21 October 2013
Procedure to issue Redeemable Preference Shares
1. Articles of Association of the Company must authorise issue of redeemable preference shares; if not, steps should be taken to alter them accordingly.
2. Obtain ‘credit rating’ from any of the approved credit rating agencies.
3. Call a Board Meeting by giving notice to all the directors of the company as per section 286 and take the decision of issuing redeemable preference shares and fix up the date, time, place and agenda for calling a General Meeting to pass an Ordinary Resolution
4. Issue notices in writing at least twenty-one days before the date of the General Meeting proposing the resolution with suitable Explanatory Statement.
5. Inform the Stock Exchange at which the securities of the Company are listed about such proposed issue of redeemable preference shares.
6. Hold the General Meeting and pass the resolution (if it is made on private placement basis, pass special resolution under section 81(1A) and if the issue is made on right basis, comply with section 81(1).
7. If the resolution passed is a Special Resolution, file the same with the ROC in e-Form No. 23 within thirty days of its passing.
8. If the issue of redeemable preference shares is to be made by issue of Prospectus, then prepare a draft Prospectus in consultation with the Lead Manager responsible for such drafting. Follow the procedure for Public Issue of Shares.
9. Make allotment by passing a resolution at a duly convened Board Meeting.
10. File a return of allotment in e-form 2 with ROC.