Relaxations from certain provisions of the SEBI ICDR Regulations, 2018 in respect of Rights Issue
Summary
This circular introduces temporary relaxations to the SEBI (ICDR) Regulations, 2018 regarding Rights Issues due to the Covid-19 pandemic. The provisions modify eligibility conditions for Fast Track Rights Issues, lower the minimum subscription threshold, and increase the filing exemption limit for draft letters of offer. These relaxations apply to Rights Issues opening on or before March 31, 2021, but exclude warrant issuances.
Text
Nothing contained in sub-regulations (1), (2), (4) and (5) of Regulation 71 shall apply if the issuer satisfies conditions under Regulation 99 for fast track route.
In regulation 99(a) the words ‘three years’ shall be read as ‘eighteen months’
In regulation 99(c) the words ‘two hundred and fifty crores’ shall be read as ‘one hundred crores’
In regulation 99(f) and its proviso the words ‘three years’ shall be read as ‘eighteen months’
no show-cause notices, excluding under adjudication proceedings, have been issued by the Board and pending against the issuer or its promoters or whole-time directors as on the reference date; In cases where... necessary disclosures in respect of such action (s) along-with its potential adverse impact on the issuer shall be made in the letter of offer.
the issuer or promoter or promoter group or director of the issuer has fulfilled the settlement terms or adhered to directions of the settlement order(s) in cases where it has settled any alleged violation of securities laws through the consent or settlement mechanism with the Board
In regulation 99 (j) the words ‘three years’ shall be read as ‘eighteen months’.
For audit qualifications, if any, in respect of any of the financial years for which accounts are disclosed in the letter of offer, the issuer shall provide the restated financial statements adjusting for the impact of the audit qualifications. Further, that for the qualifications wherein impact on the financials cannot be ascertained the same shall be disclosed appropriately in the letter of offer.
The minimum subscription to be received in the issue shall be at least seventy-five per cent of the offer through the offer document. Provided that if the issue is subscribed between 75% to 90%, issue will be considered successful subject to the condition that out of the funds raised atleast 75% of the issue size shall be utilized for the objects of the issue other than general corporate purpose
In regulation 3(b), proviso to regulation 3 and in regulation 60, the words ‘ten crores’ shall be read as ‘twenty-five crores’.
The eligibility and general conditions as specified in Regulation 61 & 62 respectively shall continue to apply.
These temporary relaxations are applicable for Right Issues that open on or before March 31, 2021.
You have read the preview. Create a free account to read the full document and see every order that applied it.
Free accounts include 10 searches/day with full text access.
Source: SecMarx — Relaxations from certain provisions of the SEBI ICDR Regulations, 2018 in respect of Rights Issue. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.