Allotment of Debentures

From Application to Allotment

As the Issue of Debentures chapter's procedure section described, once the subscription list for a public or rights issue of debentures closes, the Board of Directors meets again to pass a resolution of allotment, deciding how many debentures each applicant will actually receive. Where the issue is exactly subscribed, every applicant simply receives what was applied for; where it is oversubscribed, the Board allots on a proportionate (pro-rata) basis, or on such other basis as the terms of the issue permit, and the balance of the application money on the un-allotted portion is refunded, as the next section explains.

What a Letter of Allotment States

A Letter of Allotment is the Secretary's formal communication to a successful applicant, and it must state:

1. The applicant's name and address.
2. The number of debentures allotted, out of the number originally applied for.
3. The distinctive numbers of the debentures allotted.
4. The folio number under which the debentures are recorded in the Register of Debenture-holders.
5. Any balance amount still payable, where the issue price is payable in instalments rather than in full on application, and the date by which it is due.
6. A reference to the debenture certificate, stating that it will follow, within the period the Companies Act, 2013 prescribes for issuing certificates, or that it is enclosed.
7. The rate of interest and the dates on which it is payable.

Specimen Letter — Allotment of Debentures

GODAVARI SUGAR MILLS LIMITED

Registered Office: Shahupuri, Kolhapur – 416001

CIN: U15421MH2011PLC121212

Date: 18th April

Mr. Vinayak Ghatge

Folio No. SP/DEB/0311

Dear Sir,

Sub: Allotment of 200, 9% Secured Redeemable Non-Convertible Debentures of ₹100 each

We are pleased to inform you that, pursuant to the resolution passed by our Board of Directors at its meeting held on 15th April, 200 (Two Hundred) 9% Secured Redeemable Non-Convertible Debentures of ₹100 each, applied for by you, have been allotted to you, bearing Distinctive Numbers 40501 to 40700 (both inclusive), under Folio No. SP/DEB/0311.

The full application money on these debentures having already been received, no further amount is payable by you. Your Debenture Certificate is being prepared and will be despatched to you within the period prescribed under the Companies Act, 2013. Interest at 9% per annum will be paid half-yearly, on 30th September and 31st March each year, directly to the bank account recorded in our records against your folio.

Kindly acknowledge receipt of this letter, and inform us promptly of any change in your address or bank account details for future correspondence and interest payment.

Thanking you,

Yours faithfully,

For Godavari Sugar Mills Limited

(Ashwini Kadam)

Company Secretary …