Category Archives: Chapter III – CA2013

PROSPECTUS AND ALLOTMENT OF SECURITIES

PAS – 3


Return of Allotment

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ISSUING GLOBAL DEPOSITORY RECEIPTS


Section 41 of the Companies Act, 2013 is simply interesting provision which leave everything for legislative capacity of executives. We have discussed this provision earlier here.

Under wide powers, the Ministry framed the Companies (issue of Global Depository) Rules 2014.

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DEMATERIALISATION, REFUND AND COMMISSION


In this post, we will discuss dematerialisation of shares, Refund of application money and payment of commission on issue of share capital.

DEMATERIALISATION OF SECURITIES

Section 29 of the Companies Act 2013, say every company making public offer; and such other class or classes of companies as may be prescribed shall issue the securities only in the dematerialised form. This section was discussed in detail earlier on this blog here.

Rule 9 of the Companies (Prospectus and Allotment of Securities) Rules 2014 prescribes that the promoters of every public company making a public offer of any convertible securities may hold such securities only in dematerialized form. The entire holding of convertible securities of the company by the promoters held in physical form up to the date of the initial public offer shall be converted into dematerialized form before such offer is made and thereafter such promoter shareholdings shall be held in dematerialized form only.
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PRIVATE PLACEMENT


Section 42 of the Companies Act, 2013 allows any company, whether private or public, to make private placement of securities through issue of a “Private Placement Offer Letter” (PPOL). We have discussed provision of the Section earlier here.

In addition of Section 42, Rule 14 of the Companies (Prospectus and Allotment of Securities) Rules 2014 prescribes all fine prints of the private placement.

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RETURN OF ALLOTMENT


As we discussed earlier here, sub – section (4) of Section 39 of the Companies Act 2013 says, “Whenever a company having a share capital makes any allotment of securities, it shall file with the Registrar a return of allotment in such manner as may be prescribed”. Rule 12 of the Companies (Prospectus and Allotment of Securities) Rules 2014 prescribes this manner.

Whenever a company having a share capital makes any allotment of its securities, the company shall, within thirty days thereafter, file with the Registrar a return of allotment in Form PAS – 3, along with the fee as specified in the Companies (Registration Offices and Fees) Rules, 2014.

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SHELF PROSPECTUS AND INFORMATION MEMORANDUM


We have discussed Shelf Prospectus and Information Memorandum here in an earlier post. Rule 10 of the Companies (Prospectus and Allotment of Securities) Rules 2014 discuss it further.

The information memorandum shall be prepared in Form PAS – 2 and filed with the Registrar along with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014 within one month prior to the issue of a second or subsequent offer of securities under the shelf prospectus.

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OFFER OF SALE BY MEMBER


Where certain members of company propose to offer whole or part of their holding of share to public, they may do so in accordance with prescribed procedure. We have discussed provisions Section 28 of the Companies Act 2013 earlier here. Rule 8 of the Companies (Prospectus and Allotment of Securities) Rules 2014 prescribes procedure under Section 28 of the Companies Act, 2013.

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