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Shelf Disclosure Document Dated: October 9, 2014
Private and Confidential - For Private Circulation only
(This Shelf Disclosure Document/Private Placement Offer Letter is neither a Prospectus nor a Statement in Lieu of Prospectus)
GATI KAUSAR INDIA LIMITED Registered Office: 1-7-285, M.G. Road, Secunderabad-500003, Telangana
Website: www.gatikausar.com, E-Mail: [email protected]: Compliance Officer: K. Harish Adithya
GATI KAUSAR INDIA LIMITED was incorporated on July 11, 1984 as a public limited company under the provisions of the Companies Act, 1956 and the CIN of the Company is U74899TG1984PLC089495
ISSUE BY WAY OF PRIVATE PLACEMENT BY GATI KAUSAR INDIA LIMITED (THE “COMPANY” / “ISSUER”) OF UPTO 240 SENIOR SECURED,REDEEMABLE, NON-
CONVERTIBLE DEBENTURES CUM BONDS OF FACE VALUE OF Rs. 1,000,000/- EACH AGGREGATING UPTO Rs.240,000,000/- (THE “ISSUE”)
GENERAL RISKS
Investment in debt and debt related securities involve a degree of risk and investors should not invest any funds in the debt instruments, unless they can afford to take the risks attached to such investments. For taking an investment decision, the investors must rely on their own examination of the Company and the Issue including the risks involved. The Securities and Exchange Board of India (“SEBI”) does not take any responsibility for this Issue in any manner nor does SEBI guarantee the accuracy or adequacy of this information Memorandum. Prospective investors are advised to carefully read the risk associated with the Issue
GENERAL DISCLAIMER
This Shelf Disclosure Document is neither a prospectus nor a statement in lieu of prospectus and does not constitute an offer to the public generally to subscribe for or otherwise acquire the Bonds to be issued by GATI KAUSAR INDIA LIMITED. This Shelf Disclosure Document is for the exclusive use of the intended recipient(s) to whom it is addressed and delivered and it should not be circulated or distributed to third parties. It cannot be acted upon by any person other than to whom it has been specifically addressed. Multiple copies hereof given to the same person / entity shall be deemed to be offered to the same person.
ISSUER'S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this Shelf Disclosure Document contains all information as required under Schedule I of SEBI (Issue and Listing of Debt Securities) Regulations, 2008 and as amended from time to time, that the information contained in this Shelf Disclosure Document is true and fair in all material aspects and is not misleading in any material respect, that the opinions and
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intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Shelf Disclosure Document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect
CREDIT RATING
CARE BB+(pronounced “CARE Double B Plus”) by CARE Limited for Rs. 120 Crores Non-Convertible Debenture/Bond issue. Instruments with this rating are considered to have moderate risk of default regarding timely servicing of financial obligations. The rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The rating may be subject to suspension, revision or withdrawal at anytime by the assigning rating agency. The rating agency has a right to revise, suspend or withdraw the rating at any time on the basis of factors such as new information or unavailability of information or other circumstances which the rating agency believes may have an impact on its rating
LISTING
The Bonds are proposed to be listed on the BSE Limited (“BSE” or the “Stock Exchange”). This Shelf Disclosure Document has been prepared for the purpose of listing of Bonds. This Shelf Disclosure Document is only an information brochure intended for private use and should not be construed to be a prospectus and/or an invitation to the public for subscription to Bonds under any law for the time being in force.
ISSUE PROGRAMME
Series I Issue Opening Date: October 9, 2014
Series I Issue Closing Date : October 9, 2014
Series I Deemed Date of Allotment : October 9, 2014
*The Company reserves the right to extend or close the Issue earlier from the aforesaid dates or change the Issue schedule including the Deemed Date of Allotment at its sole and absolute discretion, without giving any reasons or prior notice.
The Shelf Disclosure Document is dated October 9, 2014 and will be valid for a period of 180days from the date of filing with the Stock Exchange
DEBENTURE TRUSTEE Registrar to the Issue
The IL&FS Trust Company Limited
Plot No. C–22, G Block,
BandraKurla Complex
Bandra(E), Mumbai - 400051, India.
Tel- +91-022- 2659 3612
Fax -+91-022- 2653 3297
Website - www.itclindia.com
Email Id - [email protected]
Karvy Computershare Pvt. Limited
Plot No. 17-24, Vittal Rao Nagar,
Madhapur, Hyderabad - 500 081, India.
Tel - +91- 040- 4465 5000
Fax - +91- 040- 2343 1551
Website – www.karvycomputershare.com
Email Id - [email protected]
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TABLE OF CONTENTS The table below sets out the disclosure requirements as provided in PAS-4 and the relevant pages in this Shelf Disclosure Document where these disclosures, to the extent applicable, have been provided S. No Disclosure Requirements Relevant Page
1 GENERAL INFORMATION
Name, address, website and other contact details of the company indicating both registered office and corporate office
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Date of incorporation of the company Cover page
Business carried on by the company and its subsidiaries with the details of branches or units, if any
17
Brief particulars of the management of the company 19
Names, addresses, DIN and occupations of the directors. 22
Management’s perception of risk factors 14
Details of default, if any, including therein the amount involved , duration of default and present status, in repayment of: Statutory dues;
Debentures and interest thereon;
Deposits and interest thereon; and
Loan from any bank or financial institution and interest thereon
27
Names, designation, address and phone number, email ID of the nodal/ compliance officer of the company, if any, for the private placement offer process
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2 PARTICULARS OF THE OFFER
Date of passing of board resolution
August 6 , 2014
Date of passing of resolution in the general meeting, authorizing the offer of securities. September 11,
2014
Kinds of securities offered (i.e. whether share or debenture) and class of security
37
Price at which the security is being offered including the premium, if any, along with justification of the price.
37
Name and address of the valuer who performed valuation of the security offered
NA
Amount which the company intends to raise by way of securities.
37
Terms of raising of securities 37
Duration, if applicable; 37
Rate of dividend; NA
Rate of interest 37
Mode of payment; and 47
Mode of repayment 47
Proposed time schedule for which the offer letter is valid. Cover Page
Purposes and objects of the offer. 37
Contribution being made by the promoters or directors either as part of the offer or separately in furtherance of such objects
NA
Principle terms of assets charged as security, if applicable 42
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3 DISCLOSURES WITH REGARD TO INTEREST OF DIRECTORS, LITIGATION ETC
Any financial or other material interest of the directors, promoters or key managerial personnel in the offer and the effect of such interest in so far as it is different from the interests of other persons
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Details of any litigation or legal action pending or taken by any Ministry or Department of the Government or a statutory authority against any promoter of the offeree company during the last three years immediately preceding the year of the circulation of the offer letter and any direction issued by such Ministry or Department or statutory authority upon conclusion of such litigation or legal action shall be disclosed
32
Remuneration of directors (during the current year and last three financial years)
34
Related party transactions entered during the last three financial years immediately preceding the year of circulation of offer letter including with regard to loans made or, guarantees given or securities provided
34
Summary of reservations or qualifications or adverse remarks of auditors in the last five financial years immediately preceding the year of circulation of offer letter and of their impact on the financial statements and financial position of the company and the corrective steps taken and proposed to be taken by the company for each of the said reservations or qualifications or adverse remark.
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Details of any inquiry, inspections or investigations initiated or conducted under the Companies Act or any previous company law in the last three years immediately preceding the year of circulation of offer letter in the case of company and all of its subsidiaries. Also if there were any prosecutions filed (whether pending or not) fines imposed, compounding of offences in the last three years immediately preceding the year of the offer letter and if so, section-wise details thereof for the company and all of its subsidiaries
36
Details of acts of material frauds committed against the company in the last three years, if any, and if so, the action taken by the company
36
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4 FINANCIAL POSITION OF THE COMPANY
The capital structure of the company in the following manner in a tabular form
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The authorised, issued, subscribed and paid up capital (number of securities, description and aggregate nominal value);
18
Size of the present offer; and 18
Paid up capital: 18
After the offer; and 18
After conversion of convertible instruments (if applicable) 18
Share premium account (before and after the offer). 18
The details of the existing share capital of the issuer company in a tabular form, indicating therein with regard to each allotment, the date of allotment, the number of shares allotted, the face value of the shares allotted, the price and the form of consideration. Provided that the issuer company shall also disclose the number and price at which each of the allotments were made in the last one year preceding the date of the offer letter separately indicating the allotments made for considerations other than cash and the details of the consideration in each case.
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Profits of the company, before and after making provision for tax, for the three financial years immediately preceding the date of circulation of offer letter
24
Dividends declared by the company in respect of the said three financial years; interest coverage ratio for last three years (Cash profit after tax plus interest paid/interest paid)
24
A summary of the financial position of the company as in the three audited balance sheets immediately preceding the date of circulation of offer letter.
24
Audited Cash Flow Statement for the three years immediately
preceding the date of circulation of offer letter
29
Any change in accounting policies during the last three years and their effect on the profits and the reserves of the company.
27
5 A DECLARATION BY THE DIRECTORS THAT
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The company has complied with the provisions of the Act and the rules made thereunder
55
The compliance with the Act and the rules does not imply that payment of dividend or interest or repayment of debentures, if applicable, is guaranteed by the Central Government.
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The monies received under the offer shall be used only for the purposes and objects indicated in the Offer letter.
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DEFINITIONS AND ABBREVIATIONS All capitalized terms in this Shelf Disclosure Document that have not been specifically defined herein, shall have the meaning ascribed to such term in the Bond Subscription Agreement. Term Description
GATI KAUSAR INDIA LIMITED or “GKIL ” or the “Company” or the “Issuer”
Gati Kausar India Limited a public limited company incorporated under the Companies Act, 1956 and having its registered office at 1-7-285, M.G. Road, Secunderabad-500003, Telangana India
Articles of Association or “AOA”
Articles of association of the Company, as amended from time to time.
Board of Directors/Board or “BOD”
The board of directors of the Company or a committee constituted thereof
Promoter(s) / Holding Company
Gati Limited
Shelf Disclosure Document
Offer Document / Information Memorandum / Offer Letter / Disclosure Document as per Form no. PAS-4 pursuant to Section 42 of the Companies Act, 2013 and Rule 14(1) of Companies (Prospectus and Allotment of Securities) Rules, 2014
Issue Related Terms Term Description
Affiliate (s) Affiliate (s) shall mean with respect to any person, any other person directly or indirectly Controlling, Controlled by, or under direct, indirect or common Control with, such person.
AGM Annual General Meeting
Application Form The form in which an investor can apply for subscription to the Bonds.
BSE / Stock Exchange
BSE Limited
Beneficial Owner(s) or Debenture Holders or Bond Holders
Holder(s) of the Bonds in dematerialized form as defined under section 2 of the Depositories Act.
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Bonds / Debentures
240Senior Secured, redeemable, non-convertible debentures cum bonds of the face value of Rs. 1,000,000/- each aggregating upto Rs. 240,000,000
Bond Subscription Agreement
Bond Subscription Agreement dated 16 September 2014
CDSL
Central Depository Services (India) Limited
Credit Rating Agency or Rating Agency Credit Analysis & Research Ltd or “CARE”
Bond Documents
All documents entered into in relation to the issuance of the Bonds and/or the creation of any Security Interest and/or other rights and privileges of the Investor and the Debenture Trustee including but not limited to the Bond Subscription Agreement, the Debenture Trust Deed, this Shelf Disclosure Document, the Pledge Agreement and Deed of Hypothecation, the power of attorney in relation to the Pledge Agreement and Deed of Hypothecation and any other agreement or document so designated by the Debenture Trustee.
Debenture Trustee / Bond Trustee
IL&FS Trust Company Ltd
Debenture Trust Deed/DTA
Debenture Trust Deed between the Company and IL&FS Trust Company Ltd (the Debenture Trustees) dated 16 September 2014
Depository(ies) A depository registered with the SEBI under the Securities and Exchange Board of India (Depositories and Participant) Regulations, 1996, as amended from time to time, in this case being NSDL and CDSL.
Depositories Act The Depositories Act, 1996, as amended from time to time.
DP-ID Depository Participant Identification Number.
Designated Bank
HDFC Bank Limited.
EGM Extra Ordinary General Meeting
Equity Shares Equity shares of the Company of face value of Rs. 10 each
Exempted Assets
The assets of the Company that are encumbered in favour of Lenders and are enumerated in Schedule XI to the Bond Subscription Agreement and shall include the vehicles procured by the Company for the Business and encumbered in favour of the lenders financing the procurement on or after the Issue Closing Date.
FII Foreign Institutional Investor as defined under the Securities and Exchange Board of India (Foreign Institutional Investors) Regulations, 1995 and registered with the SEBI under applicable laws in India.
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Gati promoter Group
Collectively the following Persons: 1. Mahendra Investment Advisors Pvt. Ltd; 2. TCI Finance Ltd; 3. Mahendra Kumar Agarwal; 4. Dhruv Agarwal Benefit Trust; 5. Manish Agarwal Benefit Trust; 6. Mahendra Kumar Agarwal (HUF); 7. Bunny Investments & Finance Pvt. Ltd; 8. Jubilee Commercial & Trading Pvt. Ltd; and 9. Neera& Children Trust.
Investor Mandala Agribusiness Investments II Limited
Issue Private Placement of upto 240 Senior Secured, redeemable, non-convertible debentures cum bonds of the face value of Rs. 1,000,000/- each aggregating uptoRs. 240,000,000in one or more tranches
Material Documents
All documents, agreements, contract, arrangement or transaction that are material for the Company to carry on its Business, including but not limited to the Share Subscription and Shareholders Agreement dated in and around the same date as the Bond Subscription Agreement and entered into amongst the Issuer, Investor(or its Affiliate) and Obligor.
Series I Issue Opening date
October 9, 2014
Series I Issue Closing date
October 9, 2014
Obligor Gati Limited NSDL National Securities Depository Limited.
NRI A person resident outside India, who is a citizen of India or a person of Indian origin and shall have the same meaning as ascribed to such term in the FEMA Regulations.
Outstanding Amounts
All amounts payable to the Bond Holders (including Principal Amounts, Interest, Redemption Premium and Default Interest) which have become due and payable, including any costs or fees payable to the Debenture Trustee acting in any of its capacities under the respective Bond Documents hereunder and in relation to an Acceleration Event shall mean the entire remaining principal sums of the Bonds, the Interest accrued and accruing thereon till repayment of principal in full, the entire Redemption Premium accruing and payable on the date of repayment of the Bonds, the Default Interest accrued and accruing thereon till repayment of principal in full and all other sums due and payable to the Bond Holders/Debenture Trustee in terms of the Bond Documents.
OCB A company, partnership, society or other corporate body owned directly or indirectly to the extent of at least 60% by NRIs including overseas trusts, in which not less than 60% of beneficial interest is irrevocably held by NRIs directly or indirectly as defined under FEMA Regulations. OCBs are not permitted to invest in this Issue.
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Shelf Disclosure Document
This Shelf Disclosure Document/Private Placement Offer Letter through which the Bonds are offered on private placement basis
PAN Permanent Account Number
RBI Reserve Bank of India
Record Date 7 (seven) days prior to each Interest payment/redemption date, for determining the beneficiaries of the Bonds for the interest payment and/or principal repayment.
RegisteredDebenture / Bond Holder
The Bondholder whose name appears in the Register of Bond Holders or in the beneficial ownership record furnished by NSDL/CDSL for this purpose
Register of Debenture / Bond Holders
The register maintained by the Company containing the name of Bond holders entitled to receive interest/redemption amount in respect of the Bonds on the Record Date, which shall be maintained at the Corporate Office.
SCRA Securities Contracts (Regulations) Act, 1956
SEBI Act The Securities and Exchange Board of India Act, 1992, as amended from time to time
Stock Exchange BSE Limited
Series I Private Placement of 60 Senior Secured, redeemable, non-convertible debentures cum bonds of the face value of Rs. 1,000,000/- each aggregating to Rs. 60,000,000
Series II Private Placement of upto 180 Senior Secured, redeemable, non-convertible debentures cum bonds of the face value of Rs. 1,000,000/- each aggregating uptoRs. 180,000,000 in one or more tranches as decided by the Board
Transaction Documents
Bond Subscription Agreement, Debenture Trust Deed, Pledge Agreement, Deed of Hypothecation, this Shelf Disclosure Document, and any other agreement or document executed / to be executed in connection with the issue and subscription of Bonds and any other agreement or document designated as such by the Debenture Trustee. Copies of such Transaction Documents shall be circulated separately
Validity This Shelf Disclosure Document is valid upto 180 days from the date of filing with the Stock Exchange
Working Days All days except Saturday, Sunday and any public holiday.
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Disclaimer
This Shelf Disclosure Document is neither a prospectus nor a statement in lieu of a prospectus. The issue of Bonds to be listed on the Stock Exchange is being made strictly on a private placement basis. Multiple copies hereof given to the same entity shall be deemed to be given to the same person and shall be treated as such. It does not constitute and shall not be deemed to constitute an offer or an invitation to subscribe to the Bonds to the public in general. This Shelf Disclosure Document should not be construed to be a prospectus or a statement in lieu of prospectus under the Companies Act. This Shelf Disclosure Document has been prepared in conformity with the SEBI (Issue and Listing of Debt Securities) Regulations, 2008 and as amended from time to time and as per Rules prescribed under the Companies Act, 2013. As per Rule 14 of Companies (Prospectus and Allotment of Securities) Rules, 2014, copy of the Shelf Disclosure Document shall be filed with the Registrar of Companies, Hyderabad within a period of 30 days of circulation of the private placement letter of offer. This Shelf Disclosure Document has been prepared to provide general information about the Issuer and the Bonds to potential investors to whom it is addressed and who are willing and eligible to subscribe to the Issue. This Shelf Disclosure Document does not purport to contain all the information that any potential investor may require. Neither this Shelf Disclosure Document nor any other information supplied in connection with the Issue is intended to provide the basis of any credit or other evaluation and any recipient of this Shelf Disclosure Document should not consider such receipt a recommendation to subscribe to the Issue or purchase any Bonds. Each investor contemplating subscribing to the Issue or purchasing any Bonds should make its own independent investigation of the financial condition and affairs of the Issuer, and its own appraisal of the creditworthiness of the Issuer.Potential investors should consult their own financial, legal, tax and other professional advisors as to the risks and investment considerations arising from an investment in the Bonds and should possess the appropriate resources to analyse such investment and the suitability of such investment to such investor's particular circumstances. The Issuer confirms that, as of the date hereof, this Shelf Disclosure Document (including the documents incorporated by reference herein, if any) contains all information that is material in the context of the issue of the Bonds, and is accurate in all material respects and does not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements herein not misleading, in the light of the circumstances under which they are made. No person has been authorised to give any information or to make any representation not contained or incorporated by reference in this Shelf Disclosure Document or in any material made available by the Issuer to any potential investor pursuant hereto and, if given or made, such information or representation must not be relied upon as having been authorised by the Issuer. This Shelf Disclosure Document and the contents hereof are restricted for only the intended recipient(s) who have been addressed directly and specifically through a communication by the Issuer and only such recipients are eligible to apply for the Bonds. All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this issue. The contents of this Shelf Disclosure Document are intended to be used only by those investors to whom it is distributed. It is not intended for distribution to any other person andshould not be reproduced by the recipient. No invitation is being made to any persons other than those to whom Application Forms along with this Shelf Disclosure Document being issued have been sent by or on behalf of the Issuer. Any application by a person to whom the Shelf Disclosure Document has not been sent by or on behalf of the Issuer shall be rejected without assigning any reason.
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The person who is in receipt of this Shelf Disclosure Document shall maintain utmost confidentialityregarding the contents of this Shelf Disclosure Document and shall not reproduce or distribute in whole or part or make any announcement in public or to a third party regarding the contents without the consent of the Issuer. Each person receiving this Shelf Disclosure Document acknowledges that: Such person has been afforded an opportunity to request and to review and has received alladditional information considered by it to be necessary to verify the accuracy of or to supplement the information herein; and such person has not relied on any intermediary that may be associated with issuance of Bonds in connection with its investigation of the accuracy of such information or its investment decision; Neither the delivery of this Shelf Disclosure Document nor any issue of Bonds made hereunder shall, under any circumstances, constitute a representation or create any implication that there has been no change in the affairs of the Issuer since the date hereof; This Shelf Disclosure Document does not constitute, nor may it be used for or in connection with, an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not authorised or to any person to whom it is unlawful to make such an offer or solicitation. No action is being taken to permit an offering of the Bonds or the distribution of this Shelf Disclosure Document in any jurisdiction where such action is required. The distribution of this Shelf Disclosure Document and the offering of the Bonds may be restricted by law in certain jurisdictions. Persons into whose possession this Shelf Disclosure Document comes are required to inform themselves about and to observe any such restrictions. The Shelf Disclosure Document is made available to investors in the Issue on the strict understanding that the contents hereof are strictly confidential. DISCLAIMER OF THE STOCK EXCHANGE As required, a copy of this Shelf Disclosure Document has been submitted to the Stock Exchange(s) for hosting the same on its website. It is to be distinctly understood that such submission of the Shelf Disclosure Document with Stock Exchange(s) or hosting the same on its website should not in any way be deemed or construed that the document has been cleared or approved by the Stock Exchange(s); nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Shelf Disclosure Document; nor does it warrant that this Issuer’s Bonds will be listed or continue to be listed on the Stock Exchange(s); nor does it take responsibility for the financial or other soundness of this Issuer, its promoters, its management or any scheme or project of the Company. Every person who desires to apply for or otherwise acquire any Bonds of this Issuer may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the Stock Exchange(s) whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever. DISCLAIMER OF THE RESERVE BANK OF INDIA The Securities have not been recommended or approved by the Reserve Bank of India nor does RBI guarantee the accuracy or adequacy of this document. It is to be distinctly understood that this document should not, in any way, be deemed or construed that the securities have been recommended for investment by the RBI. RBI does not take any responsibility either for the financial soundness of the Issuer Company, or the securities being issued by the Issuer Company or for the correctness of the statements made or opinions expressed in this document. Potential investors may make investment decision in
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the securities offered in terms of this Shelf Disclosure Document solely on the basis of their own analysis and RBI does not accept any responsibility about servicing/ repayment of such investment. DISCLAIMER OF THE SECURITIES & EXCHANGE BOARD OF INDIA This Shelf Disclosure Document has not been filed with Securities & Exchange Board of India (SEBI). The Securities have not been recommended or approved by SEBI nor does SEBI guarantee the accuracy or adequacy of this document. It is to be distinctly understood that this document should not, in any way, be deemed or construed that the same has been cleared or vetted bySEBI. SEBI does not take any responsibility either for the financial soundness of any scheme or the project for which the Issue is proposed to be made, or for the correctness of the statements made or opinions expressed in this document. The issue of Bonds being made on private placement basis, filing of this document is not required with SEBI, however SEBI reserves theright to take up at any point of time, with the Issuer Company, any irregularities or lapses in this document. DISCLAIMER OF THE TRUSTEE The Trustees are not borrower or Principal Debtor or Guarantors of the Monies paid/invested by investors for the Bonds. DISCLAIMER OF THE ISSUER The Issuer confirms that the information contained in this Shelf Disclosure Document is true and correct in all material respects and is not misleading in any material respect. All information considered adequate and relevant about the Issue and the Issuer Company has made available in this Shelf Disclosure Document for the use and perusal of the potential investors and no selective or additional information would be available for a section of investors in any manner whatsoever. The Issuer Company accepts no responsibility for statements made otherwise than in this Shelf Disclosure Document or any other material issued by or at the instance of the Issuer Company and anyone placing reliance on any other source of information would be doing so at his/her/their own risk. DISCLAIMER OF THE CREDIT RATING AGENCY Ratings are opinions on credit quality and are not recommendations to sanction, renew, disburse, or recall the concerned bank facilities or to buy, sell or hold any security. The Rating Agency has based its ratings on information obtained from sources believed by it to be accurate and reliable. The Rating Agency does not, however, guarantee the accuracy, adequacy, or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. Rating Agency has been paid a credit rating fee for rating these instruments, based on the amount and type of instruments. RISK FACTORS The investments in the Bonds are not free of risk. The investments in Bonds can be subject to investment risk including interest rate risk, credit risk and possible delays in repayment. The following are the risks envisaged by the management of the Issuer and investors should consider these risk factors carefully for evaluating the trading or profitability of the Issuer and its business before making any investment decision. Unless the context requires otherwise, the risk factors described below apply to the Issuer only. It is however clarified that none of the risk factors disclosed herein would in any way prejudice any of the obligations of the Issuer or the rights of the Investor under any of the Transaction Documents.
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The investors must rely on their own examination and investigation of the Issuer and its business, their promoters, associate companies and the issue of Bonds including the risks and uncertainties involved. The Issuer and its business are subject to risks, uncertainties and assumptions, internal as well as external, and could materially affect the performance of the Issuer. The following are some of the important factors that could cause actual results to differ materially from the Issuer’s expectations. The Issuer believes that the risks described below are the principal ones inherent in this transaction for the prospective investors and the Issuer does not represent that the statement of risks set out hereunder are exhaustive:-
Limited Liquidity & Price Risk:
There is no assurance that a deep secondary market will develop for the Bonds. This could limit the ability of the investor to resell them. This leads to liquidity and price risk on the Bonds. Even if a secondary market develops and sales were to take place, these secondary transactions may be at a discount to the price (paid for the Bonds) due to changes in the interest rate structure Risk in relation to the Security:
Under the Transaction Documents, the Issuer is obliged to provide security by way of mortgage over the properties of the Issuer. However, the value of the security may increase or decrease from time to time and may not at all times be sufficient to cover the liabilities of the Issuer under the Transaction Documents. Delay, Delinquency & Credit Risk:
The Bonds represent an obligation of the Issuer and do not represent any other person associated with the issue. No financial recourse is available to the investors against any person other than the Issuer and the promoters of the Issuer under the Transaction Documents.Further, on default by the Issuer to repay its obligations, the Debenture Trustee may in terms of the Transaction Documents initiate legal proceedings for enforcement of the security interest. However, such proceedings are a long drawn process and fraught with litigation risk. Therefore, the enforcement of the security may not yield desired benefit to the investors. The investors may lose their investments in the Bonds on account of default by the Issuer. Regulatory Risks:
Any change in the regulatory framework as applicable to the Issuer, may impact the Issuer which may in turn affect the investments of the investors in the Bonds. Business Risks:
The primary business of the Issuer is the Cold Chain transportation and the Issuer proposes to enter into Cold Chain warehouse services. Therefore its business is subject to the general risks encountered in the Cold Chain industry. A number of factors, many of which are common to the Cold Chainindustry are beyond the control of the Issuer, and such factors could affect the business of the Issuer.
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1. Issuer Information Issuer Name Gati Kausar India Ltd
CIN U74899TG1984PLC089495
Registered office ofthe Issuer
1-7-285, M.G. Road, Secunderabad-500003, Telangana
Tel – +91 - 040- 71204284
Fax – +91 - 040 - 23112318
Website - www.gatikausar.com
E-Mail - [email protected]
Corporate Office of the Issuer
Plot No. 20, Survey No. 12, Kothaguda,
Kondapur, Hyderabad – 500084, India
Tel- +91- 040- 71204284
Head Office of the Issuer
7th Mile Stone, Gyani Border,
Chikamberpur, Ghaziabad - 201006, India.
Tel – +91 -0120 - 4157150
Website - www.gatikausar.com
E-Mail - [email protected]
Compliance Officerof the Issuer
Mr. K. Harish Adithya
Plot No. 20, Survey No. 12, Kothaguda,
Kondapur, Hyderabad – 500084, India.
Tel- +91- 040- 71204284
Email: [email protected]
CFO of the Issuer
Not Applicable
Arranger, if any
Not Applicable
Trustee of the Issue
IL&FS Trust Company Ltd
The IL&FS Financial Center
Plot No. C–22, G Block, BandraKurla Complex, Bandra(E), Mumbai - 400051, India.
Tel- +91-022- 2659 3612 Fax -+91-022- 2653 3297
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Website - www.itclindia.com Email Id - [email protected]
Registrar of the Issue
Karvy Computershare Pvt. Limited
Plot No. 17-24, Vittal Rao Nagar,
Madhapur, Hyderabad - 500 081, India.
Tel - +91- 040- 4465 5000; Fax - +91- 040- 2343 1551
Website – www.karvycomputershare.com
Email Id - [email protected]
Credit RatingAgency of the Issue
Credit Analysis & Research Ltd [CARE]
4th Floor, Godrej Coliseum, Somaiya Hospital Road,
Sion-East, Mumbai - 400 022, India.
Tel - +91-022-67543456; Fax- +91-022-67543457
Website: www.careratings.com
E-mail: [email protected]
Auditors of the Issuer
Walker Chandiok& Co LLP
7th floor, Block IV, White House,
KundanBagh, Begumpet,
Hyderabad -500016, India.
Tel - +91- 040 – 66308200;Fax - +91- 040 – 66308230
2. Brief summary of Business/Activities of the Issuer and its line of Business
a. Overview Established in 1984, Gati Kausar India is a leading player in the cold chain transportation segment in India. Gati acquired Gati Kausar India in 2007. The Company is one of the largest ISO 9001:2008 certified refrigerated transportation companies in India, certified by Food Safety and Standard Authority of India (FSSAI).
The Company serves healthcare, meat & poultry, bio-pharma, frozen & fresh food, dairy products & organized retail segments. Key customers of the Company include Reliance Retail, Bharti Retail, Amul, Mother Dairy, Allana, Vadilal, etc.
The Company provides Primary and Secondary cold chain transportation services in India. Primary transportation refers to movement of goods between factory and warehouses while Secondary transportation refers to movement of goods from warehouses/distribution centers to retail stores.
The Company has a fleet of around 194 own refrigerated vehicles transporting approx. 200,000 tons annually. Following are the highlights of the fleet –
18
§ State–of-the-art modern Carrier and Thermo King refrigeration units with climate control capability from +20 degrees to -20 degrees celsius.
§ Customized vehicles to meet the specific requirements of the customer. § The Company provides insulated reefer vehicles designed to suit India’s weather
patterns which are tamper proof and sealed to safeguard the perishable cargo during transportation.
§ The vehicles are built with advanced pneumatic suspension system for safe & timely delivery of delicate cargo over long distances.
§ The Company has vehicle tracking IT solution and monitors cargo condition through data loggers.
§ The Company has installed GPS in 100 vehicles and is in the process of upgrading other vehicles with the same.
The Company is now planning to deploy 10 cold warehouses to increase its market share in the cold chain industry. Locations identified for the same are Delhi, Chennai, Bangalore, Hyderabad, Nagpur, Mumbai, Ahmedabad, Kolkata. The Company plans to deploy 2 warehouses each in Delhi and Mumbai and 1 warehouse each in all remaining locations.
The cold chain industry is expected to grow from INR 113 bn in 2012 to INR 157 bn in 2015, thereby growing at a CAGR of 12%. Storage is expected to grow at 11% while transportation if expected to grow at 17% during the said period
b. Corporate Structureas on date of the Information Memorandum
99.85%
c. Capital Structure of the Company as on date of this Shelf Disclosure
Document: Share Capital Amount (Rs.) A. Authorized Capital
7,500,000 Equity shares of Rs. 10/- each 1,000,000 Preference Shares of Rs. 10/- each
75,000,000 10,000,000
B. Issued, Subscribed and Paid-up Capital
5,220,526 Equity shares of Rs. 10/- each 52,205,260
C. Size of present issue 240 Senior Secured, Redeemable, Non-Convertible Debentures Cum Bonds of Face Value of Rs. 1,000,000/- each
240,000,000
D. Paid up capital after the Bond Issue
5,220,526 Equity shares of Rs. 10/- each 52,205,260 E. Share Premium account before and after the
issue 136,235,340
GATI LIMITED
Gati Kausar India Limited
19
The paid up capital and share premium after the Bond Issue doesn’t include the impact of proposed equity/preference shares infusion of INR 300 mn issue.
d. Details of the Shareholding of the Company
i. Details of the shareholding of the Company as on date of this Shelf Disclosure Document
Sr. Name of the Shareholder
No of Shares % Shareholding
Demat Share
1 Gati Limited 5,212,526 99.85% 36,97,800 2 Other
shareholders (Individuals) 8,000 0.15%
Total 5,220,526
100.00% 36,97,800
ii. List of top 10 holders of equity shares of the Company as on the date of this Shelf Disclosure Document
Sr. Name of the Shareholder
No of Shares % Shareholding Demat Share
1 Gati Limited 5,212,526 99.85% 36,97,800 2 Jagjeet Singh
Teja 1,000 0.02% Nil
3 Jatinder Paul 500 0.01% Nil 4 Harpal Singh 500 0.01% Nil 5 Harkaran Singh 500 0.01% Nil 6 Ramesh Makar 500 0.01% Nil 7 Motia Rani 500 0.01% Nil 8 Meenakshi Maker 500 0.01% Nil 9 Rakesh Chander 500 0.01% Nil 10 Krishna Bansal 500 0.01% Nil
3. OUR MANAGEMENT
a. Details regarding the directors of the Company: Details of current directors of the Company
Name & DIN
Age
Address Ocupation
Designation
Date of appoint
ment
Directorship in other
companies
MANISH AGARWAL
06573302
26 139, SHEESH MAHAL COMPOUND,, AVENUE 5, BANJARAHILLS, HYDERABAD, 500034, Andhra Pradesh, INDIA
Service Additional director
07/11/13 --
20
ANILKUMAR VENKAT EPUR
00202454
65 H.NO. B-2-703 / 7/A, ROAD NO.12, BANJARA HILLS, HYDERABAD, 500034, Andhra Pradesh, INDIA
Service Additional director
01/04/14 Rane Brake Linings Limited,
RaneDiecast Limited&
Rane Brake Lining Limited
SANWAR MAL JALAN
00324182
68 12-134 PERSEPOLIS BLDG.,, CAPT PRAKASH PETHE MARG,COLABA, MUMBAI, 400005, Maharashtra, INDIA
Service Director
22/01/08 TCI HI-Ways Private Limited,
MNM Trading Solutions Private Limited,
Mega Freight Movers Limited,
TCI Finance Limited,
Bhoruka Classic Finance Private Limited&
Mukesh Textiles Mills Limited
SAMPATH RAVI KUMAR GANAPATHI
01087133
50 102, FIRST FLOOR, SWARNA PALACE, ROAD NO 1, PLOT, NO 17, MCH NO 10-2-180, WEST MARREDPALLY, SECUNDERABAD, 500026, Andhra Pradesh, INDIA
Service Director
01/02/13 Gati Ship Limited,
Gati Intellect Systems Limited&
Zen Cargo Movers Private Limited
PRABHU NARAIN SHUKLA
61 9 D, RAILWAY BAORD FLATS, SAROJINI NAGAR, NEW
Service Director
01/02/13 Gati limited
21
01868580 DELHI, 110023, Delhi, INDIA
4. A BRIEF HISTORY OF THE ISSUER a. Major events Year Event
1984 Company incorporate as Kausar (India) Pvt Ltd
1995 Name changed to Kausar India Limited
1996 IPO and listing on DSE and LSE
2007
2009
Company acquired by Gati Ltd
Delisted from Ludiana Stock Exchange & Delhi Stock Exchange
2007 - 2013
§ Expanded cold chain transportation fleet from 95 to ~ 200 § Strengthened leadership and management capabilities § Developed processes and systems and received ISO certification § Improved IT infrastructure § Commenced secondary distribution
2013 Company’s name changed to Gati Kausar India Ltd
b. Changes in its capital structure -Built up of Authorized Capital
Date From (Rs)
Increase (Rs)
Authorized Capital after
enhancement(Rs)
Particulars
11.07.1984 500,000 500,000 On Incorporation
24.11.1995 500,000 54,500,000 55,000,000 Increased 11.09.2014 5,50,00,000 3,00,00,000 8,50,00,000 Increased
c. Equity Share Capital History of the Company Date of allotment
No. of Shares issued
Face value (Rs.)
Issue Price (Rs.)
CumulativeNo.
of Shares
CumulativePaid-
up Capital
(Rs.)
Cummulative Equity Share Premium
Consideration (Cash other than cash, etc)
Nature of Allotment/Remarks
(Rs.)
11.07.1984
20 100 100 20 2,000 0 Cash Subscription toMemorandum
19.12. 34 100 100 54 5,400 0 Cash Private
22
1984 Placement
19.12.1985
300 100 100 354 35,400 0 Cash Private Placement
7.01.1986
500 100 100 854 85,400 0 Cash Private Placement
1.09.1986
200 100 100 1,054 105,400 0 Cash Private Placement
11.03.1991
2,000 100 100 3,054 305,400 0 Cash Private Placement
29.03.1993
1,400 100 100 4,454 445,400 0 Cash Private Placement
24.07.1995
10 10 44,540 445,400 0 Cash Spilt of Face Value
20.10.1995
1,483,900
10 10 1,528,440
15,284,400
0 Cash Private Placement
16.05.1996
2,178,360
10 10 3,706,800
37068000 0 Cash Public Issue
1.11.2012
1,044,242
10 100 4,751,042
47,510,420
93,981,780
Cash Issued to Promoters
06.08.2014
469,484
10 100 5,220,526
52,205,260
136,235,340
Cash Issued to Promoters
d. Details of any Acquisition or Amalgamation in the last 1 year: N.A e. Details of any Reorganization or Reconstruction in the last 1 year: N.A.
f. Details of change in Directors since last three years:-
Name, Designation & DIN Date of
Appointment Date of
Resignation
MANISH AGARWAL - Additional Director
06573302
07/11/13 -
ANILKUMAR VENKAT EPUR – Additional Director
00202454
01/04/14 -
SAMPATH RAVI KUMAR GANAPATHI - Director
01/02/13 -
23
01087133
PRABHU NARAIN SHUKLA - Director
01868580
01/02/13 -
SHINDE LAXMIKANT CHITRA – Director
03642581
16/01/12 28.02.2014
MAHENDRA KUMAR AGARWAL – Director
0179779
22/01/08 29/06/12
BIJOY KUMAR PANSARI – Director
00160146
22/01/08 22/12/11
KHATRI SAMEER – Director
02615343
30/04/09 28/02/12
NAGESH GOENKA – Director
01121865
22/01/08 07/02/13
SM Jalan- Director
00324182
22/01/08 --
g. Details regarding auditors of the Company:
Name Address Appointment
Walker Chandiok& Co LLP
7th floor, Block IV, White House, KundanBagh, Begumpet, Hyderabad -500016, India.
Tel - +91- 040 – 66308200;Fax - +91- 040 – 66308230
April 25, 2013
24
h. Details of change in auditor since the last 3 years
Name
Address Date of Appointment/ Resignation
Remarks
S.S. Kothari & Co
415/416, Model House,Punjagutta, Hyderabad 500082
April 2,2013 Resigned
Walker Chandiok& Co LLP
7th floor, Block IV, White House,
KundanBagh, Begumpet,
Hyderabad -500016, India
April 25, 2013 Appointed
i. Dividends declared by the company in respect of the said three financial
years;
FY ending 31-Mar-14 30-Jun-13 30-Jun-12 Dividends declared 0 0 0
j. Interest coverage ratio for last three years
Interest coverage ratio for the last 3 financial years is as follows-
FY ending 31-Mar-14(9 months) 30-Jun-13 30-Jun-12 PAT (39,208,805) (24,331,086) (21,613,707) Add: Deferred tax (11,852,342) 753,300 Add: Depreciation 43,783,585 58,234,530 55,482,892 Add: Interest expenses 23,564,804 26,835,305 24,893,237 Cash Available 28,139,584 48,886,407 59,515,722 Interest expenses 23,564,804 26,835,305 24,893,237 Interest coverage ratio 1.19 1.82 2.39
k. Key Operational and Financial Parameters for last 3 audited years FY ending 31-Mar-14 30-Jun-13 30-Jun-12 Networth 20,400,634 59,609,439 (20,483,675) Total Debt of Which 257,022,470 277,817,467 258,026,167 Non Current Maturities: of Long Term Borrowings
118,763,963 144,013,519 180,630,568
Short Term Borrowings 48,054,743 47,691,022 25,204,404 Current Maturities: of Long Term Borrowings
90,203,764 86,112,926 52,191,195
Net Fixed Assets 229,845,343 278,027,614 185,576,571 Non Current Assets 230,257,557 280,841,961 188,660,443 Cahs& Cash Equivalents 5,687,649 1,409,255 1,615,457
25
Current Investments - - - Current Assets 81,363,861 87,937,392 84,946,642 Current Liabilities 171,991,531 164,746,121 101,540,782 Total Revenue 357,808,470 458,462,404 402,141,968 EBITDA 33,664,941 48,886,407 59,515,722 EBIT -10,118,644 -9,348,123 4,032,830 Interest 23,564,804 26,835,305 24,893,237 PAT -39,208,805 -24,331,086 -21,613,707 Dividend Amount - - - Current Ratio* 2.41 2.84 3.52 Interest Coverage Ratio 1.19 1.82 2.39 Gross Debt/equity ratio 12.60 4.66 (12.60) Debt Service Coverage Ratios
0.43 0.59 0.60
Note: Current Ratio is calculated after the adjustments of Short Term Borrowings and Current portion of Term Loan in Current Liabilities
l. Gross Debt/ Equity Ratio of the Company Before the issue of Bonds* 4.06
After the issue of Bonds* 5.26 after the Issue of Series I and 8.85 after both the series are issued
*Equity includes the share capital and reserves and surplus as on 31 August 2014 *Gross Debt/Equity Ratio calculated above doesn’t include the impact of equity/preference shares infusion of INR 300 mn
m. Details of borrowings of the Company, as on 31st August 2014 i. Details of Secured Loan facilities:-
Lender’s
Name
Type of
Facility
Amt
Sanctioned (Rs.)
Principal Amt
Outstanding (Rs.)
Repayment
Date /
Schedule
Security
HDFC Bank Limited
Term Loan Vehicle
28,035,000 1,455,624 15 Vehicle
HDFC Bank Limited
Term Loan Vehicle
47,472,600 32,864,252 20 Vehicle
HDFC Bank Limited
Term Loan Vehicle
47,726,394 31,156,527 5 Vehicle
ICICI Bank ltd
Term Loan Vehicle
7,937,646 5,239,101 1 Vehicle
26
ICICI Bank ltd
Term Loan Vehicle
7,260,000 4,494,657 7 Vehicle
ICICI Bank ltd
Term Loan Vehicle
6,631,590 3,851,215 7 Vehicle
ICICI Bank ltd
Term Loan Vehicle
21,022,860 15,176,015 15 Vehicle
L & T Finance ltd
Term Loan Vehicle
5,639,667 2,607,043 2 Vehicle
L & T Finance ltd
Term Loan Vehicle
13,779,750 6,422,767 15 Vehicle
Magma Fincorp Limited
Term Loan Vehicle
2,750,980 1,087,178 1 Vehicle
Magma Fincorp Limited
Term Loan Vehicle
5,639,665 2,607,473 10 Vehicle
Magma Fincorp Limited
Term Loan Vehicle
6,000,000 810,474 10 Vehicle
Magma Fincorp Limited
Term Loan Vehicle
18,842,515 2,126,773 20 Vehicle
Reliance Capital Limited
Term Loan Vehicle
39,082,000 5,972,850 20 Vehicle
Reliance Capital Limited
Term Loan Vehicle
6,000,000 1,726,541 2 Vehicle
ReligareFinvest Ltd
Term Loan Vehicle
18,393,520 2,935,998 15 Vehicle
Tata Motors Finance Ltd
Term Loan Vehicle
16,546,000 2,108,762 15 Vehicle
Tata Motors Finance Ltd
Term Loan Vehicle
10,523,000 1,630,928 2 Vehicle
The Agrasen Co-op urban bank ltd
Term Loan 20,000,000 4,185,902 11 Current Assets
27
The Agrasen Co-op urban bank ltd
Term Loan 20,000,000 14,250,832 28 Current Assets
HDFC BANK Working Capital
50,000,000 48,609,990 NA Current Assets
Total 19,13,20,902
ii. Details of Unsecured Loan facilities S.No Lender Amount (in Rs.) 1 Gati Limited, Parent Company 1,05,00,000 2 HDFC Bank 15,96,989
Total 1,20,96,989
iii. Details of NCD:- Not Applicable iv. List of Top 10 Debenture Holders:- Not Applicable v. Details of corporate Guarantee Issued by Issuer : Not Applicable vi. Details of Commercial paper : Not Applicable vii. Details of rest of the borrowings (if any including hybrid debt like FCCB,
Optionally Convertible Debentures/Preference Shares): Not Applicable viii. Details of all default/s and/or delay in payments of interest and principal
of any kind of term loans, debt securities and other financial indebtedness including corporate guarantee issued by the Company, in the past 5 years: Nil
ix. Details of any outstanding borrowings taken/ debt securities issued where taken/ issued (i) for consideration other than cash, whether in whole or part, (ii) at a premium or discount, or (iii) in pursuance of an option: NIL
x. Details of default , if any, including therein the amount involved , duration of default and present status, in repayment of Statutory dues/ Debentures and interest thereon/ Deposits and interest thereon and Loan from any bank or financial institution and interest thereon :NIL
xi. Details of any change in accounting policies during the last three years and their effect on the profits and the reserves of the company: NIL
xii. Details of the Promoters of the Company as on the date of this Shelf Disclosure Document
Sr.No. Name of the Shareholders
Total No. of
Equity Shares
No. of shares in
demat form
Total
shareholding
as % of total
no. of equity
shares
No. of shares
pledged
% of shares
pledged with
respect to
shares owned
28
1 Gati Ltd 5,212,526 36,97,800 99.85% 0 0
xiii. Abridged version of Audited Standalone Financial Information (like Profit & Loss
statement, Balance Sheet and Cash Flow Statement) for at least last three years and auditors qualifications, if any:
As on 31-Mar-14 30-Jun-13 30-Jun-12 Equity and liabilities Share capital 47,510,420 47,510,420 37,068,000 Reserves and surplus (27,109,786) 12,099,019 (57,551,675) Shareholders' funds 20,400,634 59,609,439 (20,483,675) Long-term borrowings 118,763,963 144,013,519 180,630,568 Deferred tax liabilities, net - - 11,852,342 Long-term provisions 465,290 410,274 67,068 Non-current liabilities 119,229,253 144,423,793 192,549,978 Short-term borrowings 48,054,743 47,691,022 25,204,404 Trade payables 13,149,988 11,182,776 3,806,037 Other current liabilities 110,786,800 105,872,323 72,204,065 Short-term provisions - - 326,276 Current liabilities 171,991,531 164,746,121 101,540,782 Total Liabilities 311,621,418 368,779,353 273,607,085 Assets Fixed assets
Tangible assets 229,845,343 278,027,614 185,576,571 Non-current investments 10,000 10,000 10,000 Long-term loans and advances 402,214 2,804,347 3,073,872
Non-current assets 230,257,557 280,841,961 188,660,443 Inventories 3,878,347 3,593,582 4,566,790 Trade receivables 56,277,367 65,083,890 66,209,848 Cash and bank balances 5,687,649 1,409,255 1,615,457 Short-term loans and advances 15,021,303 17,115,284 11,890,742
Other current assets 499,195 735,381 663,805 Current assets 81,363,861 87,937,392 84,946,642 Total Assets 311,621,418 368,779,353 273,607,085
FY ending 31-Mar-14 30-Jun-13 30-Jun-12 (9 months) (12 months) (12 months)
Revenue Revenue from operations 349,398,377 447,992,401 395,253,602 Other income 8,410,093 10,470,003 6,888,366 Total revenue 357,808,470 458,462,404 402,141,968
29
Expenses Fleet Running Expenses 296,119,306 376,457,596 317,292,877 Employee benefit expense 14,764,030 17,207,475 14,784,426 Finance costs 23,564,804 26,835,305 24,893,237 Depreciation charge 43,783,585 58,234,530 55,482,892 Other expenses 13,260,193 15,910,926 10,548,943 Total expenses 391,491,918 494,645,832 423,002,375 Loss before tax (33,683,448) (36,183,428) (20,860,407) Exceptional Items 5,525,357 Tax expense Deferred tax charge / (benefit) - (11,852,342) 753,300
Loss for the year (39,208,805) (24,331,086) (21,613,707)
FY ending 31-Mar-14 30-Jun-13 30-Jun-12 Cash flows from operating activities
Loss before tax (39,208,805) (36,183,428)
(20,860,407)
Adjustments :
Depreciation charge 43,783,585 58,234,530
55,482,892
Gain on sale of fixed assets (7,047,147) (6,469,903)
(2,840,450)
Provision for employee benefits 55,017
16,930
(7,453)
Interest income (20,384) (127,728)
(77,152)
Dividend income (4,150)
(3,500)
Interest expenses 22,948,685 25,717,960
24,632,394
Receivables written-off 5,525,357 Operating profit before working capital changes 26,036,309 41,184,211 56,326,324
Increase in other current liabilities (2,268,080)
1,756,181
(11,456,451) Increase in trade payables 5,058,931 7,376,739 447,401
Decrease in inventories (284,764) 973,207
(982,129)
Decrease in trade receivables 8,806,523
1,125,958
(20,633,032) Decrease in long-term loans and advances 123,597
21,510
(145,000) Decrease in short-term loans and advances 2,093,983
(5,224,542)
(3,217,963) Decrease in other current assets 236,186
(71,576)
(2,136,454) Cash generated from operating activities 39,802,685 47,141,688 18,202,696
Income taxes paid (10,994) 248,016
(856,942)
Net cash generated from 39,791,691 47,389,704 17,345,754
30
operating activities (A) Cash flows from investing activities
Purchase of tangible assets (135,936,892) (35,293,969) Proceeds from sale of Assets 8,210,000
7,006,499
3,891,999
Interest received 20,384 127,728
77,152
Dividend received 4,150
3,500
Increase in other bank balances 1,206,922
(138,386)
(554,086) Net cash used in investing activities (B) 9,437,306 (128,936,901)
(31,875,404) Cash flows from financing activities
Proceeds from long-term borrowings 20,000,000
138,051,090
66,527,326 Repayment of long-term borrowings (41,158,718) (56,027,609) (74,365,630)
Proceeds from short-term borrowings, net 363,722
22,486,618
10,937,708
Interest paid (22,948,685) (23,307,490)
(18,156,851)
Net cash provided by / (used in) financing activities (C)
(43,743,681) 81,202,609 (15,057,447)
Net increase in cash and cash equivalents (A+B+C)
5,485,316 (344,588)
(29,587,097)
Cash and cash equivalents as at the beginning of the year
82,333
426,921
30,014,018
Cash and cash equivalents as at the end of the year 5,567,649 82,333 426,921
Cash and bank balances as per Balance Sheet 5,687,649 1,409,255 1,615,457
Less: Fixed deposits held with banks as margin money
120,000 1,326,922 1,188,536
Cash and cash equivalents considered for the purpose of cash flow
5,567,649 82,333 426,921
Note :There is no Auditors’ qualification.
xiv. Abridged version of latest Audited/Limited Review half yearly Consolidated (wherever available) and Standalone Financial Information (like Profit & Loss statement and Balance Sheet) and auditors qualifications, if any: Not applicable
31
xv. Any material event/development or change having implications on the
financials/credit quality (e.g. any material regulatory proceedings against the Issuer/promoters, tax obligations resulting in material liabilities, corporate restructuring event etc.) at the time of issue which may affect the issue or the Investor’s decision to invest/continue to invest in the debt securities. Other than details given in this Information Memorandum there is no material event/development or change at the time of issuance of this document which may affect the issue or the investor’s decision to invest/ continue to invest in the debt securities.
xvi. Debenture Trustee
The debenture trustee of the proposed Issue is IL&FS Trust Company Ltd.The IL&FS Financial Center Plot No. C–22, G Block, Bandra Kurla Complex Bandra(E), Mumbai - 400051, India. IL&FS Trust Company Ltd having its address at The IL&FS Financial Center Plot No. C–22, G Block, BandraKurla Complex Bandra(E), Mumbai - 400051, India has been appointed as Debenture Trustee for the proposed Issue. The Debenture Trustee has given its consent to the Issuer under regulation 4(4) for its appointment. The Company has entered into a Trusteeship Agreement / Debenture Trust Deed dated 16 September 2014, inter-alia, specifying the powers, authorities and obligations of the Company and the Debenture Trustee in respect of the Bonds.
The Bondholders shall, by signing the Application Form and without any further act or deed, be deemed to have irrevocably given their consent to and authorised the Debenture Trustee or any of their Agents or authorised officials to do, inter alia, all such acts, deeds and things necessary in respect of or relating to the security to be created for securing the Bonds being offered in Terms of this Shelf Disclosure Document. All rights and remedies under the Debenture Trust Deed / Trusteeship Agreement and/or other security documents shall rest in and be exercised by the Debenture Trustee without having it referred to the Bondholders. Any payment made by the Company to the Debenture Trustee on behalf of the Bondholder(s) shall discharge the Company pro ratato the Bondholder(s). No Bondholder shall be entitled to proceed directly against the Company unless the Debenture Trustee, having become so bound to proceed, fails to do so. The Debenture Trustee will protect the interest of the Bondholders in the event of default by the Company in regard to timely payment of interest and Redemption Amount and they will take necessary action at the cost of the Company. Copy of the consent letter from the Debenture Trustee is attached.
xvii. Credit Rating
CARE has assigned “BB+” (pronounced “CARE Double B Plus”) for the proposed Rs. 1,200 million Bond issue. Credit Rating Letter from CARE is attached as Annexure I.
xviii. Guarantee or comfort for the Bonds.
Not Applicable
xix. Details of stock exchanges where the securities are to be listed
32
The Securities are proposed to be listed on BSE Limited which will be designated stock exchange
xx. Disclosures with regard to interest of directors, litigation, etc
i. Any financial or material interest of the directors, promoters or
key managerial personnel in the offer and the effects of such interest in so far as it is different from the interests of other persons. None of the Directors, Promoters or Key Managerial Personnel has financial or material interests in the offer.
ii. Details on litigation or legal action pending or taken by any
Ministry or Department of the Government or a statutory authority against any promoter of the offeree company during the last three years The following are the litigation or legal action pending or taken by any Ministry or Department of the Government or a statutory authority against Gati Limited, promoter of the offeree Company:
i) Following tax disputes are pending against Gati Limited under the Income Tax Act, 1961.
Appeal Number
Asst. Year
Pending before Amount in dispute (Rs.)
ITTA NO. 190 of 2008 & 204
of 2008
2000-01 High Court
(Appeal by the Income-tax Department )
34,50,297
ITTA NO.220/2013
2003-04 High Court
(Appeal by the Income-tax Department)
78,78,766
326/2013-14 2007-08 CIT(Appeals)
(Appeal by the assessee company )
2,64,26,757(*)
0289/2010-11 2008-09 CIT(Appeals)
( Appeal by the assessee company)
16,87,01,142(*)
0200/2013-14 2010-11 CIT(Appeals)
( Appeal by the assessee company)
2,87,61,680(*)
(*) The tax demands have already been adjusted against refunds due to the company.
ii) Following service tax appeals arepending against Gati Limited
33
Issue Order No.
Asst. Year Pending Before
Amount in dispute
(Rs.)
Amount paid/rev
ersed under
protest
Non-Payment of service tax on the export service to Nepal
13/2009 2003-04 to 2007-08
CESTAT
(Bangalore)
5,35,010 _
124/2013
2008-09 3,35,943 1,67,973
18/2013 2009-10 3,83,419 1,91,710
8/2013 2010-11 3,24,552 3,24,552
2011-12 3,34,988 -
Irregular availment of Cenvat credit on Group Mediclaim Insurance
110-111 2009-10 CESTAT
(Bangalore)
12,41,516 12,41,516
2010-11 8,13,700 8,13,700
Irregular availment of Cenvat credit on input services / capital goods
47/2014 2007-09 CESTAT
(Bangalore)
3,55,52,229
75,00,000
iii) Air India and Gati Arbitration In the year 2009, the Gati Limited discontinued Freighter Aircraft operations as per the arrangement with National Aviation Company of India Ltd (NACIL) (erstwhile Indian Airlines Ltd.,) and now Air India (AI), due to continuous failure and defaults by NACIL. The Learned Arbitral Tribunal adjudicating on the disputes between Gati and Air India Limited in respect of the discontinued freighter operations of Gati, has passed its Award dated September 17, 2013, whereby, it has inter alia directed Air India Limited to pay an amount of Rs. 2682 Lakhs to the Gati against which an amount of Rs. 2,659 Lakhs was included in the Loans and Advances being the difference between the amount of bank guarantee invoked by NACIL and claims acknowledged by Gati. Further, the Learned Tribunal has directed Air India Limited to pay interest@18% per annum on the awarded amount. Air India has preferred an application in the Hon’ble Delhi High Court inter alia seeking setting aside of the Award. The matter is pending adjudication.
iv) Foreign Currency Convertible Bonds (FCCBs) The Board of Directors of Gati Limited has allotted 22.182 Zero Coupon Unsecured Foreign Currency Convertible Bonds (FCCB) of US$1,000 each,
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thereby raising US$ 22.18 Mn. on December 12, 2011. The Bonds are convertible pursuant to terms and conditions thereof, any time from December 12, 2012 upto the close of business on November 13, 2016 by holders of the Bonds into fully paid equity shares of Gati. Unless previously converted, redeemed or purchased and cancelled, the Bonds will be redeemed in US dollars at 132.8341 percent of principle amount on December 13, 2016 giving a Yield to Maturity of 5.76 percent per annum calculated on semi-annual basis.
In response to Gati's application to Reserve Bank of India (RBI) seeking permission for part repurchase of FCCBs, RBI vide its letter dated 27th September 2013 accorded permission while stating that Gati was not an eligible borrower under the automatic route and the borrowing be treated as a Foreign Debt. Gati was levied a compounding fee of Rs.29.6 Mn in this respect. While suspending the compounding orders of RBI, the Hon’ble High Court of Andhra Pradesh had passed an interim order directing Gati to deposit Rs. 0.74 Mn with Reserve Bank of India, out of the compounding fee of Rs.29.6Mn, which the Company has since deposited. The matter being subjudice and on the basis of written legal advice, Gati has not recognized the conversion notice from one of the bondholders in respect of the FCCBs.
iii. Remuneration of directors during current year and the last three
financial years
No other Directors are paid Remuneration during the current fiscal year and last three financial years, Except for the below mentioned Director: Particulars 31-Mar-14 31-Mar-13 30-Jun-12
Manish Agarwal 371,700 Nil Nil
iv. Related party transactions during the last three financial years As on 31-Mar-14 (Rs.) 31-Mar-14 Gati Limited Equity Investment 0 Unsecured Loan 32,428,500 Interest Expense 0 Management Fee 1,571,383 Advances received Reimbursable expenses incurred on behalf of the Company
519,233
Gati-Kintetsu Express Pvt. Ltd. Revenue from Operations 6,522,876 Advances received 32,800,000 Managerial remuneration Manish Agarwal 371,700
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As on 31-Mar-13 (Rs.) 31-Mar-13 Gati Limited Equity Investment 104,424,200 Unsecured Loan 4,375,500 Interest Expense 2,410,470 Management Fee 1,603,901 Advances received 4,028,048 Reimbursable expenses incurred on behalf of the Company 959,770 Gati-Kintetsu Express Pvt. Ltd. Revenue from Operations 7,442,250 Advances received 1,875,300
As on 30-Jun-12 (Rs.) Opening
balance as on 01-Jul-11
Debit during the year
Credit during the year
Closing balance as on 30-Jun-12
Freights & Others Sundry Debtors - Gati Ltd.
5,000,431 8,238,297 11,180,943 2,057,785
Creditors Unsecured loan from Gati
88,931,010 6,417,264 19,800,000 75,548,274
Gati Ltd. (interest Payable) for sl no.1
10,909,908 6,475,543 90,520 17,294,931
Gati Academy (providing man power to kausar
486,998 6,174,311 6,476,191 185,118
Loan taken from Gati Ltd. (SDB) from Fleets
7,428,117
1,617,775 5,810,342
Gati Ltd. interest for sl no.4
0
703,565 703,565
Loans and Advances
Delhi Frozen Containers (P) Ltd.
2,418,627
2,418,627
v. Summary of reservations or qualifications or adverse remarks of auditors in the last five financial years immediately preceding the year of circulation of offer letter and of their impact on the financial statements and financial position of the company and the corrective steps taken and proposed to be taken by the company
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for each of the said reservations or qualifications or adverse remark. Nil.
vi. Details of any inquiry, inspections or investigations initiated or conducted under the Companies Act or any previous company law in the last three years immediately preceding the year of circulation of offer letter in the case of company and all of its subsidiaries. Also if there were any prosecutions filed (whether pending or not) fines imposed, compounding of offences in the last three years immediately preceding the year of the offer letter and if so, section-wise details thereof for the company and all of its subsidiaries
No inquiry, inspections or investigations have been initiated or conducted under the Companies Act or any previous company law in the last three years immediately preceeding the year of circulation of offer letter in the case of company and all of its subsidiaries.
vii. Details of acts of material frauds committed against the company
in the last three years, if any, and if so, the action taken by the company
None
xxi. Other details i. Debenture Redemption Reserve
Company would create Debenture Redemption Reserve as per the Act and the regulations and guidelines issued by the Securities and Exchange Board of India (SEBI), and if during the currency of these presents, any guidelines are formulated (or modified or revised) by a Governmental Authority having authority under law in respect of creation of Debenture Redemption Reserve the Company shall abide by such guidelines and execute all such supplemental letters, agreements and deeds of modifications as may be required by the Bond Holders or the Debenture Trustees and shall also cause the same to be registered, where necessary
ii. Issue/instrument specific regulations - relevant details (Companies Act, RBI guidelines, etc).
• The Companies Act, 2013 and the applicable Rules as amended from time to time
• SEBI (Issue and Listing of Debt Securities) Regulation, 2008 as a amended from time to time
• RBI Notification bearing no. RBI/2011-12/423 A.P. (DIR Series) Circular No. 89 dated March 1, 2012 issued by Reserve Bank of India, Foreign Exchange Department, Central Office, Mumbai – 400 001 in respect of FII investment in ‘to be listed’ debt securities
iii. Application Process:- As described below
5. DETAILS Of ISSUE
a. Issue details In addition to theterms mentioned below, the said Bonds shall be subject to the terms of this Information Memorandum, Bond Subscription Agreement and Debenture Trust Deed.
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Security Name Gati Kausar India Limited- Bonds
Series Gati Kausar India Limited- Bonds - Series I
Issuer Gati Kausar India Limited
Type of Instrument Senior Secured Redeemable Non-convertible Bonds
Nature of Instrument Secured
Seniority Shall rank senior to all other debt of the Issuer, except those creditors/lenders having charge over the Exempted Assets as provided in the Bond Subscription Agreement.
Mode of Issue Private Placement
Eligible Investors The following categories of Investors, who have been specifically approached and have been identified upfront, are eligible to apply for this private placement of Bonds subject to fulfilling their respective investment norms/rules and compliance with laws applicable to them by submitting all the relevant documents along with the Application Form:
i. Foreign Institutional Investors (FIIs)
Listing The Bonds are proposed to be listed on WDM segment of BSE Limited.
On or before the date falling 15 (fifteen) days from the Relevant Closing Date as provided in the Bond Subscription Agreement with the BSE in accordance with the all applicable rules and regulations of the BSE and in compliance with Applicable Law.
Rating of the Instrument CARE BB+ for the Total Investment Amount of Rs. 120 Crores
Total Issue Size Upto Rs. 24 crores in Series I Bonds and Series II Bonds as a part of Total Investment Amount of Rs. 120 Crores
Series I Issue Size (Amount) Rs.6 Crores as a part of Total Investment Amount of Rs. 120 Crores
Option to retain over subscription Not Applicable
Objects of the Issue The proceeds of the issue shall be utilized in funding the Capital Investment Program/CIP and
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repayment of the Specified Promoter Loans, as provided in the Bond Subscription Agreement.
Details of the utilization of the Proceeds
The proceeds realized out of the Issue, shall be utilized towards the Objects of the Issue as aforesaid and for no other purpose
Return 13.65 % per annum of which
(i) 5.65 % per annum shall be paid in cash quarterly (“Quarterly Interest”); and
(ii) 8% per annum shall (if not voluntarily paid annually in accordance with Clause 6 of the Bond Subscription Agreement) be compounded annually upto the last day of the Initial Term (“Redemption Premium”) and shall be accrued and paid on the last Business Day of the Initial Term. The principal and all accrued amounts on Bonds that are not redeemed within five years of their issuance shall carry interest at the rate of 14.65 % per annum, payable every quarter in cash, for the period after the fifth anniversary of their issuance and until their redemption (“Extended Period Coupon”). It is hereby clarified that Redemption Premium of 8% per annum shall not be paid during Extended Period Coupon, i.e. beyond the period of 5 (five) years from the Relevant Closing Date of the Bonds.
Step Up/ Step Down Interest Rate Not Applicable
Interest Payment Frequency Quarterly
Interest Payment Date(s) The Quarterly Interest shall be payable on the dates falling on the last day of every Fiscal Quarter and if such day is not a Business Day, then the last Business Day immediately preceding such day provided that Interest shall be calculated till the last day of the Fiscal Quarter.
"Fiscal Quarter" shall mean in any fiscal year i.e. the accounting period commencing from April 1st of each year till March 31st of next year, any of the following three month periods of a fiscal year:
(a) April 1 to June 30;
(b) July 1 to September 30;
(c) October 1 to December 31;
(d) January 1 to March 31.
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Interest Type Fixed
Interest Reset Process None
Day Count Basis Actual/Actual Basis
Interest payable on the Bonds will be calculated on the basis of actual number of days elapsed in a year of 365 or 366 Days as the case may be.
Interest on Application Money Not Applicable
Default Interest Interest payable on the Outstanding Amounts at the rate of 2% (two percent) p.a., over and above the Interest, compounded continuously, and payable from the date of occurrence of Event of Default until repayment (as per the terms of the Bond Subscription Agreement). Provided however that if a Cure Period is prescribed (under the Bond Documents) and the breach is cured within the applicable Cure Period, then no Default Interest shall be payable in relation to such breach.
Tenor “Initial Term” in relation to any Series of Bond, shall mean a period of 5 (five) years from the Relevant Closing Date of the Bonds issued in such Series. Unless extended in accordance with the Bond Subscription Agreement/ Debenture Trust Deedthe Bonds shall have a term of, and be immediately repayable along with accrued Interest and any unpaid amounts at the end of 5 (five) years from the date of their issuance.
The Issuer may extend the term of any one or more Series of Bonds but not any part of a Series of Bonds subject to, and in accordance with the following provisions: (i) The Issuer may extend the Initial Term of a
Bond only if one-third of the principal sums of such Series of Bonds whose tenor is sought to be extended is repaid on the fifth anniversary of their issuance or prepaid before such time in accordance with all Bond Documents.
(ii) In order to extend the Initial Term of any
Bond, the Issuer shall serve a written notice (the “Tenor Extension Notice” as given under the Bond Subscription Agreement) on the Debenture Trustee no later than the midnight IST ending the 180th day prior to the
40
fifth anniversary of the issuance of the relevant Extended Bond. Any delay or failure to serve a Tenor Extension Notice on or before such time shall be an irrevocable waiver of the Issuer’s right to extend the tenor of Extended Bond.
(iii) The Initial Term of a Bond may only be
extended once and for a period of 2 (two) years.
(iv) The Principal Amount and all Outstanding Amounts on Bonds that are not redeemed within five years of their issuance shall carry interest at the rate of 14.65 % per annum (the “Extension Interest”), payable in cash on the Quarterly Interest Payment Date, for the period after the fifth anniversary of their issuance and until the Final Maturity Date.
(v) The Extended Bonds shall be redeemed/repaid on the Extended Bonds Redemption Date(s).
“Extended Bonds Redemption Date(s)” in relation to any Extended Bonds, shall mean the following:
(i) With respect to one third of the original face / principal value of the relevant Extended Bonds, the date falling 60 (sixty) months from the Relevant Closing Date;
(ii) With respect to another one third of the original face / principal value of the relevant Extended Bonds, the date falling 72 (seventy two) months from the Relevant Closing Date;
(iii) With respect to the balance of the original face / principal value of the relevant Extended Bonds, the date falling 84 (eighty four) months from the Relevant Closing Date.
Redemption Date / Final Maturity Date
The date on which the Bonds are redeemed (i.e. any part or whole of the principal amounts of the Bonds are paid back to the Bond Holders) and includes the Accelerated Repayment Date, the Prepayment Date, the Final Maturity Date and if applicable in the case of Extended Bonds, the Extended Bond Redemption Date(s).
Redemption Amount Principal + Interest + Redemption Premium and such additional amounts, if any, as provided in the Bond Subscription Agreement
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Redemption Premium /Discount 8% per annum shall (if not voluntarily paid annually in accordance with Clause 6 of the Bond Subscription Agreement) be compounded annually upto the last day of the Initial Term (“Redemption Premium”) and shall be accrued and paid on the last Business Day of the Initial Term. It is hereby clarified that Redemption Premium of 8% per annum shall not be paid during Extended Period Coupon, i.e. beyond the period of 5 (five) years from the Relevant Closing Date of the Bonds. Provided if the Company chooses to make the Redemption Premium before the expiry of a specific Financial Year, the Company shall issue a written notice (“Interest Payment Notice”), at least 15 Business Days prior to the closure of the relevant Financial Year to the Bond Holders and the Debenture Trustee. The Interest Payment notice shall include the following:(a) the relevant details in relation to the Series of Bonds for which such payment is beingmade,(b) the aggregate amount of the interest that is being paid; and(c) the Company and the Obligor shall represent that it has not violated any of theprovisions of the Bond Documents. The Company shall thereafter, within a period of 15 Business Days, remit the Redemption Premium to the Debenture Trustee’s bank account as notified by the Debenture Trustee to the Company (the “Annual Interest Payment Date”). Thereafter, the Debenture Trustee shall, immediately upon the credit of the Redemption Premium in the Debenture Trustee’s notified bank account, deliver to the relevant Bond Holders of the Series in respect of which the payment was sought to be made and the Company, a written confirmation of receipt of the full amount of the Redemption Premium and transfer to the relevant Bond Holders the sums of monies credited as Redemption Premium for the relevant Bonds held by them.
Issue Price Rs.1,000,000 per Bond
Discount at which security is issued and the effective yield as a result of such discount
Not Applicable, as the Bonds are being issued at par
Put Option Date Not Applicable
Put Option Price Not Applicable
Call Option Date Not applicable
Call Option Price Not applicable
Put Notification Time Not Applicable
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Call Notification Time Not applicable
Face Value Rs.1,000,000 per Bond
Minimum Application and in multiples thereafter
60 Bonds and in multiples of 60 Bonds thereafter
Issue Timing#:
Series I Issue Opening Date
October 9, 2014
Series I Issue Closing Date
October 9, 2014
Series I Deemed Date of Allotment
October 9, 2014
Issuance mode of the Instrument Only in dematerialised form
Trading Mode of theInstrument Only in dematerialised form
Settlement Mode of theInstrument Payment of interest and Redemption Amount will be made by way of Cheque / DD / RTGS / NEFT / Electronic mode and any other prevailing mode of payment from time to time.
Depository NSDL
Business Day Convention A day (other than a Saturday or a Sunday) on which banks are normally open for regular banking business in Mumbai and the place of incorporation of the Investor.
Deemed Date of Allotment Issue Closing Date
Record Date 7 (seven) days prior to each Interest payment/redemption date, for determining the beneficiaries of the Bonds for the interest payment and/or principal repayment.
Security A. Pledge of the Pledged Shares; B. First ranking and fixed charge on all the Assets
of the Issuer other than the Exempted Assets; and
C. Second ranking and fixed charge on the Exempted Assets.
D. Equitable mortgage on all the Immovable Properties of the Company.
Pledged Shares As per the Bond Subscription Agreement.
Security Creation Security will be created as per the terms of the Bond Documents.
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Credit Comfort Not Applicable
Future Borrowings/Permitted Indebtedness
Additional drawdown as per the drawdown schedule in the Bond Subscription Agreement and Permitted Indebtedness as per the terms of the Bond Subscription Agreement.
Transaction Documents The Company has executed/shall execute the documents including but not limited to the following in connection with the issue:
(i) Bond Subscription Agreement (ii) Debenture Trust Deed (iii) Copy of the Board Resolution (iv) Letter appointing M/s. Karvy
Computershare Private Limited Registrar and Transfer Agents of the Company Resolution
(v) Letter appointing IL&FS Trust Company Ltd. as Debenture Trustee to the Bond Holders
(vi) such other documents executed by the Parties pursuant to the transactions contemplated under the Bond Documents
Conditions Precedent to Disbursement
As set out in Bond Subscription Agreement
Conditions Subsequent to Disbursement
As set out in Bond Subscription Agreement
Event of Default As set out in Bond Subscription Agreement
Provisions related to Cross Default Any breach by the Issuer and/ or the Obligor of Material Documents shall constitute an Event of Default under the Bond Documents
Debenture Trustee and Role and Responsibilities of Debenture Trustee
The Company has appointed IL&FS Trust Company Ltd. registered with SEBI, as Debenture Trustee for the benefit of Bond holders(hereinafter referred to as “Debenture Trustee”). The Company has entered into a Trustee Agreement/ Debenture Trust Deed dated 16 September 2014 inter-alia, specifying the powers, authorities and obligations of the Company and the Debenture Trustee in respect of the Bonds.
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Governing Law and Jurisdiction The Bonds (including for the avoidance of doubt, the agreement to arbitrate contained herein) shall be governed by and shall be construed in accordance with the laws of India without reference to its conflict of laws principles. Subject to the provisions with respect to Dispute Resolution as given below, the courts and tribunals at Hyderabad, Andhra Pradesh, India shall have exclusive jurisdiction to decide any Disputes or adjudicate on any matter in relation to this Agreement.
Dispute Resolution As provided in the Bond Subscription Agreement
Notes: 1. Unless specifically provided herein or in any Bond Documents, when payment
can’t be made due to any reason like sudden bank holiday etc., it will be payable on the next Business Day immediately after such payment day.
(i) Security Creation (where applicable): In case of delay in execution of
Trust Deed and Charge documents, the Company will refund the subscription with penal interest of 2% p.a. over and above the Interest.
(ii) Default in Payment: As per the Default Interest provided above and in accordance with the Bond Documents.
(iii) Delay in listing: In case of delay in the listing of the Bonds beyond 15 days from the deemed date of allotment, the Company will redeem the Bonds in full by repaying the entire principal sums invested in the Bonds along with the costs and expenses certified by the Investor as having been incurred and/or suffered by them to subscribe to the Bonds.
b. Other Issue details
i. Bonds in Dematerialised Form The Company is issuing the Bonds only in the dematerialised form subject to the terms of the Bond Subscription Agreement and hence no Bonds are being issued in physical form in Terms of the Shelf Disclosure Document. The Company has entered in to Depository Arrangements with NSDL for dematerialisation of the Securities.
Applicants have to mention their Depository Participant’s name, DP-ID and Beneficiary Account Number/Client ID in the appropriate place in the Application Form. Bonds of successful allottee(s) having Depository Account shall be credited to their Depository Account
Interest, Redemption Amount or other benefits with respect to the Bonds would be paid to those Bond holders whose names appear on the list of Beneficial Owners given by the Depository to the Issuer as on the Record Date.
ii. Undertaking- Common Form of Transfer
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The Bonds shall be transferred subject to the terms of the Bond Subscription Agreement and in accordance with the rules and procedures as prescribed by the NSDL, Depository Participant of the transferor / transferee and any other applicable laws and rules notified in respect thereof.
The normal procedure followed for transfer of securities held in the dematerialized form shall be followed for transfer of the Bonds, issued in Terms of the Shelf Disclosure Document and held in electronic form. The seller should give delivery instructions containing details of the buyer’s depository account to his Depository Participant
The transferee(s) should ensure that the transfer formalities are completed prior to the Record Date. In the absence of the same, interest will be paid / redemption will be made to the person, whose name appears in the records of the Depository. In such cases, claims, if any, by the transferee(s) would need to be settled with the transferor(s) and not with the Company.
The Company is issuing the Bonds only in the dematerialized form and hence there is no physical holding of the Bonds being issued in Terms of the Shelf Disclosure Document. The Company undertakes that it shall use a common form / procedure for transfer of the Bonds issued under the Terms of the Shelf Disclosure Document, if at a later stage there is some holding in the physical form due to the Depository giving re-materialisation option to any investor.
iii. Joint-Holders
Where two or more persons are holders of any Bond(s), they shall be deemed to hold the same as joint tenants with benefits of survivorship in the same manner and to the same extent and be subject to the same restrictions and limitations as in the case of the existing equity shares of the Company, subject to other provisions contained in the Articles of Association of the Company.
iv. Mode of Transfer
The Bonds shall be transferable and transmittable in the manner as provided in and subject to the terms of the Bond Subscription Agreement. The provisions relating to transfer and transmission, nomination and other related matters in respect of equity shares of the Company, contained in the Articles of Association of the Company, shall apply mutatis mutandis to the transfer and transmission of the Bonds and nomination in this respect.
v. Succession
In the event of demise of the sole holder of the Bonds, the Company will recognize the executor or administrator of the deceased Bondholder, or the holder of succession certificate or other legal representative as having title to the Bonds. The Company shall not be bound to recognize such executor, administrator or holder of the succession certificate, unless such executor or administrator obtains probate or letter of administration or such holder is the holder of succession certificate or other legal representation, as the case may be, from a Court in India having jurisdiction over the matter. The Directors of the Company may, in their absolute discretion, where they think fit, dispense with production of probate or letter of administration or succession certificate or other legal representation, in order to recognize such holder as being entitled to the Bonds standing in the name of the deceased Bondholder on production of sufficient documentary proof or indemnity
vi. Record Date
The Record Date for the Bonds shall be 7 days prior to the date of each of the Interest payment date and/or the redemption date, as the case may be. In case
46
the Record Date falls on non-business day, the day prior to the said non-business day will be considered as the Record Date. Interest and/or Redemption Amount shall be paid to the person whose name appears as sole / first in the register of Bond holders/ beneficiaries on the Record Date. In the event of the Company not receiving any notice of transfer at least 15 days before the respective due date of payment of interest and at least 15 days prior to the Redemption Date, as the case may be, the transferees for the Bonds shall not have any claim against the Company in respect of interest so paid to the registered Bondholders. In case of those Bonds for which the beneficial owner is not identified by the Depository as on the Record Date, the Company would keep in abeyance the payment of interest or other benefits, till such time that the beneficial owner is identified by the Depository and conveyed to the Company, whereupon the interest or benefits will be paid to the beneficiaries, as identified, within a period of 30 days from the date of such notification by the Depository.
vii. List of Bondholders / Beneficiaries
The Company shall request the Depository to provide a list of Bondholders / Beneficial Owners at the end of the Record Date. This shall be the list, which shall be considered for payment of interest or Redemption Amount, as the case may be.
viii. Payment on Redemption
The Bonds shall be redeemed at the end of the Tenor, as mentioned in the Issue Details. The Bonds will not carry any obligation, for interest or otherwise, after theTenor. The Bonds held in the dematerialised form shall be taken as discharged on payment of the Outstanding Amounts by the Company at the Final Settlement Date to the registered Bondholders whose name appear in the Register of Bondholders on the Record Date. Such payment will be a legal discharge of the liability of the Company towards the Bond holders. Payment of Redemption Amount will be made by way of Cheque / DD / RTGS / NEFT / Electronic mode and any other prevailing mode of payment in the name of BondHolder(s)/Beneficial Owners(s) whose names appear on the List of Beneficial Owners given by the Depository to the Company as on the Record Date. Cheque / DD will be dispatched to the Bondholder(s) by Courier / Registered Post / Hand Delivery, in accordance with the existing rules / laws at the sole risk of the Bond holder(s) to the sole holder(s) / first named holder(s) at the address registered with the Company.
ix. Future Borrowings
As per terms of the Bond Subscription Agreement.
x. Effect of Holidays If any of the Interest Payment Dates is not Business Day, interest will be payable on the last Business Day immediately preceding such day providedthat Interest shall be calculated till the last day of the Fiscal Quarter
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xi. Tax Benefits to the Bondholders
The holder(s) of the Bonds are advised to consider in their own case, the tax implications in respect of subscription to the Bonds after consulting their own tax advisor/ counsel.
xii. Consents
The consents in writing of Registrar to the Issue and the Debenture Trustee to act in their respective capacities have been obtained and attached as Annexure II and Annexure III to this Shelf Disclosure Document.
xiii. Sharing of Information
The Company may, at its option, use on its own, as well as exchange, share or part with any financial or other information about the Bond holders available with the Company, with its subsidiaries and affiliates and other banks, financial institutions, credit bureaus, agencies, statutory bodies, as may be required and neither the Company nor its subsidiaries and affiliates or their agents shall be liable for use of the aforesaid information.
xiv. Bond holder not a Shareholder
The Bond holders will not be entitled to any of the rights and privileges available to the Shareholders of the Company.
xv. Modification of Rights
As set out in the Bond Subscription Agreement/Debenture Trust Deed.
xvi. Modification of Bonds/Information Memorandum The Issuer will, with the prior consent of the Debenture Trustee, agree to make any modifications in the Information Memorandum which is not prejudicial to the interest of the Bond Holders, and which in the opinion of the Debenture Trustee is of a formal, minor or technical nature or is to correct a manifest error
xvii. Notice(s)
All notices to the Bond holder(s) required to be given by the Company or the Debenture Trustee from time to time, shall be deemed to have been given if sent by registered post / by courier to the sole / first allottee or the sole / first Beneficial Owner of the Bonds, as the case may be, or if published in Mumbai. All notice(s) to be given by the Bond holder(s) shall be sent by registered post or by hand delivery to the Company or to such persons at such address as may be notified by the Company from time to time through suitable communication.
xviii. Disputes and Governing Law
The Bonds are governed by and shall be construed in accordance with the existing laws of India. Any dispute arising thereof will be subject to the exclusive jurisdiction of the courts at Hyderabad.
xix. Bond Documents
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In the event of any discrepancy/ conflict with respect to the information related to the Issue provided in this Shelf Disclosure Document and any specific Bond Documents, then the provisions of the specific Bond Documents shall prevail at all times. Further it is expressly clarified that no statement contained herein in this Shelf Disclosure Document shall in any way prejudice any right or excuse any obligation in the Bond Documents. Further it is expressly clarified that the rights of the Investor/Bond holder have been agreed to in the Bond Subscription Agreement and the Investor/Bond holder shall not have the right to claim any additional rights pursuant to this Shelf Disclosure Document.
xx. Eligible Investors The following categories of investors, when specifically approached, are eligible to apply for this private placement of Debentures subject to fulfilling their respective investment norms/ rules and compliance with laws applicable to them by submitting all the relevant documents along with the Application Form: a. FII All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this issue of Debentures. Applications not to be made by person(s) or entity(ies) resident outside India (including NRIs, Overseas Corporate bodies, etc.) Note: Participation by potential investors in the issue may be subject to statutory and/or regulatory requirements applicable to them in connection with subscription to Indian securities by such categories of persons or entities. Applicants are advised to ensure that they comply with all regulatory requirements applicable to them, including exchange controls and other requirements. Applicants ought to seek independent legal and regulatory advice in relation to the laws applicable to them.
c. How to Apply
i. APPLICATION FOR THE BONDS
All Application Forms, duly completed, together with cheque/ dema nd draft in favor of “GATI KAUSAR INDIA LIMITED” must be delivered before the Issue Closing Date to the Company or to the Arranger of the Issue. Applications for the Bonds must be in the prescribed form (enclosed) and completed in BLOCK CAPITAL LETTERS in English and as per the instructions contained therein. Investors may also remit their subscription money by way of RTGS/NEFT/ Account Transfer for credit in the account of GATI KAUSAR INDIA LIMITED.
The payment by FIIs shall be made through the payment modes permitted by Reserve Bank of India.
ii. WHO CAN APPLY
Nothing in this Shelf Disclosure Document shall constitute and/or deem to constitute an offer or an invitation to an offer, to be made to the public or any section thereof through this Shelf Disclosure Document, and this Shelf Disclosure Document and its contents should not be construed to be a prospectus under the Companies Act. Only those Eligible Investors, who are specifically approached, are eligible to apply for this private placement of Bonds. All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue.
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This Shelf Disclosure Document and the contents hereof are restricted for only the intended recipient(s) who have been addressed and only such recipients are eligible to apply for the Bonds. Furthermore, NRIs, OCBs and persons resident outside India (except as specifically provided in this Shelf Disclosure Document) are not eligible to apply for or hold the Bonds.
Documents to be provided by Investors / applicants • Investors need to submit the following documents, along with the Application
Form, as applicable: • Memorandum and Articles of Association • Board Resolution / letter authorizing the investment • Certified true copy of the Power of Attorney • Form 15AA for investors seeking exemption from Tax Deduction at Source
(TDS) – both on Interest on Application Money as well as annual interest payments
• Specimen signature of the authorised signatories, duly certified by an appropriate authority
• PAN to be submitted
iii. Fictitious Application
As a matter of abundant caution and although not applicable in the case of Bonds, attention of applicants is specially drawn to the provisions of subsection (1) of Section 68A of the Act: “Any person who: (a) makes in a fictitious name an application to a company for acquiring, or subscribing for, any shares therein, or (b) otherwise induces a company to allot, or register any transfer of, shares therein, to him, or any other person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years.
iv. Procedure for applying for Dematerialised Facility
• The applicant must have at least one beneficiary account with any of the DPs
of the Depository prior to making the application. • The applicant must necessarily fill in the details (including the beneficiary
account number and DP’s ID) appearing in the Application Form under the heading "Details for Issue of Bonds in Electronic/Dematerialised Form".
• Bonds allotted to an applicant will be credited directly to the applicant's respective beneficiary account(s) with the DP.
• For subscribing to the Bonds, names in the Application Form should be identical to those appearing in the account details in the depository. In case of joint holders, the names should necessarily be in the same sequence as they appear in the account details in the Depository.
• Non-transferable allotment advice/refund orders will be directly sent to the applicant by the Registrar and Transfer Agent to the Issue.
• If incomplete/incorrect details are given under the heading "Details for Issue of Bonds in Electronic/Dematerialised Form" in the Application Form, it will be deemed to be an incomplete application and the same may be held liable for rejection at the sole discretion of the Issuer.
• For allotment of Bonds, the address, nomination details and other details of the applicant as registered with his/her DP shall be used for all correspondence with the applicant. The applicant is therefore responsible for the correctness of his/her demographic details given in the Application Form
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vis-à-vis those with his/her DP. In case the information is incorrect or insufficient, the Issuer would not be liable for the losses, if any.
• Interest or other benefits would be paid to those Bond Holders whose names appear on the list of beneficial owners given by the Depositories to the Issuer as on the record date. In case of thoseBonds for which the beneficial owner is not identified by the Depository as on the record date, the Issuer would keep in abeyance the payment of interest or other benefits, till such time that the beneficial owner is identified by the Depository and conveyed to the Issuer, whereupon the interest and benefits will be paid to the beneficiaries, as identified.
v. Applications under Power of Attorney
In case of applications made under a Power of Attorney or by a Limited Company or a Body Corporate etc, the relevant Power of Attorney or the relevant resolution or authority to make the application, as the case may be, together with the certified true copy thereof along with the certified copy of the Memorandum and Articles of Association and/or Bye-Laws as the case may be must be attached to the Application Form or lodged for scrutiny separately with the photocopy of the Application Form, quoting the serial number of the Application Form at the Company’s branch where the application has been submitted failing which the applications are liable to be rejected
vi. PAN/GIR Number
All Applicants should mention their Permanent Account Number or the GIR Number allotted under Income Tax Act, 1961 and the Income Tax Circle / Ward / District. In case where neither the PAN nor the GIR Number has been allotted, the fact of such a non-allotment should be mentioned in the Application Form in the space provided.
vii. SIGNATURES
Signatures should be made in English or in any of the Indian Languages. Thumb impressions must be attested by an authorised official of a Bank or by a Magistrate/Notary Public under his/her official seal.
viii. Date of Subscription
Date of Subscription shall be the date of realisation of proceeds of subscription money in the bank account of the Company.
ix. Details of subscription / Mode of payment
All cheques/demand drafts should be in favour of “GKIL Limited” and crossed “Account Payee Only”. Alternatively investors can remit their subscription money by way of electronic transfer of funds through the RTGS mechanism for credit in the account of “GKIL Limited” as per the following details
Bank: HDFC Bank
Branch: Hitech City Branch
Bank Account No:: 50200007555507
IFSC Code No. HDFC0000545
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x. Basis of Allotment
The Company has the sole and absolute right to allot the Bonds to any applicant.
xi. Right to Accept or Reject Applications
The Company reserves its full, unqualified and absolute right to accept or reject any application, in part or in full, without assigning any reason thereof. The applicants will be intimated about such rejection along with the refund warrant. The Application Forms that are not complete in all respects are liable to be rejected and such applicant would not be paid any Interest on Application Money. Application would be liable to be rejected on one or more technical grounds, including but not restricted to
• Bank account details not given • Details for issue of Bonds in electronic/ dematerialised form not given • PAN not mentioned in appropriate place • In case of applications under Power of Attorney by limited companies,
corporate bodies, etc. relevant documents not submitted In the event of number of Bonds applied for are not allotted in full, the excess application money of such applicant will be refunded, as may be permitted.
xii. Payment of Interest/Return
Interest will be paid only to the Bond holders registered in the Register of Bond holders or to the Beneficial Owners. The Quarterly Interest and the Extended Period Interest shall be paid bywire transfer of immediately available funds on the dates falling on thelast day of every Fiscal Quarter and if such day is not a Business Day,then the last Business Day immediately preceding such day providedthat Interest shall be calculated till the last day of the Fiscal Quarter.The determination of the persons entitled to receive Interest in respect of the Bonds (i.e., persons whose names are registered in the register of Bond holders or the Depositories’ record) shall be made on the Record Date. In the case of joint holders of Bonds, Interest shall be payable to the first named Bond holder.
xiii. Redemption
The entire principal amount of the Bonds will be repaid on or before the Final Maturity Date, except as specifically provided in the Bond Subscription Agreement. The Bonds held in the dematerialised form shall be taken as discharged on payment of the Outstanding Amounts by the Company on maturity to the registered Bond holders whose name appears in the Register of Bond holders on the record date. Such payment will be a legal discharge of the liability of the Company towards the Bond holders. On the Company dispatching the amount as specified above in respect of the Bonds, the liability of the Company shall stand extinguished.
The Company's liability to the Bond holders towards all their rights shall cease and stand extinguished on the Final Settlement Date. In case of surrender of Bonds, the Company’s liability to the Bond holders towards all their rights shall cease and stand extinguished from the date of surrender of Bonds. Further the Company will not be liable to pay any Interest or compensation from the dates of such redemption / surrender.
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xiv. Place, Currency and Mode of Payment
All obligations of the Company on the Bonds including Interest/Return, are payable in Indian rupees only. The payments will be made through cheques or RTGS/NEFT/Fund Transfer mode.
xv. Issue of Bonds In Dematerialised Form
The Bonds will be issued only in dematerialized form. The trading in Bonds will be in dematerialized mode only. The Company has made arrangements with the depositories for the issue of the Bonds in dematerialised form. Investors will have to hold the Bonds in dematerialised form as per the provisions of Depositories Act. The Depository Participant’s name, DP-ID and beneficiary account number must be mentioned at the appropriate place in the Application Form. The Company shall take necessary steps to credit the Bonds allotted to the depository account of the investor.
xvi. Succession
In the event of demise of a Registered Bond holder of the Bonds, or the first holder in the case of joint holders, the Company will recognize the executor or administrator of the demised Bond holder or the holder of succession certificate or other legal representative of the demised Bond holder as the Registered Bonds holder of such Registered Holder’s Bonds if such a person obtains probate or letter of administration or is the holder of succession certificate or other legal representation, as the case may be, from a Court in India having jurisdiction over the matter and delivers a copy of the same to the Company. The Company may in its absolute discretion, where it thinks fit, dispense with the production of the probate or letter of administration or succession certificate or other legal representation, in order to recognize such holder as being entitled to the Bonds standing in the name of the demised Bond holder(s) on production of sufficient documentary proof or indemnity. In case a person other than individual holds the Bonds, the rights in the Bonds shall vest with the successor acquiring interest therein, including liquidator or such any person appointed as per the applicable law.
xvii. Notices
The notices, communications and writings to the Bond holder(s) required to be given by the Company shall be deemed to have been given if sent by registered post/courier to the Registered Bond holder(s) at the address of the Bond holder(s) registered with the Corporate Office. All notices, communications and writings to be given by the Bond holder(s) shall be sent by registered post or courier or by hand delivery to the Company at its Corporate Office or to such persons at such address as may be notified by the Company from time to time and shall be deemed to have been received on actual receipt of the same.
xviii. Rights of Bond holders
The Bond holder(s) shall not be entitled to any right and privileges of shareholders other than those available to them under the Companies Act. The Bond shall not confer upon the holder the right to receive notice(s) or to attend and to vote at any general meeting(s) of the shareholders of the Company.
xix. Tax Benefits
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A Bond holder is advised to consider the tax implications in respect of subscription to the Bonds after consulting his tax advisor.
xx. Debenture Trustee
The Issuer has received the consent of IL&FS Trust Company Limited to act as the Trustees on behalf of the Bond Holders. All the rights and remedies of the Bond holders shall vest in and shall be exercised by the Debenture Trustee without referring to the Bond holders. All investors are deemed to have irrevocably given their authority and consent to IL&FS Trust Company Limited to act as their debenture trustee and for doing such acts and signing such documents to carry out their duty in such capacity. Any payment by the Company to the Debenture Trustee on behalf of the Bond holders shall discharge the Company pro rata to the Bond holders. Resignation/retirement of the Debenture Trustee shall be as per terms of the Debenture Trust Deed. A notice in writing to the Bond holders shall be provided for the same.
xxi. Anti Money Laundering
Since these Bonds are issued in “compulsory demat mode” and the Company uses depository system for allotment of the Bonds, KYC checks conducted by depository participants at the time of accepting the customer or transaction under the prevention of money laundering policy adopted by depositories or depository participant shall be considered adequate irrespective of risk level of the customer or transaction. However, as a matter of a good practice, Company may examine transactions/clients that may fall under “suspicious transactions” category as defined under Prevention of Money Laundering Act, 2002 and seek further information from the clients.
6. Particulars of the dates of, and parties to all material contracts, agreements involving financial obligations of the Issuer
Material Contracts - By very nature and volume of its business, the Company is involved in a large number of transactions involving financial obligations and therefore it may not be possible to furnish details of all material contracts and agreements involving financial obligations of the Company. However, the contracts referred to in Para A below (not being contracts entered into in the ordinary course of the business carried on by the Company) which are or may be deemed to be material have been entered into by the Company. Copies of these contracts together with the copies of documents referred to in Para B may be inspected at the Registered Office of the Company between 10.00 a.m. and 12.00 noon on any working day until the Issue Closing Date. Para A:
• Letter appointing M/s Karvy Computershare Private Limited as the Registrars and Transfer Agents (“Registrar”)
• Letter appointing M/s. IL&FS Trust Company Ltd., as the trustee for the benefit of the Bond holders (“Debenture Trustee”)
Para B:
• Memorandum and Articles of Association of the Company • Board Resolution dated August 6, 2014 authorising issue of Bonds offered
under Terms of this Shelf Disclosure Document
• Shareholders Resolution dated September 11, 2014
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• Consent letter from M/s IL&FS Trust Company Ltd for acting as Debenture Trustee for and on behalf of the Bond holders dated September 22, 2014
• Consent letter from M/s. Karvy Computershare Private Limited for acting as Registrars to the Issue dated September 24, 2014
• Letter from CARE Limited dated September 22, 2014 conveying the credit rating for the Bonds of the Company
• Tripartite Agreement between the Company, NSDL and the Registrar for the Issue of Bonds in dematerialised form
• Debenture Trust Deed dated 16 September 2014 • Bond Subscription Agreement dated 16 September 2014
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7. DECLARATION
It is hereby declared that this Shelf Disclosure Document contains full disclosure in accordance with Form no. PAS-4 pursuant to Section 42 of the Companies Act, 2013 and Rule 14(1) of Companies (Prospectus and Allotment of Securities) Rules, 2014, Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 issued vide Circular No. LADNRO/ GN/2008/13/127878 dated June 06, 2008 and as amended from time to time (including Securities Exchange Board Of India (Issue And Listing Of Debt Securities) (Amendment) Regulations, 2012 through notification dated October 12, 2012), SEBI Circular CIR/IMD/DF/17/2011 dated September 28, 2011 and RBI Circular RBI/2012-13/560/ DNBD(PD) CC No. 330/03.10.001/2012-13 dated June 27, 2013. The Issuer also confirms that this Shelf Disclosure Document does not omit disclosure of any material fact which may make the statements made therein, in the light of the circumstances under which they are made, misleading. The Shelf Disclosure Document also does not contain any false or misleading statement. The Issuer accepts no responsibility for the statements made otherwise than in this Shelf Disclosure Document or in any other material issued by or at the instance of the Issuer and any one placing reliance on any other source of information would be doing so at his own risk. The company has complied with the provisions of the Act and the rules made thereunder The compliance with the Act and the rules does not imply that payment of dividend or interest or repayment of Bonds, if applicable, is guaranteed by the Central Government The monies received under the offer shall be used only for the purposes and objects indicated in the Offer letter I am authorized by the Board of Directors of the Company vide resolution dated August 6, 2014 to sign this Shelf Disclosure Document and declare that all the requirements of Companies Act, 2013 and the rules made thereunder in respect of the subject matter of this form and matters incidental thereto have been complied with. Whatever is stated in this Shelf Disclosure Document and in the attachments thereto is true, correct and complete and no information material to the subject matter of this form has been suppressed or concealed and is as per the original records maintained by the promoters subscribing to the Memorandum of Association and Articles of Association It is further declared and verified that all the required attachments have been completely, correctly and legibly attached to this form. For Gati Kausar India Limited Sd/- GS Ravi Kumar Director Date October 9, 2014 Place Secunderabad
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APPLICATION FORM Application No: ___ Date: _________ Dear Sirs, Having read and understood the contents of the Shelf Disclosure Document dated October 9, 2014 we apply for allotment of Non-Convertible Debentures (NCDs) to us. The amount payable on application as shown below is remitted herewith. On allotment, please place our name(s) on the Register of Debenture holder(s). We bind ourselves to the terms and conditions as contained in the Shelf Disclosure Document. (Please read carefully the instructions on the next page before filling this form) No. of Debentures Applied for No. in Figures No. in Words
Amount (Rs) in figures: Amount (Rs) in words: Cheque/ Demand Draft/ RTGS Details
Date Drawn on Bank
Applicant’s Name & Address in full (please use capital letters) Name Address Telephone: Fax: Email ID: Status: Banking Company ( ) Insurance Company ( ) Others specify ___________ Name of Authorized Signatory Designation Signatures Bank Account (for Refund / Interest payment / Redemption): Bank Name & Branch Nature of Account Account No.: IFSC/NEFT Code
Payment Details: Cheque / UTR no. Dated Amount Drawn on Bank and Branch Account no.
Depository Details: DP Name NSDL / CDSL DP ID Client ID
Income Tax Details: PAN / GIR no. IT Circle/Ward/District
(*) We understand that in case of allotment of debentures to us/our Beneficiary Account as mentioned above would be credited to the extent of debentures allotted. We hereby agree that we (i) are knowledgeable and experienced in financial and business matters, have expertise in assessing credit, market and all other relevant risk and are capable of evaluating, and have evaluated, independently the merits, risks and suitability of purchasing the Debentures; (ii) understand that the Issuer have not provided, and will not provide, any material or other information regarding the Debentures, except as included in the Shelf Disclosure Document, (iii) have not requested the Issuer to provide it with any such material or other information, (iv) have not relied on any investigation that any person acting on their behalf may have conducted with respect to the Debentures, (v) have made our own investment decision regarding the Debentures based on our own knowledge (and information we have or which is publicly available) with respect to the Debentures or the Issuer (vi) have had access to such information as deemed necessary or appropriate in connection with purchase of the Debentures, and (vii) are not relying upon, and have not relied upon, any statement, representation or warranty made by any person, including, without limitation, the Issuer. Name: ________________________ Date: ______________________ Authorised Signatory: ______________
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ACKNOWLEDGEMENT SLIP Application No: _______ Date: ______ Received From _______________________________________________________________________ INR ___________________________/- By Cheque/ Demand Draft/ RTGS No _____________________ drawn on ______________________________________________ towards application for _________Debentures. (Cheques / Demand Drafts are subject to realisation) Instructions:
1. You must complete application in full in BLOCK LETTERS IN ENGLISH. 2. Your Signatures should be made in English or in any of the Indian languages 3. Application forms duly completed in all respects, together with high value Cheques/ Pay Order/ Demand
Drafts must be lodged at the corporate office. 4. Payments through RTGS shall be made as follows:
Account Name: GKIL Limited Bank: HDFC Bank Branch: Hitech City Branch Bank Account No:: 50200007555507 IFSC Code No. HDFC0000545
5. The Cheque(s)/Demand Draft(s) of high value clearing zone should be drawn in favour of “GKIL Limited” and crossed "A/c payee" only. Cheque(s)/Demand draft(s) may be drawn on any scheduled bank and payable at Secunderabad.
6. Outstation cheques, cash, money orders, postal orders and stock invest will NOT be accepted. 7. As a matter of precaution against possible fraudulent encashment of interest warrants due to
loss/misplacement, you are requested to mention the full particulars of the bank account, as specified in the application form.
8. Interest warrants will then be made out in favour of the bank for credit to your account. In case the full particulars are not given, cheques will be issued in the name of the applicant at their own risk.
9. You should mention your Permanent Account Number or the GIR number allotted under Income- Tax Act, 1961 and the Income-Tax Circle/Ward/District. In case where neither the PAN nor GIR number has been allotted, the fact of non-allotment should be mentioned in the application form in the space provided.
10. The application would be accepted as per the terms of the issue outlined in the Shelf Disclosure Document.
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Annexure I
Credit Rating Letter
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Annexure II
Consent letter from Registrar and Transfer Agent
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Annexure III
Consent from Debenture Trustee