenture Trustee Risk factors pertaining to the issue Governing Law and Jurisdiction Notes: (a) If there is any change in coupon rate pursuant to any event including lapse of certain time period or downgrade in rating, then such new coupon rate and the events which lead to such change should be disclosed. (b) The list of documents whic....