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Unit 7: Prospectus

A similar report on the accounts of a body corporate by an accountant (who shall be Notes
named in the prospectus) if the proceeds of the issue are to be applied in the purchase
of shares of the body corporate so that, that body corporate becomes a subsidiary of
the acquiring company.
(iii) Principal terms of loans, and assets charged as security.

3. Statutory and Other Information: It includes information about:
(i) Minimum subscription.
(ii) Expenses of the issue i.e. fee payable to advisors, registrars to the issue, managers to
the issue and trustees for the debenture holders.
(iii) Underwriting commission and brokerage.
(iv) Previous issue for cash.
(v) Previous public or rights issue; if any, during the last five years, along-with prescribed
particulars.
(vi) Issue of shares otherwise than for cash.
(vii) Commission or brokerage on previous issues.

(viii) Revaluation of assets, if any, during the last five years.
(ix) Material contracts and, time and place where such documents may be inspected.
(x) Debentures and redeemable preference shares or other instruments issued but,
remaining outstanding on the date of the prospectus and terms of their issue.
(xi) Purchase of any property with prescribed details.
(a) Details of directors, proposed directors, whole-time directors, their
remuneration, appointment, remuneration and of manager or managing
director, interests of directors, their borrowing powers and qualification
shares.
Any amount or benefit paid or given within the preceding two years or
intended to be paid or given to any promoter or officer, and consideration for
payment of giving the benefit.
(b) Full particulars of the nature and extent of the interest, if any, of every director
or promoter.
(xii) Restrictions, if any, on transfer and transmission of shares/debentures, and on their
consolidation or splitting.

(xiii) Outstanding litigations relating to financial matters or criminal proceedings against
the company or directors under schedule XIII.
(xiv) Any material development subsequent to the date of the latest balance sheet and its
impact on performance and prospects of the company.
(xv) Management perception of risk factors (e.g. sensitivity to foreign exchange rate
fluctuations, difficulty in availability of raw materials or in marketing of products,
cost/time over-run, etc.).
Part III of the Schedule gives explanations of certain terms and expressions used under Part-I and
Part - II of the Schedule.

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