(2) A company is allowed to issue equity shares with differential rights only to the extent of 25% of the total issued share capital. (3) Approval of the shareholders is obtained by passing of ordinary resolution at the general meeting. A listed public company is required to pass the resolution through postal ballot. (4) The company has distributable profits in terms of section 205 of the Companies Act, for the 3 financial years preceding the year in which it was decided to issue such shares; (5) The company has not defaulted in filing annual accounts and annual returns , for the 3 financial years preceding the year in which it was decided to issue such shares; (6) The company did not fail to repay its deposits or interest thereon on the due date or redeem its debentures on the due date or pay dividend; (7) The company has not been convicted of an offence under the SEBI Act, Securities Contracts (Regulation) Act or the FEMA Act; and (8) The company has not defaulted in meeting investors’ grievances.