"4D.
Issue of redeemable preference shares
(1)
On and after the commencement of the State Financial Corporations (amendment)
Act, 2000, the Financial Corporation may-
(a)
issue redeemable preference shares on such terms and in such manner as
the Board may decide; and
(b)
convert, such number of equity shares as it may decide into redeemable
preference shares, with the prior approval of the State Government and
the Small Industries Bank, by a resolution passed in the general meeting
of the shareholders:
Provided
that such conversion shall in no case reduce the equity shares held by
the parties referred to in clauses (a), (b) and (c) of sub-section
(3) of section 4 to less than fifty-one per cent. of the issued equity
capital of the Financial Corporation.
(2) The
redeemable preference shares referred to in sub-section (1) Shall-
(a)
carry such fixed rate of dividend as the Financial Corporation may specify
at the time of such issue or conversion; and
(b)
neither be transferable nor carry any voting rights.
4E.Reduction
of share capital
(1)
The Financial Corporation, with the prior approval of the State Government
and the Small Industries Bank, may, by resolution passed in a general meeting
of the shareholders, reduce its share capital in any way.
(2)
Without prejudice to the generality of the foregoing power, the share capital
may be reduced by-
(a)
extinguishing or reducing the liability on any of its equity shares in
respect of share capital not paid-up; or
(b)
either with or without extinguishing or reducing liability on any of its
equity shares, cancelling any paid-up share capital which is lost or is
unrepresented by available assets; or
(c)
either with or without extinguishing or reducing liability on any of its
equity shares, paying of any paid-up share capital which is in excess of
the wants of the Financial Corporation.
4F.Restriction
on exercising of voting right
Every
shareholder of the Financial Corporation holding equity shares shall have
a right to vote in respect of such shares on every resolution and his voting
right on a poll shall be in proportion to his share of the paid-up equity
capital of the Financial Corporation :
Provided,
however, that no shareholder other than a shareholder referred to in clauses
(a), (b) and (c) of sub-section (3) of section 4 , shall be entitled to
excercise voting rights in respect of any equity share held by him in excess
of ten per cent.of the issued equity capital.
4G.
Proxy voting
In
a general meeting referred to in clause (b) of sub-section (1) of section
4D and sub-section (1) of section 4E, the resolution for conversion or
reduction of share capital shall be passed by shareholders entitled
to vote, voting in person, or, where proxies are allowed, by proxy, and
the votes cast in favour of the resolution are not less than three times
the number of votes, if any, cast against the resolution by shareholders
so entitled and voting.
4H.
Transfer of share capital to Small Industries Bank
On
such date as the Central Government may, by notification in the Official
Gazette, notify (hereinafter referred to as the notified date) all the
shares of every Financial Corporation subscribed by the Development Bank
and the amount outstanding in respect of loans in lieu of capital
provided by the Development Bank as on the date immediately preceding the
notified date, shall stand transferred to, and vested in, the Small Industries
Bank, such transfer shall be at such rate and be paid in cash or such other
manner as may be mutually agreed upon between the Development Bank and
the Small Industries Bank.''