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TMI Blog2018 (7) TMI 2263X X X X Extracts X X X X X X X X Extracts X X X X ..... aking that this plan will remain in conformity with the other requirements as specified by the Board. Application disposed off. X X X X Extracts X X X X X X X X Extracts X X X X ..... ar form, the same is hereby inserted which is as follows: S.N. Date of Event Description of Activity Time prescribed under the Code/ CIRP Regulations (if applicable) 1. Order dated July 18, 2017 Order passed by this Hon'ble the Tribunal admitting Company Petition No. 1139/I&BP/NCLT/MAH/2017 ("Company Petition") filed by State Bank of India ("SBI") under Section 7 of the Code against the Corporate Debtor. SBI had filed the application before this Hon'ble Tribunal, inter alia, on the ground that, as 21, 2017, the Corporate Debtor had failed on June to repay the outstanding balance of ₹ 1539,33,72,303.63 to SBI. 2. July 24, 2017 Order communicated to the Applicant appointing the Applicant as the interim resolution professional. 3. July 26, 2017/ July 27, 2017 Public announcement published in Form A in Business Standard (Hindi), Raipur edition newspapers ("Public Announcements") to invite proof of claims from Public announcement published in Form A Business Standard (both English and Hindi) Delhi edition, The Pioneer (English), Raipur edition, the creditors of the Corporate Debtor. The Public Announcement was also published on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Applicant, a list of creditors was finalized. As per regulation 13(1) of the CIRP Regulations, the interim resolution professional or the resolution professional, as the case may be, is required to verify every claim, as on the insolvency commencement date, within 7 (seven) days from the last date of the receipt of the claims, and thereupon maintain a list of creditors containing names of creditors along with the amount claimed by them, the amount of their claims admitted and the' security interest, if any, in respect of such claims, and update it. Status: Compliant 7. August 16, 2018 After collating the claims received and determining the financial position of the Corporate Debtor, the Applicant constituted a Committee of Creditors of the Corporate Debtor ("CoC"). Section 21(1) of the Code requires an interim resolution professional to constitute a committee of creditors after collating the claims received and determining the financial position of the corporate debtor. Status: Compliant 8. August 21, 2018 The first list of creditors and report on constitution of CoC filed with this Hon'ble Tribunal. Due to claim being received from a new financi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulation 13(2) of the CIRP Regulations, the list of creditors is required to be filed with this Hon'ble Tribunal. Status: Compliant 11. August 23, 2017 First meeting of CoC held, inter alia, where the CoC resolved to appoint the Applicant as the Resolution Professional for the Corporate Debtor ("Resolution Professional"). The insolvency process costs and along with any expenses, taxes and reimbursements were ratified and approved by the members Approval to appoint Grant Thornton by the Interim Resolution Professional as a professional advisor. * List of creditors presented at the first meeting of the Coc. * Certain procedural matters were also discussed and approved. Minutes of first meeting of the CoC is enclosed hereto as Exhibit D. As per regulation 17(2) of the CIRP Regulations, the first meeting of the CoC (seven) days of the |filing of the report is required to be convened within 7, (seven) days of the |filing of the report under regulation 17(1) of the CIRP Regulations. As per regulation 13(2)(e) of the CIRP As per regulation Regulations, the list of creditors is required to be presented at the first meeting of the CoC. Status: Compliant 12. Septemb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... criteria for evaluation of resolution plans. CoC also approved certain costs. CoC was also apprised of the updated list of creditors Minutes of third meeting of the CoC is enclosed hereto as Exhibit F. 16. September 26, 2017 to October 10, 2017 Signing of non-disclosure agreements with potential resolution applicants (hereinafter, the "NDA"). Request for proposal document inviting resolution plans from qualified persons as well as information memorandum (required under regulation 36(1) of the CIRP Regulations (as it stood then)) was issued to the potential resolution applicants who executed an NDA. 17. September 26, 2017 Virtual data room was made accessible to potential resolution applicants, subject to the potential resolution applicants executing the NDA. 18. October 22, 2017 till November 5, 2017 Legal and financial due diligence of the Corporate Debtor was facilitated for the potential resolution applicants, and plant visits were organized for Raipur and Raigarh plants/facility of the Corporate Debtor. 19. November 17, 2017 Last date for submitting resolution plans. 29A The date for submission of resolution plan was initially extended till November 27, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Applicants") 22. December 16, 2017 Fifth meeting of CoC was held. In this meeting, the team of registered valuers from RBSA Valuation Advisors LLP and Knight Frank India (P) Limited presented their reports on the liquidation value of the Corporate Debtor, and the CoC members discussed the same. The liquidation value of the Corporate Debtor is ₹ 2365 crore. The initial resolution plan submitted by the Resolution initial resolution plan Applicants was deliberated upon by the members of CoC. A core committee comprising of 6 (six) financial creditors of the Corporate Debtor was constituted to negotiate with the Resolution Applicant on behalf of the CoC. CoC also decided to seek extension of the period of CIRP for a further period of 90 section 12 of the Code and (ninety) days under authorized the Applicant to file an application before this Hon'ble Tribunal for this purpose. It was informed to all the participants that SBI, Financial Creditor had also engaged RBSA Valuation Advisors LLP for ascertaining the enterprise value of the Corporate Debtor. The members of the COC requested the Resolution Professional to circulate the said enterprise value report to all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the SBI Capital Markets Limited made a presentation on the broad contours of the terms of the negotiated resolution plan before the CoC and the CoC members discussed the same. The Resolution Professional reiterated that the resolution plan must take into account the interest of all the stakeholders in the broader spirit, although the law does not contain any express provisions on the manner of dealing with the shareholders except for a mention of the same in the resolution plan and the treatment of dissenting financial creditors and payment of liquidation value due to operational creditor Resolution Professional confirmed by way of an email that the requirements of Regulation 39(3A) of the CIRP Regulations, 2016 are satisfied. The CoC requested the Resolution Professional to appoint a suitable agency to carry out the feasibility and viability exercise on the plan on behalf of the CoC and place the report before the next CoC meeting for ratification. In this meeting, the special audit report prepared by Agrawal Anil & Co. Chartered Accountants on transactions as provided in Sections 43, 45, 50 & 66 of the Code was presented to the CoC by Mr. Anil Agrawal, Chartered Accountant. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the liquidation amount payable to them in case they dissent on the resolution plan which is approved by the CoC. CoC was also apprised of the updated list of creditors. Minutes of eighth meeting of the CoC is enclosed hereto as Exhibit K. 32. April 9, 2018to April 10, 2018 The Final Resolution Plan was approved by the CoC with 98.97% (ninety-eight point nine seven percent) majority voting share in accordance with Regulation 39(3) of the CIRP Regulations. Voting on the Final Resolution Plan was via electronic voting system as laid down in Regulation 25(5) of the CIRP Regulations. The electronic voting took place between April 9, 2018, 10.00 AM to April 10, 2018, 10.00 AM. Status: Compliant 33. April 13, 2018 Revised list of creditors of the Corporate Debtor updated as on April 7, 2018 filed with this Hon'ble Tribunal. 34. April 13, 2018 In accordance with section 30(6) of the Code, application 'filed before this Hon'ble Tribunal seeking approval for the Final Resolution Plan prior to the expiry of 270 (two hundred and seventy) days from the date of the admission of the Company Petition by this Hon'ble Tribunal. Pursuant to the Amendment Regulations issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 1243 crores, put together it would come to ₹ 11,478,09,50,325. By this difference the liquidation value of the asset of the Corporate Debtor is not even sufficient to satisfy the admitted claim of secured financial creditors in full and therefore, the liquidation value due to the unsecured financial creditors, operational creditors and other creditors of the Corporate Debtor as per the waterfall mechanism mentioned under Section 53 of the Code is NIL. In the backdrop of it, the Resolution Plan approved by the COC discloses that the Resolution Applicant would make an upfront payment of amount equivalent to ₹ 2457 crores (less the liquidation value paid to the dissenting secured financial creditors) to the assenting secured financial creditors on pro rata basis alongwith conversion of an amount of ₹ 215.20 crores into equity shares of the Corporate Debtor allotted to assenting financial creditors in proportion to their admitted debt and would undertake deemed automatic conversion of the remaining admitted debt held by the assenting financial creditors into Optionally Convertible Preference Shares (OCPS) which shall be deemed to be purchased by the Resolutio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an Affidavit agreeing to pay Rs.25 crores within a period of one year from the date the final resolution plan becomes effective, to the operational creditors (other than employees and workmen) in the manner directed by this Bench. 10. Asto ₹ 25 crores, since the Resolution Applicant agreed to distribute among the operational creditors other than employees and workmen, debt valuing ₹ 114,81,27,623 (Exhibit A to the Affidavit filed by the Resolution Applicant on 13.7.2018), the Resolution Applicant is hereby directed to pay to the operational creditors on pro rata basis in compliance with principle of pari passu within one year from the date of delivery of this order, i.e. 24.07.2018. 11. In respect to treatment of other creditors, this approved resolution plan discloses that all other liabilities and obligations of the Corporate Debtor are being extinguished in full and all litigations and proceedings in respect to debts pending against the Corporate Debtor prior to commencement of CIRP shall stand abated as the liquidation value due to those creditors as per the waterfall mechanism in Section 53 of the Code is NIL, but whereas the Financial creditors and other credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... older, who are holding even 1, 2 shares in the Corporate Debtor company. 17. Having regard to the merger proposed by the Resolution Applicant, it has been said in the Resolution Plan that there will be a merger on the effective date of a Bidding Company ("Bid Co") whose entire share capital will be directly or indirectiy held by the Resolution Applicants, with and into the Corporate Debtor. Pursuant to the merger, the Corporate Debtor will issue equity shares in the shareholding pattern of the Corporate Debtor as mentioned below: Category of Shareholder Total no. of Shares % of equity share capital Equity shares: Consortium (Resolution Applicants) 349,020,000 74.29 Others (including financial institutions and banks) 120,765,221 25.71 Total 469,785,221 100.00 Compulsorily convertible preference shares: CCPS held by Consortium post-merger 525,980,000 This Bench hereby approves the merger with the shareholding as mentioned above. 18. The Resolution Plan discloses a proposal for a slump sale of non-core assets of this Corporate Debtor to a newly incorporated subsidiary ("Newco"), 100% of the shares of the Newco are proposed to be sold at the fair ..... X X X X Extracts X X X X X X X X Extracts X X X X
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