(1) The provisions of this Chapter shall not apply where the preferential issue of equity shares is made:

(a) pursuant to conversion of loan or option attached to convertible debt instruments in terms of sub-sections (3) and (4) of sections 81 of the Companies Act, 1956 ;

(b) pursuant to a scheme approved by a High Court under section 391 to 394 of the
Companies Act, 1956 or a Tribunal under sections 230 to 234 of the Companies Act, 2013, whichever applicable Provided that the pricing provisions of this Chapter shall apply to the issuance of shares under schemes mentioned in clause (b) in case of allotment of shares only to a select group of shareholders or shareholders of unlisted companies pursuant to such schemes;

(c) in terms of the rehabilitation scheme approved by the Board of Industrial and Financial Reconstruction under the Sick Industrial Companies (Special Provisions) Act, 1985 or the Tribunal under the Insolvency and Bankruptcy Code, 2016, whichever applicable :
the lock-in provisions of this Chapter shall apply to preferential issue of equity shares mentioned in clause (c).

Provided that the lock-in provisions of this Chapter shall apply to such preferential issue of equity shares.

(2) The provisions of this Chapter relating to pricing and lock-in shall not apply to equity shares allotted to any financial institution within the meaning of sub-clauses (ia) and (ii) of clause (h) of section 2 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 (51 of 1993).

(3) The provisions of regulation 73 and regulation 76 shall not apply to a preferential issue of equity shares and compulsorily convertible debt instruments, whether fully or partly, where the Board has granted relaxation to the issuer in terms of regulation 29A of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 , if adequate disclosures about the plan and process proposed to be followed for identifying the allottees are given in the explanatory statement to notice for the general meeting of shareholders.

The provisions of sub-regulation (2) of regulation 72 and sub-regulation (6) of regulation 78 shall not apply to a preferential issue of specified securities where the proposed allottee is a Mutual Fund registered with the Board or Insurance Company registered with Insurance Regulatory and Development Authority .

Conversion of debt into equity under strategic debt restructuring scheme- The provisions of this Chapter shall not apply where the preferential issue of equity shares is made to the consortium of banks and financial institutions pursuant to conversion of their debt, as part of the strategic debt restructuring scheme in accordance with the guidelines specified by the Reserve Bank of India, subject to the following conditions:

(a) conversion price shall be determined in accordance with the guidelines specified by the Reserve Bank of India for strategic debt restructuring scheme, which shall not be less than the face value of the equity shares;

(b) conversion price shall be certified by two independent qualified valuers, and for this purpose ‘valuer’ shall have the same meaning as assigned to it under clause (r) of sub regulation (1) of regulation 2 of the Securities and Exchange Board of India (Issue of Sweat Equity) Regulations, 2002;

(c) equity shares so allotted shall be locked in for a period of one year from the date of trading approval: Provided that for the purposes of transferring the control, the consortium of banks and financial institutions may transfer their shareholding to an entity before completion of the lock in period subject to continuation of the lock in on such shares for the remaining period with the transferee;

(d) applicable provisions of Companies Act, 2013 are complied with, including the requirement of special resolution.

The provisions of this Chapter shall not apply when any other secured lenders opt to join the strategic debt restructuring scheme in accordance with the guidelines specified by the Reserve Bank of India and convert their debt into equity share in accordance with sub regulation (5).

SEBI (Issue of Capital and Disclosure Require-ments) (Third Amendment) Regulations, 2010 dated 13.04.2010

SEBI (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2017, w.e.f. 15.02.2017

SEBI (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2012, w.e.f. 07.02.2012

SEBI (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2015, w.e.f. 05.05.2015

SEBI (Issue of Capital and Disclosure Requirements) (Second Amendment) Regulations, 2017, w.e.f. 31.5.2017.