9911796707
TMI Blog2019 (11) TMI 686X X X X Extracts X X X X X X X X Extracts X X X X ..... r of this Tribunal for 'Liquidation' of the Corporate Debtor and appointment of Mr. Sudip Bhattacharya to act as 'Liquidator' of the Corporate Debtor for the completion of liquidation proceedings. 3. It is stated that the RP was appointed Interim Resolution Professional (hereinafter referred to as "IRP") of the Corporate Debtor by way of the admission order under section 7 of the I&B Code passed on 17.05.2018 by this Tribunal. The IRP made a public announcement in Business Standard, Indian Express and Loksatta newspapers in terms of Regulation 6(1) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution process for Corporate Persons) Regulations, 2016 ("CIRP Regulations"). 4. A Committee of Creditors (hereinafter referred to as "CoC") was constituted on 06.06.2018 as per section 18(1)(c) of the I&B Code, which comprised of the Financial Creditors of the Corporate Debtor including SBI. The first meeting of CoC was held on 14.06.2018 wherein the IRP was confirmed as the RP of the Corporate Debtor. 5. The RP appointed M/s Adroit and M/s Crest Capital advisers as "Valuers" in accordance with Regulation 27 of the CIRP Regulations for the purpose of dete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Applican, (ii) Lodha Development Management Pvt. Ltd. ("Lodha"), (iii) Ex directors of the Corporate Debtor as well as the (iv) Employees association of the Corporate Debtor vide respective Miscellaneous Applications independently moved by them. These objections are going to be dealt with hereunder. (B) Miscellaneous Application No. 716 of 2019: 11. This application is filed by Lodha Development Management Pvt. Ltd. ("Lodha"), a 'Financial Creditor' and one of the members of the CoC of the Corporate Debtor, having 1.03% of the voting share in the CoC. The admitted claim of Lodha after verification by the RP is Rs. 32.52 Cr. 11.1 The major grievance of Lodha is that the commercial decision arrived at by the CoC for 'liquidation' of the Corporate Debtor is not a sound decision being unsupported by any credible information. It is submitted that as opposed to Liquidation value, Taguda's resolution plan is a better offer for revival of the Corporate Debtor and beneficial to all the stakeholders. 11.2 The resolution plan of Taguda provides for an upfront payment of INR 200 Crores which will be paid in 4 equal tranches in 90 days. The 1st tranche of the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the liquidation value is merely Rs. 67 Crores (approx.) ? questioned by this applicant. On top of it, the time taken may turn out to be more than two years. 11.7 It is further submitted that Adroit Technical Services Pvt. Ltd. has assigned "Nil" value to majority of the sundry debts due to the Corporate Debtor. The reasons assigned for the same are that most of the debtors of the Corporate Debtor are under liquidation proceedings or NPAs themselves and that most of the receivables are outstanding for more than three years. Therefore, even if the Corporate Debtor is liquidated, the financial creditors may recover only the liquidation value of the assets, whereas the possibility of recovering the receivables is almost non-existent. 11.8 Furthermore, it is stated that liquidation of the Company would gravely prejudice the livelihood of the employees of the Corporate Debtor and suffocates the object of the Code i.e. maximization of value of the assets of the Corporate Debtor. 11.9 The Applicant has relied on the judgement of the Hon'ble Supreme Court in the matter of Miheer H. Mafatlal v. Mafatlal Industries Ltd. [(1997) 1 Supreme Court Cases 579], wherein it has laid down th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ust, fair and reasonable from the point of view of prudent men of business taking a commercial decision beneficial to the class represented by them for whom the scheme is meant. 9. Once the aforesaid broad parameters about the requirements of a scheme for getting sanction of the Court are found to have been met, the Court will have no further jurisdiction to sit in appeal over the commercial wisdom of the majority of the class of persons who with their open eyes have given their approval to the scheme even if in the view of the Court there would be a better scheme for the company and its members or creditors for whom the scheme is framed. The Court cannot refuse to sanction such a scheme on that ground as it would otherwise amount to the Court exercising appellate jurisdiction over the scheme rather than its supervisory jurisdiction." 12. The Ld. Counsel for Lodha has also pointed out in its application that Mr. Sudip Bhattacharya, whose appointment the CoC seeks as a liquidator of the Corporate Debtor, is associated and affiliated with Duff and Phelp, a recovery agency who has informed SBI of the potential recovery of Rs. 400 to Rs. 500 Cr. A suspicion is raised regarding the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approve or reject the resolution plan, under Section 30(4) of the I&B Code. At best, the Adjudicating Authority (NCLT) may cause an enquiry into the "approved" resolution plan on limited grounds referred to in Section 30(2) read with Section 31(1) of the I&B Code. It cannot make any other inquiry nor is competent to issue any direction in relation to the exercise of commercial wisdom of the financial creditors - be it for approving, rejecting or abstaining, as the case may be. Even the inquiry before the Appellate Authority (NCLAT) is limited to the grounds under Section 61(3) of the I&B Code. It does not postulate jurisdiction to undertake scrutiny of the justness of the opinion expressed by financial creditors at the time of voting..........." 14. The RP submits that most of the CoC members have voted against the Resolution Plan, merely banking upon one statement of SBI, that was regarding recoveries of the Corporate Debtor. That reliance would be unjust because all the CoC members have given their own reasoning for rejecting or approving the resolution plan. The reasons given by each of the Financial Creditor for rejecting the resolution plan is given below ( extracted from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s filed an application challenging the decision of COC of rejecting Taguda's resolution plan. It is stated that as per the two valuers appointed, the liquidation value of the Corporate Debtor is much less as compared to the proposal of the Resolution Applicant. Hence, keeping in view the interests of all the stakeholders including employees and object of the Code i.e. "promoting resolution over liquidation of corporate debtor" as mentioned in the Preamble of the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018, the decision taken by CoC in its 16th meeting dated 06.02.2019 should be set aside. (D) Miscellaneous Application No. 517 of 2019 17. This Application is filed by Canara Bank on 06.02.2019, a 'financial creditor' dissenting to the resolution plan proposed by Taguda. The Applicant seeks an order against the Resolution Applicant to revise the Resolution Plan by giving preferential treatment to the Applicant. It is stated that the Applicant has 3.14% voting share in the CoC of the Corporate Debtor. However, the plan provides for a meagre share of 0.34% which is nothing but un-proportionate share to the secured creditor of the CoC. 18. It is further sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Resolution Applicant by 06.02.2019 in an instance the Letter of Intent is issued. viii. Rs. 35 Crores is being paid for capital expenditure and working capital requirements of the Corporate Debtor. 22. It is submitted that despite all modifications done as per the suitability of the CoC, the CoC rejected the plan on 06.02.2019 and opted for Liquidation of the Corporate Debtor. The CoC without considering that the liquidation value of the Corporate Debtor, as arrived at by two valuers, is less than even from the upfront payment of the plan, took an unreasonable and un acceptable view, which was abinitio bad in law . 23. The Resolution Applicant further submits that SBI has coloured the mind of all the CoC members by mentioning the wrong figure of liquidation i.e. Rs. 400-500 Crores and without mentioning even the source of this evaluation. The Resolution Applicant submits that even based on the hypothetical assumption of Rs. 400-500 crores of recoveries which would be monitored by a Monitoring Committee consisting of 50% representation by CoC nominee, the total Resolution Plan amount would work out to Rs. 444 crores - Rs. 519 crores (i.e. 13.5% - 15.8% of the total admit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section (2) of section 29: (3) The resolution professional and registered valuers shall maintain confidentiality of the fair value and the liquidation value.". Therefore, as per law, the Liquidation Value of the Corporate Debtor has to be a confidential figure and can be shared only with the CoC members subject to the confidentiality undertaking. Hence, it is not clear that how Taguda is aware of the liquidation value, as it has given the comparing figures of its Resolution Plan and the Liquidation Value of the Corporate Debtor. 27.2 SBI further submits that approval holds only 28.68% of the voting share in CoC, while plan is rejected by 77.61% of CoC members. It states that it has not coloured the minds of CoC members as alleged. The minutes of the 16th CoC meeting show that out of 9 dissenting financial creditors, only 4 had voted in favour of the plan due to the reason of receivables of the Corporate Debtor. Other 5 financial creditors rejected Taguda's Plan on other grounds as mentioned above (supra). 27.3 SBI states that the plan provided for a haircut of 94.78% to the financial creditors, which is another reason for rejection of resolution plan. Furthermore, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Debtor which is merely Rs. 76 Crores (67.11 Cr.) . As far as knowledge of liquidation value is concerned, the Ld. counsel for Taguda submits that it was made aware about the Liquidation value from RP himself and thereafter upon receipt of MA No. 716 of 2019 filed by Lodha. 28.1 It is further submitted that SBI had no substantial information regarding the amount of receivables which it quoted to be Rs. 400-500 Crores valued by "some recovery agency" before the CoC members. It is submitted that when the liquidation value as per the valuers is merely Rs. 67 or Rs. 76 crores, there is no possibility that the debt of the Corporate Debtor would be covered by the liquidation value. 28.2 The Ld. counsel for Taguda submits that the debt of the Corporate debtor to the tune of Rs. 976.77 Crores which is allegedly admitted is in fact not available to the Corporate Debtor. It is submitted that 10% of the confirmed debt of the debtors have already been liquidated and around 45% of these debtors are under litigation. Further, it is a known fact that 10% of such debtors belong to one group which is undergoing bankruptcy proceedings in India. Hence the trade receivables of the Corporate Debto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors are not members of CoC, yet they have a right to participate in each and every meeting held by the CoC and also have a right to discuss along with members of CoC all resolution plans that are presented at such meetings. In this case, the promoter alleges that not only the papers were not given to them by CoC, also they were asked to wait outside the CoC meeting and were not allowed to take part or discuss the plan in the meeting. Therefore, the due procedure is not followed to conduct CIRP proceedings of the Corporate Debtor. Hence, it is argued that the decision of CoC for liquidation of Corporate Debtor be rejected for the same is not taken after complying with the procedure prescribed by law. Findings: 32. To arrive at a rightful conclusion and before coming to pronounce a reasoned judgement it is necessary to first scrutinise the purpose of introduction of the Insolvency Code and for that study of 'Preamble' is paramount , which prescribes as under :- " An Act to consolidate and amend the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximisation of value of assets o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eports pose a different figure. It is worth to note that most of the debtors of the Corporate Debtor are under insolvency/liquidation or NPAs. Further, the debts are more than 4-5 years old and under dispute as per the valuation report given by Adroit, hence, chances of recovery from these debtors is almost negligible. 34. It is seen that four CoC members, namely, Bank of Baroda holding 3.59%, IDBI holding 13.51%, SBI holding 29.09% and UCO Bank holding 2.45% have rejected the resolution plan due to the only reason of alleged presence of receivables. Their respective reasons have already been reproduced above. If a correct figure of receivables is presented to these dissenting financial creditors, then there was every possibility of approval of the plan by around 71% voting. Therefore, even if this contention is considered that there were other reasons given by banks other than the fact that receivables are more than Rs. 400 Crores, then also the plan would have stood approved. 35. That regarding the Apex Court's decision in K. Sashidhar (supra) , this Bench is not suggesting to interfere in general with the commercial wisdom exercised by a CoC, if the implementation of such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Adjudicating Authority has the authority to pierce the veil and expected to judiciously x-ray the scheme/plan. In the present case, the procedure established by law is that the 'commercial wisdom' is to be exercised by the CoC, and if the same is not done, then the Adjudicating Authority within its jurisdiction can neglect such an illogical, unreasoned , unfounded, unsound decision of CoC. In this case, regardless of the fact that the impugned trade receivables cannot be recovered and most of them are stated to be bad debts, even the CoC claims to be able to recover some amount against the outstanding of Rs. 400 crores pursuant to a liquidation order in future. As on date, it is an unpredictable, erratic and capricious situation of recovery i.e. a far fetched imaginary rather unrealistic and simply a dream . As against that, the resolution plan proposes an upfront payment of Rs. 200 Cr. And on the other hand, it is proposed by the RA. to share 75% of the 'trade receivables' that will be given to the financial creditors for the next three years. Thus the CoC by not considering this fact has prima facie failed to exercise its profitable wisdom, strangely relying up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... test decision on three parameters i.e. (i) it's feasibility, (ii) it's viability , and (iii) it's effective implementation. Only after careful examination of these factors an A.A. is expected to record it's satisfaction that too in writing as prescribed U/s 31(1) of the Code. The term 'satisfaction' has been interpreted in a Judgement pronounced in the case of Raj Oil Mills (MA 35/2018 in CP (IB) 1132 (MB)/ 2017 order dated 19/04/2018) by this Bench and the Code prescribes ... Approval of resolution plan "31.(1) If the Adjudicating Authority is satisfied that the resolution plan as approved by the committee of creditors under sub-section(4) of section 30 meets the requirements as referred to in sub-section (2) of section 30, it shall by order approve the resolution plan which shall be binding on corporate debtor and its employees, members, creditors, guarantors and other stakeholders involved in the resolution plan: [Provided that the Adjudicating Authority shall, before passing an order for approval of resolution plan under this sub-section, satisfy that the resolution plan has provisions for its effective implementation.]".............. Thus, o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vent of a liquidation of the corporate debtor under section 53; (c) provides for the management of the affairs of the Corporate debtor after approval of the resolution plan; (d) the implementation and supervision of the resolution plan; (e) does not contravene any of the provisions of the law for the time being in force. (f) ...." 39.4 One of the basic requirement of law is that the offer in a resolution Plan has to be above the Liquidation value. In this case this requirement is very much satisfied, as discussed supra, by the Resolution Applicant. In short , the requirement of Sec.30(2)(b) to be read along with Regulation 39B of IBBI (INSOLVENCY RESOLUTION PROCESS FOR CORPORATE PERSONS ) REGULATIONS,2016 , has been duly complied with. 39.5 A glaring misconduct of CoC has also been highlighted that the Resolution Plan was submitted on 02/02/1019 and the same was rejected on 06/02/ 2019 without giving an opportunity to the Resolution Applicant to explain the Plan. Another wrong doing highlighted is that a copy of the Plan was not shared with the promoter although it is held as a mandatory requirement by the Supreme Court in the case of Vijay Kr Jain ( Civil Appeal No.8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the approval of the resolution plan was mandatory hence dismissed the appeal. In short in both the cases the respected NCLAT had taken a view that in the absence of garnering 75% voting share the resolution plans ought not to be approved. The moot question which was addressed by the Hon'ble Supreme Court as framed was as under; "Having heard learned counsel for the parties, the moot question is about the sequel of the approval of the resolution plan by the CoC of the respective corporate debtor, namely KS&PIPL and IIL, by a vote of less than seventy five percent of voting share of the financial creditors; and about the correctness of the view taken by the NCLAT that the percentage of voting share of the financial creditors specified in section 30(4) of the I&B Code is mandatory. Further, is it open to the adjudicating authority/ appellate authority to reckon any other factor (other than specified in Section 30(2) or 61(3) of the I&B Code as the case may be) which, according to the resolution applicant and the stakeholders supporting the resolution plan, may be relevant?" ( refer para 18 of the judgement) 40.1 After framing the Question, the respected Supreme Court has g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , is not open to challenge before the Adjudicating Authority (NCLT) or for that matter the Appellate Authority (NCLAT). If so, non-recording of any reason for taking such commercial decision will be of no avail. In the present case, admittedly, the dissenting financial creditors have rejected the resolution plan in exercise of business/commercial decision and not because of non-compliance of the ground specified in Section 30(2) or Section 61(3), as such. Resultantly, the amended regulation pressed into service, will be of no avail." 40.3 The Hon'ble Court also talks about subjective satisfaction of the financial creditors, as per following observations :- "The subjective satisfaction of the financial creditors at the time of voting is bound to be a mixed baggage of variety of factors. To wit , the feasibility and viability of the proposed resolution plan and including their perceptions about the general capability of the resolution applicant to translate the projected plan into a reality. The resolution applicant may have given projections backed by normative data but still in the opinion of the dissenting financial creditors, it would not be free from being speculative. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refer para 77 of the judgement ) 41. In this case under these parameters, as narrated herein above , on one hand there was a proposal of Liquidation and on the other hand there was the existence of a resolution plan of Taguda and thus both points to be are examined. In this case, it seems that the decision of CoC is based on some wrong unsubstantiated facts that is why the judicious applicability of mind by the CoC has gone in the wrong direction. The Adjudicating Authority may not be in a position to go into the nitty-gritty of the commercial aspects of the plan, but even a reasonably prudent man would not support such obnoxious decision of the CoC. My reason and conscience do not allow me to let this company go into liquidation when such a better beneficial offer is already on the table. When one of the valuer has assigned 'zero' value to the trade receivables and the source of the information regarding receivables being worth Rs. 400 Cr. is not known, I shall not let some misconceived facts take the company down on its knees and then ultimately die. Therefore, the endeavour is to save this company from liquidation in the larger interest of the employee and the public at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n a period of three years financial creditor shall be paid 75 % of the actual amount recovered in excess of Rs. 75 Cr after paying expenditure incurred. The monitoring committee look after the procedure and transaction. It is clarified that no amount shall be paid beyond three years or recoveries are less than Rs. 75 Cr. 42.2 All other proposal have been perused and prima facie appears to be advantageous for the debtor company, as well as other stakeholders. This plan of Taguda Ltd is hereby approved. For the sake of completeness, however keeping brevity in mind only the relevant portion of the plan is reproduced below to be made a part of this order;- " RESOLUTION PLAN- USHDEV INTERNATIONAL LIMITED Submitted by:- -TAGUDA PTE LIMITED RESOLUTION PLAN General Overview Taguda Pte Limited, a private limited company incorporated under the laws of Singapore and having its registered office at 1 Magazine Road, #04-11 Central Mall Singapore 059567 (the Resolution Applicant or Taguda), is pleased to submit this resolution plan (the Resolution Plan) for Ushdev International Limited (Company) under the IBC, and in accordance with the Request for Resolution Plan (RFRP), the CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esale (including import and export) trade of ferrous and non-ferrous metals and precious stones through its wholly owned subsidiaries. The Resolution Applicant also deals in mining activities and consultancy services in real estate. The Resolution Applicant has established its business model by building a long-term relationship to clients and suppliers, a highly trusted commitment to quality and deliver the best possible customer service. Mr. Sagar Subhash Zaveri, an Indian national who has global wings in trading and mining operations, owns 100% (one hundred percent) of the share capital of the Resolution Applicant and its subsidiaries in the manner set out below: Brief Background of Mr. Sagar Subhash Zaveri Mr. Sagar Subhash Zaveri is a commerce graduate and hails from a family traditionally into business, started his first business venture at the young age of 19. He is the third-generation entrepreneur with unique approach and understanding of the business. With his expertise, he has been able to form a customized and profitable business model best suited to the current market scenario, the benefits of which, he offers to clients. Mr. Zaveri's foray as a businessman and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... siness activity of metal and precious stone trading. It has net worth of USD 19.55 million and revenue of USD 101.28 million; and (d) Gympie Eldorado Mining Pty. Limited, Australia: Located in the mining hub of Australia, owns a sprawling land of over 125 hectare with a plan to develop an industrial park in collaboration with the local partners, along with initiation of trading business activities. Company- ideal platform to grow the business of the Resolution Applicant Resolution Applicant has presence in commodity trading where it trades into ferrous & non-ferrous metals, precious metals and stones. It has operations in Singapore, Hong Kong, Australia and UAE. Company at one point in time was marquee player in Indian commodity segment with strong distribution infrastructure, hedging platform and trading team. Resolution Applicant has good client base in India and Company's trading platform can support the growth plan of Resolution Applicant in India. Trading operations similar to Company can facilitate the entry of Resolution Applicant into Indian commodity distribution market and capturing significant market share. Resolution Applicant is confident about the future gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sagar Zaveri. The Identified Affiliate is compliant with Section 29A of IBC and the manner of payment (at the discretion of the Resolution Applicant) shall be in compliance with the requirements of IBC and informed to the CoC. On 30th day from Transfer Date* 3. The Resolution Applicant shall cause the Company to pay an amount of INR 50 crore to the Financial Creditors. On 60th day from Transfer Date* 4. The Resolution Applicant shall cause the Company to pay an amount of INR 50 crore to the Financial Creditors. On 90th day from Transfer Date* 2. Payment to the Financial Creditors against recoveries from the Existing Receivables In addition, if the cash recoveries made by the Resolution Applicant and/or the Company from the Existing Receivables (net of debtors) during the period of 3 years from the Transfer Date are in excess of INR 75 crores, the Financial Creditors shall be paid 75% of the actual amounts recovered that are in excess of INR 75 crore (after paying all costs and expenses incurred in making cash recoveries and costs and expenses incurred for the Monitoring Committee). The Financial Creditors shall be paid their pro rata share at the end of each ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the Existing Receivables (net of debtors) made by the Resolution Applicant and/or the Company, within the period of 3 years from the Transfer Date, are in excess of INR 75 crores in aggregate, the Financial Creditors shall be paid 75% of the actual amounts recovered that are in excess of INR 75 crore (and after paying all costs and expenses incurred in making cash recoveries and costs and expenses incurred for the Monitoring Committee). This amount payable to the Financial Creditors is proposed to be paid at the end of each year for 3 years from the Transfer Date, as the Resolution Applicant believes that this time period is required to successfully recover amounts against the Existing Receivables. It is, however, clarified that the Financial Creditors shall not be paid any amounts if (i) the cash recoveries from the Existing Receivables are made after 3 years from the Transfer Date; or (ii) the cash recoveries from the Existing Receivables is less than INR 75 crore (after paying all costs and expenses incurred in making cash recoveries and costs and expenses incurred for the Monitoring Committee). For clarity, INR 197 crore is the maximum amount that the Resolution Applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsfer Date. 2 Operational Creditors (including workmen and employees) 913.79 INR 2 crore or Liquidation Value owed to Operational Creditors, whichever is higher, to be paid out of INR 50 crore of Investment Amount 3 Statutory claims NA To the extent the claims with respect to statutory liabilities are included as part of Operational Debt, proportional share out of the payments to the Operational Creditors as mentioned above, to be paid out of INR 50 crore of Investment Amount 4 CIRP Cost payment Actuals INR 1 crore, to be paid out of INR 50 crore of Investment Amount 5 Shareholders Nil Capital reduction of shares held by Promoters, and public shareholders holding more than 5,000 equity shares, at NIL value 6 Capital expenditure and working capital for revival of the Company NA INR 35 crore to be infused in the Company over a period of 12 months from the Transfer Date Executive Summary; Statement on Treatment of all Stakeholders 2.1 This Resolution Plan deals with and addr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... each on or before 60th day and 90th day from the Transfer Date. Notwithstanding anything stated herein, the Bid Bond and the Performance Bank Guarantee/PBG as paid by the Resolution Applicant as per the requirements of RFRP shall be treated as part of the Investment Amount, and used towards payment of the first payment of INR 47 crore proposed to be made to the Financial Creditors on the Transfer Date. 2.3 Out of the Resolution Amount, the Resolution Applicant shall infuse an amount aggregating to INR 35 crore in the Company over a period of 12 months from the Transfer Date for meeting Company's capital expenditure and working capital requirements. This amount will be infused by the Resolution Applicant either directly or through any of its Indian Affiliates (such entity shall be compliant with Section 29A of IBC) by way of debt or equity funding, as it may consider appropriate. 2.4 In addition to the Resolution Amount, the Financial Creditors shall be paid 75% of the cash recoveries made by the Resolution Applicant and/or the Company from the Existing Receivables (net of debtors) within 3 years from the Transfer Date, that are in excess of INR 75 crore (plus all costs and e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editors. (iv) However, and without prejudice to the above, if the shortfall in cash balance available with the Company as on the Transfer Date is in excess of INR 1 crore, the Resolution Applicant proposes that INR 47 crore that is set aside to be paid to the Financial Creditors shall be reduced with an amount such that the CIRP Costs are paid in full and in priority to any other payments to the creditors of the Company. 3.2 Financial Creditors (i) As per the Information Memorandum, the total claims filed by the Financial Creditors is INR 3,301.70 crores, out of which claims aggregating to INR 3,292.52 crores have been verified and admitted by the Resolution Professional pursuant to the CIRP Regulations as on 26 January 2019. This admitted claim amount and any other claims submitted by the Financial Creditors that are verified and admitted by the Resolution Professional pursuant to the CIRP Regulations (together, the Admitted Debt) are proposed to be settled in full in accordance with this Clause 3.2. Based on the information shared by the Resolution Professional, it is hereby assumed that the Admitted Debt is the entire debt owed to the Financial Creditors. (ii) No amounts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editors or any party concerned. (c) In addition to the payments under sub-Clause (a) and sub-Clause (b) above, the Resolution Applicant proposes that Financial Debt aggregating to INR 100 crore out of the Admitted Debt shall be repaid by the Company to the Financial Creditors in two equal tranches in the following manner: (A) INR 50 crore on or before the 60th day from the Transfer Date; and (B) INR 50 crore on or before the 90th day from the Transfer Date. The internal accruals of the Company may be used to fund the repayment of aforesaid instalments by the Company. In addition, if any amounts are required for repayment of aforesaid instalments by the Company, it shall be funded by the Resolution Applicant by way of subscription of such instruments including equity shares, convertible preference shares or convertible/non-convertible debentures or any debt funding as it may decide in its sole discretion in the Company, detailed terms of which are set out in Schedule V. (d) Any balance Financial Debt forming part of the Admitted Debt (Unpaid Debt), i.e. the Admitted Debt as reduced by the amounts mentioned in sub-Clauses (a), (b) and (c) above, is proposed to be converte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the members of the Monitoring Committee shall be borne by the Company, subject to a maximum amount of Rs. 75 lakhs. The term of the Monitoring Committee shall be until the completion of 3 years from the Transfer Date. C. Any cash recoveries made by the Resolution Applicant and/or the Company within a period of 3 years from the Transfer Date of up to INR 75 crore (after payment all costs and expenses incurred in making cash recoveries as mentioned in sub-Clause (A) above and costs and expenses incurred for the Monitoring Committee as mentioned in sub-Clause (B) above) shall be retained by the Company, and the Financial Creditors shall not be paid any amounts from such recoveries. If, however, the cash recoveries made by the Resolution Applicant and/or the Company (net of debtors) within 3 years from the Transfer Date are in excess of INR 75 crore (after payment all costs and expenses incurred in making cash recoveries as mentioned in sub-Clause (A) above and costs and expenses incurred for the Monitoring Committee as mentioned in sub- Clause (B) above), such cash recoveries that are in excess of INR 75 crore (after payment of above mentioned cost and expenses) will be shared be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of INR 50 crore constituting the Assigned Debt by Taguda India Private Limited in the manner set out in Schedule XI. The Excluded Securities shall also not be extinguished or waived under this Resolution Plan and will continue be available with the Financial Creditors in accordance with their terms, which may be exercised by the Financial Creditors at their discretion. All other securities or other Encumbrances provided by the Company including on the fixed assets of the Company shall be extinguished as on the Final Settlement Date. The Financial Creditors reserve the right to take any action against the Promoters. (iv) Other than the payments as specified in this Clause 3.2 above, any and all other claims or demands made by or liabilities or obligations owed or payable to (including any demand for any losses or damages, principal, interest, compound interest, penal interest, liquidated damages, notional or crystallized mark to market losses on derivatives and other charges already accrued/ accruing or in connection to any third party) any actual or potential Financial Creditors of the Company or in connection with any debt of the Company (including any transactions in deri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sers and agents), the Company and the Resolution Applicant shall at no point of time, directly or indirectly, have any obligation, liability or duty in relation thereto. Furthermore, subject to sub-Clause (vii) below, any third party (other than the Promoters) who has guaranteed or secured the obligations of the Company shall stand discharged of and not liable for any default or event of default under any loan documents or other financing agreements or financing arrangements (including any side letter, letter of comfort, letter of undertaking etc) and all rights/ remedies of the creditors shall stand permanently extinguished. Notwithstanding anything stated herein, the Excluded Securities and Assigned Securities shall continue to survive, in the manner set out in this Resolution Plan. The Resolution Professional (and his representatives, advisers and agents), the Company or the Resolution Applicant shall have no liability, either present or arising in future, and all such liability shall be waived in entirety, either pursuant to a right of subrogation under law or otherwise, for any amounts or obligations paid or discharged by the Promoters or any third party pursuant to any guaran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able Law, the Excluded Securities and Assigned Securities shall be free from any subrogation rights of the Promoters or respective guarantors or security provider. By virtue of the approval of this Resolution Plan by the Adjudicating Authority, the Promoters or respective guarantors/ security provider shall have no claim of any right of subrogation, indemnity, security, recompense or any claim of whatsoever nature (whether under contract, equity or Applicable Law) against the Company, assignee or the Resolution Applicant against recovery or reimbursement or any amounts paid by them pursuant to invocation of the Excluded Securities and Assigned Securities, and all such rights and obligations stand irrevocably and unconditionally extinguished in perpetuity. Along with the assignment of the Assigned Debt, the Financial Creditors shall deliver and shall cause to be delivered to the Identified Affiliate, all documents (including loan agreements, guarantees, security documents, title deeds, lease deeds, lease agreements, demand promissory notes, records, powers of attorneys, post-dated cheques, other negotiable instruments, share certificates encumbered with the Financial Creditors and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal Creditors (excluding employees and workmen) aggregate to INR 913.04 crores out of which claims aggregating to INR 912.15 crores have been verified and admitted by the Resolution Professional pursuant to the CIRP Regulations as on 26 January 2019. Further, the Information Memorandum also records claims amounting to INR 0.75 crore made by the workmen and employees of the Company out of which claims aggregating to INR 0.63 crore have been verified and admitted as on 26 January 2019. The admitted claim amount and any other claims submitted by the Operational Creditors including the employees and workmen of the Company that are verified and admitted by the Resolution Professional pursuant to the CIRP Regulations are proposed to be settled in accordance with this Clause 3.3. (ii) The claims of the Operational Creditors (including employee and workmen) will be paid in compliance with Regulation 38 of the CIRP Regulations. The Resolution Applicant proposes to pay an amount aggregating to INR 2 crore or the Liquidation Value due to Operational Creditors, whichever is higher (Operational Creditors Dues) in priority to any amounts paid to the Financial Creditors of the Company, out of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Schedule III, the balance sheets of the Company or the profit and loss account statements of the Company or the Information Memorandum, in relation to any period prior to the Insolvency Commencement Date will be written off in full and shall be deemed to be permanently extinguished by virtue of the order of the Adjudicating Authority approving this Resolution Plan and the Resolution Professional (and his representatives, advisers and agents), the Company and the Resolution Applicant shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. (v) Subject to the Adjudicating Authority granting the relief as set out in Clauses 13, 14, 15 and 16 of Schedule VII of this Resolution Plan, any Encumbrance or any other form of collateral (whether over immovable, movable assets, fixed deposits or cash or any other rights or privileges and including without limitation, any guarantee, security, letter of credit or pledge provided by the Promoters of the Company) that was created/granted/arranged in connection with any Operational Debt of the Company, at any time prior to the Insolvency Commencement Date, shall automatically be waived and/or rele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an the statutory liabilities that have been filed/ claims as dues of the Operational Creditors, all monetary claims or demands made by, or financial liabilities or obligations owed or payable to or assessed by, the Governmental Authorities including but not limited to the Central government, the State governments, any regulatory or local authority or body or any agency or instrumentality thereof, in relation to any Taxes, including all such dues, duties, direct or indirect, penalties, fees, interest, fines, levies, cesses, assessments or additions or any other charges or payments whatsoever (including without limitation, claims by tax authorities and any financial liabilities in relation to any consent, permission, privilege, entitlement, exemption, benefit, license or approval granted to the Company or in relation to the Company, whether or not such consent, permission, privilege, entitlement, exemption, benefit, license or approval is subsisting, lapsed or expired), existing Tax related proceedings, whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... increase, compensation, or any other such liability whatsoever under any contract, agreement, lease, license, approval, consent or permission to which the Company are entitled; (d) any leasehold rights or freehold rights to movable or immovable properties in the possession of the Company (including but not limited to the leases, letter of intent or other agreements/contracts/arrangements for immovable property entered into by the Company with the Central and State Government); and (e) any contracts, agreements or commitments made by the Company, in each of the foregoing cases whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the Schedule III, the balance sheets of the Company or the profit and loss account statements of the Company or the Information Memorandum, in relation to any period prior to the Insolvency Commencement Date will be written off in full and will be deemed to be permanently extinguished by virtue of the order of the Adjudicating Authority approving this Resolution Plan, and the Resolution Professional (and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1881, and the Tax related claims or liabilities) in relation to any matter for the period prior to the Insolvency Commencement Date, including the existing litigations or proceedings as set out in Schedule VI, shall be settled at NIL value as against any amount determined to be paid by the Company and accordingly, all financial liabilities or obligations of the Company in relation thereto, whether or not set out in the Provisional Balance Sheet, the balance sheets of the Company or the profit and loss account statements of the Company or the Information Memorandum, will be deemed to have been waived and written off in full against a NIL value by virtue of the order of the Adjudicating Authority approving this Resolution Plan. By virtue of the order of the Adjudicating Authority approving this Resolution Plan, no amounts or monies shall be payable by the Company and no financial liability or obligation will arise in future for the Company in relation to any existing litigations or proceedings that pertain to the period prior to the Insolvency Commencement Date. All new inquiries, investigations, notices, suits, claims, disputes, litigation, arbitration or other judicial, regulato ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority, court, tribunal or any other forum prior to the Transfer Date or (b) that may arise out of any proceedings, inquiries, investigations, orders, show cause, notices, suits, litigation etc (including any orders that may be passed by the Adjudicating Authority pursuant to Sections 43, 45, 49, 50, 66, 68, 70, 71, 72, 73, 74 of the IBC), whether civil or criminal, that may be initiated or instituted post the approval of the Resolution Plan by the Adjudicating Authority on account of any transactions entered into, or decisions or actions taken by, such Promoters and existing shareholders, managers, directors, officers, employees, Workmen or other personnel of the Company, and notwithstanding anything stated above the Resolution Professional (and his representatives, advisers and agents), the Company and the Resolution Applicant shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. 3.6 Equity Shareholders (i) The details of the outstanding Equity Share capital of the Company as of the Insolvency Commencement Date is set out in Schedule IV. The Resolution Applicant acknowledges that there are no outstanding preference shares tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any further actions on the part of the Company and/or Resolution Applicant. 4. Proposal for Settlement of Resolution Debt Amount The entire Resolution Debt Amount as understood under the RFRP will be paid in the manner set out in Clause 3 above. 5. Proposal for funding by the Resolution Applicant The Resolution Amount is proposed to be infused by the Resolution Applicant in the following manner: (i) Infusion on and after the Transfer Date: (a) The Resolution Applicant shall infuse the Investment Amount of INR 50 crore in the Company, against subscription of the Equity Shares of the Company, as contemplated under Schedule V. It is clarified that the amounts paid by the Resolution Applicant towards Bid Bond and PBG as per the requirements of the RFRP shall be treated as part of the Investment Amount and on the Transfer Date, Equity Shares shall be issued to the Resolution Applicant for such amounts; and (b) On or before the 30th day from the Transfer Date, the Resolution Applicant shall cause the Identified Affiliate to pay an amount aggregating to INR 50 crore towards Assigned Debt. The Identified Affiliate is compliant with Section 29A of IBC and the manner of payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) above, the Resolution Applicant proposes to infuse an additional amount of INR 35 crore over a period of within 12 months from the Transfer Date to meet the Company's capital expenditure and working capital requirements. This infusion over 12 months period will be made by the Resolution Applicant either directly or through its Affiliates (such entity shall be compliant with Section 29A of IBC) on such dates and in instalments of such amounts as the Resolution Applicant considers appropriate based on business needs of the Company. For this purpose, the Resolution Applicant or its Affiliates, as the case may be, shall subscribe to such instruments issued by the Company, including Equity Shares, convertible preference shares or convertible/non-convertible debentures as the Resolution Applicant may decide in its sole discretion. 6. Other Mandatory Contents of the Resolution Plan 7.1 The Resolution Applicant confirms and represents that the provisions of Section 29A of the IBC or any other Applicable Law do not disqualify the Resolution Applicant in presenting this Resolution Plan. The relevant disclosures to establish the eligibility of the Resolution Applicant under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Company on the date of approval of this Resolution Plan. Mr. Arvind Prasad shall cease to have any executive responsibilities in the Company and shall continue as a non-executive director of the Company, on and from the date of the approval of this Resolution Plan by the Adjudicating Authority. During the implementation of this Resolution Plan, Mr. Arvind Prasad shall not be in the management or control of the business of the Company. As per the Information Memorandum, Mr. Prateek Gupta, Mrs. Suman Gupta and Mr. Arvind Prasad constitute the Board and Mr. Prateek Gupta and Mrs. Suman Gupta shall vacate the office of director as stated above. In addition to Mr. Arvind Prasad appointed as a non-executive director of the Company, IMA shall be entitled to nominate one other individual to act as a director of the Company on and from the date of the approval of this Resolution Plan by the Adjudicating Authority and until the Transfer Date. (b) On and from the date of approval of this Resolution Plan by the Adjudicating Authority, the Resolution Applicant shall have the right to nominate directors on the Board in accordance with the Act and other Applicable Laws. In addition to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocess of the Company) shall be met out of internal accruals of the Company. It is clarified that for the entire Interim Period, the Board (constituting the representative nominated by the Resolution Applicant) shall act on the instructions of or subject to the approval of the IMA and any action taken by the Board without the instructions or approval of the IMA shall be void. (iv) During the Interim Period, IMA shall: (a) not undertake any additional financial commitments of any nature whatsoever, borrow any amounts or incur any other liabilities or expenditure, issue any additional guarantees, indemnities, letters of comfort or commitment either for themselves or on behalf of its respective Affiliates or associates or any third party, or sell, transfer, alienate, charge, mortgage or encumber or deal in any of its properties/assets, except when written consent of the Resolution Applicant; (b) except as provided in the Resolution Plan, not make any change in capital structure of the Company either by way of any increase (by issue of Equity Shares, bonus shares, convertible debentures or otherwise), decrease, reduction, reclassification, sub-division or consolidation, re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement after CoC's Approval After approval by the CoC and until the approval of the Resolution Plan by the Adjudicating Authority, all major business decisions impacting the shareholders' value and the running of the Company along with its business shall be made by the Resolution Professional. 7.7 Concessions, Reliefs and Dispensation Sought The Resolution Applicant requests for the reliefs, concessions and dispensations set out in Schedule VII in order for the Resolution Plan to be successful and each of these may be included in the Adjudicating Authority order approving the Resolution Plan and if not expressly included, shall be deemed to be included in such order. 7.8 In case the Adjudicating Authority does not grant any of the reliefs, concessions and dispensations as claimed under Schedule VII of this Resolution Plan, the Resolution Applicant shall implement the Resolution Plan without such reliefs, concessions and dispensations, unless such reliefs have been stated to be an integral part of this Resolution Plan and without which this Resolution Plan stands withdrawn. For clarity, the reliefs set out in Para 1, 2, 9, 13, 14, 15 and 16 of Schedule VII of this Resol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rly placed class of creditors or stakeholders as stated in this Resolution Plan. 11 Compliance with Applicable Law The Resolution Applicant hereby confirms that this Resolution Plan and performance of actions contemplated herein are not in contravention of the provisions of law for the time being in force and are in strict compliance with the IBC and the CIRP Regulations. 12 Binding Nature of the Resolution Plan 12.1 Upon the approval of this Resolution Plan by the Adjudicating Authority, it shall be binding on the Resolution Applicant, Company and its employees, members, creditors, guarantors and other stakeholders involved in this Resolution Plan and/or otherwise concerned or connected with the Company. 12.2 Any breach of the terms of this Resolution Plan or default in the performance of the obligations hereunder by any of the foregoing persons shall cause irreparable damage to the Resolution Applicant and its proposal to revive the Company. Accordingly, in case of such breach or default, the Resolution Applicant shall have the right to an injunction or other equitable relief including specific performance of the terms hereof. 12.3 This Resolution Plan overrides all past ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Applicant under this Resolution Plan are subject to the information provided in the Information Memorandum and the information shared on the Data Room, and on the assumptions as set out in this Resolution Plan. 14.2 In case of any changes or modifications to any of the foregoing, the Resolution Applicant shall be entitled to seek suitable amendments to this Resolution Plan. 15 Severability and a challenge to this Resolution Plan 15.1 None of the provisions of this Resolution Plan are severable. If any provision of this Resolution Plan (or any part thereof) is declared invalid, unenforceable or illegal, all the other provisions of this Resolution Plan shall stand suspended. The Resolution Applicant may, however, in its absolute and sole discretion choose to implement the other provisions of the Resolution Plan which have not been declared illegal, invalid or unenforceable. 15.2 If at any time the Resolution Applicant or Resolution Professional becomes aware of any circumstances that is or is likely to adversely impact the Resolution Plan or its implementation or fulfilment of any of the conditions or term of the Resolution Plan, such Person shall immediately and in any event ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esolution plan arising out of or pursuant to the obligations of the Resolution Applicant. 18 Definitions Capitalised terms used in this Resolution Plan shall have meanings and definitions set out in Schedule I. If not defined in Schedule I, the capitalised terms used in this Resolution Plan shall have meanings as understood in the RFRP. We understand that the members of the CoC have further right to renegotiate the terms of this Resolution Plan and the decision of the CoC in selection of the Successful Resolution Applicant shall be final and binding on us. Yours faithfully, Name: Amita Subhash Zaveri (Common Seal) Date: 2 February 2019 Place: Mumbai SCHEDULE III DETAILS OF CLAIMS PROVIDED IN INFORMATION MEMORANDUM Amount claimed Claims verified and admitted Currency: INR crore Financial creditors 3,301.70 3,292.52 Operational creditors (excluding employees and workmen) 913.04 912.15 Operational creditors (employee and workmen) 0.63 0.63 Total 4,215.50 4,205.32 SCHEDULE IV DETAILS OF OUTSTANDING EQUITY SHARES Equity Shares: Details of the Equity Shareholding of the Company is represented in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shares of the Company at the face value, and there will be capital reduction by way of cancellation of these Equity Shares held by the Financial Creditors against payment of Nil amount. The terms of the capital reduction are mentioned in Paragraph 5 below of this Schedule V. Subject to above, INR 50 crore to be paid to Financial Creditors towards the Assigned Debt, in terms of this Resolution Plan. On 30th day from the Transfer Date* 7. 25% of the Unpaid Debt held by the Financial Creditors will be converted into Equity Shares of the Company at the face value, and there will be capital reduction by way of cancellation of these Equity Shares held by the Financial Creditors against payment of Nil amount. The terms of the capital reduction are mentioned in Paragraph 5 below of this Schedule V. Subject to above, payment of INR 50 crore to the Financial Creditors. On 60th day from the Transfer Date* 8. 25% of the Unpaid Debt held by the Financial Creditors will be converted into Equity Shares of the Company at the face value, and there will be capital reduction by way of cancellation of these Equity Shares held by the Financial Creditors against payment of Nil amount. The terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r applicable. 3.3 The Resolution Applicant proposes that no share certificate will be issued by the Company with respect to the New Equity Shares and only a letter of allotment will be issued by the Company to evidence issuance of the New Equity Shares The New Equity Shares will not be dematerialized thereby not requiring compliance with the procedural requirements of the depositories and/or the stock exchanges. Provided, however, if there any other mandatory requirements prescribed by the Reserve Bank of India as applicable for lenders for the treatment of New Equity Shares as mentioned herein, then the Resolution Applicant shall discuss those requirements with the Financial Creditors and address those requirements. 3.4 Any fee required to be paid to the ROC and the stamp duty, if any, for the increase in the authorized share capital to allow the conversion of Unpaid Debt into Equity Shares, shall be funded from the cash flows of the Company, and if cash is not available with the Company, then such expenses shall be funded by the Resolution Applicant and/or its Affiliates. For the purpose of determination of the stamp duty, the Resolution Applicant has assumed the following: ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mbursement or any amounts paid by them pursuant to invocation of the Excluded Securities and/or Assigned Securities, and all such rights and obligations stand irrevocably and unconditionally extinguished in perpetuity. 4.3 The subscription by the Resolution Applicant or its Affiliates of the Equity Shares or any other instruments issued by the Company to fund (i) the Investment Amount of INR 50 crore on the Transfer Date, (ii) any part of the instalments of INR 50 crore each that may be funded by the Resolution Applicant on the failure of the Company to pay such instalment at the end of 60th day or 90th day from the Transfer Date, and (iii) INR 35 crore to meet the Company's capital expenditure and working capital requirements, shall be an integral part of this Resolution Plan and on the approval of this Resolution Plan by the Adjudicating Authority no separate approvals of the board of directors of the Company, shareholders of the Company, Securities and Exchange Board of India, stock exchanges and/or any other Person or Governmental Authority shall be required, and the issuance of such instruments shall be done while availing all exemptions and relaxations provided in Applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the terms set out in this Resolution Plan. 6.2 The Designated Bank Account shall not be subject to any Encumbrance and/or any lien or security interest created in favor of the Financial Creditors, Operational Creditors or any other third party. The Resolution Professional shall ensure that the authorized representatives of the Designated Bank Account shall be changed to an authorized representative of the Resolution Applicant post the payment of Upfront FC Payment of INR 197 crores to the Financial Creditors. 6.3 The details of the Designated Bank Account shall be shared by the Resolution Professional with the Resolution Applicant for the purposes of implementation of this Resolution Plan. 7. RECOVERY OF EXISTING RECEIVABLES 7.1 All cost and expenses incurred in making recoveries from the Existing Receivables, including the expenses for pursuing litigations, and appointing legal, financial and tax advisors, shall be borne by the Company. 7.2 There shall be a Monitoring Committee, comprising of two members where 1 member shall be appointed from amongst upto 5 professional consultants suggested by the Financial Creditors, and the other 1 member shall be nominated by the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ranche payment at the end of each year subject to cash recoveries made in that year. 7.5 The Company shall be free to use its portion of the cash recoveries made within 3 years from the Transfer Date, i.e. any cash recovery upto INR 75 crore, and it's 25% share of cash recoveries above INR 75 crore (after payment of above mentioned cost and expenses), at its discretion at all times including to pay such amounts to the Resolution Applicant. 7.6 Any cash recoveries made by the Resolution Applicant and/or the Company after the expiry of 3 years from the Transfer Date (including cash recoveries from the Existing Receivables) shall be retained by the Company and shall be available for use at its discretion at all times including to pay such amounts to the Resolution Applicant. In order to make recoveries from the Existing Receivables, the Company shall be entitled to execute power of attorney in favour of the Resolution Applicant in the form proposed by the Resolution Applicant. 7.7 All cash recoveries and costs and expenses as mentioned above shall be routed through a separate bank account opened by the Company with any of the scheduled bank who is a part of the Financial Credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be deemed to be fulfilled by the Company. The aforesaid is without prejudice to the right of termination available with each of the contracting parties under the respective contracts or Applicable Law. Nothing stated above shall apply to related party transactions and other contracts that are proposed to be terminated as part of this Resolution Plan, as indicated in Schedule VII of this Resolution Plan. 8.5 With effect from the Transfer Date, all the permits held or availed of by, and all rights and benefits that have accrued to, the Company shall without any further act, instrument or deed be transferred to, and vest in, or be deemed to have been vested in, and be available to, the Company so as to become as and from the Transfer Date, the permits, estates, assets, rights, title, interests and authorities of the Company and shall remain valid, effective and enforceable on the same terms and conditions to the extent permissible in Applicable Laws. 8.6 In order to give effect to the Resolution Plan, any or all special rights available with the existing shareholders of the Company shall be withdrawn and shall be replaced with the special rights of the Resolution Applicant w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia Pte Ltd Company Petition $ 73,355,785 Pending hearing 12. COMSS/192/2018 High Court of Bombay Ushdev International Limited v. Culross Mayfair Civil Suit $ 25,287,872 Pending hearing 13. COMSS/191/2018 High Court of Bombay Ushdev International Limited v. Edenbridge Limited Civil Suit $ 22,264,654 Pending hearing 14. COMSS/189/2018 High Court of Bombay Ushdev International Limited v. Rosscull Limited Civil Suit $ 18,763,289 Pending hearing 15. NCLT Ahmadabad bench Ushdev International Limited v. Wind world (India) Limited NCLT 122,80,35,148 Pending hearing 16. COMS/543/2017 High Court of Bombay Ushdev International Limited v. Gunvor Singapore Pte Ltd Civil Suit $ 522,508,334.35 Pending hearing 17. S/2060/2012 High Court of Bombay Ushdev International Limited v. Sims Copper SDN BHD &Ors. Civil Suit $ 1,500,000.00 Pending hearing 18. 2150/SS/2015 to 2153/SS/2015 64th Esplanade court Ushdev International Limited v. Vikash Metals & Power Ltd. &Ors. Complaint Under Section 138 of Negotiable Instruments 9,00,00,000 Pending hearing Cases Filed Against the Company as on 14 May 2018 S.No Case Number Forum Respondent Natu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l of Pollution) Act, 1974, Air (Prevention and Control of Pollution) Act, 1981. 5. RBI to exempt the valuation at which the equity investment is made by the Resolution Applicant into the Company from the pricing guidelines prescribed under Foreign Exchange Management Act, 1999. 6. The relevant Governmental Authorities to waive all past non-compliances of the Company in relation to any delayed filing or non-filing of relevant mandatory forms or returns or any other documents, including any undertakings or acknowledgements to be filed in relation thereto, under the Act, Foreign Exchange Management Act, 1999 and any other Applicable Law. 7. The Ministry of Corporate Affairs of the Government of India, the Registrar of Companies, Mumbai and the Collector of Stamps, Revenue Department, Government of Maharashtra to waive all the past non-compliances of the Company in relation to the issue and allotment of the Equity Shares by the Company. 8. The relevant Governmental Authorities to waive all past non-compliances of the Company in relation to obtaining required corporate authorisations for undertaking related party transactions. 9. The relevant Governmental Authority to exempt t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating Authority to waive any financial or monetary liability of the Company in entirety with respect to any matters set out in Clause 3.3, Clause 3.4 and Clause 3.5 of Part A of this Resolution Plan (including in relation to claims (as defined in IBC) from the Operational Creditors, Financial Creditors, workmen, employees, Governmental Authorities) or any amounts that are due and payable on account of any ongoing litigation against the Company, which relates to the period prior to the Insolvency Commencement Date, and neither the Company nor the Resolution Applicant shall have any liability to make any payments to such Person with respect to such liability. 15. All Governmental Authorities to waive any non-compliances by the Company prior to the Transfer Date including without limiting the failure of the Company to obtain any approval from such Governmental Authority with respect to the change in control of the Company pursuant to the implementation of this Resolution Plan. 16. The Company shall be entitled to modify or terminate contracts (including the shareholders agreement and any other agreements) with related parties of the Company and/ or the Promoters entered into prior ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ublic shareholding requirements as given in Rule 19A(5) of Securities Contracts (Regulation) Rules, 1957, wherein a fall in public shareholding of a listed company below 25% can be rectified within a period of three years from such fall, will apply; (iv) under Regulation 31A of the Listing Obligations and Disclosure Requirements Regulations, 2015 (LODR Regulations), reclassification of the existing Promoters will be permitted, and (v) approval of SEBI, designated stock exchange or any court for reduction of capital of Equity Shares as contemplated by the Resolution Plan, is not required pursuant to the exemption granted under Regulation 37(7) of the LODR Regulations. SCHEDULE VIII ASSUMPTIONS Notwithstanding anything contained in this Resolution Plan or any other related documents, this Resolution Plan has been prepared on the basis of the Information Memorandum and on the reliance that all information contained in the Information Memorandum and the Data Room as of filing this Resolution Plan, is true, correct, complete and not misleading in any respect. The details for the Financial Creditors, Operational Creditors and claims from workmen and employees of the Company as set ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) that has been assigned along with the Assigned Debt. The assignment of the Assigned Debt and related security will occur pursuant to and as an integral part of this Resolution Plan and shall not require any further actions and execution for any further documents by the Financial Creditors or any party concerned. However, for the purpose of any procedural requirement or for clarity on any aspect of the assignment of Assigned Debt or related security, the Resolution Applicant will be willing to enter into assignment deed to record the assignment and/or novation as contemplated herein including the assignment and/or novation of the identified security held by the Financial Creditors. Security for Assigned Debt As part of the assignment of the Assigned Debt, the Financial Creditors also assign and transfer to the Identified Affiliate the Assigned Securities provided by the Promoters or third parties to the Financial Creditor as security. The Assigned Securities shall not be deemed to be extinguished or waived under this Resolution Plan and all rights, title and interest therein of the Financial Creditors is hereby assigned to Taguda India Private Limited by way of this Resolut ..... X X X X Extracts X X X X X X X X Extracts X X X X
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