RIGHTS AND RESPONSIBILITIES OF SPONSOR(S) :
Regulation 11 provides for the rights and responsibilities of the Sponsor(s). These are the followings:-
1. The sponsor(s) shall set up the REIT and appoint the trustee of the REIT.
2. The sponsor(s) shall transfer or undertake to transfer, its entire shareholding or interest in the SPV or entire ownership of the real estate assets to the REIT prior to allotment of units of the REIT to the applicants.
However, this shall not apply to the extent of any mandatory holding of shares or interest in the SPV by
the sponsor(s) as required any Act or regulations or circulars or guidelines of government or regulatory
authority as specified from time to time.
3. With respect to holding of units in the REIT, the sponsor(s) shall,-
(a) Hold a minimum of 25% of the total units of the REIT after initial offer on a post-issue basis and shall be hold for a period of at least three years from the date of listing of such units. Further, any holding of the sponsor exceeding the minimum holding as specified in this clause, shall be held for a period of at least one year from the date of listing of such units.
(b) Together hold not less than 15% of the outstanding units of the listed REIT.
(c) Individually, hold not less than 5% of the outstanding units of the listed REIT.
4. If the sponsor(s) propose(s) to sell its units below the limit specified in above sub- regulations :-
(a) such units shall be sold only after a period of three years from the date of listing of the units;
(b) prior to sale of such units, the sponsor(s) shall arrange for another person(s) or entity(ies) to act as the re-designated sponsor(s) where the re-designated sponsor satisfy the eligibility norms for the sponsor as specified under these regulation.
However, such units may also be sold to an existing sponsor;
(c) The sponsor/proposed re-designated sponsor shall obtain approval from the unit holders or provide option to exit to the unit holders in accordance with guidelines as may be specified.
However, this clause shall not apply where the units are proposed to be sold to an existing sponsor.
5. If re-designated sponsor(s) propose(s) to sell its units to any another person, conditions specified in above sub- regulations shall be complied with.