Functioning of Secretarial Department

Secretarial Department of Ludhiana Stock exchange is main Department of LSE. The main function of this Department is recording and framing of Agendas & Minutes or proceedings of all the committee as well as Board meeting.

Composition of Board of Directors

Shareholder Directors - 6 (six) Public Interest Directors - 6 (six) Managing Director - 1 (one).

Annual General Meeting

Annual General Meeting is usually held in the month of September, every year for electing Shareholder Directors. At every subsequent AGM , 1/3rd of the members of the Board of Director for the time being, as are liable by rotation shall retire from office and shall be eligible for reelection.

The member of the Board of directors to retire by rotations at every AGM shall be those who have been longest in office, since their last appointment but as between person who become members of the Board of Directors on the same day, those who are to retire shall in default and subject to any agreement between such members of the Board of Directors be determined by lot.

APPOINTMENT OF DIRECTORS/PUBLIC INTEREST DIRECTOR

Public Interest Director or non Executive directors are to be selected by Governing Board from amongst the persons in the SEBI constituted panel . A person shall not act as Public interest Director on or more than one stock exchange simultaneously . The Board of directors with subject to approval of SEBI appoint a wholetime CEO/MD/ED or a person as the case may be, who will be an ex-officio member on the Governing Board, he or she shall not be liable to dismissal or removal from office except with the prior approval of SEBI. He or She manages the administration of the Exchange .

Mandatory Committees for Stock Exchanges

There are two kind of Committees

1. Operational Committees 2. Oversight Committees

Operational Committees
1.Membership Selection Committee 2.Disciplinary Action Committee 3.Investor Grievance Redressal Committee (IGRC) 4.Defaults Committee 5.Compensation Committee 6.Selection Committee

Oversight Committees
1. Standing committee on technology 2. Sub- Committee for Monitoring Compliance of suggestions given in SEBI Inspection report 3. Investor services committee 4. Public Interest Directors Committee 5. Arbitration Committee 6. Ethics Committee 7. Independent oversight committee of the governing board for member regulation 8. Independent oversight committee of the governing board for listing function. 9. Independent oversight committee of the governing board for trading and Surveillance function. 10.Advisory Committee

ADDITIONAL COMMITTEES

1. Management Sub- Committee 2. FMC cum Room Transfer Committee 3. Share Transfer Committee 4. Audit Committee

Every Department can put up the matter concerned to the respective committee in the form of Agenda items. A prior notice say it Day, Date Time & Venue is sent to the Respective Members along with the Agenda .Thereafter the minutes of the respective committees are duly vetted from the chairman of the committees and are then circulated to all the members of the respective committee. The minutes of the various committees are considered and approved in the forthcoming Board meeting. The Minutes of all the committees and the Board are preserved in god order.

SEBI COMPLIANCE
1. SEBI Inspection Report :SEBI usually conducts inspection in the month of January, February , March and sends the inspection report along with the observations made by the SEBI officials which is to be put up before the Governing Board of the Exchange and with in 30 days, it has to submit compliance report on the observation made their based on which the renewal of recognition is granted by SEBI. to SEBI in a prescribed format given by SEBI on Quarter Basis. The same is placed before the combined meeting organized by SEBI and northern regional Stock Exchange.

2. Quarterly Development report and Surveillance report:- is send

SEBI COMPLIANCE CONTD

3. Shareholding Pattern Report :is also sent to SEBI on Quarterly Basis. Before 2005 i.e Demutualization 100% holding of shares of Exchange were with our trading member. After demutualization 51% holding was given to the public and rest 49% was given to the trading members and this ratio/status has to be maintained. Shares in Physical form or demat form can be transferred from one person to other person and these share transfer cases are put up in the share transfer committee meeting. The Transfer cases after being approved by RTA (Beetal Financial Services) alongwith the requisite documents and transfers are confirmed.

This inspection is conducted by the independent appointed by the Exchange, the report is submitted by the C.A within the period of 2 months. The report is then forwarded to LSESL for their observations and the latest status of observations is sent to the Parent Exchange in a time bound period of 15 days and the matter is placed before the governing Board of Exchange for its consideration. 5. Sub-brokers Inspection:- Exchange also conducts sub brokers inspection (20% active sub brokers are chose for the inspection. The independent CAs are appointed and are given 2 months period time for preparing the report as per the checklist provided to them. The Report or comments are part up in the Disciplinary Committee meeting. The disciplinary committee gives necessary directions i.e. it imposes plenty or issue warning as per the policy or the penalty structure laid by the Exchange. The decision of the committee after the recommendation of the board are send to LSESL for further course of action.

4. Half yearly Inspection:-

SEBI COMPLIANCE CONTD

6. A part from these SEBI risk management report is sent to SEBI on yearly basis and data with regard to SEBI Annual Report is sent to SEBI on Annual Basis.

7. The Bye- Laws and memorandum and articles of the exchange amended or incorporated under the guidance of SEBI from time to time. These are as per the regulations, according in provisions of SCRA Act 1956 . These Bye- Laws are to be first pre- published for criticism in both Gazette of India and in official Gazette i.e. in Panjab Gazette after the approval of SEBI it is finally published in both the Gazettes.

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