Section - 42 - Issue of shares on private placement basis
PART IIPRIVATE PLACEMENT[Issue of shares on private placement basis.42. (1) A company may, subject to the provisions of this section, make a private placement of securities.(2) A private placement shall be made only to a select group of persons who have been identified by the Board (herein referred to as "identified persons"), whose number shall not exceed fifty or such higher number as may be prescribed [excluding the qualified institutional buyers and employees of the company being offered securities under a scheme of employees stock option in terms of provisions of clause (b) of sub-section (1) of section 62], in a financial year subject to such conditions as may be prescribed.(3) A company making private placement shall issue private placement offer and application in such form and manner as may be prescribed to identified persons, whose names and addresses are recorded by the company in such manner as may be prescribed:Provided that the private placement offer and application shall not carry any right of renunciation.Explanation I.-"Private placement" means any offer or invitation to subscribe or issue of securities to a select group of persons by a company (other than by way of public offer) through private placement offer-cum-application, which satisfies the conditions specified in this section.Explanation II.-"Qualified institutional buyer" means the qualified institutional buyer as defined in the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended from time to time, made under the Securities and Exchange Board of India Act, 1992 (15 of 1992).Explanation III.-If a company, listed or unlisted, makes an offer to allot or invites subscription .... To read the full section download the app from Google Play store
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