MKB & Associates

Company Secretaries
(Private & Confidential)
(for our retainee clients only)
Corporate Update Bulletin: 6

Amendment in Listing Agreement- to enhance quality of

disclosures by Listed Companies

SEBI has on 16th December 2010, notified an amendment to the

Equity Listing Agreement vide its Circular No. CIR/CFD/DIL/10/2010
with respect to various disclosures made by listed companies. The
objective of the current amendment is to streamline the disclosures
made by listed companied with the ever increasing need of
transparency and public interest.

Main features of the amendment (clause wise) are listed below:

Clause Applicability Amendment
amended

Amendme Applicability: Existing Clause 5A addressed and resolved the practical

nt of with immediate difficulties of companies which have issued shares in
Clause 5A effect electronic mode pursuant to the public issues or any other
issue and which remain unclaimed and are lying in the escrow
account. The procedure contained in the said clause has
now also been made applicable to shares issued in
physical form.

Amendme Applicability: For Listed Companies shall pre-announce and intimate to the
nt in all stock exchange, the fixed date for payment of
clause 20 board/shareholde dividends and credit of bonus shares while intimating
and 22 rs’ meetings about declaration of dividend and bonus shares. Consequential
convened for this changes have been made in Clause 21.
purpose on or
after January 01,
2011

Amendme Applicability: In addition to disclosing the shareholding pattern to the Stock

nt in with immediate Exchanges within 21 days from the end of each quarter, the
clause 35 effect companies shall now also mandatorily disclosure the
same on 2 (TWO) more occasion:

i. One day prior to listing of its

securities on the stock exchanges

ii. Within 10 days of any capital

restructuring of the company resulting in a
change exceeding +/-2% of the total paid-up
 share capital

The formats for making disclosure under Clause 35 have also

been amended. It is advised that new format must be used by
companies while making next disclosure.

Substitutio Applicability: Clause 40A, has been made short and sweet. It now only
n of Clause with immediate states that:
40A effect
i. The issuer company agrees to comply
with the requirements specified in Rule 19(2) and
Rule 19A of the Securities Contracts (Regulation)
Rules, 1957.

ii. Where the issuer 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.

Provided that for the purpose of adopting the method

specified at sub-clause (c) above, the issuer company
agrees to take prior approval of the Specified Stock
Exchange (SSE) which may impose such conditions as it
deems fit.

Insertion Applicability: The issuer company shall notify the stock exchange and also
of Clause with immediate disseminate the following information through its own website
53 effect about agreements made with media companies and/or their
associates, immediately upon entering into the same.

i. Disclosures regarding the shareholding (if

any) of such media companies/associates in the
issuer company.

ii. Any other disclosures related to such

agreements, viz., details of nominee of the media
companies on the Board of the issuer company, any
management control or potential conflict of interest
arising out of such agreements, etc.

iii. Disclosures regarding any other back to

back treaties/contracts/agreements/MoUs or similar
instruments entered into by the issuer company
 with media companies and/or their associates for
the purpose of advertising, publicity, etc.

Insertion Applicability: The issuer company shall maintain a functional website for
of Clause w.e.f 1st April disseminating basic information about the company. The
54 2011 website shall remain updated at any given point of time.