TMI BlogDISCLOSURES IN OFFER DOCUMENT, ABRIDGED PROSPECTUS AND ABRIDGED LETTER OF OFFERX X X X Extracts X X X X X X X X Extracts X X X X ..... Terms such as market leader , leading player , etc. shall not be used unless they can be substantiated by proper source of information which shall be disclosed. (b) All blank spaces in the draft offer document shall be filled up with appropriate data before registering the offer document with the Registrar of Companies or filing the same with the recognised stock exchanges. (c) Simple English for easy understanding of the contents of the offer document may be used. The technical terms used in explaining the business of the issuer may be clarified using simple terms to ensure better understanding by investors. (d) Wherever it is mentioned in the offer document that details are given elsewhere in the document, the same shall be adequately cross-referenced by indicating the page and paragraph numbers. (e) The offer document should not make any forward looking statements that cannot be substantiated. (f) Consistency may be ensured in the style of disclosures. If first person is used, the same may be used through out. Sentences that contain a combination of first and third persons may be avoided. (g) The issuer shall ensure that all material matters informed or repor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver applicable) shall be incorporated in a box format in case of an initial public offer: This being the first issue of the issuer, there has been no formal market for the securities of the issuer. The face value of the equity shares is (-----) and the issue price / floor price / price band is X-times of the face value. The issue price / floor price / price band (has been determined and justified by the lead merchant banker and the issuer as stated under the paragraph on Basis for Issue Price ) should not be taken to be indicative of the market price of the specified securities after the specified securities are listed. No assurance can be given regarding an active or sustained trading in the equity shares of the issuer nor regarding the price at which the equity shares will be traded after listing. (g) The following clause on General Risk' shall be incorporated in a box format: Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this offer unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he details of in-principle approval for listing obtained from these stock exchanges. (B) Back Cover Pages: The back inside cover page and back outside cover page shall be in white. (II) Table of Contents: The table of contents shall appear immediately after the front inside cover page. (III) Definitions and Abbreviations: (A) Conventional or general terms. (B) Issue related terms. (C) Issuer and industry related terms. (D) Abbreviations. (IV) Risk Factors: (A) The risk factors, other than those specified in sub-paras. (f), (g) and (h) of para. (2) of sub-item (A) of Item (I) above, shall be printed in clear readable font (preferably of minimum point ten size). (B) The risk factors shall be classified as those which are specific to the project and internal to the issuer and those which are external and beyond the control of the issuer. (C) The risk factors shall be determined on the basis of their materiality. In determining the materiality of risk factors, the following shall be considered : (1) Some risks may not be material individually but may be material when considered collectively. (2) Some risks may have an impact which is qualitative t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch exchange(s). (10) The trading of any securities of the issuer on stock exchanges or in OTC market, if limited or sporadic. (11) In case of outstanding debt instruments issued to public or to any person on private placement basis by the issuer, the default in compliance with the material covenants such as in creation of full security as per terms of issue, default in payment of interest, default in redemption, non-creation of debenture redemption reserve, default in payment of penal interest wherever applicable, non-availability or non-maintenance of asset cover, interest cover, debt-service cover, etc. (12) The fact that the unsecured loans taken by the issuer, promoter, group companies or associates can be recalled by the lenders at any time. (13) The default in repayment of deposits or payment of interest thereon. The roll over of liability, if any. (14) The potential conflict of interest, if the promoters or directors of the issuer are involved with one or more ventures which are in the same line of activity or business as that of the issuer. (15) The shortfall in performance vis- -vis objects stated in the previous issues of the issuer and group companies, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8) The fact that the land is not registered in the name of the issuer. (29) Any lack of arrangements in place for borrowings, bank finance or institutional finance in respect of working capital requirements. (30) Any restrictive covenants, as regards interests of equity shareholders, in a shareholders' agreement, promoters' agreement or any agreement for short term (secured and unsecured) and long term borrowings. (31) All disputed or contested tax demands and other government claims, along with the disclosures of amount, period for which such demands or claims are outstanding, financial implications and the status of the case. (32) The existence of large number of pending investor grievances against the issuer and other listed companies under the same management within the meaning of section 370 (1B) of the Companies Act, 1956. (33) The risks associated with second or residual charge or subordinated obligation created on the asset cover, in case of issue of secured convertible debt instruments. (34) The risk associated with orders not having been placed for plant and machinery indicating the percentage and value terms of the plant and machinery for which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issuer. (5) The name, address, telephone number, fax number and e-mail address of the compliance officer. (6) The names, addresses, telephone numbers, fax numbers, contact person, website addresses and e-mail addresses of the merchant bankers, co-managers, registrars to the issue, bankers to the issue, brokers to the issue, syndicate members, Self Certified Syndicate Banks, 6 [registrar to issue and share transfer agents, depository participants,] etc. (7) The names, addresses, telephone numbers, fax numbers and e-mail addresses of the auditors of the issuer. (8) The statement of inter-se allocation of responsibilities among lead merchant bankers, where more than one merchant banker is associated with the issue. (9) The following details of credit rating, in case of a public issue of convertible debt instruments: (a) The names of all the credit rating agencies from which credit rating including unaccepted rating has been obtained for the issue of convertible debt instruments. (b) The details of all the credit ratings including unaccepted rating obtained for the issue of convertible debt instruments. (c) All the credit ratings obtained during three years p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ail of the stabilisation mechanism. (4) The maximum increase in the equity share capital of the issuer and the shareholding pattern, post-issue, in case the issuer is required to allot further equity shares to the extent of over-allotment in the issue. (5) The maximum amount of funds to be received by the issuer in case of further allotment and the use of these additional funds shall be disclosed in the offer document. (6) The details of the agreement or arrangement entered into by the stabilising agent with the promoters or shareholders to borrow equity shares from the latter. The details shall, inter-alia, include the name of the promoters or shareholders, their existing shareholding in the issuer, the number and percentage of equity shares to be lent by them and other important terms and conditions including rights and obligations of each party. (7) The exact number of equity shares to be allotted pursuant to the public issue, stating separately the number of equity shares to be borrowed from the promoters or shareholders and over-allotted by the stabilising agent and the percentage of such equity shares in relation to the total issue size. (D) Capital Structure: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h quarter. (ii) Where item (i) is applicable, a document giving date-wise details of equity shares issued under employee stock option schemes, including the price at which such equity shares were issued, shall be made available as a material document for inspection. (f) If the issuer has made any issue of specified securities at a price lower than the issue price during the preceding one year, specific details of the names of the persons to whom such specified securities have been issued, whether they are part of promoters group, reasons for such issue and the price shall be given. (g) The proposal or intention, negotiations and consideration of the issuer to alter the capital structure by way of split or consolidation of the denomination of the shares, or issue of specified securities on a preferential basis or issue of bonus or rights or further public issue of specified securities or qualified institutions placement, within a period of six months from the date of opening of the present issue. (h) The total shareholding of the promoters in a tabular form, clearly stating the name of the promoter, nature of issue, date of allotment, number of shares, face value, issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the shares acquired in the secondary market. The aggregate cost of shares acquired in the secondary market, if available. (iv) The details of compliance with regulation 32 10 [and regulation 33] has been complied with. (v) If the issuer is exempt from the requirements of promoters contribution, the relevant provisions under which it is exempt. (vi) A statement that promoters contribution has been brought in to the extent of not less than the specified minimum lot and from persons defined as promoters under these regulations. (vii) A statement that the promoters undertake to accept full conversion, if the promoters contribution is in terms of the same optionally convertible debt instrument as is being offered to the public. (k) A statement that the issuer, its directors or the lead merchant bankers have not entered into any buy back arrangements for purchase of the specified securities of the issuer, other than the arrangements, if any, entered for safety net facility as permitted in the Regulations. In case any safety net is provided in the issue, the lead merchant banker shall certify that the person offering the safety net has the ability to honour the comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ired the equity shares by allotment on a firm basis or by private placement. (p) The details of shareholding, if any, of the lead merchant bankers and their associates in the issuer. (q) In case it is not possible to obtain information regarding sales and purchases of specified securities by any relative of the promoters, the information shall be disclosed on the basis of the transfers as recorded in the books of the issuer and/or the depository, as applicable and a statement to such effect shall be made in the offer document. (r) The details of options granted or equity shares issued under any scheme of employee stock option or employee stock purchase of issuer, in last three years (separately for each year) and on a cumulative basis for all options or equity shares issued prior to the date of the offer document, including the following details in cases where options granted to employees in pursuance of any employee stock option scheme existing prior to the initial public offer, are outstanding at the time of the initial public offer: (i) options granted; (ii) the pricing formula; (iii) options vested; (iv) options exercised; (v) the total number of shares ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of equity shares intended to be sold by the holders of options), if any. In case of an employee stock option scheme, this information same shall be disclosed regardless of whether equity shares arise out of options exercised before or after the initial public offer. (xvii) specific disclosures about the intention to sell equity shares arising out of an employee stock option scheme or allotted under an employee stock purchase scheme within three months after the date of listing, by directors, senior managerial personnel and employees having equity shares issued under an employee stock option scheme or employee stock purchase scheme amounting to more than one per cent. of the issued capital (excluding outstanding warrants and conversions), which inter-alia shall include name, designation and quantum of the equity shares issued under an employee stock option scheme or employee stock purchase scheme and the quantum they intend to sell within three months. 11 [(xviii) the details of the number of shares issued in ESPS, the price at which such shares are issued, employee-wise details of the shares issued to senior managerial personnel; any other employee who is issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... objects of the issue, as the case may be, capacity utilisation assumptions, break up of expected current assets into raw materials, finished goods, work in progress, sundry debtors etc., with assumption about the holding norms for each type of current asset, total current liabilities, net current assets and envisaged sources of finance for net current assets, i.e., bank finance, institutional finance, own funds ,etc.. (d) The total envisaged working capital requirement in a tabular form, the margin money thereof and the portion to be financed by any bank(s) or otherwise. (e) A complete perspective on the present working capital position vis- -vis the projected one based on which the money is proposed to be raised in the public issue. (f) Details of the existing working capital available to the issuer with a break up for total current assets into raw materials, finished goods, work in progress, sundry debtors, etc., total current liabilities, net current assets and sources of finance for net current assets i.e. bank finance, institutional finance, own funds etc.. (g) If no working capital is shown a part of project, the reasons therefor. (5) Disclosure of asset cover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appraisal report shall be explained and disclosed. (4) The weaknesses and threats, if any, given in the appraisal report, shall be disclosed by way of risk factors. (E) Schedule of Implementation: (1) The schedule of implementation of the project in a tabular form and the progress made so far, giving details of land acquisition, civil works, installation of plant and machinery, trial production, date of commercial production and reasons for delay, if any. (F) Deployment of Funds: (1) The details of the sources of funds and the deployment of these funds on the project (where the issuer is raising capital for a project), up to a date not earlier than two months from the date of registering the offer document with the Registrar of Companies, as certified by a Chartered Accountant, along with the name of the chartered accountant and the date of the certificate. (2) Where the promoters contribution has been brought prior to the public issue and has already been deployed by the issuer, the issuer shall give the cash flow statement in the offer document disclosing the use of such funds received as promoters contribution. (G) Sources of Financing of Funds Al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Economic Times of 26/6/95) (3) Return on Net Worth (a) 1992-93 27.36% (b) 1993-94 28.77% (c) 1994-95 33.45% (d) Weighted Average 30.88% (4) Minimum Return on Total Net Worth after Issue needed to maintain EPS at ₹ 13.82 14.65% (5) Net Asset Value (a) As at 31-3-1995 ₹ 46.40 (b) After issue ₹ 94.29 (c) Issue price ₹ 520.00 14 [(h) Comparison of accounting ratios of the issuer as mentioned in items (a) to (g) above with the industry average and with the accounting ratios of the peer group (i.e. companies of comparable size in the same industry). The source from which industry average ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to the date(s) of conversions). (L) Tax Benefits: Any special tax benefits for the issuer and its shareholders. (VIII) About the Issuer: (A) Industry Overview (B) Business Overview (1) Details of the business of the issuer: (a) Location of the project; (b) Plant, machinery, technology, process, etc.: (i) Details shall be given in a tabular form, which shall include the details of the machines required to be bought by the issuer, cost of the machines, name of the suppliers, date of placement of order and the date or expected date of supply, etc.. (ii) In case machines are yet to be delivered, the date of quotations relied upon for the cost estimates given shall also be mentioned. (iii) The percentage and value terms of the plant and machinery for which orders are yet to be placed shall be stated. (iv) The details of the second hand machinery bought or proposed to be bought, if any, including the age of the machines, balance estimated life, etc. shall also be given. (c) Collaborations, any performance guarantee or assistance in marketing by the collaborators: The following information regarding persons or entities with whom technical an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his regard have been complied with. (b) In case the intellectual property rights are not registered in the name of the issuer, the name of the entity with which they are registered. (c) In case the intellectual property rights are registered in the name of entity in which the promoters are interested, the salient features of the agreement entered into for the use of the intellectual property rights by the issuer. (4) Property (5) Purchase of property: (a) As respects any property referred to in sub-clause (b): (i) the names, address, descriptions and occupations of the vendors; (ii) the amount paid or payable in cash, shares or debentures to the vendor and, where there is more than one separate vendor, or the issuer is a sub purchaser, the amount so paid or payable to each vendor, specifying separately the amount, if any, paid or payable for goodwill; (iii) the nature of the title or interest in such property acquired or to be acquired by the issuer; (iv) short particulars of every transaction relating to the property completed within the two preceding years, in which any vendor of the property to the issuer or any person who is, or was at the time of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... siness, date of conversion of partnership into limited company or private limited company to public limited company, as applicable, dates on which names have been changed, if applicable, reasons for change of name, changes in registered offices of the issuer and reasons therefore, dates on which the Memorandum of Association of the issuer have been amended citing the details of amendment. (b) Details of the major events in the history of the issuer, including the details of: (i) Capacity/facility creation, location of plant, products, marketing, competition etc. (ii) Raising of capital in form of equity or debt, (iii) Time/cost overrun in setting up projects including the proposed project, (iv) Defaults or rescheduling of borrowings with financial institutions/ banks, conversion of loans into equity along with reasons thereof, lock out, strikes and reasons for the same etc. (v) Negative features like time / cost overrun, defaults and lock out / strikes etc (vi) Details regarding the changes in the activities of the issuer during the last five years which may have had a material effect on the profits/loss, including discontinuance of lines of business, loss of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ners. (E) Management: (1) Board of Directors: (a) Name, age, qualifications, Director Identification Number, experience, address, occupation and date of expiration of the current term of office of manager, managing director, and other directors (including nominee directors, whole-time directors), giving their directorships in other companies. 17 [(ai) Details of current and past directorship(s) in listed companies whose shares have been/were suspended from being traded on the Bombay Stock Exchange Ltd. National Stock Exchange of India Ltd., as follows: Name of the Company : Listed on [give name of the Stock Exchange(s)] : Date of Suspension on stock exchanges : Suspended more than three months: Yes/No. If yes, reasons for suspension and period of suspension. Whether suspension revoked: Yes/No. If yes, date of revocation of suspension. Term (along with relevant dates) of Director in the above company(ies). Explanation : The above details shall be given with respect to a period of five years prior to date of filing of draft offer document and ought to be updated upto the date of filing of RHP. In case of offer documents for fast track issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , if any, of every Director. (i) in the promotion of the issuer; or (ii) in any property acquired by the issuer within two years of the date of the offer document or proposed to be acquired by it. (b) Where the interest of such a director consists in being a member of a firm or company, the nature and extent of the interest of 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 qualify him 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 shall be disclosed. (5) Change, if any, in the directors during the last three years, and reasons, thereof. (6) Management Organisation Structure. (7) Corporate Governance: (a) A disclosure to the effect that the issuer has complied with the requirements of Corporate Governance contained in the Equity Listing Agreement, particularly those relating to composition of board of directors, constitution of committees such as Audit Committee, Shareholder / Investor Grievance Committee, etc (b) Deta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f any, as required by the Regulations or Regulations of the Board relating to Employee Stock Option Scheme and Employee Stock Purchase Scheme, is given. (b) Payment or Benefit to Officers of the issuer (non-salary related): Any amount or benefit paid or given within the two preceding years or intended to be paid or given to any officer and consideration for payment of giving of the benefit. (F) Promoters/ Principal Shareholders: (1) Where the promoters are individuals: (a) A complete profile of the promoters, including their name, age, personal addresses, educational qualifications, experience in the business or employment and in the line of business proposed in the offer document, positions/posts held in the past, Directorship held, other ventures of each promoter, special achievements, their business and financial activities, photograph, voter ID number, driving license number shall be disclosed. (b) A declaration, confirming that Permanent Account Number, Bank Account Number and Passport Number of the promoters have been submitted to the recognised stock exchanges on which the specified securities are proposed to be listed, at the time of filing the draft offer do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uer was acquired within five years immediately preceding the date of filing draft offer document with the Board, disclosure shall be made of the details regarding the acquisition of control, date of acquisition, terms of acquisition, consideration paid for acquisition and compliance with the provisions of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 and Listing Agreement as applicable. (4) If there is no identifiable promoter, such fact shall be disclosed and a further disclosure shall be made of the shareholders who control individually or as a group, fifteen per cent. or more of the voting rights of the issuer and of persons, if any, who have the right to appoint director(s) on the board of directors of the issuer. (5) If the promoters do not have experience in the proposed line of business, that fact shall be disclosed explaining how the proposed activities would be carried out/managed. (6) If the promoters have any interest in the issuer other than as promoters, brief details of the interest shall be given along with cross-reference to the pages on which extensive details have been given in the offer document. (7) The following inform ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S 21) Consolidated Financial Statements issued by the Institute of Chartered Accountants of India shall be incorporated in the offer document. (2) All the notes to the accounts, significant accounting policies as well as the auditors qualifications shall be incorporated. (B) Financial Information of the issuer: (1) A report by the auditors of the issuer with respect to: (a) profits and losses and assets and liabilities, in accordance with para (2) or (3) of sub-item (B) of Item (IX), as the case may require; and (b) the rates of dividends, if any, paid by the issuer in respect of each class of shares in the issuer for each of the five financial years immediately preceding the issue of the offer document, giving particulars of each class of shares on which such dividends have been paid and particulars of the cases in which no dividends have been paid in respect of any class of shares for any of those years; and, if no accounts have been made up in respect of any part of the period of five years ending on a date three months before the issue of the offer document, containing a statement of that fact (and accompanied by a statement of the accounts of the issuer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the purchase of an interest in any business and by reason of that purchase, or anything to be done in consequence thereof, or in connection therewith; the issuer will become entitled to an interest as respects either the capital or profits and losses or both, in such business exceeding fifty percent, thereof; a report made by accountants (who shall be named in the offer document) upon: (i) the profits or losses of the business of each of the five financial years immediately preceding the issue of the offer document; and (ii) the assets and liabilities of the business at the last date to which the accounts of the business were made up, being a date not more than one hundred and twenty days before the date of the issue of the offer document. (5) (a) If: (i) the proceeds, or any part of the proceeds, of the issue of the shares or debentures are or is to be applied directly or indirectly in any manner resulting in the acquisition by the issuer 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 will become a subsidiary of the issuer; a report ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... triggering the profit or loss occurred. (c) Where there has been a change in accounting policy, the profits or losses of the earlier years (required to be shown in the offer document) and of the year in which the change in the accounting policy has taken place shall be recomputed to reflect what the profits or losses of those years would have been if a uniform accounting policy was followed in each of these years. (d) If an incorrect accounting policy is followed, the re-computation of the financial statements shall be in accordance with correct accounting policies. (e) Statement of profit or loss shall disclose the profit or the loss arrived at before considering extraordinary items and after considering the profit or loss from extraordinary items. An illustrative format of the disclosure of profits and losses on this basis is specified hereunder: Year ended March 31, . 20X1 20X2 20X3 20X4 20X5 (Rupees In lakhs) Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t before extraordinary items 30 21 161 (110) (150) Extraordinary items (net of tax) - 49 (64) 800 1000 Net Profit after Extraordinary Items 30 70 97 700 850 (f) The statement of assets and liabilities shall be prepared after deducting the balance outstanding on revaluation reserve account from both fixed assets and reserves and the net worth arrived at after such deductions. An illustrative format of assets and liabilities is specified hereunder: 21 [ As at March 31, 20X1 20X2 20X3 20X4 20X5 (Rupees in lakhs) (1) Equity Liabilities Shareholders Funds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (d) Other non current assets (5) Current Assets (a) Current Investments (b) Inventories (c) Trade receivables (d) Cash and bank balances (e) Short term loans and advances (f) Other current assets Total ] (g) Relevant details of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a party. (c) The amount of outstanding loans (including guarantees of any kind) made by the issuer or any of its parent companies to or for the benefit of any of the directors or key managerial personnel. The information given should include the amount outstanding as of the latest date, the nature of the loan and the transaction in which it was incurred, and the interest rate on the loan. (13) Accounting and other ratios: (a) The following key accounting ratios shall be given for each of the accounting periods for which financial information is given. (b) Earnings per Share and Diluted Earnings Per Share: This ratio shall be calculated after excluding extra ordinary items. (c) Return on net worth: This ratio shall be calculated after excluding revaluation reserves and extra-ordinary items. (d) Net Asset Value per share. This ratio shall be calculated excluding revaluation reserves. (e) Accounting and other Ratios shall be based on the Financial Statements prepared on the basis of Indian Accounting Standards. (f) In the event of capital structure undergoing a change on account of capitalisation of reserves, its impact on the key ratios should be distin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Unsecured loans: (a) Break-up of total outstanding unsecured loans taken by the issuer shall be given in the offer document into the amount borrowed from promoters/group companies/subsidiaries / material associate companies and amount borrowed from others. Further, in respect of each such loan of the former category, terms and conditions shall be disclosed including the interest rates and repayment schedule. If the loans can be recalled by the lenders at any time, the same shall be disclosed. (b) Break-up of the total outstanding unsecured loans taken 23 [from the issuer] by the promoters, group companies, related parties, material associate companies and others shall be disclosed. (c) If the loans can be recalled by the lenders at any time, the same shall be disclosed along with details of such loans. (17) For a proper understanding of the future tax incidence, the following factors shall be identified and explained through proper disclosures: (a) Profits after tax are often affected by the tax shelters which are available. (b) Some of these are of a relatively permanent nature (for example, arising out of export profits) while others may be limited in point ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 35) (18) The issuer, if it so desires, may include in the offer document, the financial statements prepared on the basis of more than one accounting practices, subject to disclosure of the material differences arising because of differences in the accounting policies of different accounting practices. (19) In respect of the periods, within the period of five years, when the relevant Accounting Standard issued by the Institute of Chartered Accountants of India was mandatory in respect of such issuers: (a) Where, in respect of listed issuers, the auditors report does not deal with the profits and losses and assets and liabilities of the issuer and its subsidiaries as a whole, the consolidated balance sheets and profit and loss accounts shall be presented in respect of the periods, within the period of five years, when preparation of such statements was mandatory in respect of such issuers under the listing agreement with the recognised stock exchanges. (b) In respect of business segments, disclosure shall be made of segment revenue, segment result and net capital employed and where the primary segment is a geographic segment, similar details by geographic se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - i. the last completed accounting year, and ii. the period beginning from the date of the end of the last completed accounting year and ending on the date on which financial statements of the issuer have been disclosed in the offer document. (3) Where the said acquisition or divestment does not fulfill the tests of materiality specified in clause 23(1)(b) above, the fact of the acquisition or divestment along with the consideration paid/received and the mode of financing such acquisition shall be disclosed. (4) The information disclosed as per sub-clause (2) and (3) above shall be certified by the statutory auditor of the issuer.] 26 [(BA) Alternate Financial Information of the issuer in further public offers: (1) An issuer making further public offer may disclose the financial information specified in clause (2) of this sub-item , in lieu of information specified under sub-item (B) if: (i) the issuer is making further public offer in accordance with provisions of regulation 10; (ii) the specified securities offered in further public offer are of the same class of those already listed on a recognised stock exchange; (iii) financial reports of the issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Provision for taxes (d) Estimated net profit / loss (2) Material changes and commitments, if any affecting financial position of the issuer. (3) Week-end prices for the last four weeks; current market price; and highest and lowest prices of equity shares during the period with the relative dates. (iii) Stock market quotation of shares/ convertible instruments of the company (high/ low price in each of the last three years and monthly high/low price during the last six months). (iv) Accounting and other ratios: The following accounting ratios shall be given for each of the accounting periods for which financial information is given: (1) Earnings per share: This ratio shall be calculated after excluding extra ordinary items. (2) Return on Networth: This ratio shall be calculated excluding revaluation reserves. (3) Net Asset Value per share: This ratio shall be calculated excluding revaluation reserves. (4) Accounting and other ratios shall be based on the financial statements prepared on the basis of Indian Accounting Standards. (v) Capitalisation Statement: (1) A Capitalisation Statement showing total debt, net worth, and the debt/ equity ratios befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... companies has made public or rights issue in the preceding three years, the issue price of the security, the current market price and particulars of changes in the capital structure, if any, since the date of issue and a statement regarding the cost and progress of implementation of the project in comparison with the cost and implementation schedule given in the offer document. (k) Information regarding significant adverse factors related to the group companies and in particular regarding: (i) whether the company has become a sick company within the meaning of the Sick Industrial Companies (Special Provisions) Act, 1995 or is under winding up; (ii) whether the company has made a loss in the immediately preceding year and if so, the profit or loss figures for the immediately preceding three years. (l) Disclosure shall be made about group companies which had remained defunct and for which application was made to the Registrar of Companies for striking off the name of the company, during the five years preceding the date of filing draft offer document with the Board. The disclosure shall include reasons for the company having become defunct as also all pending litigations, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies has business interests in the issuer then the amount of commercial business that the said company has /proposes to have with the issuer may be quantified. If no, a distinct negative statement may be incorporated to this effect. (D) Changes in accounting policies in the last three years (E) Management s Discussion and Analysis of Financial Condition and Results of Operations as Reflected in the Financial Statements. (1) Overview of the business of the issuer. (2) Significant developments subsequent to the last financial year: A statement by the directors whether in their opinion there have arisen any circumstances since the date of the last financial statements as disclosed in the offer document and which materially and adversely affect or is likely to affect the trading or profitability of the issuer, or the value of its assets, or its ability to pay its liabilities within the next twelve months. (3) Factors that may affect the results of operations. (4) Discussion on the results of operations: This information shall inter-alia contain the following: (a) A summary of the past financial results after adjustments as given in the auditor s report for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to which business is seasonal; (i) any significant dependence on a single or few suppliers or customers; (j) competitive conditions. (6) Management s Discussion and Analysis of Financial Condition and Results of Operations as Reflected in the Financial Statements shall be based on the financial statements prepared on the basis of Indian accounting practices and may additionally be presented based on other accounting practices and shall also include the post audit period.. ( X) Legal and Other Information: (A) Outstanding Litigations and Material Developments: 28 [(1) Litigations involving the issuer/ its directors/promoters/group companies/ subsidiaries: (i) All criminal proceedings; (ii) All actions by statutory / regulatory authorities; (iii) Taxation - Separate disclosures regarding claims related to direct and indirect taxes, in a consolidated manner giving details of number of cases and total amount; (iv) Other pending litigations - As per policy of materiality defined by the board of the issuer and disclosed in the offer document. (2) Outstanding dues to creditors: (i) Based on the policy on materiality of the board of the issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing disclaimer clause in bold capital letters: It is to be distinctly understood that submission of offer document to the Securities and Exchange Board of India (SEBI) should not in any way be deemed or construed that the same has been cleared or approved by SEBI. SEBI does not take any responsibility either for the financial soundness of any scheme or the project for which the issue is proposed to be made or for the correctness of the statements made or opinions expressed in the offer document. The lead merchant banker, ______________ has certified that the disclosures made in the offer document are generally adequate and are in conformity with the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 in force for the time being. This requirement is to facilitate investors to take an informed decision for making investment in the proposed issue. It should also be clearly understood that while the Issuer is primarily responsible for the correctness, adequacy and disclosure of all relevant information in the offer document, the lead merchant banker is expected to exercise due diligence to ensure that the issuer discharges its responsibility adequately in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls of fees payable to .(in terms of amount, as a percentage of total issue expenses and as a percentage of total issue size) separately as under: (1) Lead merchant bankers. (2) Co-lead merchant bankers, if any (3) Co-managers, if any (4) Other merchant bankers (5) Registrars to the issue. (6) Advisors (7) Bankers to issues (8) Trustees for the debt instrument holders. (9) Underwriting commission, brokerage and selling commission. (10) Others, if any (specify). (Q) Previous public or rights issues, if any (during the last five years): (1) Closing Date. (2) Date of allotment. (3) Date of refunds. (4) Date of listing on the recognised stock exchange. (5) If the issue(s) was at premium or discount and the amount thereof. (6) The amount paid or payable by way of premium, if any, on each equity share which had been issued within the two years preceding the date of the offer document or is to be issued, stating the dates or proposed dates of issue and, where some shares have been or are to be issued at a premium and other shares of the same class at a lower premium, or at par or at a discount, the reasons for the differentiation and how a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rices for the six months preceding the date of filing the draft offer document with the Board which shall be updated till the time of registering the offer document with the Registrar of Companies; (3) number of shares traded on the days when high and low prices were recorded in the relevant stock exchange(s) during the said period of (a) and (b) above and indicating the total number of days of trading during the six months preceding the date of filing the draft offer document and the average volume of shares traded during that period and if the shares were not actively traded, such fact shall be disclosed; (4) the stock market data referred to above shall be shown separately for periods marked by a change in capital structure, with such period commencing from the date the relevant stock exchange recognises the change in the capital structure (e.g. when the shares have become ex-rights or ex-bonus); (5) the market price immediately after the date on which the resolution of the board of directors approving the issue was approved; (6) the volume of securities traded in each month during the six months preceding the date on which the offer document is registered with the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n level falls below ninety per cent. after the closure of issue on account of cheques having being returned unpaid or withdrawal of applications, the issuer shall forthwith refund the entire subscription amount received. If there is a delay beyond eight days after the issuer becomes liable to pay the amount, the issuer shall pay interest as per section 73 of the Companies Act, 1956. (b) For Underwritten Public Issues: The following statement shall appear: If the issuer does not receive the minimum subscription of ninety per cent. of the offer through offer document including devolvement of Underwriters within sixty days from the date of closure of the issue, the issuer shall forthwith refund the entire subscription amount received. If there is a delay beyond eight days after the issuer becomes liable to pay the amount, the issuer shall pay interest prescribed under section 73 of the Companies Act, 1956. (c) For Composite Issues: (i) The lead merchant banker shall ensure that the requirement of minimum subscription is satisfied both jointly and severally, i.e., independently for both rights and public issues. (ii) If the issuer does not receive the minimum su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... subscribe in the issue: (a) The details of option, if any, to receive the specified securities subscribed for either in demateralised form or physical form. If the issue size, in case of a public issue is equal to rupees ten crores or more, the specified securities issued in the public issue shall be only in dematerialized form in compliance with Section 68B of the Companies Act, 1956. It shall be disclosed that furnishing details of depositories account is mandatory and applications without depositories account shall be treated as incomplete and rejected. Investors will not have the option of getting the allotment of specified securities in physical form. However, they may get the specified securities rematerialised subsequent to allotment. (b) It shall be specifically disclosed that the specified securities, on allotment, shall be traded on stock exchanges in demat segment only. (c) Disclosure that single bid from any investor shall not exceed the investment limit/minimum number of specified securities that can be held by him/her/it under the relevant regulations/statutory guidelines. (3) The following details shall be disclosed in the offer document 33 [***]: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... up of the book and revision of bids. In this regard, it may be specifically disclosed that qualified institutional buyers shall not be allowed to withdraw their bids after the closure of the issue (8) Price discovery and allocation. (9) Signing of underwriting agreement. (10) Filing of the offer document with the Registrar of Companies. (11) Announcement of pre-issue advertisement. (12) Issuance of Confirmation of Allocation Note ( CAN ) and allotment in the Issue. (13) Designated date. (14) General instructions: (a) Do s and don ts. (b) Instructions for completing the bid form. (c) Bidders bank account details. (d) Bids by non-resident Indians or 35 [foreign portfolio investors] on repatriation basis (15) Payment instructions: (a) Payment into escrow account of the issuer. (b) Payment into escrow account of the syndicate member. (c) Payment instructions for Application Supported by Blocked Amount. (16) Submission of bid form. (17) Other instructions: (a) Joint bids in the case of individuals. (b) Multiple bids. (c) Instruction to applicants to disclose Permanent Account Number in the application form, irrespective of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the offer document. (b) If the issuer proposes to use more than one mode of making refunds to applicants, the respective cases where each such mode will be adopted shall be disclosed. The permissible modes of making refunds are as follows: (i) In case of applicants residing in any of the centres specified by the Board: by crediting of refunds to the bank accounts of applicants through electronic transfer of funds by using ECS (Electronic Clearing Service), Direct Credit, RTGS (Real Time Gross Settlement) or NEFT (National Electronic Funds Transfer), as is for the time being permitted by the Reserve Bank of India; 36 [(ii) In case of other applicants: by dispatch of refund orders by registered post, (subject however to postal rules); and] (iii) In case of any category of applicants specified by the Board: crediting of refunds to the applicants in any other electronic manner permissible under the banking laws for the time being in force which is permitted by the Board from time to time. (29) Interest in Case of Delay in Despatch of Allotment Letters or Refund Orders/instruction to Self Certified Syndicate Banks by the Registrar in Case of Public Issues: The caption ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hrough electronic transfer of funds, a suitable communication shall be sent to the applicant within fifteen days of closure of the issue giving details of the bank where refunds shall be credited along with amount and expected date of electronic credit of refund; (vi) that the promoters contribution in full, wherever required, shall be brought in advance before the Issue opens for public subscription and the balance, if any, shall be brought in pro rata basis before the calls are made on public; (vii) that the certificates of the securities or refund orders to the non-resident Indians shall be despatched within specified time; (viii) that no further issue of securities shall be made till the securities offered through this offer document are listed or till the application moneys are refunded on account of non-listing, under subscription, etc.; (ix) that adequate arrangements shall be made to collect all Applications Supported by Blocked Amount and to consider them similar to non-ASBA applications while finalizing the basis of allotment; (b) In case of an issue of convertible debt instruments, the issuer shall also give undertakings to the following effect in the off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch monies had been utilised; and (iii) details of all unutilised monies out of the issue of specified securities referred to in sub-item (i) shall be disclosed under an appropriate separate head in the balance sheet of the issuer indicating the form in which such unutilised monies have been invested. (b) The prospectus for an issue other than an offer for sale or a public issue made by any bank or public financial institution shall contain a statement of the board of directors of the issuer to the effect that: (i) the utilisation of monies received under promoters contribution and from reservations shall be disclosed and continue to be disclosed under an appropriate head in the balance sheet of the issuer, till the time any part of the issue proceeds remains unutilised, indicating the purpose for which such monies have been utilised; (ii) the details of all unutilised monies out of the funds received under promoters contribution and from reservations shall be disclosed under a separate head in the balance sheet of the issuer, indicating the form in which such unutilised monies have been invested (32) Restrictions on foreign ownership of Indian securities, if any: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) An issuer making a further public offer of specified securities may not make the disclosures indicated hereunder and specified in Part A of this Schedule, in the offer document, subject to fulfilment of the conditions specified in para 2: (i) Sub-para (a) of para (2) of sub-item (D) of item (VI); (ii) Sub-para (o) of para (2) of sub-item (D) of item (VI); (iii) Para (8) of sub-item (E) of item (VIII); (iv) Para (1) of sub-item (C) of item (IX), in respect of entities not covered under section 370 (1)(B) of the Companies Act, 1956; (2) The conditions referred to in para (1) above are as follows: (a) The issuer has been filing periodic statements in regard to financial results and shareholding pattern with the designated stock exchange and also with the Registrar of Companies (in case of a public issue), for the last three years and such statements are available on the website of the designated stock exchange or on a common e-filing platform; (b) The issuer has in place an investor grievance handling mechanism, which includes meeting of the Shareholders / Investors Grievance Committee at frequent intervals, appropriate delegation of power by the board of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication form, no part of the information given in the abridged prospectus is mutilated. ] PART E [See regulation 57(2)(b)] DISCLOSURES IN LETTER OF OFFER (1) A listed issuer making a rights issue of specified securities shall make disclosures, as specified in clause (5) of this Part, in the letter of offer, if it satisfies the following conditions: (a) the issuer has been filing periodic reports, statements and information in compliance with the listing agreement for the last three years immediately preceding the date of filing the letter of offer with the designated stock exchange in case of a fast track issue and in any other case, the date of filing the draft letter of offer with the Board; (b) the reports, statements and information referred to in sub-clause (a) above are available on the website of any recognised stock exchange with nationwide trading terminals or on a common e-filing platform specified by the Board; (c) the issuer has investor grievance-handling mechanism which includes meeting of the Shareholders or Investors Grievance Committee at frequent intervals, appropriate delegation of power by the board of directors of the issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... letter of offer shall be white and no patterns or pictures shall be printed on these pages. (2) The front outside cover page of the letter of offer shall contain only the following details: (a) The words Letter of Offer . (b) The name of the issuer, its logo, address of its registered office, its telephone number, fax number, contact person, website address and e-mail address. (c) The nature, number, price and amount of specified securities offered and issue size, as may be applicable. (d) The following clause on general risk : Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this offer unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this offering. For taking an investment decision, investors must rely on their own examination of the issuer and the offer including the risks involved. The securities being offered in the issue have not been recommended or approved by Securities and Exchange Board of India (SEBI) nor does SEBI guarantee the accuracy or adequacy of this document. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which impact the business of the issuer. (C) The risk factors shall be determined on the basis of their materiality. In determining the materiality of risk factors, the following shall be considered: (1) Some events may not be material individually but may be found material collectively. (2) Some risks may have an impact which is qualitative though not quantitative. (3) Some risks may not be material at the time of making the disclosures in the letter of offer but may have a material impact in the future. (D) The risk factors shall appear in the letter of offer in the following manner: (1) The risks envisaged by the management. (2) The proposals, if any, to address the risks and the manner in which the same are proposed to be addressed. (E) The proposals to address risks shall not contain any speculative statement on the positive outcome to any litigation, etc. (F) The proposals to address risks shall not be given for any matter that is sub-judice before any Court or Tribunal. (G) The risk factors shall be disclosed in the descending order of materiality. Wherever risks about material impact are stated, the financial and other implications of the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng obtained for the issue of convertible debt instruments. (b) All credit ratings obtained during the three previous years before filing the letter of offer for any of its listed convertible debt instruments at the time of accessing the market through a convertible debt instrument. (6) The names, addresses, telephone numbers, fax numbers, website addresses and e-mail addresses of the trustees under debenture trust deed, in case of a rights issue of convertible debt instruments. (7) The name of the monitoring agency, if appointed and the disclosure as to whether the appointment is pursuant to regulation 16 of these regulations. (8) The name, address, telephone number and e-mail address of the appraising entity, in case the project has been appraised. (9) The details of underwriting, if any: (a) The names, address, telephone numbers, fax numbers and e-mail address of the underwriters and the amount underwritten by them. (b) A declaration by the board of directors of the issuer that the underwriters have sufficient resources to discharge their respective obligations. (c) In case of partial underwriting of the issue, the extent of underwriting. (d) The detail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not been decided, a statement to that effect; (c) If the investment is in debt instruments, complete details regarding the rate of interest, nature of security, terms of repayment, subordination, etc. (d) If the investment is in equity, whether any dividends are assured; (e) The nature of benefit expected to accrue to the issuer as a result of the investment; (3) If one of the objects of the issue is the grant of a loan to any entity, details of the loan agreements including the rate of interest, whether secured or unsecured, duration, nature of security, terms of repayment, subordination, etc. and the nature of benefit expected to accrue to the issuer as a result of the investment. If such loan is to be granted to a subsidiary, group or associate company, details of the same. (4) If one of the objects of the issue is utilisation of the issue proceeds for long term working capital, the following additional disclosures shall be made. (a) Basis of estimation of working capital requirement, along with relevant assumptions. (b) Reasons for raising additional working capital, substantiating the same with relevant facts and figures. (c) Details of the projected wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... performance guarantee if any, or assistance in marketing by the collaborators. (d) infrastructure facilities for raw materials and utilities like water, electricity, etc. (7) If the proceeds, or any part of the proceeds, of the issue are, or is, to be applied directly or indirectly: (a) in the purchase of any business; or (b) in the purchase of an interest in any business and by reason of that purchase, or anything to be done in consequence thereof, or in connection therewith; the issuer will become entitled to an interest as Page 166 of 255 respects either the capital or profits and losses or both, in such business exceeding fifty percent, thereof; a report made by accountants (who shall be named in the letter of offer) upon: (i) the profits or losses of the business of each of the five financial years immediately preceding the issue of the letter of offer; and (ii) the assets and liabilities of the business at the last date to which the accounts of the business were made up, being a date not more than six months before the date of the issue of the letter of offer. (8) If: (a) the proceeds, or any part of the proceeds, of the issue of the shares o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f filing the letter of offer with the designated stock exchange, as certified by a Chartered Accountant, along with the name of the chartered accountant and the date of the certificate. (2) Where share application money brought in advance by the promoters is deployed in the project and the same is being adjusted towards their rights entitlement in the rights issue, the extent of deployment and utilisation of the funds brought in by the promoters shall be disclosed. (H) Sources of Financing of Funds Already Deployed: Means and source of financing, including details of bridge loan or other financial arrangement, which may be repaid from the proceeds of the issue. (I) Details of Balance Fund Deployment: Year wise break up of the expenditure proposed to be incurred on the said project. (J) 45 [Interim Use of Funds: Net issue proceeds pending utilization (for the stated objects) shall be deposited only in the scheduled commercial banks included in the Second Schedule of Reserve Bank of India Act, 1934.] (K) Any special tax benefits for the issuer and its shareholders. (L) Key Industry Regulations for the proposed objects of the issue (if different from existing bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, suppliers or others, pursuant to which of the directors was selected as a director or member of senior management. (D) Details of service contracts entered into by the directors with the issuer providing for benefits upon termination of employment and a distinct negative statement in the absence of any such contract. (X) Financial Information of the Issuer: (A) Stand-alone and consolidated financial statements of the issuer: (4) A report by the auditors of the issuer with respect to profit or loss and assets and liabilities (indicating changes in accounting policies, if any) in respect of the last completed accounting year for which audit has been completed. (5) A report by the auditors of the issuer on a limited review of the profit or loss and assets and liabilities (indicating changes in accounting policies, if any), as at a date not earlier than six months prior to the date of the opening of the issue, where audited accounts as at such date are not available. (6) For the purpose of clauses (1) and (2) above, it shall be sufficient if: (a) In the statement of the assets and liabilities, the main heads of assets and liabilities as provided in Part I of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be incorporated. (5) In case of any change in the share capital since the date as of which the financial information has been disclosed in the prospectus, a note explaining the nature of the change shall be given. (6) An illustrative format of the Capitalisation Statement is specified hereunder: Particulars Pre-issue as at 30-6-1995 As Adjusted for issue (Rupees in lakhs) Short-Term Debt 1870 1870 Long Term Debt 4370 4370 Shareholders Funds Share Capital 4000 4450 Reserves 14570 37520 Total Shareholders Funds 18570 41940 Long Term Debt/Equity 0.24:1 0.10:1 Note: Since 31-3-1995 (which is the last date as of which financial information has been given in para of this d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluded in the offer document, either separately or in consolidated form. (XIII) Government Approvals or Licensing Arrangements: In case of a new line of activity/project, all pending government and regulatory approvals; In case of an existing line of activity/project, al pending regulatory and government approvals and pending renewals of licences. (XIV) Material Development: Any material development after the date of the latest balance sheet and its impact on performance and prospects of the issuer. (XV) Other Regulatory and Statutory Disclosures: (A) Authority for the issue and details of resolution passed for the issue. (B) A statement by the issuer that the issuer, promoters, promoter group, directors or person(s) in control of the promoter have not been prohibited from accessing or operating in the capital markets or restrained from buying, selling or dealing in securities under any order or direction passed by the Board. (C) A confirmation whether any of the directors of the issuer are associated with the securities market in any manner, if yes, whether the Board has initiated any action against the said entities and the related details. (D) It may b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to the effect that the issuer and the lead merchant banker accept no responsibility for statements made otherwise than in the Letter of Offer or in the advertisement or any other material issued by or at the instance of the issuer and that anyone placing reliance on any other source of information would be doing so at his own risk. Investors who invest in the issue will be deemed to have been represented by the issuer and lead manager and their respective directors, officers, agents, affiliates and representatives that they are eligible under all applicable laws, rules, regulations, guidelines and approvals to acquire equity shares of our company, and are relying on independent advice / evaluation as to their ability and quantum of investment in this issue. (3) Disclaimer in respect of jurisdiction: A brief paragraph mentioning the jurisdiction under which provisions of law and the rules and regulations are applicable to the letter of offer. (4) Disclaimer clause of the stock exchanges, if any (5) Disclaimer clause of the Reserve Bank of India (if applicable). (H) The fact of filing the letter of offer with the Board and the stock exchange(s) and the office of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Application Supported by Blocked Amount. (4) A statement that the shareholders who have not received the application form may, along with the requisite application money, apply in writing on a plain paper. (5) The format to enable the shareholders to make the application on plain paper specifying therein necessary particulars such as name, address, ratio of rights issue, issue price, number of equity shares held, ledger folio numbers, depository participant ID, client ID, number of equity shares entitled and applied for, additional shares if any, amount to be paid along with application, and particulars of cheque, etc. to be drawn in favour of the issuer s account; (6) A statement that the shareholders making the application otherwise than on the application form shall not renounce their rights and shall not utilise the application form for any purpose including renunciation even if it is received subsequently. 48 [(BA) Dealing with Fractional Entitlement: Manner of dealing with fractional entitlement viz. payment of the equivalent of the value, if any, of the fractional rights in cash etc.] (C) Provisions of sub-section (1) of section 68A of the Companies Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (s) disclosed shall be made available to the Registrar to the issue by the issuer. (D) that where refunds are made through electronic transfer of funds, a suitable communication shall be sent to the applicant within 15 days of closure of the issue giving details of the bank where refunds shall be credited along with amount and expected date of electronic credit of refund. (E) that adequate arrangements shall be made to collect all ASBA applications and to consider them similar to non-ASBA applications while finalizing the basis of allotment. (F) In case of convertible debt instruments, the issuer shall additionally undertake that: (1) the issuer shall forward the details of utilisation of the funds raised through the convertible debt instruments duly certified by the statutory auditors of the issuer, to the debenture trustees at the end of each half-year. (2) the issuer shall disclose the complete name and address of the debenture trustee in the annual report. (3) the issuer shall provide a compliance certificate to the convertible debt instrument holders (on yearly basis) in respect of compliance with the terms and conditions of issue of debentures as contained i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) The details of option, if any, to receive the specified securities subscribed for either in demateralised form or physical form. (2) The lead merchant banker shall incorporate a statement in the offer document and in the application form to the effect that the investor shall have an option either to receive the security certificates or to hold the securities in dematerialised form with a depository. (B) Material contracts and time and place of inspection which shall include copies of the Annual Reports of the issuer for the last five years. (XXII) Any other material disclosures, as deemed necessary. (XXIII) Declaration: (A) The draft letter of offer (in case of issues other than fast track issues) and letter of offer shall be approved by the Board of Directors of the issuer and shall be signed by all directors, the Chief Executive Officer, i.e., the Managing Director or Manager within the meaning of the Companies Act, 1956 and the Chief Financial Officer, i.e., the whole-time finance director or any other person heading the finance function and discharging that function. (B) The following statement shall be disclosed: No statement made in this letter o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (g) Statement that a copy of the offer document of the immediately preceding public or rights issue is made available to the public as specified under sub-regulation (1) of regulation 61 and also as a document for public inspection. 52 [PART G [See regulation 4(6)] DISCLOSURES PERTAINING TO WILLFUL DEFAULTERS (1) If the issuer or any of its promoters or directors is a wilful defaulter, it shall make the following disclosures: (a) Name of the bank declaring the entity as a wilful defaulter; (b) The year in which the entity is declared as a wilful defaulter; (c) Outstanding amount when the entity is declared as a wilful defaulter; (d) Name of the party declared as a wilful defaulter; (e) Steps taken, if any, for the removal from the list of wilful defaulters; (f) Other disclosures, as deemed fit by the issuer in order to enable investors to take informed decisions; (g) Any other disclosure as specified by the Board. (2) The fact that the issuer or any of its promoters or directors is a wilful defaulter shall be disclosed prominently on the cover page with suitable cross-referencing to the pages. (3) Disclosures specified herein shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2015, w.e.f. 11.08.2015. Prior to its substitution, sub-item (I) read as under : (I) Interim Use of Funds : Investment avenues in which the management proposes to deploy issue proceeds, pending its utilisation in the proposed project. 14 Substituted by SEBI (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2011 w.e.f. 23.09.2011. Prior to its substitution, sub-clause (h) read as under: (h) Comparison of all the accounting ratios of the issuer as mentioned in items (a) to (g) above with the industry average and with the accounting ratios of the peer group (i.e., companies of comparable size in the same industry the source from which industry average and accounting ratios of the peer group has been taken shall be indicated). 15 Omitted by SEBI (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2010, w.e.f. 13.04.2010. Prior to its omission, sub-clause (f) read as under: (f) amount of accumulated profits or losses of the subsidiary(ies) not accounted for by the issuer. 16 Substituted for (XII) by the SEBI (Issue of Capital and Disc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2000 Other Current Assets 70 80 55 200 220 Total 674 644 912 3080 8320 (3) Liabilities and Provisions: Secured Loans 376 607 616 620 460 Unsecured Loans 3 3 - - 4000 Current Liabilities and Provisions 250 180 330 460 1100 Total (629) (790) (946) (1080) (5560) (4) Net worth 330 402 607 2589 3715 (5) Represented by Share Capital 300 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irectors; (g) Outstanding litigations, defaults, etc. pertaining to matters likely to affect operations and finances of the issuer, including disputed tax liabilities, prosecution under any enactment in respect of Schedule XIII to the Companies Act, 1956 (1 of 1956) etc.; (h) The information regarding pending litigations, defaults, non-payment of statutory dues, proceedings initiated for economic offences or civil offences (including the past cases, if found guilty), any disciplinary action taken by the Board or stock exchanges against the issuer or its directors shall be appropriately disclosed under this head and as risk factor(s); (i) The name(s) of the small scale undertaking(s) or any other creditors to whom the issuer owes a sum exceeding Rs. one lakh which is outstanding more than thirty days. (2) The information regarding outstanding litigations as specified sub-para (g) of para (1) of sub-item (A) of Item (X) shall also be furnished in respect of the subsidiaries of the issuer. 29 Omitted by the SEBI (Issue of Capital and Disclosure Requirements) (Fourth Amendment) Regulations, 2015, w.e.f. 14.08.2015. Prior to its substitution, sub-clause (3) read as under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sclosure Requirements) (Fourth Amendment) Regulations, 2010, w.e.f. 12.11.2010. 33 The words and application form omitted by SEBI (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2011 w.e.f. 01.11.2011. 34 Inserted by the SEBI (Issue of Capital and Disclosure Requirements) (Fifth Amendment) Regulations, 2015, w.e.f. 01.01.2016. 35 Substituted for foreign institutional investors by the SEBI (Foreign Portfolio Investors) Regulations, 2014, w.e.f. 7-1-2014. 36 Substituted by SEBI (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2011, w.e.f. 23.09.2011. Prior to its substitution, section (ii) read as under: (ii) In case of other applicants: by despatch of refund orders by registered post, where the value is ₹ 1500/- or more, or under certificate of posting in other cases, (subject however to postal rules); and 37 Substituted for thirty days by SEBI (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2010, w.e.f. 13.04.2010. 38 Substituted for foreign institutional investors by the SEBI (Foreign Portfolio Investors) Regulations, 2014, w.e.f. 7-1-2014. 39 Inserted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Please ensure that you read the Red Herring Prospectus (RHP), the General instructions contained in this Memorandum and the General Information Document (GID) for investing in Public Issues undertaken through the book building process before applying in the Issue. Unless otherwise specified, all terms used in this form shall have the meaning ascribed to such terms in the RHP. The investors are advised to retain a copy of RHP/Abridged Prospectus for their future reference . (D) If the GID is not appended to the Abridged Prospectus, indicate where the GID would be available for perusal. (E) Logo of the issuer, name of the issuer, incorporation details including details of change in name (if any), Corporate Identity Number, registered office of the issuer along with telephone number, fax number, email address and website address. (F) Name, phone number, fax number, email address of Compliance Officer for any pre-issue or post-issue related problems. (G) All the grades obtained for the public issue, along with the page numbers where rationale or description furnished by the credit rating agency(ies) for each of the grades obtained is contained in this abridged prospectu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts, depository participants and stock brokers. (G) The name and website address of the Credit rating agencies. (H) The name and address of the trustee under debenture trust deed (in case of a debenture issue), along with telephone number, fax number, website address, name of contact person and email address. (I) Indicative dates of Bid/ Issue Closing, finalization of basis of allotment with stock exchanges, credit of equity shares to investors demat accounts, initiation of refunds and commencement of trading in tabular format. (Attention of investor should be invited to disclaimers with regard to indicative table.) (III) Table/Index of Contents should be included in tabular format. (IV) Our History, Promoters and Management: (A) History of the issuer and the details of any demergers, mergers and acquisitions to be provided. (B) Promoters and their background to be provided. (1) Where promoter is individual a complete profile of the promoters, including their name, educational qualifications, experience in the business or employment and in the line of business proposed in the offer document, positions/posts held in the past, their business and financial perf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompanies/Subsidiaries/Joint Ventures: (1) Name of the group companies, Equity Capital, Turnover, Profit after tax, shareholding of issuer company and listing status to be given in tabular format for preceding financial year or the last period of audited financial statements included in offer document. This information is to be given for the five largest group companies based on turnover. However information regarding every such group company which has become a sick industrial company or is under winding up or has a negative net worth shall be given. (2) Total number of subsidiaries and joint ventures to be indicated. (3) Name of the Subsidiaries/Joint Ventures, Equity Capital, Turnover, Profit after tax, shareholding of issuer company and listing status to be given in tabular format for Subsidiaries/Joint Ventures which contribute more than 5% of revenue/profits/assets of the issuer company on a consolidated basis in the preceding financial year or the last period of audited financial statements included in offer document. (F) Details of Material Penal Actions/ Litigations. (G) Details of Material Related Party Transactions. (H) Details and reasons for non-deploym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ific risk. (3) Industry Specific Risks. (B) The heading of the risk factors should appear in bold and italics. All the risk factors should be highlighted. (C) Attention of investor should be invited to refer to RHP or to the General Information Document for Other Risks and General Risks. (VIII) Particulars of the Issue: (A) Objects of the issue. (B) Cost of the Project. (C) Means of financing. (D) Schedule of Deployment of Issue Proceeds. (E) Name of Appraising Agency, where applicable. (F) Name of Monitoring Agency (where applicable), if appointed by the issuer and the disclosure as to whether the appointment is pursuant to regulation 16 of these regulations. (IX) Basis of Issue Price: (A) Qualitative Factors for determining the basis of issue price for the issuer as included in offer document. (B) Quantitative Factors for determining the basis of issue price for the issuer as under: (1) Earnings per share and Diluted Earnings Per Share pre-issue (and the weight assigned) on consolidated basis (where applicable) in tabular form for the last three years (as adjusted for changes in capital). (2) Average return on net worth (and the we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied by the Board. (I) Declaration Signatories to the Offer Document. Details of Bidding Centres. 43 Inserted by SEBI (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2010, w.e.f. 13.04.2010. 44 Inserted by SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, w.e.f. 23.09.2011. 45 Substituted by the SEBI (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2015, w.e.f. 11.08.2015. Prior to its substitution, sub-item (J) read as under : (J) Interim Use of Funds: Investment avenues in which the management proposes to deploy issue proceeds, pending its utilisation in the proposed project. 46 Inserted by the SEBI (Issue of Capital and Disclosure Requirements) (Fourth Amendment) Regulations, 2010, w.e.f. 12.11.2010. 47 The words by Reserve Bank of India or other authorities omitted by SEBI (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2016 w.e.f. 25.05.2016. 48 Inserted by the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, w.e.f. 01.12.2015. 49 Substituted for FIIs by the SEBI (Foreign Portfolio Investors) Regulations, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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