1. INTERNATIONAL MARKET

2.  External Commercial Borrowings (ECB) are defined to include  commercial bank loans,  buyer's credit,  supplier's credit,  securitised instruments such as floating rate notes, fixed rate bonds etc.,  credit from official export credit agencies,  commercial borrowings from the private sector window of multilateral financial institutions such as IFC, ADB, AFIC, CDC etc. and  Investment by Foreign Institutional Investors (FIIs) in dedicated debt funds

3.  Stands for Foreign Cuurency Convertible Bond  A type of convertible bond issued in a currency different than the issuer's domestic currency. In other words, the money being raised by the issuing company is in the form of a foreign currency  FCCB can be assessed theu 2 ways:  (i) FCCBs Issue upto US $ 500 million under the Automatic Route  (ii) FCCBs Issue beyond US $ 500 million with the specific approval of the Reserve Bank i.e. under the Approval Route.[43]

4.  Eligibility of the Issuer: i. Indian Corporates except financial intermediaries such as banks, FIs, NBFCs. ii. NGOs engaged in micro finance activities. iii. Individuals, Non Profit making organizations and trusts are not eligible.  Eligibility of the Subscriber: i. International Capital markets. ii. International banks. iii. Multilateral Financial Institutions. iv. Export credit agencies. v. Suppliers of equipment. vi. Foreign collaborator. vii. Foreign equity holder, subject to Ø minimum holding of equity of 25% in the borrower’s company for raising ECB up to USD 5 million; Ø minimum holding of equity of 25% in the borrower’s company and a debt equity ratio of not more than 4:1, for raising ECB above USD 5 million.

5.  Regulatory mechanisms in ECB:  Get prior permission from Department of Economic Affairs, Ministry of Finance, Government of India  Other regulatory acts areFERA(1973),FEMA(1992),under FDI scheme

6.  The low cost airline SpiceJet, -due to oil price increase –going to raise Rs.354 Crores ($80milion) to tide over this financial crunch  This funds will be used for working capital needs,To maintain the capital requirements due to losses,maintaining the careers productivity until the crude oil price stabilize  The conversion price of FCCBs is pegged at Rs. 56 per share and this convertibility option may be exercised anytime till 2010.

7.  Definition->bond expressed in foreign currency, the principal and interest in respect of which is payable in foreign currency, issued by an issuing company and subscribed to by a person who is resident outside India, in foreign currency and exchangeable into equity share of another company, to be called the offered company, in any manner, either wholly, or partly or on the basis of any equity-related warrants attached to debt instruments’.

8.  Under the FCEB scheme, both issuing company and offered company are defined as Indian companies under the Companies Act  in the case of a company, ‘promoter group’ includes:  a subsidiary or holding company of that company;  any company in which the promoter holds 10% or more of the equity capital or which holds 10% or more of the equity capital of the promoter; and  any company in which any group of individuals, companies or combinations thereof that holds 20% or more of the equity capital in that company also holds 20% or more of the equity capital of the issuer company

9.  1. s.noFCCBFCEB 1Bonds are converted into shares Of issuing company Bonds are exchanged into shares of offered company by issuing company 2.The holder exercises the option to convert transfer of the shares (of the offered company) held by the issuing company to the holder of the FCEB during the exchange process