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    SEBI Bonus Guidelines

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    vivekgupta4444
    The document outlines guidelines for listed companies proposing bonus share issues. Key requirements include using reserves from genuine profits or share premium for the bonus issue, extending similar benefits to holders of convertible securities, and increasing authorized capital if the bonus issue causes subscribed capital to exceed authorized amounts. The company must also comply with provisions regarding capitalization of reserves in its articles of association and fully pay up any partly paid shares.

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    SEBI Bonus Guidelines

    Uploaded by

    vivekgupta4444
    4K views6 pages
    The document outlines guidelines for listed companies proposing bonus share issues. Key requirements include using reserves from genuine profits or share premium for the bonus issue, extending similar benefits to holders of convertible securities, and increasing authorized capital if the bonus issue causes subscribed capital to exceed authorized amounts. The company must also comply with provisions regarding capitalization of reserves in its articles of association and fully pay up any partly paid shares.

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    The document outlines guidelines for listed companies proposing bonus share issues. Key requirements include using reserves from genuine profits or share premium for the bonus issue, extending similar benefits to holders of convertible securities, and increasing authorized capital if the bonus issue causes subscribed capital to exceed authorized amounts. The company must also comply with provisions regarding capitalization of reserves in its articles of association and fully pay up any partly paid shares.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT or read online from Scribd
    Download as ppt
    4K views6 pages

    SEBI Bonus Guidelines

    Uploaded by

    vivekgupta4444
    The document outlines guidelines for listed companies proposing bonus share issues. Key requirements include using reserves from genuine profits or share premium for the bonus issue, extending similar benefits to holders of convertible securities, and increasing authorized capital if the bonus issue causes subscribed capital to exceed authorized amounts. The company must also comply with provisions regarding capitalization of reserves in its articles of association and fully pay up any partly paid shares.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT or read online from Scribd
    Download as ppt
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    GUIDELINES FOR BONUS ISSUES

    15.0 A listed company proposing to issue bonus shares shall


    comply with the following:

    15.1 (a) No company shall, pending conversion of FCDs/PCDs,


    issue any shares by way of bonus unless similar benefit is
    extended to the holders of such FCDs/PCDs, through
    reservation of shares in proportion to such convertible part of the
    FCDs or PCDs.

    (b) The shares so reserved may be issued at the time of


    conversion(s) of such debentures on the same terms on which
    the bonus issues were made.
    GUIDELINES FOR BONUS ISSUES

     15.1.1 The bonus issue shall be made out of free reserves


    built out of the genuine profits or share premium collected
    in cash only.

     15.1.2 Reserves created by revaluation of fixed assets are


    not capitalised.
    GUIDELINES FOR BONUS ISSUES

     15.1.3 The declaration of bonus issue, in lieu of dividend, is


    not made.

     15.1.4 The bonus issue is not made unless the partly paid
    shares, if any existing, are made fully paid-up.
    GUIDELINES FOR BONUS ISSUES

     15.1.5 The Company—


    (a) has not defaulted in payment of interest or principal in
    respect of fixed deposits and interest on existing
    debentures or principal on redemption thereof ; and

    (b) has sufficient reason to believe that it has not defaulted


    in respect of the payment of statutory dues of the
    employees such as contribution to provident fund, gratuity,
    bonus, etc.
    GUIDELINES FOR BONUS ISSUES

     15.1.6 A company which announces its bonus issue after


    the approval of the Board of Directors must implement the
    proposal within a period of six months from the date of
    such approval and shall not have the option of changing
    the decision.

     15.1.7 (i) The Articles of Association of the company shall


    contain a provision for capitalisation of reserves, etc.
    (ii) If there is no such provision in the Articles the
    company shall pass a Resolution at its general body
    meeting making provisions in the Articles of Association for
    capitalizations.
    GUIDELINES FOR BONUS ISSUES

     15.1.8 Consequent to the issue of bonus shares if the


    subscribed and paid-up capital exceed the authorized
    share capital, a resolution shall be passed by the company
    at its general body meeting for increasing the authorized
    capital.

     15.1.9 A certificate duly signed by the issuer company and


    countersigned by statutory auditor or by Company
    Secretary in practice to the effect that the provision of
    clauses 15.1.1 to 15.1.9 have been complied with shall be
    forwarded to the Board.

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