LISTING AGREEMENT Compliances and Case Studies -P.JAGANNATHAM M.COM, LL.B, FCS Corporate Advocate Compiled by: Puttaparthi Jagannatham & CO. Company Secretaries

Welcome to MSOP. MSOP is meant for an interaction with experienced faculty which will enhance the students self-confidence prior to their becoming members. FOCUS: Among other things build a bridge between knowledge acquired and its application in actual work situation. Puttaparthi Jagannatham & Co., Company Secretaries OVERVIEW MSOP

WHAT IS COVERED ? Importance Agreement Important clauses FAQ’s and Case Studies Consequences for default Suggestions….. If you want to take !

WHY IT IS IMPORTANT Paves Way to Become to Complete professional. Comprehensive code of SEBI Regulations, CA, Securities Act and Rules. Presupposes Knowledge of various laws - Contract Act, Depositories Act Makes you understand that SEBI Compliances are ensured through the listing Dept of SE and you are important BEFORE YOU GO WHAT IS PRESUPPOSED of YOU it helps to have knowledge of SE’s, No. of exchanges, turn over, opportunities for employment /profession, how u r made important,Reading pink papers and listening to News channels

WHAT IS LISTING AGREEMENT? Listing means admission of the securities to dealings. Listing Department to grant approval for listing of securities of Companies in accordance with the provisions. Companies to make certain disclosures and perform certain acts. Listing Department monitors the compliance of the companies.

Important Clauses 55 clauses. Here we cover few Compliances Periodical compliances Event based compliances

Clause 16 The Company to close its transfer books at least once a year at the time of A.G.M. Time Limit: At least 7 working days in advance. Minimum time gap between the two book closures/record dates: at least 30 days.

Clause 31 & 32 Forward to the exchange: 6 copies of annual reports, B/s, P&L, notices, resolutions, etc., a copy of proceedings at A.G.M and E.G.M, 3 copies of notices/circulars in case of merger/amalgamation; etc., Time limit – promptly. Clause 32 - Mode of supplying Annual Reports to shareholders - soft copies of annual reports to all those who have registered their addresses and hard copies to those who have not and to those who request for the same.

Clause 35 File- share holding pattern, details of: shares locked in, Depositories Receipt (DRs), shares pledged or otherwise encumbered, etc., details of holding held under partly paid-up shares, outstanding convertible securities and warrants if any, etc., Time limit – (a)one day prior to listing of its securities, (b)on quarterly basis within 21 days from the end of each quarter and (c)within 10 days of any capital restructuring resulting in a change exceeding +/- 2% of its total paid up share capital. Insertion of Clause 35A – to disclose the voting results in prescribed format to the exchanges and to place the same on their websites with in 48 hours from the conclusion of the concerned share holders’ meeting. Applicable to top 500 listed entities based on market capitalization. Change in the format of disclosure pursuant of SEBI (SAST) Regulations 2011 – as per the amendment, to disclose the holding of securities (including shares, warrants, convertible securities) for the category: promoter and promoter group, “public” and holding more than 1% and 5% of the total number of shares of the Company.

Clause 40A Minimum level of public share holding The company agrees to comply with the requirements specified in Rule 19(2)(b) and Rule 19A of the Securities Contracts (Regulation) Rules, Where the company is required to achieve the minimum level of public shareholding specified in Rule 19(2)(b) and/or Rule 19A of the Securities Contracts (Regulation) Rules, 1957, it shall adopt any of the following methods to raise the public shareholding to the required level:- (a) issuance of shares to public through prospectus; or (b) offer for sale of shares held by promoters to public through prospectus; or (c) sale of shares held by promoters through the secondary market.

(d) Institutional Placement Programme (IPP) - As per the amendment, the minimum level of public shareholding may also be achieved through Institutional Placement Programme (IPP) in terms of SEBI (ICDR) Regulations, (e)Rights Issues to public shareholders, with promoter/promoter group shareholders forgoing their entitlement to equity shares, whether present or future, that may arise from such issue. (f) Bonus Issues to public shareholders, with promoter/promoter group shareholders forgoing their entitlement to equity shares, whether present or future, that may arise from such issue. (g) any other method as may be approved by SEBI on a case to case basis.

Clause 41 Quarterly and year to date financial results. Notice of Board Meeting – at least 7 clear calendar days prior to the meeting. Also issue a public notice. Time limit – with in 45 days from the end of each quarter (other than the last quarter) – to submit audited (+auditor’s report) or unaudited (+limited review report) results. In respect of last quarter: - -if unaudited: for the quarter – in 45 days -if audited: for the entire F.Y – in 60 days from the end of the F.Y Hold the Board meeting.

Contd., With in 15 min of completion of the Board meeting fax the results. Also publish the same. Where there is a variation between the unaudited quarterly or year to date financial results and the results amended pursuant to limited review for the same period, and – - the variation in net profit or net loss after tax is in excess of 10% or Rs.10 lakhs, whichever is higher; or - the variation in exceptional or extraordinary items is in excess of 10% or Rs.10 lakhs, whichever is higher - the company shall submit to the stock exchange an explanation of the reasons for variations. Change in format – to disclose figures in respect of immediately preceding quarter in addition to the existing requirements and also to submit the last quarter results along with the audited annual results.

Clause 47C A certificate from PCS., on half-yearly basis that the securities lodged for transfer have been registered and dispatched with in 15 days from the date of lodgment. Time limit – with in 30 days of the end half of the financial year or 24 hours of the receipt of the certificate by the Company ( virtually whichever earlier.)

Clause 49 Compliance Report on corporate governance. Compliance with: composition of Board, code of conduct, Audit committee, subsidiaries, disclosures, CEO/CFO certification, report on CG, compliance. Time limit – with 15 days from the end of the quarter.

Clause 52 Clause 52 – Corporate Filing and Dissemination System (CFDS): viz., Time limit - to ensure that the electronic filing of information through CFDS, pursuant to compliance with any clause of the listing agreement, shall be done within the time limit specified in the respective clause of the listing agreement. For e.g. shareholding pattern, report on corporate governance, financial information, etc.,

Clause 54 Clause 54 - Company has to maintain and update a functional website containing basic information : - details of business, financial information, shareholding pattern, compliance with corporate governance, contact information, etc., Newly added: Clause 55- Listed entities shall submit, as part of their Annual Reports, Business Responsibility Reports, describing the initiatives taken by them from an environmental, social and governance perspective

Consequences in case of default Suspension Delisting Penalties

FAQ’S & CASE STUDIES

Suggestions Comprehensive Reading Consultations with colleagues Attitude….. to learn and to help Careful dealing with the officials Communication skills and drafting skills. Checklists and table calendars. Take good care of yourself

THANK YOU P.JAGANNATHAM M.Com., LL.B., FCS Corporate Advocate