DRAFT LETTER OF OFFER FOR RIGHT ISSUE
Issue
of …………. Equity Shares of Rs……/- each for cash at par aggregating to Rs……….
(Rupees …………………) on Rights basis to the existing shareholders.
of …………. Equity Shares of Rs……/- each for cash at par aggregating to Rs……….
(Rupees …………………) on Rights basis to the existing shareholders.
Dear Equity Shareholder(s)
The Board of Directors of our Company
have on ………….. decided to make an issue of ……… equity shares of Rs………/- each
(hereinafter referred to as new shares) of an aggregate nominal value of Rs…………
(Rupees ………….), for cash at par to the existing shareholders
have on ………….. decided to make an issue of ……… equity shares of Rs………/- each
(hereinafter referred to as new shares) of an aggregate nominal value of Rs…………
(Rupees ………….), for cash at par to the existing shareholders
Your Directors are pleased to hereby
offer to you the number of shares specified in the enclosed application form,
to which you are entitled in terms of the basis of offer i.e. …….. new equity shares
for every ……… equity shares held.
offer to you the number of shares specified in the enclosed application form,
to which you are entitled in terms of the basis of offer i.e. …….. new equity shares
for every ……… equity shares held.
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Name
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No. of shares
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Face value/share in Rs.
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Appln/Allot money in Rs.
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Objects
of the Issue
of the Issue
The Object of the new right Issue is
to raise funds for the ………….
to raise funds for the ………….
The new equity shares now being
offered are subject to the terms and conditions of this ‘Offer Letter’ and the
enclosed application form, the Memorandum and Articles of Association of the
Company, the allotment letter/share certificate to be issued, and the
applicable provisions of the Companies Act, 2013 and Reserve Bank of India
regulations.
offered are subject to the terms and conditions of this ‘Offer Letter’ and the
enclosed application form, the Memorandum and Articles of Association of the
Company, the allotment letter/share certificate to be issued, and the
applicable provisions of the Companies Act, 2013 and Reserve Bank of India
regulations.
The
principal terms and conditions are as follows:
principal terms and conditions are as follows:
1. Basis of Offer: as per
the provisions of section 62 (1) of the Companies Act, 2013 where at any time,
a company having a share capital proposes to increase its subscribed capital by
the issue of further shares, such shares shall be offered to persons who, at
the date of the offer, are holders of equity shares of the company in
proportion, as nearly as circumstances admit, to the paid-up share capital of
those shares. Accordingly, the entitlement of the existing shareholders and/or
affiliates under the proposed offer is as stated above.
the provisions of section 62 (1) of the Companies Act, 2013 where at any time,
a company having a share capital proposes to increase its subscribed capital by
the issue of further shares, such shares shall be offered to persons who, at
the date of the offer, are holders of equity shares of the company in
proportion, as nearly as circumstances admit, to the paid-up share capital of
those shares. Accordingly, the entitlement of the existing shareholders and/or
affiliates under the proposed offer is as stated above.
2. Face
Value:
The new equity shares shall be of a face value of Rs. …./- each.
Value:
The new equity shares shall be of a face value of Rs. …./- each.
3. Offer
Price:
The Offer price is Rs. ……./- per share.
Price:
The Offer price is Rs. ……./- per share.
4. Terms of
payment:
The full amount of Rs. ……/- per share shall be payable on application.
payment:
The full amount of Rs. ……/- per share shall be payable on application.
5. Mode of
Payment:
Payment:
Share Application money
shall be paid by way of Account Payee Cheque issued in the name of …………………………
and in the case of foreign investors, the Payments should be made in accordance
with the provisions/rules/regulations under the Foreign Exchange Management
Act, 2002 and Reserve Bank of India Regulations.
shall be paid by way of Account Payee Cheque issued in the name of …………………………
and in the case of foreign investors, the Payments should be made in accordance
with the provisions/rules/regulations under the Foreign Exchange Management
Act, 2002 and Reserve Bank of India Regulations.
6. Ranking: The new shares shall
rank pari-passu inter-se, i.e. without any preference or priority of one over
the other or any of them and will rank pari-passu with the existing equity
shares of the Company in all respects except that the new shares shall qualify
for the dividend if any to be declared by the Company for the current year pro-rata
for the period during which such capital is paid up.
rank pari-passu inter-se, i.e. without any preference or priority of one over
the other or any of them and will rank pari-passu with the existing equity
shares of the Company in all respects except that the new shares shall qualify
for the dividend if any to be declared by the Company for the current year pro-rata
for the period during which such capital is paid up.
7.
Acceptance of Offer:
You may accept and apply for the equity shares hereby offered to you wholly or
in part by filling up the enclosed Application form and submitting the same
along with the application money to the Company from …………………….. to …………………………..
Acceptance of Offer:
You may accept and apply for the equity shares hereby offered to you wholly or
in part by filling up the enclosed Application form and submitting the same
along with the application money to the Company from …………………….. to …………………………..
The application must be only on the
prescribed form enclosed. As stated above, you may apply for additional shares
if, in the first instance, you have subscribed to all the shares offered to you.
prescribed form enclosed. As stated above, you may apply for additional shares
if, in the first instance, you have subscribed to all the shares offered to you.
8. Disposal of
unsubscribed shares: If
the Application Form along with the application money is not received by the
Company on or before ……………………………, then this offer shall be deemed to have been
declined and the Board or a Committee authorized by it may dispose of the
un-subscribed shares in such manner as it thinks fit.
unsubscribed shares: If
the Application Form along with the application money is not received by the
Company on or before ……………………………, then this offer shall be deemed to have been
declined and the Board or a Committee authorized by it may dispose of the
un-subscribed shares in such manner as it thinks fit.
9. Renunciation: This offer carries right
of renunciation.
of renunciation.
10. Basis of
Allotment:
The Basis of allotment shall be finalized by the Board or Committee authorized
by the Board in the following order of priority:
Allotment:
The Basis of allotment shall be finalized by the Board or Committee authorized
by the Board in the following order of priority:
i) Full
allotment to the shareholders who have applied for their rights entitlement
either in full or in part.
allotment to the shareholders who have applied for their rights entitlement
either in full or in part.
ii) Allotment
to the shareholders who have applied for additional shares provided that they
have applied for all the shares offered to them and there is a surplus.
to the shareholders who have applied for additional shares provided that they
have applied for all the shares offered to them and there is a surplus.
Allotment to any other person as the
Board or Committee authorized by the Board may in their absolute discretion,
deem fit, provided there is surplus available after allotment under i) and ii)
above.
Board or Committee authorized by the Board may in their absolute discretion,
deem fit, provided there is surplus available after allotment under i) and ii)
above.
11.
Allotment and Refund Order:
Allotment and Refund Order:
The Company will
issue and despatch Letters of Allotment / Share certificates and/or letters
of regret along with refund orders, if any within a period of 60 days from the
date of closure of the subscription list.
issue and despatch Letters of Allotment / Share certificates and/or letters
of regret along with refund orders, if any within a period of 60 days from the
date of closure of the subscription list.
General
instructions:
instructions:
The
application form must be filled up in block letters in English.
The
application must be accompanied by a certified copy of the resolution of the
Board of Directors of the applicant Company.
application must be accompanied by a certified copy of the resolution of the
Board of Directors of the applicant Company.
This
letter of Offer and any claims arising there from shall be subject to the
jurisdiction of courts at Indore, India.
letter of Offer and any claims arising there from shall be subject to the
jurisdiction of courts at Indore, India.
Caution: Attention of the applicant is specifically
drawn to the provision of Section 38 of the Companies Act, 2013, which is
reproduced below:
drawn to the provision of Section 38 of the Companies Act, 2013, which is
reproduced below:
Section
38 (1) Any person who—
38 (1) Any person who—
(a) makes or abets making of an application in a fictitious name to a company for acquiring, or subscribing for, its securities; or
(b) makes or abets making of multiple applications to a company in different names
or in different combinations of his name or surname for acquiring or
subscribing for its securities; or
or in different combinations of his name or surname for acquiring or
subscribing for its securities; or
(c) otherwise induces directly or indirectly a company to allot, or register any
transfer of, securities to him, or to any other person in a fictitious name,
shall be liable for action under section 447.
transfer of, securities to him, or to any other person in a fictitious name,
shall be liable for action under section 447.
(2) The provisions of
sub-section (1) shall be prominently reproduced in every prospectus issued by a
company and in every form of application for securities.
sub-section (1) shall be prominently reproduced in every prospectus issued by a
company and in every form of application for securities.
(3) Where a person has
been convicted under this section, the Court may also order disgorgement of
gain, if any, made by, and seizure and disposal of the securities in possession
of, such person.
been convicted under this section, the Court may also order disgorgement of
gain, if any, made by, and seizure and disposal of the securities in possession
of, such person.
(4) The amount received
through disgorgement or disposal of securities under subsection (3) shall be
credited to the Investor Education and Protection Fund.
through disgorgement or disposal of securities under subsection (3) shall be
credited to the Investor Education and Protection Fund.
DECLARATION
NO STATEMENT MADE IN
THIS LETTER OF OFFER CONTRAVENES ANY OF THE PROVISIONS OF THE COMPANIES ACT, 2013
AND THE RULES MADE THEREUNDER. ALL LEGAL REQUIREMENTS CONNECTED WITH THE SAID
ISSUE HAS BEEN DULY COMPLIED WITH.
THIS LETTER OF OFFER CONTRAVENES ANY OF THE PROVISIONS OF THE COMPANIES ACT, 2013
AND THE RULES MADE THEREUNDER. ALL LEGAL REQUIREMENTS CONNECTED WITH THE SAID
ISSUE HAS BEEN DULY COMPLIED WITH.
Yours
Sincerely.
By
the Order of the Board of Directors
the Order of the Board of Directors
Place :
Date :
Encl: Application Form
………………………………………………………………………………………………………………………………
This below given Application Form should be sent to shareholders with the Offer Letter For Right Issue.
APPLICATION FORM
Issue
of …………. Equity Shares of Rs……/- each for cash at par aggregating to Rs……….
(Rupees …………………) on Rights basis to the existing shareholders.
of …………. Equity Shares of Rs……/- each for cash at par aggregating to Rs……….
(Rupees …………………) on Rights basis to the existing shareholders.
Name, Address and Folio Number of the
applicant:
applicant:
To
The Board of
Directors
Directors
Dear Sir(s)
Pursuant to the Letter of
Offer dated ********, I/we accept …………… number of equity shares offered to me/us and apply for
allotment of the same as indicated in Block I below.
Offer dated ********, I/we accept …………… number of equity shares offered to me/us and apply for
allotment of the same as indicated in Block I below.
Having accepted the equity
shares in full, I /we also apply for additional shares indicated in Block II
below and agree to accept these shares or whatever lesser number is allotted to
me/us by the Board of Directors.
shares in full, I /we also apply for additional shares indicated in Block II
below and agree to accept these shares or whatever lesser number is allotted to
me/us by the Board of Directors.
I/we enclose the amount specified in Block IV
at the rate of Rs. …/- per share payable on application.
at the rate of Rs. …/- per share payable on application.
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(To
be filled up by applicant) |
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Regd. Folio No.
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No. of shares held on
………….
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Number of new shares offered
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Amount payable on application
Rs.
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No. of new shares accepted
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Number of additional New shares
accepted |
Total No. of shares applied
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Actual Amount Paid
(Rs.)
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BLOCK I
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BLOCK II
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BLOCK III
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BLOCK IV
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The
Application money has been paid by cheque No. _____________ dated ___________,
Bank Name ____________________________.
Application money has been paid by cheque No. _____________ dated ___________,
Bank Name ____________________________.
We
hereby agree to accept and hold the Equity shares applied for or such lesser
number as may be allotted to us, subject to the terms and conditions of this
Offer Letter, the application form and the Memorandum & Articles of
Association of the Company.
hereby agree to accept and hold the Equity shares applied for or such lesser
number as may be allotted to us, subject to the terms and conditions of this
Offer Letter, the application form and the Memorandum & Articles of
Association of the Company.
We hereby authorise you to enter
against our names the shares allotted to us in the Register of Members as the
holders of Equity shares so allotted to us.
against our names the shares allotted to us in the Register of Members as the
holders of Equity shares so allotted to us.
We hereby undertake that we shall
sign such other documents and do all such other acts, if any, necessary on our
part to be registered as the holders of Equity shares issued to us.
sign such other documents and do all such other acts, if any, necessary on our
part to be registered as the holders of Equity shares issued to us.
I/ we declare that I/we are not
applying for the shares as a nominee of any other person.
applying for the shares as a nominee of any other person.
We declare that we are a Domestic
Company.
Company.
We hereby enclose a copy of the
resolution of the Board of Directors of the Company authorizing the
subscription of the shares applied for.
resolution of the Board of Directors of the Company authorizing the
subscription of the shares applied for.
Thanking you
Shareholder
………………………………………………………………………………………………………………….
The above drafts Letter of Offer For Right Issue and Application Form are to be used for reference only, kindly make necessary changes as applicable in your case.
………………………………………………………………………………………………………………….
The above drafts Letter of Offer For Right Issue and Application Form are to be used for reference only, kindly make necessary changes as applicable in your case.
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