MCQs On THE SECURITIES AND EXCHANGE BOARD OF INDIA REGULATIONS Part No - 3

Q.1:- The provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 shall apply to which of the following: i. Employee stock option schemes ii. Employee stock purchase schemes iii. Stock appreciation rights schemes iv. General employee benefits schemes v. Retirement benefit schemes

• i, ii, iii, iv, v
• i, ii, iii
• i, ii
• i, ii, iv, v

Q.2:- As per SEBI (Share Based Employee Benefits) Regulations, 2014, A company shall constitute a……. .for administration and superintendence of the schemes:

• None of the above
• Compensation committee
• Administration committee
• Supervisory committee

Q.3:- If Employee Stock Purchase Scheme ( ESPS) is part of a public issue and the shares are issued to employees at the same price as in the public issue,

• Higher Price
• Weighted average price
• Same price
• Lower price

Q.4:- As per SEBI (Share Based Employee Benefits) Regulations, 2014, employee does not include:

• None of the above
• An employee who is a promoter or a person belonging to the promoter group.
• A director who either himself or through his relative or through anybody corporate, directly or indirectly, holds more than ten per cent of the outstanding equityshares of the company.
• Both (b)and(C)

Q.5:- Intrinsic Value is:

• Exercise price
• The market price of underlying share.
• The excess of the market price of underlying share over the exercise price of the Option
• Book value of the underlying shares.

Q.6:- Whether employees’ welfare trusts with objective of employee welfare, such as medical assistance, etc., with no share-based benefits, but are holding/dealing shares of the listed company or shares of listed holding company covered under the scope of SEBI (Share Based Employee Benefits) Regulations, 2014?

• Yes
• Not applicable
• None of the above
• No

Q.7:- . Shares have been acquired by the Trust from secondary market and held for a minimum period of six months in terms of as per the SEBI (Share Based Employee Benefits) Regulations, 2014 pursuant to which the same are transferred to employees under ESPS. Whether requirement of lock-in, in terms of SEBI (Share Based Employee Benefits) Regulations, 2014, shall be applicable to shares received by employees?

• Yes, Rest Six Month Lock-in shall be applicable to the shares received by employees.
• Yes. One year Lock-in shall be applicable to the shares received by employees.
• No. Lock-in shall not be applicable to the shares received by employees.
• .Yes. Lock-in shall applicable to the shares received by employees

Q.8:- As per SEBI (Prohibition of Insider Trading), Regulations 2015, Unpublished price sensitive information includes:

• Merger, demerger, acquisition, delistings, disposals and expansion of business
• Change in Key managerial personnel
• Change in Capital structure
• All of these

Q.9:- As per SEBI (Prohibition of Insider Trading), Regulations 2015, Trading means:

• Subscribing, buying, selling, dealing in any securities
• Agreeing to subscribe, buy, sell, deal in any securities
• Both a and b
• None of the above

Q.10:- The difference between the QIP and Preferential allotment of shares is that the QIPs allotment can be made only to QIBs and preferential allotment can be made to selected persons/organizations including QIBs.

• True
• False
• May be may not be
• None of the above

Q.11:- Which of the following is not covered as connected person:

• A banker of the company
• Subscribing, buying, selling, dealing in any securities
• A concern, firm, trust, Hindu undivided family, company or association of persons wherein a director company or his immediate relative or banker of the company, has more than ten percent of the interest.
• None of the above

Q.12:- Which of the following is deemed as connected person

• An official of a stock exchange or of clearing house or corporation
• An investment company, trustee company, asset management company Oran employee or director thereof
• A holding company or associate company or subsidiary company
• All of these

Q.13:- “Insider” in reference with SEBI(PROHIBITION OF INSIDER TRADING) REGULATIONS, 2015 can be understood as

• Connected person Only director and Promoters
• Person in possession of or having access to UPSI C
• (A) or (B) or both
• Only director and Promoters

Q.14:- In case of initial public issue, the promoters contribution shall not less than……. .of the post issue capital:

• 40%
• 10%
• 20%
• 25%

Q.15:- An Issuer can make a rights issue, where the aggregate value of the specified securities offered is less than _____lakh rupees without filing draft offer document by the lead merchant banker:

• Ninety
• Seventy
• Fifty
• Twenty-five

Q.16:- Which of the following documents, lead merchant bankers shall submit to the Board along with the draft offer document:

• A due diligence certificate
• A certificate, confirming that an agreement has been entered into between the issuer and the lead merchant bankers
• A certificate, confirming that an agreement has been entered into between the issuer and the lead merchant bankers
• All of the above

Q.17:- What is the amount of security deposit the issuer shall deposit, before the opening of subscription list, and keep deposited with the stock exchange?

• Two and half percent of the amount of securities offered for subscription to the public.
• Two percent of the amount of securities offered for subscription to the public
• Five percent of the amount of securities offered for subscription to the public.
• . One percent of the amount of securities offered for subscription to the public.

Q.18:- SEBI (Issue of capital and Disclosure Requirements) Regulations, 2009 shall not applies to:

• An issue of bonus shares by a listed issuer
• A right issue, where the aggregate value of specified securities offered is less than fifty lakh rupees.
• A Preferential issue
• A Public issue

Q.19:- SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 shall applies to:

• An issue of Indian Depository Recipts
• A Qualified institutions placement by a listed issuer
• A right issue, where the aggregate value of specified securities offered is fifty lakh rupees or more
• All of these

Q.20:- As per the regulation under SEBI (issue of Capital and Disclosure Requirements) Regulations, 2009 If any applicant fails to pay the call money within the said 12 months (or more, as the case may be), the equity shares on which there are calls in arrears along with the subscription money already paid on such

• Shares will be forfeited
• Money shall be refunded.
• Money will be forfeited.
• Shares shall be issued.

Q.21:- When the issuer shall take into account valuation parameters including book value, comparable trading multiples, and such other parameters as are customary for valuation of shares of such companies while determining price for preferential issue:

• Where the shares are frequently traded.
• Where are shares are not frequently traded.
• Where the shares are frequently traded in more than one stock exchange.
• None of the above

Q.22:- In case of equity share allotted in excess of 20% of total capital of the issuer, the equity share in excess of 20% shall be locked in for……….:

• Three year
• Five year
• Two year
• One year

Q.23:- Lock in period specified in case of preferential issue to promoter and promoter group:

• Two year
• Three year
• Five year
• One year

Q.24:- In case of equity share allotted in excess of 20% of total capital of the issuer, the equity share in excess of 20% shall be locked in for……….:

• Five year
• One year
• Three year
• Two year

Q.25:- 'What is the time limit prescribed for completion of allotment pursuant to the special resolution?

• Thirty days from the date of passing of such resolution
• Ten days from the date of passing of such resolution
• Twenty-one days from the date of passing of such resolution
• Fifteen days from the date of passing of such resolution

Q.26:- In which of the following case full consideration is not required to paid at the time of allotment of preferential issue?

• Issue of specified securities pursuant to a scheme of corporate debt restructuring as per the corporate debt restructuring framework specified by Reserve Bank of India,
• Issue of warrants
• Both a and b
• None of the above

Q.27:- When adjustment to price determined for preferential issue required?

• Makes a rights issue of equity shares
• Consolidates its outstanding equity shares into a smaller number of shares.
• Makes an issue of equity shares by way of capitalization of profits or reserves, other than by way of a dividend on shares.
• All of the above

Q.28:- . For the purpose of Chapter VII of SEBI (ICDR), 2009, Relevant date in case of preferential issue of equity share means:

• The date thirty days prior to the date on which the meeting of BOD is held to consider the proposed preferential issue
• The date twenty-one days prior to the date on which the meeting of shareholders is held to consider the proposed preferential issue.
• The date twenty-one days prior to the date on which the meeting of BOD is held to consider the proposed preferential issue.
• The date thirty days prior to the date on which the meeting of shareholders is held to consider the proposed preferential issue.

Q.29:- Minimum Price for Frequently traded shares listed for 26 weeks or more is Higher of the average of weekly high/low of volume weighted average prices during, weeks prior and 2 weeksprior

• 22
• 24
• 20
• 26

Q.30:- Where the relevant date falls on a Weekend/Holiday, the day ________the Weekend/Holiday will he reckoned to be the relevant date:

• Weekend/Holiday
• After
• Two days after
• Preceding;

Q.31:- Once the decision to make a bonus issue is announced,the issuewithdrawn.

• can be withdrawn subject to provisions of SEBI (ICDR) Regulations,2009
• cannot
• can
• none of these

Q.32:- Condition to be fulfilled of Bonus Issue includes that the partly paid shares, if any outstanding on the date of allotment, are made fully paidup

• Incorrect
• May be may not be
• Correct
• D. None of the above

Q.33:- Persons not entitled for allotment of shares on preferential basis, A listed issuer may make a preferential issue of specified securities, if:

• All the equity shares, if any, held by the proposed allottees in the issuer are in dematerialized form and the issuer has obtained the Permanent Account Number (PAN) of the proposed allottees.
• A special resolution has been passed by itsshareholders
• The issuer is in compliance with the conditions for continuous listing of equity shares as specified in the listing agreement with the recognized stock exchange where the equity shares of the issuer are listed;
• All of the above.

Q.34:- The Company shall issue fully paid up Bonus Shares except outof:

• Reserves created by the revaluation ofassets.
• The securities premium account;
• The capital redemption reserveaccount
• Free Reserves of theCompany,

Q.35:- . Which of the following is required to be disclosed to recognize stock exchange by the issuer after payment of consideration to the dissenting shareholders?

• Details of aggregate numbers of tendered, accepted and payment of consideration.
• A report by the merchant banker that the payment has been duly made to all the dissenting shareholder whose shares have been accepted in the exit offer.
• The post-offer shareholding pattern of the issuer
• D All of the above.

Q.36:- Certain shares are eligible for the computation of promoter’s contribution e.g.

• Issued in last three years out of bonus issue by utilization of revaluation reserve, or unrealized profits of the issuer or from bonus issue against equity shares.
• Issued in last one year at a price lower than issue price, unless topped up.
• Issued in last three years out of bonus issue by utilization of unrealized profits of the issuer or from bonus issue against equity shares.
• None of above

Q.37:- . Which of the following is not following under SEBI stipulated the eligibility norms under the Profitability route for entities planning an IPO:

• Net intangible assets of at least INR3 crore in each of the preceding three full years of which not more than 50 per cent are held in monetary assets.
• Net worth of at least INR1 crore in each of the preceding three full years.
• Minimum of INR15 crore as average pre-tax operating profit in at least three years of the immediately preceding five years.
• The aggregate of the proposed issue and all previous issues made in the same financial year in terms issue size should not exceed five times the pre-issue net worth as per the audited balance sheet of the preceding financial year.

Q.38:- Chapter VII of SEBI (ICDR), 2009 deals with:

• Preferential issue
• Rights issue
• Public issue
• All of the above

Q.39:- Maximum permissible Non-public shareholding in listed companies other the public sector companies:

• 90%
• 75%
• 50%
• 25%

Q.40:- The dissenting shareholders who have tendered their shares in acceptance of the exit offer:

• Shall have the option to withdraw such acceptance even after the date of closure of the tendering period
• Shall have the option to withdraw such acceptance till the date of closure of the tendering period
• Shall not have the option to withdraw such acceptance.
• Shall have the option to withdraw such acceptance till the 2 days before date of closure of the tendering period.

Q.41:- Incaseofaninitialpublicoffer,theminimumcontributionofpromotershouldnotbelessthan................ of the post issue capital;

• 40%
• 25%
• 20%
• 30%

Q.42:- The issuer of shares by public issue type. If issue price does not exceed INR 500 per share. Face value shouldbeINR…………per share

• 10
• between 1 to10
• a) or(b)
• None of theabove

Q.43:- The minimum offer to the Public should be………..of the issue size if the post issue capital of thecompany calculated at the offer price is less than or equal to INR 1,600crores

• 20
• 30
• 15
• 25

Q.44:- 17. One of the Pre-Requisites for a Company to be eligible to opt for IPO with respect to SEBI is that the aggregate of the proposed issue and all previous issues made in the same financial year in terms of issue size doesnotexceed………timesitspreissuenetworthasperauditedbalancesheetofPreceding financial year;

• two
• four
• three
• five

Q.45:- Which of the following is required for the purpose of providing exit offer to dissenting shareholders?

• Submission the list of dissenting shareholders, as certified by its compliance officer, to the recognized stock exchange
• Appointment of a merchant banker registered with the Board and finalizes the exit offer price in accordance with these regulations.
• The notice proposing the passing of special resolution for changing the objects of the issue and varying the terms of contract, referred to in the prospectus shall also contain information about the exit offer to the dissenting shareholders.
• All of the above

Q.46:- One of the Pre-Requisites for a Company to be eligible to opt for IPO with respect to SEBI is it has a net worth of at least……crore rupees in each of the preceding three fullyears

• One
• four
• three
• two

Q.47:- In case of exit offer to dissenting shareholders, to ensure security for performance of their obligations, the promoters or shareholders having control, as applicable, shall create an escrow account which may be interest bearing and deposit……… in the account at least two working days prior to opening of the tendering period:

• The aggregate consideration
• 90% of the aggregate consideration
• 80% of the aggregate consideration
• 75% of the aggregate consideration

Q.48:- For the purpose of Chapter VI-A of SEBI (ICDR), 2009, Relevant date means:

• Date of shareholders meeting
• Date of the board meeting in which the proposal for change in objects or variation in terms of a contract, referred to in the prospectus is approved.
• Date of exit offer
• Date of the board meeting in which the proposal for change in objects or variation in terms of a contract, referred to in the prospectus is proposed.

Q.49:- The SEBI (ICDR), 2009 Regulations Not apply to the following:

• An issue of Global Depository Receipts
• A public issue (including an offer for sale) and An issue of bonus and A preferential issue shares by a listed issuer. A qualified institutions placement by a listed issuer
• A qualified institutions placement by a listed issuer
• A rights issue, where the aggregate value of specified securities offered is INR50 lakhs or more.

Q.50:- Who can make exit offer:

• The promoters
• Shareholders in control of an issuer
• None of the above
• Either a or b