CCPS to equity - reg

[K Lakshminarayanan]

Dear members,

I need to convert compulsory convertible preference shares into equity. Can someone please share the process for the same?

-Thanks

[Chirdigvijayee Sangwan]

I will try to provide a summarized version of the process. Depending on the manner and terms of issue of the CCPS the process may differ a little. I am assuming the Authorized share capital is sufficient to accommodate the post conversion capital.

1. Hold a Board Meeting to approve the conversion of CCPS and consequent allotment of equity shares.
2. File MGT-14 for the resolution passed in the aforesaid meeting. Time limit is within 30 days of the board meeting. Private companies are exempted from filing MGT-14 in this case.
3. Parallelly, you also need to file form PAS-3 for the aforesaid allotment. This needs to be filed within 30 days of the board meeting.

Now this is effectively the whole process. However as i said earlier, the process may differ depending on the manner and terms of issue of CCPS. Therefore, i would like to elaborate on a common scenario:

• If the CCPS were issued pursuant to an agreement

Then this agreement must contain a provision for conversion of CCPS, including the conversion ratio (or the formula/manner for determining the conversion ratio). If the said agreement does not contain such provision, then it needs to be amended. Amendment of such agreement is an entirely different process so i will not go into that here.

You will need to attach an extract of such agreement to the PAS-3 form.

I will stop here. In case you have a query regarding a specific point, do ask.

With best regards,

Chirdigvijayee Sangwan

[K Lakshminarayanan]

Thank you so much sir.

K Lakshmi Naryanan

9444976062

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[FCA Chandrasekaran Ramadurai]

This is the procedure