Conversion of liability into shares would be subject to lock in

SpiceJet Limited (‘Company’) a listed public company which had an outstanding lease liability payable to aircraft lessor (‘vendor’). The management proposed to issue equity shares on preferential basis to the vendors in lieu of its lease liability to restructure its outstanding liabilities (‘proposed transaction’).

In reference to this, the company has sought informal guidance from SEBI on applicability of Regulation 163(3) & 167(2) of SEBI ICDR Regulations1 on the proposed transaction.