SME LISTING

BSE SME EXCHANGE – LISTING REQUIREMENTS

The following are the listing requirements for the BSE SME Exchange:

The SME must be a Limited Company .

The issuer or SME must have a post-issue face value capital of Rs.1 crore to Rs.25 crores. Entities having a post-issue face value of over Rs.25 crores have to be necessarily listed on the Main Board of the BSE.

Net Tangible Assets of the SME must be at least Rs.1 crore, as per the latest audited financial results.

Net Worth (excluding revaluation reserve) must be at least Rs.1 crore as per the latest audited financial statements.

The company must have a track record of distributable profits in terms of Section 205 of the Companies Act, 1956, for at least two out of the immediately preceding three financial years. Otherwise, net worth must be at least Rs. 3 crores.

The company must mandatorily facilitate trading in DEMAT securities and enter into an agreement with both Depositories, namely, Central Depository Services Limited and National Securities Depository Limited.

The company must have a website.

The company should not have any reference before the Board for Industrial and Financial Reconstruction (BIFR).

The company should not have any winding-up petition that has been accepted by a Court.

The issue must be a 100% underwritten issue. Merchant bankers must underwrite 15% on their own accounts.

The Merchant Banker to the issue is responsible for market making for a minimum of three years through a stockbroker who is registered as a market maker with the SME Exchange.

The company must have a minimum of 50 investors while listing through IPO.

PROCEDURE FOR LISTING ON THE BSE SME EXCHANGE

Listing on the BSE SME Exchange involves five different steps, namely:

STEP 1: APPOINTMENT OF MERCHANT BANKER

The Issuer Company must consult and appoint a Merchant Banker in an advisory capacity for the listing on the BSE SME exchange.

STEP 2: DUE DILIGENCE AND DOCUMENTATION

The Merchant Banker would then conduct due diligence regarding the company.

STEP 3: APPLICATION TO BSE SME EXCHANGE

Once the due diligence and documentation are completed by the Merchant Banker, the draft prospectus and DRHP are submitted to the Exchange as per SEBI requirements.

STEP 4: INITIAL PUBLIC OFFERING (IPO)

The Initial Public Offer (IPO) opens and closes as per schedule.

TRADING ON THE BSE SME EXCHANGE

After listing on the BSE SME exchange, existing members of the Exchange are eligible to participate in the SME Platform and trade on the share of the SME

DOCUMENTS REQUIRED FOR LISTING ON THE BSE SME EXCHANGE

Along with the application for using the name of the Exchange in the offer document, the following documents/information shall be filed by the Company with the Exchange: 10 copies of the draft offer document.

Soft copy of the Prospectus for uploading on the website

Copy of resolution passed by the Board of Directors for the issue of securities

Copy of the shareholder’s resolution under 62(1)(c) of Companies Act, 2013

Certificate from the Managing Director or PCS / Statutory or Independent Auditors stating the following: The Company has not been referred to the Board for Industrial and Financial Reconstruction (BIFR).

There is no winding-up petition against the company, which has been admitted by the court or a liquidator has not been appointed.

There has been no change in the promoter/s of the Company in the preceding one year from the date of filing an application to BSE for listing on SME segment.

Copy of all show-cause notice(s)/order(s) issued by any regulatory authority (e.g. SEBI, ROC, RBI, CLB, Stock Exchange, etc.) & Correspondence there too.

PAN & TAN of the Company.

DIN & PAN of Promoters and Directors.

Printed Balance Sheets, Profit & Loss Accounts and Cash Flow Statements for the preceding 5 years (or for such applicable periods)

Copies of major orders/contracts/ received/ executed/ in-hand should be kept ready and be available for inspection. A statement of material contracts duly certified by a practicing Chartered Accountant/ practicing Company Secretary should be submitted. The Company should also state the place, time, and date where these documents can be inspected

A statement containing particulars of the dates of, and parties to all the material contracts, agreements (including agreement for technical advice and collaboration), concessions, and similar other documents (except those entered into in the ordinary course of business carried on or intended to be carried on by the company) together with a brief description of the terms, subject matter and general nature of the documents.

Details of the present or any previous application of the Company/Group Company for a listing of any securities have been rejected earlier by SEBI or by any stock exchange and reasons thereof.

Name of the exchange which is proposed to be designated Exchange for the issue, if decided.

Copies of agreements and memoranda of understanding between the Company and its promoters/ directors.

Articles & Memorandum of Association of the Company.

A certificate from the statutory auditor certifying compliance of conditions of Corporate Governance as stipulated in clause 52 of the listing agreement and circular no.SEBI/CFD/DIL/CG/1/2004/12/10 dated October 29, 2004, issued by the Securities and Exchange Board of India (SEBI). The company should also give the composition of various committees as required under the said clause.

Association, if any, of the directors/ promoters of the Company with any public or rights issue made during the preceding 10 years.

One Time Listing Fees of Rs. 50,000/- plus applicable Service Tax. (Details of all applicable fees for SME Listing is attached)

Date of opening of the public issue is to be intimated as soon as it is finalized