Clarification on applicability of SEBI Regulations/ Circulars on Initial and Continuous Disclosures for Convertible and Non-Convertible Debt
Summary
This circular clarifies the applicability of disclosure norms for convertible and non-convertible debt securities. It mandates that non-convertible debt follows the 2008 Regulations, while convertible debt follows the 2000 Guidelines based on the conversion instrument. The rules apply to offer documents prepared on or after June 23, 2009.
Text
issue and listing of non-convertible debt securities, whether issued to the public or privately placed, is to be done in accordance with the provisions of the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008.
Issue of debt securities that are convertible, either partially or fully or optionally into listed or unlisted equity shall be guided by the disclosure norms applicable to equity or other instruments offered on conversion in terms of the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000.
The clarifications issued vide this circular shall be applicable to all information memoranda/ offer documents for issue of privately placed convertible or non- convertible debt securities that are intended to be listed on recognized stock exchanges, prepared on or after the date of issue of the instant circular.
All registered merchant bankers are directed to ensure compliance with the applicable amendments made vide this circular.
All stock exchanges are advised to bring to the notice of all the listed companies and issuers seeking listing of their convertible debt securities.
Source: SecMarx — Clarification on applicability of SEBI Regulations/ Circulars on Initial and Continuous Disclosures for Convertible and Non-Convertible Debt. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.