TMI BlogGuidelines for preferential issue of units and institutional placement of units by a listed Real Estate Investment Trust (REIT)X X X X Extracts X X X X X X X X Extracts X X X X ..... n a preferential issue of units by a listed REIT only to Institutional Investors, as defined under REIT Regulations or circulars issued thereunder. Conditions for issuance 2. A listed REIT may make a preferential issue of units or an institutional placement of units under these guidelines, if it satisfies the following conditions: 2.1. A resolution of the existing unitholders approving the issue of units, in accordance with Regulation 22(6) of the REIT Regulations has been passed. 2.2. Units of the same class, which are proposed to be allotted have been listed on a stock exchange for a period of at least six months prior to the date of issuance of notice to its unit holders for convening the meeting to pass the resolution in terms of clause 2.1 above: Provided in case of issuance of units through institutional placement the minimum listing period required shall be 12 months. 2.3. The REIT has obtained in principle approval of the stock exchange(s) for listing of units proposed to be issued under these guidelines. 2.4. The REIT is in compliance with all the condi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partner who is an officer in default shall, on and from the expiry of the twentieth day, be jointly and severally liable to repay that money with interest at the rate of fifteen percent per annum. 3.6. The REIT shall file an allotment report with SEBI within seven days of allotment of the units providing details of the allottees and allotment made. Placement document, if applicable, shall also be filed with the Board along with the allotment report. 3.7. The issue of units shall comply with the conditions and manner of allotment for preferential issue units and institutional placement as provided in Annexure I and Annexure II III, respectively. 4. This circular is being issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 and Regulation 33 of the REIT Regulations. 5. This Circular is available on the website of the Securities and Exchange Board of India at www.sebi.gov.in under the sub-category Circulars under the category Legal . Yours faithfully, Richa G. Agarwal Deputy General Manag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the stock exchange during the two weeks preceding the relevant date. 2.2. A preferential issue of units to institutional investors not exceeding five in number, shall be made at a price not less than the average of the weekly high and low of the volume weighted average prices of the related units quoted on a recognised stock exchange during the two weeks preceding the relevant date. Explanation: a) Relevant date for the purpose of clauses related to preferential issue of units shall be the date thirty days prior to the date on which the meeting of unitholders is held to consider the preferential issue. Where the relevant date falls on a weekend or a holiday, the day preceding the weekend or the holiday will be reckoned to be the relevant date. b) Relevant stock exchange shall mean the recognised stock exchange in which the units of the REIT are listed, and in which the highest trading volume in respect of the units of the REIT has been recorded during the preceding twenty-six weeks prior to the relevant date. c) Frequently traded units for purposes of these guidelines shall mean the units of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of units shall not be made to any person who has sold or transferred any units of the issuer during the six months preceding the relevant date. Explanation: Where any person belonging to sponsor(s) or the sponsor group has sold/transferred their units of the issuer during the six months preceding the relevant date, the sponsor(s) and sponsor group shall be ineligible for allotment of specified securities on preferential basis. 4.2. Allotment pursuant to the unit holders resolution shall be completed within a period of fifteen days from the date of passing of such resolution: Provided that in case the approval of any regulatory, governmental or statutory body / agency is required, then in such cases the period of fifteen days will commence from the date of approval from such regulatory, governmental or statutory body/agency: Provided further that where the REIT fails to allot the units within the specified time, the monies received shall be refunded through verifiable means within twenty days from the date of the resolution, and if any such money is not repaid within such time after the issuer becomes liable to repa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffer a discount of not more than five percent on the price so calculated, subject to approval of unitholders through a resolution as specified in guideline 2.1. Explanation: relevant date for the purpose of clauses related to institutional placement shall be the date of the meeting in which the board of directors of the manager decides to open the issue. B. Pricing of infrequently traded units 2.2. Where the units of the REIT are not frequently traded, the price determined by the REIT shall take into account the NAV of the REIT based on a full valuation of all existing REIT assets conducted in terms of REIT Regulations. 3. Transferability 3.1. The units allotted through the institutional placement shall not be sold by the allottee for a period of one year from the date of allotment, except on a recognised stock exchange. 4. Allotment 4.1. Allotment pursuant to the unit holders resolution shall be completed within a period of 365 days from the date of passing of such resolution: Provided that where the REIT fails to allot the units within the spec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The preliminary placement document and placement document shall contain the disclosures as specified under schedule III of the REIT Regulations in the following manner: a) The disclosures as per clauses 1, 2, 3, 5, 6, 7(a), 8, 12, 13, 14, 15, 16 and 18 shall be made in the preliminary placement document and placement document. b) The disclosures in clause (a) above may be incorporated by reference to disclosures made in any previous offer document or placement memorandum or placement document or annual report duly published by the REIT: Provided that the link(s) to such document wherever available, including on the website of the issuer, stock exchanges or SEBI, shall also be provided. Provided further that any modification/update in the information provided in such documents shall be suitably incorporated in the disclosure document. 4. Terms of the issue: a) Objects of the issue. b) If the objects of the issue involve financing of any new asset(s), description of such asset(s) as per disclosures required under clause 6 of the Schedule III of the REIT Regulations ..... X X X X Extracts X X X X X X X X Extracts X X X X
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