Legal Framework and Procedural Insights for NCD Issuance by Listed Companies

Key Takeaways:

The major governing acts, regulations, and circulars for issuing NCD on a private placement basis by a listed company include the Companies Act, 2013 & Rules made thereunder, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021, Operational Circular SEBI/HO/DDHS/P/CIR/2021/613, SEBI (Debenture Trustee) Regulation, 1993, and Stamp Act, 1899. The eligibility conditions for issuing NCD on a private placement basis include requirements under the Companies Act, 2013 and SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021. The requirements and conditions for making an NCD on a private placement basis include in-principle approval, depositories, debenture trustee, registrar to the issue, credit rating, creation of recovery expense fund, regulatory fees, day count convention, debenture redemption reserve/capital redemption reserve, international securities identification number (ISIN), trust deed, listing agreement, obligations of the issuer and debenture trustee, creation of security, consolidation and re-issuance, and more. The procedure for the allotment of securities NCD on a private placement basis includes provisions of Section 180(1)(c) pertaining to borrowing limits and governing provisions steps. The fees schedule includes initial listing fees, processing fees, and annual listing fees. The list of documents to be uploaded includes the listing application, letter of application, listing agreement, certified true copy of final placement memorandum/disclosure document, approval by the board of directors/committee/authorized persons of allotment of securities, and more. The brief synopsis includes the key documents that govern the terms and conditions for NCD issued on a private placement basis, issuance guidelines, and standardization of timelines for listing of securities issued on a private placement basis.