Amendments to the Equity Listing Agreement
Summary
SEBI issued a circular on July 21, 2009, amending the Equity Listing Agreement to prohibit listed companies from issuing shares with superior voting or dividend rights. The amendment inserts Clause 28A into the agreement, explicitly forbidding such issuances vis-à-vis already listed equity shares. Stock exchanges are directed to implement these changes immediately and report their status in the next Monthly Development Report.
Text
It has been decided to amend the Equity Listing Agreement to prohibit listed companies from issuing shares with superior rights as to voting or dividend vis-à-vis the rights on equity shares that are already listed. Accordingly, this circular is issued, in exercise of powers conferred by sub-section (1) of Section 11 of the Securities and Exchange Board of India Act, 1992, to protect the interest of investors in securities and to promote the development of, and to regulate the securities market.
All Stock exchanges are advised to give effect to the above mentioned policy amendments and appropriately amend the relevant Clauses of the Equity Listing Agreement in line with the text of the amendment specified in Annexure A.
Communicate to SEBI the status of implementation of the requirements of this circular in the next Monthly Development Report.
The amendment as specified in Annexure A shall come into force with immediate effect.
The company agrees that it shall not issue shares in any manner which may confer on any person, superior rights as to voting or dividend vis-à-vis the rights on equity shares that are already listed.
Source: SecMarx — Amendments to the Equity Listing Agreement. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.