Amber Ltd. is a listed company on the leading stock exchange of the country. The company has substantial bank balances in the financial statement for the Financial Year 2020-21. There is no foreseeable investment opportu

Note to Managing Director of Amber Ltd. Sir, This is reference to the conditions for buy-back of shares with reference to the SEBI (Buy-Back of Securities) Regulations, 2018. The said Regulations shall be applicable to buy-back of shares or other specified securities of a company in accordance with the applicable provisions of the Companies Act, 2013. Accordingly following condition are framed for buy-back of shares and specified securities. (i) The maximum limit of any buy-back shall be 25% or less of the aggregate of paid-up capital and free reserves of the company based on both standalone and consolidated financial statements of the company. (ii) The ratio of the aggregate of secured and unsecured debts owed by the company to the paid-up capital and free reserves after buy-back shall,- a) be less than or equal to 2:1, based on both standalone and consolidated financial statements of the company: However if a higher ratio of the debt to capital and free reserves for the company has been notified under the Companies Act, 2013, the same shall prevail; or b) be less than or equal to 2:1, based on both standalone and consolidated financial statements of the company, after excluding financial statements of all subsidiaries that are non-banking financial companies and housing finance companies regulated by Reserve Bank of India or National Housing Bank, as the case may be: However buy-back of securities shall be permitted only if all such excluded subsidiaries have their ratio of aggregate of secured and unsecured debts to the paid-up capital and free reserves of not more than 6:1 on standalone basis. (iii) All shares or other specified securities for buy-back shall be fully paid-up. (iv) A company may buy-back its shares or other specified securities by any one of the following methods: a) from the existing share holders or other specified securities holders on a proportionate basis through the tender offer; b) from the open market through- i) book-building process, ii) stock exchange; c) from odd-lot holders: Provided that the buyback from open market shall be less than fifteen per cent of the paid up capital and free reserves of the company, based on both standalone and consolidated financial statements of the company. (v) A company shall not buy-back its shares or other specified securities: (a) so as to delist its shares or other specified securities from the stock exchange. (b) from any person through negotiated deals, whether on or off the stock exchange or through spot transactions or through any private arrangement. (vi) A company shall not make any offer of buy-back within a period of one year reckoned from the date of expiry of buy-back period of the preceding offer of buy-back, if any. (vii) A company shall not allow buy-back of its shares unless the consequent reductions of its share capital is effected. (viii) A company may undertake a buy-back of its own shares or other specified securities out of- (a) its free reserves; (b) the securities premium account; or (c) the proceeds of the issue of any shares or other specified securities. Buy-back shall not be made out of the proceeds of an earlier issue of the same kind of shares or same kind of other specified securities. (ix) The company shall not directly or indirectly purchase its own shares or other specified securities: (a) through any subsidiary company including its own subsidiary companies; (b) through any investment company or group of investment companies; or (c) if a default is made by the company in the repayment of deposits accepted either before or after the commencement of the Companies Act, interest payment thereon, redemption of debentures or preference shares or payment of dividend to any shareholder, or repayment of any term loan or interest payable thereon to a financial institution or banking company. The buy-back is not prohibited, if the default is remedied and a period of three years has lapsed after such default ceased to subsist.