ABC Company Ltd. had issued 2000 equity shares of ₹80 each with attachable warrant on 20th June, 2018. The warrant can be exchanged in equity in the proportion of 1:1. S, a shareholder who was allotted 200 equity shares
CS Executive · Securities Laws and Capital Markets · PYQS · December 2021
ABC Company Ltd. had issued 2000 equity shares of ₹80 each with attachable warrant on 20th June, 2018. The warrant can be exchanged in equity in the proportion of 1:1. S, a shareholder who was allotted 200 equity shares with attachable warrant on 20th June, 2018 wants to know the warrant premium if the market value of warrant is ₹18 and exercise price is ₹70. When ABC Company can forfeit the warrant?
Answer & Explanation:
When warrant holder does not exercise the option to take equity shares against any of the warrant held by the warrant older, within three months from the date of payment of consideration, such consideration made in respect of such warrants shall be forfeited by the issuer.
Topics: Capital Market Instruments
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