Private Placement of Secured Non-Convertible Debentures
Legality
- Section 42 & 71 of the Companies Act 2013
- Rule 18 of the companies (Share Capital and Debentures) Rules 2014
- Rule 5 & 24 of the Companies (Management and Administration) Rules, 2014
- Rule 9A and 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014
- Rules 3,6 and 10 of the companies (Registration of Charges Rules) 2014
Procedure
Time Bound Disclosures:
- In case of a listed Company give prior intimation to the stock exchanges where the shares of the company are listed about the meeting of the board of Directors in which the proposal for issue of debentures is due to be considered at least 2 working days in advance excluding the date of intimation and the date of the meeting.
Board Meeting:
- Hold a meeting of board of directors to consider and approve issue of debentures, Private Placement offer letter and notice for calling of General Meeting.
General Meeting:
- Hold a General Meeting to pass Special resolution for issue of secured debentures.
Forms & Documents filing:
- File a copy of special resolution together with explanatory statement with ROC within 30 days of passing special resolution in Form MGT-14.
Bank Account:
- Open a separate bank account in a scheduled bank for keeping eh monies received on the application.
Circulation of Private Placement offer letter:
- Make a private placement offer letter in Form PAS-4. The offer letter shall be accompanied by an application form serially numbered and be addressed specifically to the person to whom the offer is made. And maintain a complete record of persons to whom the private placement offer letter is sent in Form PAS-5.
Receipt of the subscription Money:
- Receive the amount of subscription through cheque or DD or other banking channels from the individual bank account to the bank account opened for the purpose.
Board Meeting for Allotment:
- Hold a Board meeting to consider the allotment of debentures and authorise any person to file return of allotment with ROC.
Register of debenture Holders:
- Make necessary entries in register of debenture holders in Form MGT-2 with in 7 days of the board meeting in which the allotment was approved.
Form and documents filing:
- File return of allotment with ROC with in 15 days from the date of allotment in Form PAS-3
- File particulars of the charge with ROC within a period of 30days of the date of creation of charge in Form CHG-9
Certificate of Charge:
- On registration of Charge ROC shall issue a certificate of Charge in form CHG-2.
Register of Charges:
- Make necessary entries in the register of Charges in Form CHG-7.
Issue of Debenture Certificate:
- Issue and deliver the debenture certificate with in 6 Months to the debenture Holder.
Documents Required:
- Certified true copy of Board resolution.
- Certified true copy of General Meeting resolution alon with explanatory statement
- List of allotees
- Copy of Board resolution for Allotment
- Complete record of private placement
- Copy of resolution authorizing the issue of debentures
- Instrument of creation of charge.