Registration of Securities Issued in a Business-Combination Transaction — Form S-4
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-4 Form S-4 Registration Statement 253 1.33M
2: EX-2.1 Amended & Restated Agreement & Plan of Reorg 50 253K
3: EX-2.2 Form of Agree. of Merger of Jts Corp.& Atari Corp. 8 31K
4: EX-3.1 Restated Certificate of Incorp - Jt Storage 21 72K
5: EX-3.2 Form of Restated Cert. of Incorp - Jts Corp. 4 24K
6: EX-3.3 By-Laws of Jt Storage, Inc. 14 48K
7: EX-3.4 Form of By-Laws of Jts Corporation (Post Merger) 28 135K
8: EX-4.1 Form of Common Stock Certificate Jts Corporation 2 20K
9: EX-4.2 Jt Storage Registration Rights Agreement 18 79K
10: EX-4.3 Atari & Security Pac.Natl Bank Indenture 4/29/87 94 263K
11: EX-4.4 Federated Grp/Security Pacific Natl Bank Indenture 102 366K
12: EX-4.5 Federated Group/Security Pacific 1st Sup Indenture 8 31K
13: EX-4.6 Warrant to Purchase Common Stock/Venture Lending 15 63K
14: EX-4.7 Warrant to Purchase Stock/Silicon Valley Bank 9 45K
15: EX-4.8 Warrant to Purchse Common Stock/Lunenburg S.A. 7 33K
16: EX-5.1 Opinion of Cooley Godward Et. Al. 1 17K
17: EX-8.1 Form of Cooley Godward Tax Opinion 3 23K
18: EX-8.2 Form of Wilson Sonsini Et. Al Tax Opinion 3 22K
19: EX-9.1 Atari Corp. Amended & Restated Voting Agreement 5 32K
20: EX-9.2 Jt Storage Amended & Restated Voting Agreement 5 32K
21: EX-10.1 Jt Storage 1995 Sop Amended & Restated 3/19/96 33 106K
30: EX-10.10 Restricted Stk Pur Agree/Kenneth D. Wing 1/2/96 22 77K
31: EX-10.11 Restricted Stk Pur Agree/W. Virginia Walker 1/5/96 22 78K
32: EX-10.12 Restricted Stk Pur Agree/David B. Pearce 1/2/96 21 70K
33: EX-10.13 Convertible Promissory Note 5 24K
34: EX-10.14 Promissory Note/Certain Principal Stkhldrs 1/19/96 6 25K
35: EX-10.15 Subord Secured Convertible Prom Note/Atari 2/13/96 35 136K
36: EX-10.16 Stock Purchase Agreement/Lunenburg 4/4/96 29 138K
37: EX-10.17 Draft/Technical Know How License Agreement 12 45K
38: EX-10.18 Lease Jts & Cilker Revocable Trust 6/15/95 41 161K
39: EX-10.19 Loan Agree Modular Elec (I) & Indusrial Credit 37 94K
22: EX-10.2 Jt Storage 1996 Non-Employee Directors Sop 3/19/96 14 52K
40: EX-10.20 Loan Agree Modular & Industrial Credit 10/11/94 44 113K
41: EX-10.21 Loan Agree Modular Electronic/Credit Invest India 19 48K
42: EX-10.22 Agreed Order Comprising Controversies 2/4/94 27 90K
43: EX-10.23 Master Agreement/Teac & Jt Storage, Inc. 32 95K
44: EX-10.24 License Agree Teac & Jt Storage 2/24/94 28 110K
45: EX-10.25 Development Agree Compaq & Jt Storage 6/16/94 32 120K
46: EX-10.26 Purchase Agree/Jts & Compaq 6/16/94 11 48K
47: EX-10.27 Technology Transfer Agree Western Digital 2/3/95 42 89K
48: EX-10.28 Agree Jt Storage & Pont Peripherals 1/31/95 24 100K
23: EX-10.3 Putnam Streamlined Standard 401(K) & Profit Shar 109 365K
24: EX-10.4 Indemnity Agreement 7 33K
25: EX-10.5 Employment Agreement 4 27K
26: EX-10.6 Jt Storage Consulting Agreement/Roger W. Johnson 5 29K
27: EX-10.7 Restricted Stk Pur Agree/David T. Mitchell 1/2/96 22 76K
28: EX-10.8 Restricted Stk Pur Agree/David T. Mitchell 3/6/96 21 79K
29: EX-10.9 Restricted Stk Pur Agree/Sirjang Lal Tandon 3/6/96 21 79K
49: EX-21.1 List of Subsidiaries 1 13K
50: EX-23.1 Consent of Arthur Andersen LLP 1 14K
51: EX-23.2 Consent of Deloitte & Touche LLP 1 14K
52: EX-27.1 Financial Data Schedule 1 16K
53: EX-99.1 Form of Jts Proxy 2 16K
54: EX-99.2 Form of Atari Proxy 2 16K
EX-10.19 — Loan Agree Modular Elec (I) & Indusrial Credit
Exhibit Table of Contents
Exhibit 10.19
LOAN AGREEMENT
BETWEEN
MODULER ElECTRONICS (I) PVT. LTD.
AS BORROWER
AND
THE INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF INDIA LIMITED
AS LENDER
LOAN AGREEMENT
THIS Agreement made this 15th day of September One Thousand
Nine Hundred and Ninety Two between MODULER ELECTRONICS (I) PVT. LTD., a company
within the meaning of the Companies Act, 1956 (1 of 1956) and having its,
Registered office at 35 & 36, SDF Block 1, Madras Export Processing Zone
Tambaram, Kadaperi, Madras 600 045 (hereinafter referred to as to the
"Borrower", which expression shall, unless it be repugnant or to the subject or
context thereof, include its successors and assigns);
AND
THE INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF INDIA LIMITED, a
public company incorporated under the Indian Companies Act, 1913 (7 of office
at 163, and having its registered office at Backbay Reclamation, Bombay 400 020
(hereinafter referred to as "the Lender", which expression shall, unless it be
repugnant to the subject or context thereof, include its unless it be repugnant
or successors and assigns).
CONTENTS
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Article Subject Page No.
------- ------- -------
I DEFINITIONS: GENERAL CONDITIONS 2
II AGREEMENT AND TERMS OF LOAN 3
III SECURITY 6
IV APPOINTMENT OF NOMINEE DIRECTOR(S) 8
V SPECIAL CONDITIONS 8
VI EFFECTIVE DATE OF AGREEMENT 8
SCHEDULE I - THE PROJECT 9
SCHEDULE II - FINANCING PLAN 10
SCHEDULE III - AMORTIZATION SCHEDULE 11
SCHEDULE IV - SPECIAL CONDITIONS 12
3
Provided, however, that the General Conditions shall in their
application to this Agreement stand modified as under:
a) The words "commitment charge" wherever they appear shall
be substituted by "Front End Fees".
b) Section 4.16 - PLACE AND MODE OF PAYMENT BY THE BORROWER be
substituted by the following:
"Section 4.16 - PLACE AND MODE OF PAYMENTS AND CREDIT
THEREFOR-
All monies payable by the Borrower to the Lender shall be paid
to the Lender at such office(s) as may be specified by them by telegraphic,
telex or mail transfer to the account of such, office(s) or by cheque or bank
draft drawn in favour of the Lender on a scheduled bank at Bombay or such
other place or to such other account as the Lender may notify to the Borrower
and shall be so paid as to enable the Lender to realise, at par, the amount on
or before the relative due date.
Credit for all payments by local cheque/bank draft will be given on the Lender's
immediately next working day after the date of receipt of the instrument or the
relative due date whichever is later.
Credit for all payments by outstation cheque/bank draft will be given only on
realisation or on the relative due date whichever is later."
c) Section 7.4 - NOMINEE DIRECTOR sub clause (v) be substituted
as follows:
The Nominee Director(s) shall be entitled to receive all
notices agenda, minutes of Board Meetings, etc. and to attend
all General Meetings and Board Meetings and meetings of any
Committees of the Board of which he is a member."
ARTICLE II
AGREEMENT AND TERMS OF LOAN
2.1. AMOUNT AND TERMS OF LOAN:
The Borrower agrees to borrow from the lender and the Lender
agrees to lend to the Borrower, on the terms and conditions contained herein as
also in the General Conditions, sum to the maximum extent of Rs. 180 lacs.
4
2.2 INTEREST
(i) The Borrower shall pay to the Lender interest at the
rate of 20% per annum on the principal amounts of the Loan
outstanding from time to time, quarterly in each year, on
February 15, May 15, August 15 and November 15.
(ii) Disbursements made pending creation of final security as
stipulated in Article III hereof shall carry further
interest at the rate of 1% per annum till creation of such
security.
PROVIDED that in the event of any upward revision of the
minimum lending rate(s) of the commercial banks for cash credits, the Borrower
shall pay to the Lender interest at such higher rate as shall from time to time
be fixed by the Lender and intimated to the Borrower but so that such revised
rate shall not at any point of time exceed the highest of the interest rates
charged by the commercial banks for cash credits.
PROVIDED further that in the event of increase in the rate of
interest :
(a) The Borrower shall have an option to prepay to the Lender
forthwith on receipt of such intimation, the entire
outstanding of the Loan together with all outstanding interest
and other charges thereon with such premium as may be
specified by the Lender.
(b) In the alternative, the Borrower shall have an option to make
such prepayment together with interest, at the increased rate
as intimated till payment, at any time during a period of two
years after receipt of such intimation.
2.3 FRONT END FEE
The Company shall pay to the Lenders Front End Fee of 1% of
the Loan on or before signing this Agreement.
2.4 COSTS AND CHARGES
The Borrower shall pay all taxes, duties, costs, charges and
expenses in connection with or relating to the Loan transaction (including costs
of investigation of title and protection of Lender's interests). In the event
of the Borrower failing to pay the aforesaid monies, the Lender will be at
liberty but shall not be obliged to pay the same. All such sums shall be
reimbursed by the Borrower to the lender within 30 days from the date of notice
of demand from the Lender and shall be debited to the Borrower's Loan Account
and shall carry interest at the rate of 20% per annum from the date of payment
till such reimbursement.
5
In case of default in making such reimbursement within 30 days
from the date of notice of demand, the Borrower shall also pay on the defaulted
amounts, liquidated damages at the rate 2% per annum from the date of notice of
demand till reimbursement in accordance with the provisions of the General
Conditions.
2.5 LAST DATE OF WITHDRAWAL :
Unless the Lender otherwise agrees, the right to make
withdrawals from the Loan shall cease on February 15, 1995.
2.6 REPAYMENT
The Borrrower undertakes to repay the principal amounts of the
Loan in accordance with the Amortization Schedule set forth in Schedule III
hereto.
2.7 CONVERSION RIGHT IN CASE OF DEFAULT
(a) If
the Borrower commits a default in payment or repayment of
three consecutive instalments of principal amounts of the Loan
or interest thereon or any combination thereof,
then, the Lender shall have the right to convert (which right
is hereinafter referred to as "the conversion right") at its
option the whole of the outstanding amount of the Loan, or a
part not exceeding 20% of the Loan, whichever is lower, into
fully paid-up equity shares of the Borrower, at par, in the
manner specified in a notice in writing to be given by the
lender to the Borrower (which notice is hereinafter referred
to as the "notice of conversion") prior to the date on which
the conversion is to take effect, which date shall be
specified in the said notice (which date is hereinafter
referred to as the "date of conversion").
6
On receipt of notice of conversion, the Borrower shall allot
and issue the requisite number of fully paid-up equity shares
to the Lender as from the date of conversion and the Lenders
shall accept the same in satisfaction of the principal amount
of the Loan to the extent so converted. The part of the Loan
so converted shall cease to carry interest as from the date of
conversion and the Loan shall stand correspondingly reduced.
Upon such conversion, the instalments of the Loan payable after
the date of conversion as per Schedule III hereto shall stand
reduced proportionately by the amounts of the Loan so
converted. The equity shares so alloted and issued to the
Lender shall carry, from the date of conversion, the right to
receive proportionately the dividends and other distributions
declared or to be declared in respect of the equity capital of
the Borrower. Save as aforesaid, the said shares shall rank
pari passu with the existing equity shares of the Borrower in
all respects. The Borrower shall, at all times, maintain
sufficient unissued equity shares for the above purpose.
ii) The conversion right reserved as aforesaid may be exercised by
the Lender on one or more occasions during the currency of the
Loan on the happening of any of the events specified in
sub-clauses 1 (a) above.
iii) The Borrower assures and undertakes that in the event of the
Lender exercising the right of conversion as aforesaid, the
Borrower shall get the equity shares which will be issued to
the Lender as a result of the conversion, listed with the
Stock Exchange(s) at Bombay and Madras.
iv) (a) For purposes of sub-clause 1 (a) above it shall not be
construed as a default, if the Borrower approaches the Lender
well in advance for postponement of principal or interest, as
the case may be, and the Lender agrees to the same.
ARTICLE III
SECURITY
3.1 SECURITY FOR THE LOAN
(A) The Loan together with all interest, liquidated
damages, premia on prepayment or on redemption, costs, expenses and other
monies whatsoever stipulated in this Agreement shall be secured by
7
(a) a first charge by way of hypothecation in favour of the Lender
off all the Borrower's movables save and except book debts),
including movable machinery, machinery spares, tools and
accessories, present and future, subject to prior charges
created and/or to be created:
i) in favour of the Borrower's Bankers on the Borrower's
stocks of raw materials, semi-finished and finished goods,
consumable stores and such other movables as may be agreed
to by the Lender for securing the borrowings for working
capital requirements in the ordinary course of business.
(B) The Borrower shall make out a good and marketable title to
its properties to the satisfaction of the Lender and comply
with all such formalities as may be necessary or required for
the said purpose.
3.2 CREATION OF ADDITIONAL SECURITY
If, at any time during the subsistence of this Agreement, the
Lender is of the opinion that the security provided by the Borrower has become
inadequate to cover the balance of the Loan then outstanding, then, on the
Lender advising the Borrower to that effect, the Borrower shall provide and
furnish to the Lender, to the satisfaction of the Lender such additional
security as may be acceptable to the Lender to cover such deficiency.
3.3 ACQUISITION OF ADDITIONAL IMMOVABLE PROPERTIES
So long as any monies remain due and outstanding to the
Lender, the Borrower undertakes to notify the Lender in writing of all its
acquisitions of immovable properties and as soon as practicable thereafter to
make out a marketable title to the satisfaction of the Lender and charge the
same in favour of the Lender by way of first charge in such form and manner as
may be decided by the Lender.
3.4 GUARANTEE
The Borrower shall procure irrevocable and unconditional
personal guarantee from [*] in favour of the Lender for the due repayment of
the Loan and the payment of all interest and other monies payable by the
Borrower in the form prescribed by the Lender and to be delivered to the Lender
before any part of the Loan is advanced. The Borrower shall not pay any
guarantee commission to the said Guarantors.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
8
ARTICLE IV
APPOINTMENT OF NOMINEE DIRECTOR(S)
The Borrower agrees that the Lender shall be entitled to
appoint and withdraw from time to time one Director on the Board of Directors
of the Borrower at any time during the currency of this Agreement.
ARTICLE V
SPECIAL CONDITIONS
The Loan hereby granted shall also be subject to the Borrower
complying with the special conditions set out in Schedule IV hereto.
ARTICLE VI
EFFECTIVE DATE OF AGREEMENT
This Agreement shall become binding on the Borrower and the
Lender on and from the date first above written. It shall be in force till all
the monies due and payable under this Agreement are fully paid off.
9
SCHEDULE I
THE PROJECT
Moduler Electronics (I) Pvt. Ltd. (MEPL), an existing 100%
EOU has been promoted by the Tandon group for manufacture and export of
Winchester Head Gimble Assembly (HGA) for use in hard disk drives and Switch
Mode Power Supplies (SMPS) for use in computers and instrumentation. The
company now proposes to augment its existing manufacturing facilities at Meepz,
Madras in order to manufacture the latest version of HGA and also expand the
production capacity of SMPS from the existing level of 10,000 nos. per month to
25,000 nos. per month.
The cost of the project, expected to be implemented by March
1994, is estimated at Rs. 470 lacs.
The Borrower has requested the Lenders and the Lenders have at
the request of the Borrower agreed to lend and advance to the Borrower the
Rupee Term Loans of Rs. 180 lacs to meet a part of the cost of the project.
10
FINANCIAL PLAN
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Cost of Project
---------------
Plant & machinery - HGA 152
- SMPS 100
Incremental margin money 218
for working capital
---
470
---
Means of Financinq
------------------
Rupee loan - ICICI 180
Internal accruals 290
---
470
---
11
SCHEDULE III
AMORTIZATION SCHEDULE
(Rs. in lacs)
[Download Table]
Principal amount
Date Payment Principal outstanding after
Due Payment Amount each payment
---------------- ---------------- -------------------
180
May 15, 1995 15 165
August 15, 1995 15 150
November 15, 1995 15 135
February 15, 1996 15 120
May 15, 1996 15 105
August 15, 1996 15 90
November 15, 1996 15 75
February 15, 1997 15 60
May 15, 1997 15 45
August 15, 1997 15 30
November 15, 1997 15 15
February 15, 1998 15 --
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SCHEDULE IV
SPECIAL CONDITIONS
--- N I L ----
13
IN WITNESS WHEREOF the Borrower has caused its Common Seal to be
affixed hereto and to a duplicate hereof on the day, month and year first
hereinabove written and the Lender has caused the same and the said duplicate
to be executed by the hand of Shri S. Nagarkatte authorized official of the
Lender as hereinafter appearing.
THE COMMON SEAL OF MODULER ELECTRONICS (1) PVT. LIMITED has pursuant to the
Resolution of its Board of Directors passed in that behalf on the 9th day of
September 1992 hereunto been affixed in the presence of Shri [*] ,
Director, who has signed these presents in token thereof and Shri B.V. Shah
authorized person who has countersigned the same in token thereof.
SIGNED AND DELIVERED BY the withinnamed Lender by the hand of Shri S.
Nagarkatte an authorized official of the Tender.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
GENERAL CONDITIONS
NO. GC-I-86
APPLICABLE TO ASSISTANCE PROVIDED
BY FINANCIAL INSTITUTIONS
TABLE OF CONTENTS
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Article Number Title Page No.
I Applicability 02
II Definitions 02
III Approvals 03
IV Disbursement, Interest, 03-06
Commitment, other
charges and Repayment.
V Borrower's warranties 07
VI Predisbursement conditions 08
VII Conditions applicable
during currency of Loan
Agreement
1. Project 09
2. Financing of Project 10
3. General Covenants 10
4. Nominee Director 13
5. Management 14
VIII Reports 15
IX Inspection 15
X Events of default and remedies 16-18
XI Cancellation, suspension 19
and termination
XII Waiver 20
XIII Applicability of other statutes 21
XIV Miscellaneous 21
* * * *
2
ARTICLE I
APPLICABILITY
The General conditions set out herein shall, if the Loan Agreement so
provides, be applicable to the assistance provided singly or jointly (that is
in participation) by Industrial Development Bank of India ('IDBI'),
Industrial Finance Corporation of India ('IFCI'), The Industrial Credit And
Investment Corporation of India Limited ('ICICI'), Industrial Reconstruction
Bank of India ('IRBI'), Life Insurance Corporation of India ('ILIC'), General
Insurance Corporation of India ('GIC'), National Insurance Company Limited
('NIC'), New India Assurance Company Limited ('GIC'), Oriental Insurance
Company Limited ('OIC), United India Insurance Company Limited ('UII') and
Unit Trust of India ('UTI').
If there is any inconsistency between the General Conditions and the
Loan Agreement, the Loan Agreement will prevail.
All the provisions of these General Conditions and the Loan Agreement
shall have full force and effect till all monies due from the Borrower to the
Lenders under the Loan Agreement are paid/repaid in full.
ARTICLE II
DEFINITIONS
The following terms have the following meanings in these General
Conditions and in the Loan Agreement :
1. "Borrower" means the party to the Loan Agreement to which the Loans are
made.
2 "Lead Institution" means any one of the Lenders as may be designated by
them, from time to time, as their attorney in a particular Loan
transaction. In the event of any Lender granting Loan(s) to the Borrower
singly (and not in participation with other Lenders), the expression
"Lead Institution" wherever it appears in these General Conditions or in
the Loan Agreement shall mean only the "Lender".
3. "Lenders" means IDBI, IFCI, ICICI, IRBI, LIC, GIC, NIC, NIA, OIC, UII
and UTI or any one or more of them where the subject or context, so
admits.
4. "Loan Agreement" means the particular loan agreement and includes these
General Conditions as applied thereto, and all schedules and amendments
supplemental to the Loan Agreement.
3
5. "Loans" means the loans agreed to be provided under the Loan Agreement.
6. "Normal Loan" means that component of a rupee term loan which carries
interest at the maximum rate applicable to a widely held public limited
company.-
7. "Project" means the project for which the Loans are agreed to be
granted, as described in the Loan Agreement.
8. All other terms used in these General Conditions shall have the meanings
assigned to them under the Loan Agreement.
ARTICLE III
APPROVALS
Unless otherwise agreed to by the Lead Institution, the Borrower shall
approach the Lead Institution for obtaining all consents and approvals required
under the Loan Agreement. All acts and deeds done, and all consents and
approvals given, by the Lead Institution shall be deemed to have been done and
given by every Lender individually.
ARTICLE IV
DISBURSEMENT, INTEREST, COMMITMENT,
OTHER CHARGES AND REPAYMENT
Section 4.1 - TERMS OF DISBURSEMENT
(i) The Loans will be disbursed by the Lenders through the Lead
Institution, in one or more instalment(s) as may be decided by the Lead
Institution subject to the Borrower complying with the provisions of the Loan
Agreement and the disbursement procedure stipulated by the Lead Institution and
the expenditure incurred on the Project being in consonance with the details
mentioned in Loan Agreement. All disbursements shall be by
cheque(s)/authorisation(s) and the collection/ remittance charges will be borne
by the Borrower. The interest on the Loans will accrue as from the date of the
cheque(s)/authorisation(s) of the Lead Institution.
(ii) In the event of the Lender(s) agreeing to disburse any amount of the
Loans pending creation of final security as stipulated in the Loan Agreement,
the same may be disbursed on such terms as may be decided by the Lead
Institution.
4
Section 4.2 - ADJUSTMENT OF OVERDUES
The Lead Institution may deduct from sums to be lent to the Borrower any
monies then remaining due and payable by the Borrower to the Lenders.
Section 4.3 - INTEREST
(i) All interest on the Loans and an all other monies accruing due under
the Loan Agreement shall, in case the same be not paid on the respective due
dates, carry further interest at the applicable rate(s) under the Loan
Agreement, computed from the respective due dates and shall become payable upon
the footing of compound interest with quarterly rests as provided in the Loan
Agreement.
(ii) All interest or other monies which shall accrue under the provisions
of the Loan Agreement shall also be payable in the manner and on the dates as
mentioned in the Loan Agreement for payment of interest on the principal
amounts of the Loans.
Section 4.4 - COMMITMENT CHARGES
(i) Commitment charge shall be payable in the manner and on the dates
specified for payment of interest under the Loan Agreement.
(ii) Arrears of commitment charge shall carry interest at the applicable
rate for Normal Loans on the date of the Loan Agreement.
(iii) Commitment charge shall be payable even though the Loans are
ultimately cancelled or not availed of for any reason whatsoever.
(iv) In the event of such cancellation, the commitment charge in respect of
the Loans or any part thereof which has been cancelled, shall cease to accrue
from the day on which the Borrower's request for cancellation is received by
the Lead Institution.
Section 4.5 - WEIGHTED AVERAGE RATE OF INTEREST AND COMMITMENT CHARGE
The Lenders may charge interest and commitment charge on the Loans at the
weighted average rate, where applicable.
For the purpose of this clause, "weighted average rate" means the weighted
mean of the rates of interest or commitment charge, as the case may be,
applicable to the Loans.
Section 4.6 - COMPUTATION OF INTEREST AND OTHER CHARGES
Interest and all other charges shall accrue from day to day and shall be
computed on the basis of 365 days' year and the actual number of days elapsed.
5
Section 4.7 - REPAYMENT
(i) The Lead Institution may, in suitable circumstances, revise, vary or
postpone the repayment of the principal amounts of the Loans or the
balance outstanding for the time being or any instalment(s) of the
said principal amounts of the Loans or any part there of upon such
terms and conditions as may be decided by the Lead Institution.
(ii) In the event of any default in the payment of installments, of
principal, any interest, commitment charge and liquidated damages,
postponement, if any, allowed by the Lead Institution shall be at the
rate of interest as may be stipulated by the Lead Institution at the
time of postponement.
(iii) If, for any reason, the amount finally disbursed by the Lenders out of
the Loans is less than the amount of the Loans, the instalment(s) of
repayment of the Loans shall stand reduced proportionately but shall
be payable on the due dates as specified in the Amortization Schedule
in the Loan Agreement.
Section 4.8 - ACCELERATION OF REPAYMENT BY THE LENDERS
If the Lead Institution finds that the profitability of the Borrower, the
cash flow and other circumstances so warrant, the Lead Institution may, on
previous intimation to the Borrower, require the Borrower to prepay the Loans
on dates earlier than the dates specified in the Amortization Schedule in the
Loan Agreement and also increase the amount of the installments of repayment
fixed in that Schedule.
Section 4.9 - PREMATURE REPAYMENT
The Borrower shall not prepay the outstanding principal amounts of the
Loans in full or in part, before the due dates except after the conversion
right is exercised in full, or has lapsed and after obtaining the prior
approval of the Lead Institution (which may be granted conditionally).
Section 4.10 - DUE DATE OF PAYMENT
If the due date in respect of any instalment of principal, interest,
commitment charge and liquidated damages and all other monies payable under the
Loan Agreement falls on a Saturday or a day which is a bank holiday at the
place where the payment is to be made, the immediately preceding working day
shall be the due date for such payment.
Section 4.11 - LIQUIDATED DAMAGES ON DEFAULTED AMOUNTS
In case of default in payment of instalment of principal, interest,
6
commitment charge and all other monies (except liquidated damages) on their
respective due dates, liquidated damages at the rate of 2% per annum for the
period of default. Liquidated damages shall be payable in the manner and on
the dates as specified in the Loan Agreement for payment of interest. Arrears
of liquidated damages shall carry interest at the applicable rate for Normal
Loans on the date of the Loan Agreement.
Section 4.12 - REIMBURSEMENT OF EXPENSES
(i) The Borrower shall reimburse all sums paid by the Lead Institution or
the Lenders under Article VII Sections 7.3(vii), 7.5(vii), Article
IX-Section 9(b) and Article X Section 10.4 within 30 days from the date
of notice of demand from the Lead Institution. All such sums shall be
debited to the Borrower's Loan Account and shall carry interest from the
date of payment till such reimbursement at the applicable rate for
Normal Loans on the date of the Loan Agreement.
(ii) In case of default in making such reimbursement within 30 days from the
date of notice of demand, the Borrower shall also pay an the defaulted
amounts, liquidated damages at the rate of 2% per annum from the expiry
of 30 days from the date of notice of demand till reimbursement in
accordance with the provisions of Section 4.11.
Section 4.13 - APPROPRIATION OF PAYMENTS
a) Unless otherwise agreed to by the Lead Institution, any payments due
and payable under the Loan Agreement and made by the Borrower shall be
appropriated towards such dues in the following order, viz.,
(i) Premium on prepayment;
(ii) Costs, charges, expenses and other monies;
(iii) Interest on costs, charges, expenses and other monies;
(iv) Commitment charge;
(v) Interest on arrears of commitment charge;
(vi) Interest, including additional interest, payable in terms of the Loan
Agreement;
(vii) Further interest and liquidated damages on defaulted amounts payable
in terms of Section 4.3(i) and 4.11;
(viii) Repayment of installments of principal due and payable under the Loan
Agreement.
b) Notwithstanding anything contained in Clause(a) hereinabove, the
Lenders may, at their discretion, appropriate such payments towards
the dues, if any, payable by the Borrower in respect of earlier
loan(s) availed of by the Borrower from the Lenders in the order
specified in the relative Loan Agreement(s).
Section 4.14 - RESTRICTION ON PREFERENTIAL PAYMENTS
The borrower shall pay and discharge all its liabilities to each of
: 7 :
Section 4.15 - SHARING OF PREFERENTIAL PAYMENTS
If the Borrower makes any payment to any of the Lenders in preference
to other Lenders, the Lender receiving such payment shall, notwithstanding
anything to the contrary contained in the Loan Agreement, share the same with
other(s) on pro-rata basis or in such other manner as the Lenders may mutually
agree and such sharing shall be binding on the Borrower.
Section 4.16 - PLACE AND MODE OF PAYMENT BY THE BORROWER
All monies payable by the Borrower to the Lenders shall be paid to the
Lead Institution at such office(s) as may be specified by the Lead Institution,
by telegraphic, telex or mail transfer to the account of such office(s) or by
cheque or bank draft drawn in favour of the Lead Institution on a scheduled bank
at Bombay or such other place or to such other account as the Lead Institution
may notify to the Borrower and shall be so paid as to enable the Lead
Institution to realise, at par, the amount on or before the relative due date.
Credit for all payments by cheque/bank draft will be given only on realisation
or on the relative due date, whichever is later.
ARTICLE V
Section 5 - BORROWER'S WARRANTIES
Except to the extent already disclosed in writing by the Borrower to
the Lenders, the Borrower shall be deemed to have assured, confirmed and
undertaken as follows:
(a) DUE PAYMENT OF PUBLIC AND OTHER DEMANDS
The Borrower is not in arrears of any public demands such as
income-tax, corporation tax and all other taxes and revenues or any other
statutory dues payable to the Central or State Governments or any local or other
authority.
(b) SELLING AND PURCHASING AGREEMENTS
The Borrower has entered into requisite selling and purchasing
arrangements to the satisfaction of the Lead Institution.
(c) MANAGEMENT AGREEMENT
The terms and conditions of appointment of Managing Director or any
other person holding substantial powers of management by whatever name called
shall be subject to the approval of the Lead Institution.
(d) CONFLICT WITH MEMORANDUM AND ARTICLES OF ASSOCIATION
Nothing in the Loan Agreement conflicts with the Memorandum and
: 8 :
ARTICLE VI
PREDISBURSEMENT CONDITIONS
Section 6 - CONDITIONS PRECEDENT TO DISBURSEMENT
The obligation of the Lenders to make disbursements under the Loan
Agreement shall be subject to the Borrower performing all its obligations and
undertakings under the Loan Agreement besides compliance by the Borrower with
the Disbursement Procedure stipulated by the Lead Institution, such as
submission of necessary information, documents, etc. to the satisfaction of the
Lead Institution. Before seeking disbursement, the Borrower shall also comply
with the following conditions:
(a) RAISING OF SHARE CAPITAL
The Borrower shall raise share capital as stipulated in the Loan Agreement
and the promoters shall subscribe to such share capital to the extent
stipulated by the Lead Institution.
(b) SECURITY IN FAVOUR OF LENDERS
The Borrower shall create security as stipulated in the Loan Agreement in
favour of the Lenders.
(c) BORROWING FROM OTHER INSTITUTIONS/BANKS
The Borrower shall enter into effective agreements with other institutions
and banks in the form and substance satisfactory to the Lead Institution for
raising of funds as per the financing plan.
(d) NON-EXISTENCE OF EVENT OF DEFAULT
The Borrower shall satisfy the Lead Institution that no event of default
as defined in Article X hereof and no event which, with the lapse of time or
notice and lapse of time as specified in Article X, would become an event of
default, has happened and been continuing.
(e) COMPLIANCE WITH SPECIAL CONDITIONS
The Borrower shall comply with such special conditions as may be
stipulated by the Lead Institution at the time of communication of the sanction
of the Loans or subsequently.
(f) DETAILED REVIEW OF THE PROGRESS
(1) The Lead Institution shall have the right to review the cost of the
project before final disbursement of the Loans.
(2) The Lead Institution may withhold disbursement of the amount of the
Loans equivalent to the provision against margin money for working
: 9 :
capital in the cost of the Project, till such time as the Project
is completed and build-up of working capital commences.
(g) UNDERTAKING FOR MEETING SHORTFALL
The Borrower shall procure undertaking(s) from such persons as may be
specified by the Lead Institution in the form required by the Lead Institution,
whereby it/he/they shall take the responsibility for making arrangements
satisfactory to the Lead Institution for meeting the shortfall, if any, in the
resources of the Borrower for completing the project and for working capital.
The Borrower shall join in such undertaking as a confirming party. The funds
brought in to meet the shortfall in the resources of the Borrower for
completing the Project and/or working capital shall be in such form and manner
and on such terms as may be required by the Lead Institution.
ARTICLE VII
CONDITIONS APPLICABLE DURING CURRENCY OF THE LOAN AGREEMENT
Section 7.1 - PROJECT
The Borrower shall,
(i) PROJECT CHANGES
Promptly notify the Lead Institution of any proposed change in the nature
or scope of the Project and of any event or condition which might materially
and adversely affect or delay completion of the project or result in
substantial overrun in the original estimate of costs.
Any proposed change in the nature or scope of the Project shall not be
implemented or funds committed therefor without the prior approval of the Lead
Institution.
(ii) CONTRACT CHANGES
Obtain prior concurrence of the Lead Institution to any material
modification or cancellation of the Borrower's agreements with its machinery
suppliers, collaborators, technical consultants and suppliers of raw materials.
(iii) DELAY IN COMPLETING THE PROJECT
Promptly inform the Lead Institution of the circumstances and conditions
which are likely to disable the Borrower from implementing the Project or which
are likely to delay its completion or compel the Borrower to abandon the same.
: 10 :
Section 7.2 - FINANCING OF THE PROJECT
The Borrower shall,
(i) UTILISATION OF THE LOANS
Furnish to the Lead Institution at the end of each month following the
month in which the Loan monies are disbursed, a statement showing the manner
in which the said monies have been utilised.
(ii) SPECIAL BANK ACCOUNT
(a) Keep the drawals from the Loans in special accounts in the name of
the Borrower with a scheduled bank to be approved by the Lead
Institution, the payments from which the account shall be subject to
verification by any person authorised in this behalf by the Lead
Institution. The Borrower shall also obtain and furnish to the Lead
Institution a letter (in a form approved by the Lead Institution)
from the said bank forgoing its right of set-off or lien in respect
of such account.
(b) Keep such records as may be required by the Lead Institution to
facilitate verification of the entries in the said account. The
Borrower shall also authorise the said bank to furnish to the Lead
Institution, as and when required by it, certified true copy of the
said account with details for verification by the Lead Institution,
at the expense of the Borrower.
(c) Not transfer the Loans or any portion thereof from the said special
account for being kept in call or any deposit in any bank without
obtaining the prior approval of the Lead Institution.
Section 7.3 - GENERAL COVENANTS
The Borrower shall,
(i) NEW PROJECT
Not undertake any new project, diversification, modernisation or
substantial expansion of the Project described herein. The word 'substantial'
shall have the same meaning as under the Industries (Development and
Regulation) Act, 1951.
(ii) LOANS AND DEBENTURES
Not issue any debentures, raise any loans, accept deposits from public,
issue equity or preference capital, change its capital structure or create any
charge on its assets or give any guarantees without the prior approval of the
Lead Institution. This provision shall not apply to normal trade guarantees or
temporary loans and advances granted to staff or contractors or suppliers in
the ordinary course of business or to raising of unsecured loans, overdrafts,
cash credit or other facilities from banks in the ordinary course of business.
: 11 :
(iii) PREMATURE REPAYMENT
Not prepay any loan availed of by it from any other party without the
prior approval of the Lead Institution. If for any reason, the Borrower is
required to prepay any loan, it shall make proportionate prepayment to the
Lenders as well as subject to such conditions as may be stipulated by the
Lenders.
(iv) COMMISSION
Not pay any commission to its promoters, directors, managers or other
persons for furnishing guarantees, counter guarantees or indemnities or for
undertaking any other liability in connection with any financial assistance
obtained for or by the Borrower or in connection with any other obligation
undertaken for or by the Borrower for the purpose of the Project.
(v) NOTICE OF WINDING UP OR OTHER LEGAL PROCESS
Promptly inform the vendors if it has notice of any application for
winding up having been made or any statutory notice of winding up under the
provisions of the Companies Act, 1956, or any other notice under any other Act
or otherwise of any suit or other legal process intended to be filed or
initiated against the Borrower and affecting the title to the properties of the
Borrower or if a receiver is appointed of any of its properties or business or
undertaking.
(vi) ADVERSE CHANGES IN PROFITS AND PRODUCTION
Promptly inform the Lead Institution of the happening of any labour
strikes, lockouts, shut-downs, fires or other similar happenings likely to have
an adverse effect on the Borrower's profits or business and of any material
changes in the rate of production or sales of the Borrower with an explanation
of the reasons therefor.
(vii) INSURANCE
a) Keep insured up to the replacement value thereof as approved by the Lead
Institution (including surveyor's and architect's fees) the properties
charged/to be charged to the Lenders and such of its other properties as
are of an insurable nature against fire, theft, lightning, explosion,
earthquake, riot, strike, civil commotion, storm, tempest, flood, marine
risks, erection risks, war risks, and such other risks as may be
specified by the Lead Institution and shall duly pay all premia and
other sums payable for that purpose. The insurance in respect of the
properties charged/to be charged to the Lenders shall be taken in the
joint names of the Borrower and the Lenders and any other person or
institution having an insurable interest in the properties of the
Borrower and acceptable to the Lead Institution. The Borrower shall
keep deposited with the Lead Institution the insurance policies and
renewals thereof.
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b) Agree that, in the event of failure on the part of the
Borrower to insure the properties or to pay the insurance
premia or other sums referred to above, the Lenders may get
the properties insured or pay the insurance premia and other
sums referred to above, as the case may be.
(viii) LOSS OR DAMAGE BY UNCOVERED RISKS
Promptly inform the Lead Institution of any loss or damage which the
Borrower may suffer due to any force majeure circumstances or act of God, such
as earthquake, flood, tempest or typhoon, etc. against which the Borrower may
not have insured its properties.
(ix) ANNUAL ACCOUNTS
Submit its duly audited annual accounts, within six months from the
close of its accounting year. In case statutory audit (if required) is not
likely to be completed during this period, the Borrower shall get its accounts
audited by an independent firm of Chartered Accountants and furnish the same to
the Lead Institution.
(x) DIVIDEND
Not declare or pay any dividend to its shareholders during any
financial year unless it has paid all the dues to the Lenders up to the date on
which the dividend is proposed to be declared or paid or has made satisfactory
provisions therefor. Further, the Borrower shall not declare dividend to the
equity shareholders in excess of 15% or the average of the dividend paid in the
three preceding years, whichever is higher, without prior approval of the Lead
Institution, which may be given conditionally.
(xi) SUBSIDIARIES
Not create any subsidiary or permit any company to become its
subsidiary.
(xii) MEMORANDUM AND ARTICLES OF ASSOCIATION
Carry out such alterations to its Memorandum and Articles of
Association as may be deemed necessary in the opinion of the Lead Institution
to safeguard the interests of the Lenders arising out of the Loan Agreement.
(xiii) MERGER CONSOLIDATION, ETC.
Not undertake or permit any merger, consolidation, reorganisation,
scheme or arrangement or compromise with its creditors or shareholders or
effect any scheme of amalgamation or reconstruction.
(xiv) INVESTMENTS BY BORROWER
Not make any investments by way of deposits, loans, share capital,
etc. in any concern.
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(xv) REVALUATION OF ASSETS
Not revalue its assets at any time during the currency of the Loans.
(xvi) TRADING ACTIVITY
Not carry on any general trading activity other than the sale of its
own products.
(xvii) SELLING AND PURCHASING ARRANGEMENTS
Undertake that any arrangement for the sale of its products and
purchase of raw materials and inputs, shall be subject to prior approval of the
Lead Institution. If so required by the Lead Institution, the Borrower shall
take steps to suitably modify or terminate the existing selling/purchasing
arrangements in such manner as may be required by the Lead Institution. The
Borrower shall not enter into any fresh agreement for the appointment of sole
selling agents/sole purchasing agents without the prior approval of the Lead
Institution. Any such arrangement shall be subject to such terms and
conditions as may be stipulated by the Lead Institution.
Section 7.4 - NOMINEE DIRECTOR
(i) Each of the Lenders shall have the right to appoint and remove from
time to time, Director(s) on the Board of Directors of the Borrower as
set out in the Loan Agreement (such directors are hereinafter referred
to as 'Nominee Director(s)').
(ii) The Nominee Director(s) shall not be required to hold qualification
shares and not be liable to retire by rotation.
(iii) The Nominee Director(s) shall be entitled to all the rights and
privileges of other directors including the sitting fees and expenses
as payable to other Directors but if any other fees, commission,
monies or remuneration in any form is payable to the Directors, the
fees, commission, monies and remuneration in relation to such Nominee
Director(s) shall accrue to the Lenders and the same shall accordingly
be paid by the Borrower directly to the Lead Institution for the
account of the concerned Lenders.
Provided that if any such Nominee Director is an officer of the
Lenders, the sitting fees in relation to such Nominee Director(s)
shall also accrue to the Lenders and the same shall accordingly be
paid by the Borrower directly to the Lead Institution for the account
of the concerned Lenders. Any expenditure incurred by the Lenders or
the Nominee Director(s) in connection with his appointment or
directorship shall be borne by the Borrower.
(iv) The Nominee Director(s) shall be appointed a Member of the Management
Committee or other Committees of the Board, if so desired by the
Lenders.
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(v) The Nominee Director(s) shall be entitled to receive all notices,
agenda, etc. and to attend all General Meetings and Board Meetings and
Meetings of any Committees of the Board of which he is a member.
(vi) If, at any time, the Nominee Director is not able to attend a meeting
of the Board of Directors or any of its Committees of which he is a
member, the Lenders may depute an observer to attend the meeting. The
expenses incurred by the Lenders in this connection shall be borne by
the Borrower.
Section 7.5 - MANAGEMENT
Unless the Lead Institution otherwise agrees
(i) EXISTING MANAGEMENT
The Borrower shall not remove any person, by whatever name called,
exercising substantial powers of management of the affairs of the Borrower at
the time of execution of the Loan Agreement.
(ii) PAYMENT OF REMUNERATION
The person(s) referred to in (i) shall not be paid any commission in
any year unless all the dues of the Lenders in that year have been paid to the
satisfaction of the Lead Institution.
(iii) PAYMENT OF COMPENSATION
The Borrower shall not pay any compensation to any of the persons
mentioned in (i) above in the event of loss of his/their office(s) for any
reason whatsoever if there is a default in repayment of dues to the Lenders.
(iv) UNDERTAKINGS
The Borrower shall obtain suitable undertakings for giving effect to
(ii) and (iii) above from the persons mentioned in (i) above. The
appointment/reappointment including terms of appointment (or alteration in such
terms) of the persons mentioned in (i) above shall be subject to the prior
approval of the Lead Institution.
(v) FUTURE ARRANGEMENT
The Borrower shall, as and when required by the Lead Institution,
appoint and change to the satisfaction of the Lead Institution, suitable
technical, financial and executive staff of proper qualifications and experience
for the key posts. The terms of such appointments including any changes
therein, shall be subject to prior approval of the Lead Institution.
(vi) REVIEW OF MANAGEMENT
In case of default in payment of any dues to the Lenders or if in the
15
opinion of the Lead Institution the business of the Borrower is conducted in a
manner opposed to the public policy or in a manner prejudicial to Lenders'
interest, the Lead Institution shall have the right to review the management
set up or organisation of the Borrower and to require the Borrower to
restructure it as may be considered necessary by the Lead Institution,
including the formation of Management Committees with such powers and functions
as may be considered suitable by the Lead Institution.
(vii) APPOINTMENT OF TECHNICAL/MANAGEMENT CONSULTANT
The Lead Institution shall have the right to appoint, whenever it
considers necessary, any person, firm, company or association of persons
engaged in technical, management or any other consultancy business to inspect
and examine the working of the Borrower and its factory and to report to the
Lead Institution. The Lead Institution shall have the right to appoint,
whenever it considers necessary, any Chartered Accountants/Cost Accountants as
auditors for carrying out any specific assignment(s) or to examine the financial
or cost accounting system and procedures adopted by the Borrower for its
working or as concurrent or internal auditors, or for conducting a special
audit of the Borrower. The costs, charges and expenses including professional
fees and travelling and other expenses of such consultants or auditors shall be
payable by the Borrower.
(viii) The Borrower shall constitute such committees of the Board with such
composition and functions as may be required by the Lead Institution for close
monitoring of different aspects of its working.
(ix) UNDERTAKINGS FOR NON-DISPOSAL OF SHAREHOLDINGS
The Borrower shall not recognise or register any transfer of shares in
the Borrower's capital made or to be made by promoters, their friends or
associates as may be specified by the Lenders.
ARTICLE VIII
REPORTS
Section 8
The Borrower shall furnish to the Lead Institution such reports as may
be required by the Lead Institution.
ARTICLE IX
INSPECTION
Section 9 - The Borrower shall,
: 16 :
a) PROJECT EXPENDITURE RECORDS
Maintain records showing expenditure incurred on the Project, utilisation
of the disbursements out of the Loans, progress of the Project and the
operations and financial conditions of the Borrower and such records shall be
open to examination by the Lenders and their authorised representatives.
b) TECHNICAL, FINANCIAL AND LEGAL INSPECTIONS
Permit the Lenders and their authorised representatives to carry our
technical, financial and legal inspections during the construction and
operation periods of the Project and to inspect all records, registers and
accounts of the Borrower. Any such representative of the Lenders shall have
free access at all reasonable times to any part of the Borrower's factory and
to its records, registers and accounts and to all schedules, costs, estimates,
plans and specifications relating to the plant and shall receive full
cooperation and assistance from the employees of the Borrower. The cost of
inspection, including travelling and all other expenses shall be payable by the
Borrower to the Lenders in this behalf.
ARTICLE X
EVENTS OF DEFAULT AND REMEDIES
Section 10.1
If one or more of the events specified in this Section (hereinafter
called 'events of default') happen(s), the Lead Institution or the Lenders or
any of them may, by a notice in writing to the Borrower, declare the principal
of and all accrued interest on the Loans to be due and payable forthwith and the
security created in terms of Article III of the Loan Agreement shall become
enforceable and the Lenders shall have the following rights (anything in the
Loan Agreement to the contrary notwithstanding) namely: -
(i) to enter upon and take possession of the assets of the Borrower; and
(ii) to transfer the assets of the Borrower by way of lease or leave and
licence or sale.
EVENTS OF DEFAULT
a) DEFAULT IN PAYMENT OF PRINCIPAL SUMS OF THE LOANS
Default has occurred in the payment of principal sums of the Loans on
the due dates.
b) DEFAULT IN PAYMENT OF INTEREST
17
instalment of interest on the Loans and such default has continued for a period
of thirty days.
c) ARREARS OF INTEREST
Interest amounting to at least Rs. 500 has been in arrears and unpaid
for thirty days after becoming due.
d) DEFAULT IN PERFORMANCE OF COVENANTS AND CONDITIONS
Default has occurred in the performance of any other covenant,
condition or agreement on the part of the Borrower under the Loan Agreement and
any other agreement and such default has continued for a period of thirty
days after notice in writing.thereof has been given to the Borrower by the
Lenders/Lead Institution.
e) SUPPLY OF MISLEADING INFORMATION
Any information given by the Borrower in its application for Loans, in
the reports and other information furnished by the Borrower in accordance with
the Reporting System and the warranties given/deemed to have been given by the
Borrower to the Lead Institution/Lenders is misleading or incorrect in any
material respect.
f) INABILITY TO PAY DEBTS
If there is reasonable apprehension that the Borrower is unable to pay
its debts or proceedings for taking it into liquidation, either voluntarily or
compulsorily, may be or have been commenced.
g) INADEQUATE INSURANCE
If the properties and assets offered to the Lenders as security for
the Loans have not been kept insured by the Borrower or depreciate in value to
such an extent that, in the opinion of the Lead Institution, further security
to the satisfaction of the Lead Institution should be given and on advising the
Borrower to that effect such security has not been given to the Lenders.
h) SALE, DISPOSAL AND REMOVAL OF ASSETS
If, without the prior approval of the Lead Institution, any land,
buildings, structures or plant and machinery of the Borrower are sold, disposed
of, charged, encumbered or alienated or the said buildings, structures,
machinery, plant or other equipment are removed, pulled down or demolished.
i) REFUSAL TO DISBURSE LOANS BY OTHER FINANCIAL INSTITUTION
If the other financial institution(s) or bank(s) with whom the Borrower
has entered into agreements for financial assistance have refused to disburse
it(s)/their loan(s) or any part thereof or have recalled its/their loan(s)
under their respective loan agreements with the Borrower.
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j) PROCEEDINGS AGAINST BORROWER
The Borrower has voluntarily or involuntarily become the subject of
proceedings under any bankruptcy or insolvency law or the Borrower is
voluntarily or involuntarily dissolved.
k) INABILITY TO PAY DEBTS ON MATURITY
The Borrower is unable or has admitted in writing its inability to pay
its debts as they mature.
l) LIQUIDATION OR DISSOLUTION OF THE BORROWER
The Borrower has taken or suffered to be taken any action for its
reorganisation, liquidation or dissolution.
m) APPOINTMENT OF RECEIVER OR LIQUIDATOR
A receiver or liquidator has been appointed or allowed to be appointed
of all or any part of the undertaking of the Borrower.
n) ATTACHMENT OR DISTRAINT ON MORTGAGED PROPERTIES
If an attachment or distraint has been levied on the mortgaged
properties or any part thereof or certificate proceedings have been taken or
commenced for recovery of any dues from the Borrower.
o) EXTRAORDINARY CIRCUMSTANCES
If extraordinary circumstances have occurred which make improbable for
the Project to be carried out and for the Borrower to fulfill its obligations
under the Loan Agreement.
Section 10.2 CONSEQUENCES OF DEFAULT
On the happening of any of the events of default, in addition to the
rights specified in Section 10.1 hereof, each of the Lenders shall be entitled
to appoint and remove from time to time Whole-time Director(s) on the Board of
Directors of the Borrower (such Director(s) are hereinafter referred to as "the
whole-time Nominee Director(s)"). Such Whole-time Nominee Director(s) shall
exercise such powers and duties as may be approved by the Lenders and have such
rights as are usually exercised by or are available to a Whole-time Director,
in the management of the affairs of the Borrower. Such Whole-time Nominee
Director(s) shall not be required to hold qualification shares nor be liable
to retire by rotation and shall be entitled to receive such remuneration, fees,
commission and monies as may be approved by the Lead Institution. Such
Whole-time Nominee Director(s) shall have the right to receive notices of and
attend all General Meetings and Board Meetings or any committees of the
Borrower of which they are members.
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Any expense that maybe incurred by the Lenders or such Whole-time
Nominee Director(s) in connection with their appointment or directorship shall
be paid or reimbursed by the Borrower to the Lenders, or as the case may be, to
such Whole-time Nominee Director(s).
Section 10.3 NOTICE TO THE LENDERS ON THE HAPPENING OF AN EVENT OF DEFAULT
If any event of default or any event which, after the notice, or lapse
of time, or both, would constitute an event of default has happened, the
Borrower shall, forthwith give notice thereof to the Lead Institution in
writing specifying the nature of such event of default, or of such event.
Section 10.4 EXPENSES OF PRESERVATION OF ASSETS OF BORROWER AND OF
COLLECTION
All expenses incurred by the Lenders after an event of default has
occurred in connection with:
(i) preservation of the Borrower's assets (whether then or thereafter
existing); and
(ii) collection of amounts due under the Loan Agreement shall be payable by
the Borrower.
ARTICLE XI
CANCELLATION, SUSPENSION AND TERMINATION
Section 11.1 CANCELLATION BY NOTICE TO THE LENDERS
The Borrower may, by notice in writing to the Lead Institution, cancel
the Loans or any part thereof which the Borrower has not withdrawn prior to
the giving of such notice. Provided that such cancellation shall be pro-rata
for each Lender.
Section 11.2 SUSPENSION
Further access by the Borrower to the use of the Loans may be
suspended or terminated by the Lead Institution/Lenders.
a) NON-COMPLIANCE OF TERMS AND CONDITIONS
Upon failure by the Borrower to carry out all or any of the terms of
the Loan Agreement or on the happening of any event of default referred to in
Article X hereof.
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b) EXTRAORDINARY SITUATION
If any extraordinary situation makes it improbable that the Borrower
would be able to perform its obligations under the Loan Agreement.
c) ASSIGNMENT OR TRANSFER OF PROPERTIES TO RECEIVER, ASSIGNEE, ETC.
If the Borrower takes or permits to be taken any action or proceedings
whereby any of its properties shall or may be assigned or, in any manner,
transferred or delivered to any receiver, assignee, liquidator or other person
whether appointed by the Borrower or by any Court of Law whereby such property
shall or may be distributed among the creditors of the Borrower or the Borrower
suffers any charge to be created over its properties in any legal proceedings.
d) CHANGE IN THE BORROWER'S SET-UP
If any change in the Borrower's set-up has taken place which, in the
opinion of the Lead Institution (which shall be final and binding on the
Borrower), would adversely affect the conduct of the Borrower's business or the
financial position or the efficiency of the Borrower's management or personnel
or the execution of the Project.
Section 11.3 SUSPENSION TO CONTINUE TILL DEFAULT REMEDIED
The right of the Borrower to make withdrawals from the Loans shall
continue to be suspended until the Lead Institution has notified the Borrower
that the right to make withdrawals has been restored.
Section 11.4 TERMINATION
If any of the events described above as also in Article X hereof has
been continuing or if the Borrower has not withdrawn the Loans by the date
referred to in the Loan Agreement or such later date as may be agreed to by the
Lead Institution, then, in such event, the Lead Institution may, by notice in
writing to the Borrower, terminate the right of the Borrower to make
withdrawals. Upon such notice, the undrawn amount of the Loans shall stand
cancelled. Notwithstanding any cancellation, suspension or termination
pursuant to the aforesaid provisions, all the provisions of the Loan Agreement
shall continue to be in full force and effect as herein specifically provided.
ARTICLE XII
WAIVER
Section 12 WAIVER NOT TO IMPAIR THE RIGHTS OF THE LENDERS
No delay in exercising omission to exercise any right, power or
21
remedy accruing to the Lead Institution/Lenders upon any default under the Loan
Agreement, security documents or any other agreement or document shall impair
any such right, power or remedy or shall be construed to be a waiver thereof or
any acquiescence in such default, nor shall the action or inaction of the Lead
Institution/Lenders in respect of any default or any acquiescence by it in any
default, affect or impair any right, power or remedy of the Lead
Institution/Lenders in respect of any other default.
ARTICLE XIII
APPLICABILITY OF OTHER STATUTES
Section 13 APPLICATION OF OTHER STATUTES
Nothing contained in the Loan Agreement shall prejudice or in any way
affect the rights vested in the Lenders under the Industrial Development Bank
of India Act, 1964 (18 of 1964), Industrial Finance Corporation Act, 1948 (15
of 1948), Industrial Reconstruction Bank of India Act, 1984 (62 of 1984), Life
Insurance Corporation of India Act, 1956 (31 of 1956), General Insurance
Business (Nationalisation) Act, 1972 (57 of 1972) and Unit Trust of India Act,
1963 (52 of 1963) or any other statute.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 SERVICE OF NOTICE
Any notice or request to be given or made to the Lead Institution/the
Lenders or to the Borrower or to any other party shall be in writing. Such
notice or request shall be deemed to have been given or made when it is
delivered by hand or despatched by mail or telegram to the party to which it is
required to be given or made at such party's designated address.
Section 14.l SERVICE OF NOTICE
a) Each of the Lenders shall maintain, in accordance with its usual
practice, accounts evidencing the amounts from time to time lent by
and owing to it under the Loan Agreement.
b) The Lead Institution shall maintain in its books a control account or
accounts in which shall be recorded.
(1) the amount of any advance made under the Loan Agreement by
each of the Lenders;
22
(2) the amount of any principal or interest due or to become due
from the Borrower to each of the Lenders under the Loan
Agreement;
(3) the amount of any sum received or recovered by the Lead
Institution under the Loan Agreement and/or security documents
executed in favour of the Lenders and the other Lender's
participation therein.
In any legal action or proceedings arising out of or in connection
with the Loan Agreement, the entries made in the accounts maintained
pursuant to sub-clauses (a) and (b) above shall be prima-facie
evidence of the existence and amount of obligations of the Borrower as
therein recorded.
Section 14.3 BENEFIT OF THE LOAN AGREEMENT
The Loan Agreement shall be binding upon and enure to the benefit of
each party thereto and its successors and assigns.
Section 14.4 HEADINGS
The headings of various Articles and Sections herein and in the Loan
Agreement are inserted for convenience of reference and are not deemed to
affect the construction of the relative provisions.
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-4’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 6/24/96 | | | | | | | None on these Dates |
| | 2/15/95 | | 6 |
| List all Filings |
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