Check the Articles of Association of the Company, it must contain a provision authorising the company to buy-back their own shares or other specified securities. If the Articles do not contain a provision authorising buy-back, alter the articles of association by passing a special resolution in the general meeting. [Procedure for alteration in the Articles of Association]
2.
Convene and hold a Board Meeting after giving notice to all the directors [Section 286] to discuss besides others the following matters.
· To pass a [resolution] for buy-back of shares upto 25% of the total paid up capital and free reserve of the Company and also decide the price at which the company offers to the shareholders. (Section 77A)
· To appoint a Compliance officer for ensuring compliance of the provisions of the Act, the Regulations, listing Agreement and any other applicable laws relating to Buy-back of securities and to redress the grievances of the investors.
· To Appoint Merchant Banker who will take care of the whole proceeding.
· To decide the location about the investor service centre, it is desirable that such centres are opened in all such cities where the security holders holding 10% or more of the voting rights reside.
· To approve the notice of the resolution to be sent to the shareholders.
· To fix the responsibility of the entire postal ballot process to the Company Secretary and any functional director of the Company.
· To approve the postal ballot form along with the calendar of event.
· To appoint a scrutinizer, not being an employee, who is in the opinion of the Board of directors, can conduct the postal ballot voting process in a fair and transparent manner. 3.
Inform the Stock Exchange with which shares of the company are listed about the date of this meeting prior to the board meeting. [Clause 19 of the Standard Listing Agreement]
4.
Inform the said Stock Exchange within 15 minutes of the board Meeting, of the outcome of the meeting by letter or fax.
5.
File Board resolution along with the Calendar of event in [E-form no 61] with the Registrar of Companies within one week of the Board resolution.
6.
The resolution should be approved by ¾ majority i.e the votes cast in favour is three times or more than the votes cast against.
7.
File a certified true copy of the [special resolution] in [E-form no 23] with the concerned Registrar of Companies with in 7 days of the date of passing of the resolution and also file a copy of the same to the SEBI and Stock Exchange(s), where the securities of the company are listed. 8.
Make the payment of requisite fees, fees can be paid through Credit Card / by cash / by cheque in favour of “MCA Collection Account ICICI Bank” at the prescribed rates. (Fee Calculator)
9.
Forward to the Stock Exchange promptly three copies of the notice of postal ballot. [Clauses 31(c), (d) and 33 of the Standard Listing Agreement]
10.
After it has been authorised to buy-back, make a Public announcement at least 7 days before the commencement of buy-back at least one English, Hindi and Regional language Newspaper. Such public announcement shall contain the disclosures regarding detail of the Stock-Brokers and Stock Exchange(s) through which the buy-back of securities will be made.
11.
A copy of the Public announcement shall be filed with SEBI within 2 days of such announcement along with fees specified in Schedule V to the Regulation.
12.
A declaration of solvency in Form no 4A shall be filed with SEBI along with the draft letter of offer. It is also to be filed with Registrar of Companies simultaneously.
13.
Give information to the stock –exchanges on daily basis regarding the securities purchased for buy-back and such information shall be published in a national daily.
14.
The company shall buy-back its securities only through the order matching mechanism, except ‘all or none’ order matching system.
15.
The securities purchased by the company may not be necessary to be purchased at a uniform price.
16.
The company shall pay the consideration to the stock –brokers on every settlement date.
17.
The verification should be completed with in 15 days from the date of closure.
18.
Extinguish and destroy the security certificate so bought back in the presence of Registrar to the issue\ merchant banker and the Statutory Auditors of the Company within 7 days from the date of verification of securities.
19.
Furnish a certificate to SEBI and the Stock Exchange(s) with in 7 days of extinguishments and destruction of the certificates. Such certificate shall be duly verified by the Registrar to the issue/ Merchant Banker and Statutory Auditors of the Company and two whole-time directors of the Company including the Managing Director.
20.
Issue a Public advertisement in the National daily with in 2 days of completion of buy-back.
21.
Prepare a Register of Securities Bought Back in Form no 4B.
22.
File a return in Form no 4C with the concerned Registrar of Companies and SEBI within 30 days of completion of Buy-back.
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