KCPL Disclosure Document- April 11 revised · (as defined hereinafter) and, or, the Rustomjee...
Transcript of KCPL Disclosure Document- April 11 revised · (as defined hereinafter) and, or, the Rustomjee...
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KAPSTONE CONSTRUCTIONS PRIVATE LIMITED Registered Office: 702, Natraj, Western Expressway Highway, MV Road Junction, Andheri (E) 400 069
Tel. No.: 022 66766888; Fax No.: 022 66766999
DISCLOSURE DOCUMENT FOR THE PRIVATE PLACEMENT OF 300 (THREE HUNDRED) RATED
REDEEMABLE AND CUMULATIVE NON-CONVERTIBLE DEBENTURES OF FACE VALUE OF RS.1,00,00,000/-
(RUPEES ONE CRORE) EACH ("A SERIES DEBENTURES"), AT PAR, WITH MARKETABLE LOT OF ONE A
SERIES DEBENTURE FOR CASH AGGREGATING TO RS.300,00,00,000/- (RUPEES THREE HUNDRED CRORES
ONLY) ON A PRIVATE PLACEMENT BASIS (THE "ISSUE").
BACKGROUND
The A Series Debentures mentioned herein are not offered for sale or subscription to the public, but are being privately placed
with a limited number of eligible investors, less than or equal to 49 (forty nine) in number. This Disclosure Document (as defined
hereinafter) is related to the A Series Debentures to be issued by Kapstone Constructions Private Limited (the "Issuer" or
"Company") on a private placement basis and contains relevant information and disclosures required for the purpose of issuing
of the A Series Debentures. The issue of the A Series Debentures comprised in the Issue and described under this Disclosure
Document has been authorized by the Issuer through a resolution passed by the board of directors of the Issuer on March 06,
2014 and in accordance with the provisions of the Act (as defined hereinafter). This Disclosure Document should not be treated
as an offer for sale or solicitation of an offer to buy the A Series Debentures as prescribed herein by any person who has not been
provided with a copy of this Disclosure Document. This Disclosure Document does not constitute an offer for sale or a
solicitation of an offer to buy the A Series Debentures as described herein from any person other than the person whose name
appears on the cover page of this Disclosure Document. No person other than such person, receiving a serially numbered copy of
this document may treat the same as constituting an offer to sell or a solicitation of an offer to buy the A Series Debentures.
GENERAL RISKS
Investors are advised to seek independent advise for compliance with applicable regulation of the Securities and Exchange Board
of India ("SEBI") for subscription of the A Series Debentures.
RISKS IN RELATION TO THE ISSUE
There has been no formal market for the securities of the Company. No assurance can be given regarding an active or sustained
trading in the securities of the Company or regarding the price at which the securities will be traded after listing.
ISSUER'S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms, that the information contained in this
Disclosure Document contains all the information with regard to the Issuer and the Issue, which is material in the context of the
Issue and that the information contained in this Disclosure Document is true and correct in all material respects and is not
misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other
facts, the omission of which makes this Disclosure Document as a whole or any of such information or the expression of any
such opinions or intentions misleading in any material respect and nothing material is concealed hereof.
CREDIT RATING
The A Series Debentures proposed to be issued by the Issuer have been rated by Brickworks Ratings India Private Limited
(pronounced as "Brickworks"). Brickworks has vide its letter dated March 13, 2014 affirmed a rating of 'BBB-' in respect of the
A Series Debentures. The rating is not a recommendation to buy, sell or hold the rated debt. Brickworks does not assume any
responsibility on its part for any liability that may arise consequent to the Issuer not complying with any eligibility criteria from
time to time for issuance of short term debt. The rating may be subject to suspension, revision or withdrawal at any time by the
assigning rating agency. The rating agencies have a right to revise, suspend or withdraw the rating at any time on the basis of new
information or unavailability of information or such circumstances which the Credit Rating Agency believes may have an impact
on its rating. For further details including in respect of the rationale for the credit rating, please refer to respective rating rationale.
LISTING
The A Series Debentures are proposed to be listed on the Wholesale Debt Market Segment ("WDM Segment") of the Bombay
Stock Exchange Limited.
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ISSUE PROGRAMME
ISSUE OPENING DATE ISSUE CLOSING DATE DEEMED DATE OF ALLOTMENT
March 24, 2014* April 15, 2014* April 15, 2014*
* The Issuer reserves the right to change the Issue time table including the Deemed Date of Allotment (as defined hereinafter) at
its sole discretion, without giving any reasons or prior notice. The Issue will be open for subscription at the commencement of
banking hours and close at the closure of the banking hours.
DEBENTURE TRUSTEE REGISTRAR TO ISSUE
IL&FS TRUST COMPANY
LIMITED
IL & FS Trust Company Limited
The IL&FS Financial Centre, Plot
No. C-22, G-Block, Bandra Kurla
Complex, Bandra (East), Mumbai-
400051
www.itclindia.com
Phone number: +91 22 26533333
LINK INTIME INDIA PRIVATE
LIMITED
C-13, Pannalal Silk Mills, L.B.S.
Marg, Bhandup (West), Mumbai-
400078
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TABLE OF CONTENTS
SECTION PARTICULARS PAGE
NOS SECTION - 1 DEFINITIONS & ABBREVIATIONS 04
SECTION - 2 DISCLAIMERS 14
SECTION - 3 REGULATORY DISCLOSURES 17
SECTION - 4 OTHER INFORMATION AND ISSUE PROCEDURE 40
SECTION - 5 DECLARATION 46
ANNEXURES
ANNEXURE - 1 TERMSHEET 47
ANNEXURE - 2 APPLICATION FORM 78
ANNEXURE - 3 CONSENT LETTER FROM THE A SERIES DEBENTURE
TRUSTEE
81
ANNEXURE - 4 CREDIT RATING LETTER 82
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SECTION 1: DEFINITIONS & ABBREVIATIONS
Unless the context otherwise indicates, requires or implies, the following terms shall have the following
meanings in this Disclosure Document:
General Terms
Term
Meaning
Issuer Kapstone Constructions Private Limited, a private limited company incorporated in
India and having its registered office at 702, Natraj, Western Express Highway,
MV Road Junction, Andheri (E), Mumbai 400 069 India.
"we", "us" and
"our"
Unless the context otherwise requires, the Issuer.
Issuer and Issue Related Terms
Term
Meaning
A Series Debentures The redeemable and cumulative non-convertible debentures of the
Company, which shall be rated, interest bearing and rupee denominated, of a
face value/ nominal value of Rs.1,00,00,000/- (Rupees One Crore Only)
each;
A Series Debenture
Holders
Any Person who provides or contributes the Subscription Amounts (as
defined hereinafter) to the Company till such time as they hold the A Series
Debentures; and, or, means one or several persons, who for the time being
and from time to time, are the holders of the A Series Debentures and whose
names appear on the list of the beneficial owners given by the Registrar (as
defined hereinafter) to the Company;
A Series Debenture
Trustee
IL & FS Trust Company Limited or any other debenture trustee as may be
appointed by the A Series Debenture Holders from time to time.
A Series Debenture
Trustee Appointment
Agreement
The agreement dated March 18, 2014 entered into between the Company
and the A Series Debenture Trustee for the appointment of the A Series
Debenture Trustee as a trustee for the A Series Debenture Holders;
A Series Debenture
Trust Deed
The debenture trust deed executed or to be executed amongst the Company,
the Promoters, RRPL and the A Series Debenture Trustee in relation to the
terms and conditions of the appointment of the A Series Debenture Trustee
and the terms and conditions for the issuance and allotment of the A Series
Debentures;
A Series DSA
Debenture subscription agreement dated March 8, 2014 executed amongst
the Promoters, the Company, RRPL and the A Series Debenture Holders for
the purposes of subscribing to the A Series Debentures, in accordance with
the terms thereof;
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A Series Transaction
Documents
Collectively, the A Series Debenture Trust Deed, the A Series Debenture
Trustee Appointment Agreement, the A Series DSA, the Utilization Escrow
Agreement, the Personal Guarantee, the Corporate Guarantee 1, the
Corporate Guarantee 2, the Corporate Guarantee 3, the Distribution Escrow
Agreement, this Disclosure Document and any other document that may be
designated as an A Series Transaction Document mutually by the parties to
the A Series Debenture Trust Deed;
Act/ Companies Act
The (Indian) Companies Act, 2013 (to the extent notified by the Government
of India and currently in force), and the (Indian) Companies Act, 1956, to
the extent not repealed and replaced by the provisions of the (Indian)
Companies Act, 2013;
Allot/Allotment/
Allotted
Unless the context otherwise requires or implies, the allotment of the A
Series Debentures pursuant to the Issue;
Application Form
The form used by an investor to apply for the subscription to the A Series
Debentures offered through this Issue and as set out in Annexure 2 hereto;
Approvals Shall have the meaning ascribed to such term in A Series Debenture Trust
Deed;
Approved Business
Plan
Shall have the meaning ascribed to such term in the A Series Debenture
Trust Deed;
Approved Instructions The written instructions/ approval of the Majority A Series Debenture
Holders (as defined hereinafter) obtained by email or in the Meeting of the
A Series Debenture Holders (as defined hereinafter);
Articles or Articles of
Association
Articles of Association of the Issuer and, or, RRPL (as the context may
require) as amended from time to time;
Board Board of directors of the Issuer;
BSE or Stock
Exchange
Bombay Stock Exchange Limited;
Business The business of development, construction, maintenance, management,
operation, marketing, promotion, sale and leasing of the Company Project
(as defined hereinafter) and, or, the Rustomjee Project (as defined
hereinafter), as the context may require;
Business day
A day other than Saturday, Sunday or a public holiday on which the stock
exchanges and banks are normally, open for business in New Delhi and
Mumbai and in relation to any payment in any other city;
B Series Debentures The interest bearing, redeemable, cumulative non-convertible debentures of
the Company having a face value of Rs.1,00,00,000/- (Rupees One Crore
Only) each, issued to the Promoters on a private placement basis and that are
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proposed to be listed on the Wholesale Debt Market Segment of the Stock
Exchange, in accordance with the Debt Regulations and having the terms
and condition set forth in the B Series DSA (as defined hereinafter);
B Series Debenture
Holders
The holders of the B Series Debentures and shall in the first instance include
the Promoters;
B Series Debenture
Trustee
IDBI Trusteeship Services Limited, a company incorporated under the
Companies Act, 1956, having its registered office at Asian Building, 17, R.
Kamani Marg, Ballard Estate, Mumbai – 400 001;
B Series DSA The debenture subscription agreement dated March 8, 2014 executed
between the Company, RRPL and the Promoters in respect of issuance and
allotment of the B Series Debentures to the Promoters;
B Series DTD
the debenture trust deed entered or to be entered into by the Company, the
Promoters and the B Series Debenture Trustee, in respect of the issuance and
allotment of the B Series Debentures;
Call Option Exercise
Price
An amount that shall provide/give an annualized IRR (as defined
hereinafter) of 24% (twenty four percent), Net of Taxes (as defined
hereinafter), on the amounts invested/ contributed to subscribe to all and not
less than all the A Series Debentures. It is hereby clarified that the
annualized IRR of 24% (twenty four percent) shall be calculated until the
date of receipt of the Call Option Exercise Price by the A Series Debenture
Holders from the Promoters in accordance with Clause 34 of the summary
term sheet at Annexure 1 hereto;
Cash Flow Statement
Cash Flow Statement shall have the meaning as shall be ascribed to such
term in the A Series Debenture Trust Deed;
Company Project The entire special township project being constructed and developed on the
Thane Land (as defined hereinafter) by the Issuer namely 'Rustomjee
Urbania' including and without limitation the Project Athena, the Project
Astraea, the Project Landward, the Project Atelier, the Project Acura and the
Project Azziano (as more specifically described in the A Series Debenture
Trust Deed); and shall also include any other project launched on the Thane
Land in the future;
Company Receipts Any and all monies/ amounts received and, or, to be received by the
Company directly or indirectly from any source in any form, including cash,
cheques, demand drafts, pay order, electronic transfer or in any other form,
including but not limited to:
(i) receipts from sale/ lease of land area, built-up area and, or, saleable
area in the Company Project;
(ii) monies infused into the Company Project by the Shareholders (as
hereinafter defined);
(iii) refunds/ receipts from debtors, creditors, contractors, vendors, any
other person or any Governmental Authority including tax refunds
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received in relation to the Company Project;
(iv) bank/cash balance in relation to the Company Project;
(v) insurance proceeds from insurance companies with which the
Company Project is insured;
(vi) any other cash flows of the Company; and, or
(vii) proceeds from the Corporate Guarantee 2 (as hereinafter defined) and
the Corporate Guarantee 3;
but excluding the following:
(i) any amounts received/to be received or any revenues or receipts
pertaining to either directly or indirectly, the Promoters' Saleable Area
(as defined in the A Series Debenture Trust Deed) and the Schools
and Medical Facilities (as defined in the A Series Debenture Trust
Deed);
(ii) the Subscription Amount; and
(iii) all amounts received from unit purchasers/customers towards Taxes
(including service tax, VAT, labour cess, local body taxes) stamp
duty, registration charges, society formation charges, legal expenses
and all other pass through charges;
Construction Loan
Escrow Accounts
The existing construction loan escrow accounts of the Company as on the
Deemed Date of Allotment, details of which are set forth at A Series
Debenture Trust Deed, opened in accordance with the Lending Agreements
(as defined hereinafter) or any other construction loan escrow accounts that
the Company may open in the future pursuant to any secured construction
loans availed by it from a Secured Creditor (as defined hereinafter) subject
to the provisions of its Articles of Association; OR any other account opened
by the Company in accordance with its Articles, where all the Company
Receipts and the payments received from the customers towards purchase of
units in the Company Project shall be deposited, when there is no
construction loan availed by the Company from a Secured Creditor;
Crore 1 crore means 10 million;
CDSL Central Depository Services (India) Limited;
Corporate Guarantee
1
Corporate Guarantee 1 shall have the meaning ascribed to such term in the
summary term sheet at Annexure 1 hereto;
Corporate Guarantee
2
Corporate Guarantee 2 shall have the meaning ascribed to such term in the
summary term sheet at Annexure 1 hereto;
Corporate Guarantee
3
Corporate Guarantee 3 shall have the meaning ascribed to such term in the A
Series Debenture Trust Deed;
Debt Regulations The Securities and Exchange Board of India (Issue and Listing of Debt
Securities) Regulations, 2008, as amended from time to time and as may be
applicable;
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Debenture Trustee
Regulations
The Securities and Exchange Board of India (Debenture Trustees)
Regulations, 1993, as amended from time to time to the extent the same are
applicable;
Debt Listing
Agreement
The debt listing agreement entered into by the Issuer with the Stock
Exchange in relation to the listing of the A Series Debentures;
Deemed Date of
Allotment
April 15, 2014 or the date when subscription amounts towards subscription
of the A Series Debentures is received by the Company;
Depository/ies National Securities Depositories Limited and, or, Central Depository
Services (India) Limited;
Disclosure Document
The draft disclosure document dated March 19, 2014 filed by the Company
with the BSE and this updated disclosure document dated April 11, 2014
filed with the BSE;
Distributable Amounts Collectively the Company Distributable Amounts (as defined in the
summary term sheet at Annexure 1 hereto) and the RRPL Distributable
Amount (as defined in the summary term sheet at Annexure 1 hereto);
Distribution Escrow
Account
The current account to be established with the Distribution Escrow Agent
(as defined hereinafter) at their branch at Kalpataru Estate, Building No. 1,
Jogeshwari Vikhroli Link Road, Andheri (E), Mumbai, which shall be
operated in accordance with the terms and conditions of the Distribution
Escrow Agreement (as defined hereinafter);
Distribution Escrow
Agent
HDFC Bank Limited;
Distribution Escrow
Agreement
The escrow agreement to be entered into amongst the Issuer, RRPL and the
Distribution Escrow Agent;
DP Depository participant;
Equity Shares Equity shares having a face value of Rs.10/- (Rupees Ten Only) each of the
Company;
FSI Floor Space Index;
ICICI Bank ICICI Bank Limited;
ICICI Loan Facility Collectively mean 3 (three) separate term loans of (i) Rs.200,00,00,000/-
(Rupees Two Hundred Crores Only); (ii) Rs.200,00,00,000/- (Rupees Two
Hundred Crores Only); and (iii) Rs.110,00,00,000/- (Rupees One Hundred
Ten Crores Only); The Company has also availed an overdraft facility from
ICICI Bank; collectively aggregating to Rs.510,00,00,000/- (Rupees Five
Hundred Ten Crores Only) availed by the Company from the ICICI Bank;
IPC Any international property consultant of repute as selected by the A Series
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Debenture Holders;
IRR IRR shall have the meaning given to such expression in the A Series
Debenture Trust Deed;
IT Act The Income Tax Act, 1961 as amended from time to time;
Joint Development
Agreements
Joint Development Agreements shall have the meaning ascribed to such
term in the A Series Debenture Trust Deed;
Land A The Land A shall have the meaning ascribed to such term in the A Series
Debenture Trust Deed;
Land B1 Land B1 shall have the meaning ascribed to such term in the A Series
Debenture Trust Deed;
Land B2 Land B2 shall have the meaning ascribed to such term in the A Series
Debenture Trust Deed;
Land D1 Land D1 shall have the meaning ascribed to such term in the A Series
Debenture Trust Deed;
Land D2 Land D2 shall have the meaning ascribed to such term in the A Series
Debenture Trust Deed;
Land Owners The owners of the Land A, the owners of the Land B1 and the Land B2, the
owners of the Land D1 and the Land D2;
Lending Agreements The (i) loan and security agreements executed by the Company in relation to
the Loan Facilities (as defined hereinafter) viz. the ICICI Lending
Agreements and the sanction letters dated February 7 and 17, 2014 from
Union Bank; and (ii) agreements executed by the Company for the purposes
of providing security in connection with the issuance of debentures by
KRPL and Rustomjee Constructions Private Limited;
Loan Facilities Collectively (i) the ICICI Loan Facility; and (ii) the term loan amount of
Rs.400,00,00,000/- (Rupees Four Hundred Crores Only) on underwriting
basis with a take and hold amount of Rs.100,00,00,000/- (Rupees One
Hundred Crores Only) sanctioned to the Company by Union Bank (as
defined hereinafter) vide sanction letters dated February 7 and 17, 2014. As
on the Effective Date of the A Series Debenture Trust Deed, the total
outstanding amounts availed by the Company from the ICICI Bank and the
Union Bank, including the over- draft facilities, does not exceed
Rs.340,00,00,000/- (Rupees Three Hundred Forty Crores Only);
KRPL Keystone Realtors Private Limited, a company incorporated under the Act,
having its registered office at 702, Natraj, Western Express Highway, MV
Road Junction, Andheri (E), Mumbai 400 069 India;
Majority A Series Such number of the A Series Debenture Holders collectively holding more
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Debenture Holders
than 51% (fifty one percent) of the aggregate Nominal Value of the A Series
Debentures then outstanding;
Market Lot Minimum number of the A Series Debentures which may be subscribed
under the Issue which is 1 (one);
Meeting of the A
Series Debenture
Holders
A meeting of the A Series Debenture Holders, duly called, convened and
held in accordance with the provisions of the A Series Debenture Trust
Deed. For the avoidance of doubt it is clarified that any reference to
decisions taken pursuant to a Meeting of the A Series Debenture Holders
shall mean a decision taken either at a physical Meeting of the A Series
Debenture Holders or by way of a written consent from the Majority A
Series Debenture Holders in a manner determined by the A Series Debenture
Trustee as per the terms of the A Series Debenture Trust Deed;
MoA The memorandum of association of the Company;
MHADA Land
The land situated at Survey No. 106, Part 5, CTS No. 195 of Village
Andheri, Taluka Andheri, Mumbai, admeasuring approximately 20,218.65
(twenty thousand two hundred eighteen point six five) sq. mts., as per NOC
dated February 12, 2012 issued by the MHADA, on which the Rustomjee
Project is being developed by RRPL;
Nominal Value The nominal value/ face value of each A Series Debenture i.e.
Rs.1,00,00,000/- (Rupees One Crore Only) per A Series Debenture
contributed by the A Series Debenture Holders to subscribe/ acquire the A
Series Debentures;
NSDL
National Securities Depositories Limited;
Personal Guarantee Personal Guarantee shall have the meaning ascribed to such term in the A
Series Debenture Trust Deed;
Promoters
KRPL, Mr. Boman R. Irani, Mr. Percy S. Chowdhry and Mr. Chandresh D.
Mehta;
Projects Collectively the Company Project and the Rustomjee Project;
Project Acura The residential complex being constructed on the Thane Land as Residential
Sub Plot 5 bearing Survey No. 54 (part) and 55 (part) situated at Village
Majiwade, Thane;
Project Astraea The residential complex constructed on the Thane Land as Residential Sub
Plot 2 bearing Survey No. 19 (part), 20 (part), 21 (part) situated at Village
Majiwade, Thane;
Project Atelier The residential complex being constructed on the Thane Land as Residential
Sub Plot 4 bearing Survey No. 14/1(part), 15/1(part), 15/3(part), 15/5(part)
situated at Village Majiwade, Thane;
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Project Athena The residential complex constructed on the Thane Land as Residential Sub
Plot 1 bearing Survey No. 12 (part), 13 (part), 84 (part) situated at Village
Majiwade, Thane;
Project Azziano The residential complex being constructed on the Thane Land as Residential
Sub Plot 6 bearing No.14/1(part), 15/2(part), 15/3(part), 15/4(part),
15/5(part), 16/2A(part), 16/3 (part), 16/4(part), 16/5(part), 16/6(part),
17/3A(part), 17/4A(part), 17/5(part), 17/6(part), 49/1(part), 49/2(part),
49/3(part), 50/1(part), 50/2(part), 50/3(part), 51/1(part), 51/2(part),
51/3(part), 51/4(part), 51/5(part), 53/2/3(part) and 383(part) situated at
Village Majiwade, Thane;
Project Drawdown
Schedule
Project Drawdown Schedule shall have the meaning given to such
expression in the A Series Debenture Trust Deed;
Project Landward The residential complex proposed to be constructed on the Thane Land as
Residential Sub Plot 3 bearing Survey No. 36/4 (part), 36/6 (part), 36/7
(part), 37/3 (part) -37/4 (part), 37/6 (part), 37/7A (part) situated at Village
Majiwade, Thane;
RBI The Reserve Bank of India;
Record Date
3 (three) calendar days prior to the proposed date on which any payments are
required to be made in respect of the A Series Debentures to the A Series
Debenture Holders in accordance with the A Series Debenture Trust Deed;
RRPL Rustomjee Realty Private Limited, a company incorporated under the Act
having its registered office at 702, Natraj, Western Express Highway, MV
Road Junction, Andheri (E), Mumbai 400 069 India;
Redemption Amounts
The Redemption Amounts shall mean the total amounts outstanding towards
the aggregate Nominal Value of the A Series Debentures plus the accrued
and unpaid amount of the Interest;
RRPL Corporate
Guarantee
Shall have the meaning ascribed to such term in the A Series Debenture
Trust Deed;
RRPL Receipts Any and all monies/ amounts received and, or, to be received by RRPL
directly or indirectly from any source in any form, including cash, cheques,
demand drafts, pay order, electronic transfer or in any other form, including
but not limited to:
(i) receipts from sale/ lease of land area, built-up area and, or, saleable
area in the Rustomjee Project;
(ii) monies infused into the Rustomjee Project by the shareholders of
RRPL;
(iii) refunds/ receipts from debtors, creditors, contractors, vendors, any
other person or any Governmental Authority including tax refunds
received in relation to the Rustomjee Project;
(iv) bank/cash balance in relation to the Rustomjee Project;
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(v) insurance proceeds from insurance companies with which the
Rustomjee Project is insured;
(vi) any other cash flows of the RRPL; and, or
(vii) proceeds from the Personal Guarantee;
but excluding all amounts received from unit purchasers/customers
towards Taxes (including service tax, VAT, labour cess, local body
taxes) stamp duty, registration charges, society formation charges,
legal expenses and all other pass through charges;
RRPL Revenue/
Construction Loan
Escrow Account
The existing revenue cum construction loan escrow account of RRPL as on
the Deemed Date of Allotment, details of which are set forth in the A Series
Debenture Trust Deed, opened in accordance with the SBI Lending
Agreements (as defined hereinafter) or any other construction loan escrow
accounts that RRPL may open in the future pursuant to any secured
construction loans availed by it from a Secured Creditor, subject to the
provisions of its Articles of Association; OR any other account opened by
RRPL in accordance with the A Series Debenture Trust Deed, where all the
RRPL Receipts and the payments received or to be received from the
customers towards purchase of units in the Rustomjee Project shall be
deposited, when there is no construction loan availed by RRPL from a
Secured Creditor;
Registrar/ Registrar to
the Issue/ Registrar
and Transfer Agent
The Registrar to the Issue, in this case Link Intime India Private Limited;
ROC The Registrar of Companies, Maharashtra;
RTGS Real Time Gross Settlement, an electronic funds transfer facility provided by
the RBI;
Rustomjee Project The mixed use development project being constructed and developed by
RRPL on the MHADA Land, namely "Rustomjee Elements" and as more
specifically described in the A Series Debenture Trust Deed;
SBI Lending
Agreements
The loan and security agreements executed by RRPL with the State Bank of
India in relation to loan of Rs.250,00,00,000/- (Rupees Two Hundred Fifty
Crores Only) availed by it from the State Bank of India;
SEBI The Securities and Exchange Board of India constituted under the Securities
and Exchange Board of India Act, 1992 (as amended from time to time);
Secured Creditors The banks/ financial institutions/ non- banking financial companies from
whom the Company and, or, RRPL, as the case maybe, has availed or shall
avail secured construction and development loans for the Company Project
and, or, the Rustomjee Project, as the case maybe;
Share Capital
Aggregate of all the Equity Shares of the Issuer;
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Shareholders Shareholders of the Issuer;
Subscription Amounts Shall have the meaning ascribed to such term in Annexure 1 hereto;
TDS Tax Deducted at Source;
Thane Land Parcels of land situated at Mouje Majiwade Village, Taluka North Salsette
District, Thane (as more specifically described in the A Series Debenture
Trust Deed), on which the Company Project is being developed and
constructed by the Issuer;
Utilization Escrow
Account
HDFC Bank Account No. 50200004617570;
Utilization Escrow
Agent
HDFC Bank Limited;
Utilization Escrow
Agreement
The escrow agreement to be executed amongst the Company, the A Series
Debenture Trustee and the Utilization Escrow Agent.
Any capitalized terms used in the Disclosure Document and not defined in this section shall have the
respective meanings assigned to them under the remaining section hereunder.
1 Words denoting singular only shall include plural and vice-versa.
2 Words denoting one gender only shall include the other gender.
3 All references in these presents to any provision of any statute shall be deemed also to refer to the
statute, modification or re-enactment thereof or any statutory rule, order or regulation made
thereunder or under such re-enactment.
4 The headings in this section are inserted for convenience only and shall be ignored in construing
and interpreting the section.
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SECTION 2: DISCLAIMERS
ISSUER'S DISCLAIMERS
This Disclosure Document is neither a prospectus nor a statement in lieu of a prospectus for the purposes
of the Act. The issue of the A Series Debentures 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. This Disclosure Document does not constitute and shall not be deemed to constitute an
offer or an invitation to subscribe to the A Series Debentures to the public in general.
This Disclosure Document has been prepared solely to give general information regarding the Issuer to
selected investors to whom it is addressed and who are willing and eligible to subscribe to the A Series
Debentures.
This Disclosure Document is not intended for distribution and is for the consideration of the person to
whom it is addressed and should not be reproduced by the addressee. It cannot be acted upon by any
person other than to whom it has been specifically addressed.
This Disclosure Document is not intended to provide any basis for any credit or any other evaluation.
Potential investors(s) are required to make (and will be deemed to have made) their own independent
evaluation and judgment. It is the responsibility of potential investors to have obtained all consents,
approvals or authorizations required by them to participate in the subscription to the A Series Debentures.
The A Series Debentures have not been recommended or approved by SEBI nor does SEBI guarantee the
accuracy or adequacy of this Disclosure Document.
The Issuer confirms that as of the date hereof, this Disclosure Document (including the documents
incorporated by reference herein, if any) 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, in light of circumstances under which they are made. No person has been authorized to give any
information or to make any representation not contained or incorporated by reference in this 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 authorized by the
Issuer.
This Disclosure Document has been prepared for informational purposes relating to this transaction only
and upon the express understanding that it will only be used for the purposes set forth above.
By accepting this Disclosure Document, the recipient agrees to keep confidential all of such information
provided (or made available hereafter). This Disclosure Document may not be photocopied, reproduced,
or distributed to others at any time without the prior written consent of the Issuer save and except as may
be required for obtaining internal approval for making investment decision, for making disclosures to
meet any regulatory or legal obligations or as may be required for the purposes of secondary transfers. If
any recipient of this Disclosure Document decides not to participate in the A Series Debenture issue, the
recipient must promptly return this Disclosure Document and all reproductions whether in whole or in
part and any other information statement, notice, opinion, memorandum, expression or forecast made or
supplied at any time in relation thereto or received in connection with the A Series Debenture issue by the
Issuer.
The Company and its directors have not been prohibited from accessing the capital or financial market
under any order or directors passed by the SEBI or the RBI.
15
This Disclosure Document is issued by the Issuer and signed by its authorized signatory.
ISSUER'S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries accepts responsibility for and confirms that this
Disclosure Document as on date:
(i) Contains all the information with regard to the Issuer and the Issue, which is material in the
context of the Issue and is not misleading in any material respect;
(ii) That the opinions and intentions expressed therein are honestly held; and
(iii) That there are no other facts, the omission of which makes this document as a whole or any of
such information or the expression of any such opinions or intentions misleading in any material
respect.
This 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 authorized 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 A Series Debentures or the distribution of this Disclosure Document in any jurisdiction
where such action is required. The distribution of this Disclosure Document and the offering and sale of
the A Series Debentures may be restricted by law in certain jurisdictions. Persons into whose possession
this Disclosure Document comes are required to inform themselves about and to observe any such
restrictions.
The Disclosure Document is prepared in accordance with the provisions of the Debt Regulations and in
this Disclosure Document the Issuer has set out the details required as per Schedule I of the Debt
Regulations.
DISCLAIMER CLAUSE OF THE STOCK EXCHANGE.
As required a copy of this Disclosure Document has been filed with the BSE in terms of the Debt
Regulations.
It is to be distinctly understood that submission of this Disclosure Document to the BSE should not
in any way be deemed or construed to mean that this Disclosure Document has been reviewed,
cleared or approved by the BSE, nor does the BSE in any manner warrant, certify or endorse the
correctness or completeness of any of the contents of this Disclosure Document, nor does the BSE
warrant that the A Series Debentures will be listed or will continue to be listed on the BSE, nor does
the BSE take any responsibility for the soundness of the financial and other conditions of the Issuer,
its promoters, its management or any scheme or project of the Issuer.
DISCLAIMER CLAUSE OF SEBI
As per the provisions of the SEBI Debt Listing Regulations, it is not stipulated that a copy of this
Disclosure Document has to be filed with or submitted to the SEBI for its review / approval. It is to be
distinctly understood that this Disclosure Document should not in any way be deemed or construed to
have been approved or vetted by SEBI and that this Issue is not recommended or approved by SEBI.
SEBI does not take any responsibility either for the financial soundness of any proposal for which the A
Series Debentures issued thereof is proposed to be made or for the correctness of the statements made or
opinions expressed in this Disclosure Document.
16
DISCLAIMER IN RESPECT OF JURISDICTION
This Issue is made in India to investors as specified in this Disclosure Document, who shall be
specifically approached by the Issuer. This Disclosure Document does not constitute an offer to sell or an
invitation to subscribe to A Series Debentures offered hereby to any person to whom it is not specifically
addressed. The A Series Debentures are governed by and will be construed in accordance with Indian law.
Any disputes arising out of this Issue will be subject to the non-exclusive jurisdiction of the courts at
Mumbai. This offer of A Series Debentures on a private placement basis is made in India to eligible
investors resident in India and non-resident eligible investors as permissible. Nothing in this Disclosure
Document shall constitute and/or deem to constitute an offer or an invitation to an offer, to be made to the
Indian public or any section thereof, at large, through this Disclosure Document, and this Disclosure
Document and its contents should not be construed to be a prospectus under the Act. This Disclosure
Document does not constitute an offer to sell or an invitation to subscribe to the A Series Debentures
herein, in any other jurisdiction to any person to whom it is unlawful to make an offer or invitation in
such jurisdiction.
17
SECTION 3: REGULATORY DISCLOSURES
The Disclosure Document is prepared in accordance with the provisions of the Debt Regulations and in
this section, the Issuer has set out the details required as per Schedule I of the Debt Regulations:
THE ISSUER PROFILE
Name of the Issuer:
Kapstone Constructions Private Limited
Registered Office and
Corporate Office:
702, Natraj, Western Express Highway, MV Road Junction, Andheri
(E), Mumbai 400 069
Corporate Identification
number:
U45200MH2003PTC140091
Phone number:
+91 22 66766888
Fax number:
+91 22 66766999
Compliance Officer:
Financial Controller:
CFO of the Issuer:
Ms. Dipti Mehra
Mr. Vinayak Shimpi
N.A.
Email:
Statutory Auditors:
Arrangers:
M/s Shyam Malpani & Associates, Chartered Accountants
N.A.
Debenture Trustee: IL&FS Trust Company Limited
Registrar to the Issue: Link Intime India Private Limited
18
Credit Rating Agency:
Brickworks Ratings India Private Limited
BUSINESS OVERVIEW
The Issuer is presently engaged in the business of development and construction of a special township
project namely "Rustomjee Urbania" on the Thane Land.
RRPL is presently engaged in the business of development and construction of a mixed use development
project namely "Rustomjee Elements" on the MHADA Land.
Corporate Structure.
The table below represents the Corporate Structure of the Issuer as on March 31, 2014:
Sr.
No
Particulars Total No. of Equity
Shares
No. of Equity
Shares in Demat
Form
Total Shareholding
as % of total No. of
Equity Shares
1. KRPL
52,41,000 Class B
Equity Shares
8,00,000 Class B
Equity Shares
51.00
2. Mr. Boman R. Irani
2 Class B Equity Shares None 0.00
3. Mr. Percy S. Chowdhry
1 Class B Equity Shares None 0.00
4. Mr. Chandresh D. Mehta
1 Class B Equity Shares None 0.00
5 Giza Holdings Pte Ltd 50,35,465 Class A
Equity Shares
None 49.00
6 Voldemort Investment
Holding Company Ltd
1 Class A Equity Shares None 0.00
Total 1,02,76,470 100%
Key Operational and Financial Parameters for the last 3 (three) audited years.
Parameters FY 2013-2014
(Dec 13)
FY 2012-2013 FY 2011-2012 FY 2010-
2011
Net worth (758,066,089) (649,769,780) (497,003,716) 349,518,306
Total Debt 4,611,763,940 3,971,365,493 1,398,400,697 464,469,775
Of which -
- Non Current Maturities of
Long Term Borrowing
-
- Short Term Borrowing 4,611,763,940 3,971,365,493 1,398,400,697 464,469,775
- Current Maturities of Long -
19
Parameters FY 2013-2014
(Dec 13)
FY 2012-2013 FY 2011-2012 FY 2010-
2011
term Borrowing
Net Fixed Assets 89,550,220 94,173,192 73,274,852 78,255,183
Non Current Assets 167,048,225 147,228,671 240,240,799 967,596,797
Cash and Cash Equivalents 60,337,008 1,273,328,467 158,269,241 280,341,129
Long term investments 3,185,000,000 - - -
Current Investments 250 250 250 264,939,164
Current Assets 4,675,199,830 4,848,506,595 2,684,822,925 2,185,906,253
Current Liabilities 4,323,437,682 3,041,641,462 2,255,211,086 2,963,050,445
Net Sales 1,210,263,666 1,183,001,776 2,106,801,996 808,523,755
EBITDA 131,341,784 1,350,232 352,220,194 (290,240,086)
EBIT 119,974,812 (14,426,336) 330,746,773 (303,599,907)
Interest 228,271,121 138,339,728 270,377,899 98,699,074
PAT (108,296,309) (152,766,064) 53,377,978 (402,298,981)
Dividend Amounts - - - -
Current Ratio 8% 59% 19% -26%
Interest Coverage Ratio 0.53 (0.10) 1.22 (3.08)
Gross debt/ equity ratio 1:-0.16 1:-0.16 1:-0.36 1:0.75
Debt Service Coverage Ratios 58% 1% 130% -294%
Gross Debt: Equity Ratio of the Issuer.
Before issue of A Series Debentures 1:-0.16
After issue of A Series Debentures 1:-0.1
BRIEF HISTORY OF THE ISSUER
The Issuer has been incorporated as a private limited company under the Companies Act, bearing the
name 'Kapstone Constructions Private Limited' and has been issued a certificate of incorporation dated
April 22, 2003 by the ROC with the company identification number U45200MH2003PTC140091.
1. The Share Capital of the Issuer as on March 31, 2014.
Share Capital Amount (All figures in in
Rs. Crore)
Authorized Share Capital
4,52,00,000 Class A Equity Shares of the face value of Rs.10/-
4,00,00,000 Class B Equity Shares of the face value of Rs.10/-
100,000 Preference Shares* of Rs.1,000/- each
95.20
45.20
40.00
10.00
Issued, Subscribed And Paid-Up Share Capital
52,41,004 Class B Equity Shares of Rs.10/- each
50,35,466 Class A Equity Shares of Rs 10/- each
10.27
20
*Note: The preference shares are redeemable preference shares.
2. Changes in the Authorized Share Capital of the Issuer, as on March 31, 2014, for the last 5
(five) years.
Date of Change
(Date of AGM/
EGM)
Authorized
Share Capital
(in Rs. Crores)
Particulars
January 10, 2014 95.20 Authorized Share Capital is reclassified as 8,52,00,000
Equity Shares of the face value of Rs.10/- each which
can be bifurcated into different classes and 1,00,000
Preference shares of Rs.1,000/- each which can be
bifurcated into different classes.
January 25, 2014 95.20 Authorized Share Capital is reclassified as 4,52,00,000
Class A Equity Shares of the face value of Rs.10/- each
and 4,00,00,000 Class B Equity Shares of the face
value of Rs.10/- each and 1,00,000 Preference shares of
Rs.1,000/- each.
3. The Equity Share Capital History of the Issuer as on March 31, 2014 for the last 5 (five)
years.
Cumulative Date of
Allotment /
Cancellation
No. of
Equity
Shares
Face
Value
(Rs.)
Issue
Price
(Rs.)
Consideration
(cash, other
than cash etc.)
Nature of
Allotment /
Cancellation No. of
Equity
Shares
Equity
Share
Capital
(Rs.)
Equity
Share
Premium
(in Rs.)
December
23, 2011
-8,00,000 10 10 Cash Cancelled
pursuant to
High Court
Order Dated
December 23,
2011
42,00,000 4,20,00,000
March 22,
2012
10,000 10 10 Cash Scheme of
Amalgamation*
42,10,000 4,21,00,000 -
20th January
2014
10,00,000 10 10 Cash Further Issue
of Capital
52,10,000 5,21,00,000 __
February 21,
2014
31,004 10 10 Cash Further issue
of capital
52,41,004 5,24.10,040 --
March 28,
2014 50,35,4
66
10 139 Cash Further issue
of capital 1,02,76,4
70
10,27,64,70
0
--
*Note: The scheme of amalgamation of Panchgani Real Estate Private Limited with the Issuer was sanctioned by
the High Court of Bombay on December 23, 2011.
4. The Preference Share Capital History of the Issuer as on March 31, 2014, for the last 5
(five) years.
Cumulative Date of
Allotment/
Cancellation
No. of
Preference
Shares
Face
Value
(Rs.)
Issue
Price
(Rs.)
Considerat
ion (cash,
other than
Nature of
Allotment/
Cancellation/ No. of
Preference
Equity
Preference
Preferen
ce Share
21
/
Redemption
cash etc.) Redemption Shares Capital
(Rs.)
Premiu
m (in
Rs.)
December 23,
2011
-8,92,000 1000 1000 Cash Cancelled
pursuant to
High Court
Order Dated
December 23,
2011
10,000 10,00,000 -
January 20,
2014
10,000 1000 1000 Cash Redemption at
the option of
Holder
0 0 -
5. The Company has filed an application on January 24, 2014 with High Court of Bombay for
merger of Prima Builders Private Limited with the Company.
6. No reorganization or reconstruction has taken place in relation to the Issuer in the last 1 (one)
year from the date of this Disclosure Document.
7. Shareholding Pattern.
7.1 The table below represents the equity shareholding pattern of the Issuer as on March 31, 2014:
Sr.
No
Particulars Total No. of Equity
Shares
No. of Equity
Shares in Demat
Form
Total Shareholding
as % of total No. of
Equity Shares
1. KRPL
52,41,000 Class B
Equity Shares
8,00,000* 51.00
2. Mr. Boman R. Irani
2 Class B Equity
Shares
None 0.00
3. Mr. Percy S
Chowdhry
1 Class B Equity
Shares
None 0.00
4. Mr. Chandresh D
Mehta
1 Class B Equity
Shares
None 0.00
5 Giza Holdings Pte
Ltd
50,35,465 Class A
Equity Shares
None 49.00
6 Voldemort
Investment Holding
Company Ltd
1 Class A Equity
Shares
None 0.00
Total 1,02,76,470 100%
* Notes:
1. 8,00,000 Class B Equity Shares held by KRPL aggregating to 15.26% of the Share Capital of the
Issuer are in dematerialized form.
22
2. 8,00,000 Class B Equity Shares held by KRPL aggregating to 15.26% of the Share Capital of the
Issuer have been pledged in favour of IL& FS, as security for the non-convertible debentures
issued by KRPL.
7.2 As on March 31, 2014, the Issuer has not issued any preference shares.
8. List of top 10 (ten) holders of Equity Shares of the Issuer as on March 31, 2014.
Same as in Paragraph '7.1' above.
9. Details Regarding Directors of the Issuer.
9.1 Details of the Current Directors of the Issuer.
The following table sets forth the details regarding the Issuer's Board as on the date March 31,
2014:
Name,
Designation
and DIN
Ag
e
Address Date of
Appointm
ent
Other Directorships as on March 31, 2014
Rustomjee Knowledge City Private Limited
KRPL
Yazarina Estates and Investments Private
Limited
Credence Property Developers Private Limited
Rustomjee Builders Private Limited
Shalom Voyagers Private Limited
Sweety Property Developers Private Limited
Success Developers Private Limited
Moontown Trading Company Private Limited
Premium Build Tech Private Limited
Attarchand Trading Company Private Limited
Skyscraper Realtors Private Limited
Riverstone Developers Private Limited
Megacorp Constructions Private Limited
Town & Country Realty Private Limited
Riverstone Educational Academy Private
Limited
Charisma Developers Private Limited
Enigma Constructions Private Limited
Rustomjee Buildcon Private Limited
Mr. Percy S.
Chowdhry
Designation:
Director
DIN:
00057529
42 1501/150
2, 14th
Floor,
Lasonrisa
Diagonall
y, Opp.
Ruia
college,
L. Napoo
Road,
Matunga
East, CR,
Mumbai,
400014
April 22,
2003
Rustomjee Academy For Global Careers
Private Ltd
Rustomjee Knowledge City Private Limited
Rustomjee Builders Private Limited
KRPL
Attarchand Trading Company Private Limited
Mr. Boman
R. Irani
Designation:
Director
44 1602,
Rustomje
e La
Solita,
TPS III,
April 22,
2003
Rustomjee Constructions Private Limited
23
Name,
Designation
and DIN
Ag
e
Address Date of
Appointm
ent
Other Directorships as on March 31, 2014
Riverstone Educational Academy Private
Limited
Zorabian Agro Private Limited
Zorabian Chicks Private Limited
Enigma Constructions Private Limited
Apex Infraprojects Private Limited
Rustomjee Buildcon Private Limited
DIN:
00057453
Off.
Turner,
Road,
Near
Guru
Nanak
Park,
Bandra
West,
Mumbai,
400050
Raymond Limited
Rustomjee Builders Private Limited
Shalom Voyagers Private Limited
Sweety Property Developers Private Limited
Keystone Realtors Private Limited
Moontown Trading Company Private. Limited
Attarchand Trading Company Private Limited
Rustomjee Constructions Private Limited
Xcellent Realty Private Limited
Nouveau Developers Private Limited
Firestone Developers Private Limited
Riverstone Educational Academy Private
Limited
Altus Developers Private Limited
Enigma Constructions Private Limited
Imperial Infradevelopers Private Limited
Dynasty Infrabuilders Private Limited
Bloom Child Development Centre
PrivateLimited
Krishika Developers Private Limited
Mr.
Chandresh
D. Mehta
Designation:
Director
DIN:
00057575
42 Flat
No.1001,
Beuna
Vista,
10th
floor, St.
Alexius
Lane, off.
Turner
Road,
Bandra
(West),
Mumbai,
400050,
Maharash
tra,
INDIA
January 10,
2014
Rustomjee Buildcon Private Limited
Mr. Vishal
Kumar
Designation:
Director
DIN:
36 C-96,
Sector 39,
Noida
201301
INDIA
March 28,
2014 Ethenic Realtors Private Limited
Mehak Realtors Private Limited
Kedarnath Buildwell Private Limited
Shramika Infrastructure Private
Limited
Sugam Vanijya Holdings Private
Limited
Romex Promoters Private Limited
NCR Business Park Private Limited
24
Name,
Designation
and DIN
Ag
e
Address Date of
Appointm
ent
Other Directorships as on March 31, 2014
Arogya Bharati Health Parks Private
Limited
Aristotle Skools India Private
Limited
Xander Finance Private Limited
Dhanlaxmi Infrastructure Private
Limited
Xander Advisors India Private
Limited
66 Business Park Private Limited
Futura Techpark Private Limited
Mantri Premier Homes Private
Limited
Mr.
Ramprasath
Muthunaraya
nan
Designation:
Director
DIN:
33 C-302,
Golden
Square
CHS,
Sunder
Nagar,
Kalina,
Santacrz
(East),
Mumabi
400098
INDIA
March 28,
2014 TAPP Semiconductor Private
Limited
Dhanlaxmi Infrastructure
Private Limited
Mieza Schools Private Limited
Vessel Warehousing Private
Limited
Futura Techpark Private
Limited
Arogya Bharati Health Parks
Private Limited
Sugam Vanjiya Holdings
Private Limited
Mr. Ritesh
Mehta
33 702,
Amar
March 28,
2014 NA.
25
Name,
Designation
and DIN
Ag
e
Address Date of
Appointm
ent
Other Directorships as on March 31, 2014
Designation:
Director
DIN:
Prem,
Ambaji
Dham
Road,
Borivali
(West)
Mumbai
400092
INDIA
The Issuer hereby confirms and declares that none of the directors are appearing in the wilful
defaulter's list of the RBI or any other Governmental Authority.
9.2. Details of change in the Directors of the Issuer since last 3 (three) years.
Name, Designation and
DIN
Date of
Resignation /
Appointment
Director of the Issuer
since (in case of
resignation)
Remarks
Mr. Chandresh D. Mehta
Designation: Director
DIN: 00057575
February 25, 2011 April 22, 2003 Resignation
Mr. Pradeep Kumar
Verma
Designation: Nominee
Director
DIN: 02691123
June 30, 2011 March 17, 2010 Resignation
Mr. Jasmeet Chhabra
Designation: Alternate
Director
DIN: 00930654
June 30, 2011 July 23, 2010 Resignation
Mr Abhishek Kapoor
Designation: Director
DIN: 03456820
January 10, 2014 March 31, 2011 Resignation
Mr. Chandresh D. Mehta January 10, 2014 Appointment
26
Designation: Director
DIN: 00057575
Mr. Vishal Kumar
Designation: Director
DIN:
March 28, 2014 - Appointment
Mr. Ramprasath
Muthunarayanan
Designation: Director
DIN:
March 28, 2014 - Appointment
Mr. Ritesh Mehta
Designation: Director
DIN:
March 28, 2014 = Appointment
10. Details Regarding Auditors of the Issuer.
10.1 Details of the Present Statutory Auditors of the Issuer.
The following tabulation sets forth the details of the statutory auditors of the Issuer as on the date
of this Disclosure Document:
Name Type of
Auditor
Address Auditor Since
M/s Shyam Malpani &
Associates, Chartered
Accountants
Statutory
Auditors
307, Chartered House,
297/299, Dr Cawasji
Hormasji Street, Near
Marine Line Church,
Mumbai1 400002
February 24, 2014
M/s Deloitte, Haskins &
Sells
Internal
Auditors
29th Floor, Tower 3,
Senapati Bapat Marg,
Elphinstone Mill
Compound,
Elphinstone (W),
Mumbai - 400 013
September 2, 2009
10.2 Details of the Change in Auditors since the last 3 (three) years.
27
Name Address Date of
Appointment/
Resignation
Auditor since
(in case of
resignation)
Remarks
M/s B S R &
Associates,
Chartered
Accountant
5th Floor, Lodha
Excelus,
Apollo Mills
Compound,
N.M Joshi Marg,
Mahalaxmi, Mumbai
400 013
20.02.2014 29.08.2007 Resignation
M/s Shyam
Malpani &
Associates,
Chartered
Accountants
307, Chartered
House, 297/299, Dr
Cawasji Hormasji
Street, Near Marine
Line Church,
Mumbai 400002
24.02.2014 Appointment
28
11. Details of the Borrowings of the Issuer, as on January 31, 2014.
11.1 Details of the Secured Loan Facilities.
S.
No
Name of
Lender
Type of
Facility
Amount
Sanctioned (in Rs.
Crores)
Principal
Amount
Outstanding
(as on
31.01.14)
Repayment
Date/
Schedule
Security*
1. ICICI
Bank
Limited
Rupee Term
Loan,
Overdraft,
Letter of
Credit and
Bank
Guarantee
facilities
1. Rupee Term
Loan: 200
("Term Loan")
2. Sub Limits of the
Rupee Term
Loan:
(i) Overdraft: 10
(ii) Letter of
Credit: 10
(iii) Bank
Guarantee: 5
99,52,74,109
The Rupee
Term Loan
along with the
interest
thereon, must
be repaid by
the Issuer in
24 (twenty
four) monthly
installments in
accordance
with the
repayment
schedule. The
first of such
installment is
due on
October 15,
2013.
(i) An exclusive
charge by way
of registered
mortgage on
the Properties
together with
all buildings
and structures
thereon, both
present and
future;
(ii) Exclusive
charge by way
of
hypothecation
of receivables
of the Projects
under the
documents
entered into
with the
buyers of the
units by the
Issuer and all
insurance
proceeds, both
present and
future;
(iii) Exclusive
charge on the
escrow
accounts and
the debt
service reserve
account and all
monies
credited or
deposited
therein (in
whatever form
the same
maybe)
29
S.
No
Name of
Lender
Type of
Facility
Amount
Sanctioned (in Rs.
Crores)
Principal
Amount
Outstanding
(as on
31.01.14)
Repayment
Date/
Schedule
Security*
(iv) Personal
guarantee of
Mr. Boman R.
Irani and Mr.
Percy S.
Chowdhry
(v) Corporate
guarantee of
KRPL; and
(vi) Post dated
cheques for
the principal
amount of the
Term Loan.
2. ICICI
Bank
Limited
Rupee Term
Loan,
Overdraft,
Letter of
Credit and
Bank
Guarantee
facilities
1. Rupee Term
Loan: 200
("Additional
Term Loan")
2. Sub Limits of the
Rupee Term
Loan:
(i) Overdraft: 10
(ii) Letter of Credit:
10
(iii) Bank
Guarantee: 5
160,43,97,042 The Rupee
Term Loan
along with the
interest
thereon, must
be repaid by
the Issuer in
30 monthly
installments in
accordance
with the
repayment
schedule. The
first of such
installment is
due on July 15,
2015.
(i) An exclusive
charge by way
of registered
mortgage on
the Property
together with
all buildings
and structures
thereon, both
present and
future;
(ii) Exclusive
charge by ay
of registered
mortgage on
scheduled
receivables of
the Project
under the
documents
entered into
with the
buyers of units
by the
Borrower, all
insurance
proceeds, both
present and
future.
(iii) Extension of
charge by way
of registered
30
S.
No
Name of
Lender
Type of
Facility
Amount
Sanctioned (in Rs.
Crores)
Principal
Amount
Outstanding
(as on
31.01.14)
Repayment
Date/
Schedule
Security*
mortgage on
other
properties I, II
and III
together with
all buildings
and structures
thereon,
present and
future.
(iv) Extension of
charge by way
of registered
mortgage on
schedules
receivables of
the other
projects I,II
and III under
the documents
entered into
with the
buyers of units
by the
Borrower, all
insurance
proceeds, both
present and
future.
(v) Exclusive
charge by way
of registered
mortgage on
the Escrow
Account of the
project and the
DSR Account,
all monies
credited/
deposited
therein (in
whatever form
the same may
be).
(vi) Extension of
charge by way
of registered
mortgage on
31
S.
No
Name of
Lender
Type of
Facility
Amount
Sanctioned (in Rs.
Crores)
Principal
Amount
Outstanding
(as on
31.01.14)
Repayment
Date/
Schedule
Security*
the Escrow
Account of the
other project I,
II and III, all
monies
credited/
deposited
therein (in
whatever form
the same may
be).
(vii) Personal
guarantee of
Mr. Boman R.
Irani and Mr.
Percy S.
Chowdhry;
(viii) Corporate
guarantee of
KRPL; and
(ix) Post dated
cheques for the
principal
amount of the
Additional
Term Loan.
3. ICICI
Bank
Limited
Rupee Term
Loan,
Overdraft,
Letter of
Credit and
Bank
Guarantee
facilities
1. Rupee Term Loan
III (RTL III) 110
Crore and Letter
of Credit II (LC-
II) facility as
sub-limit of RTL
II I not
exceeding Rs. 15
Crore Renewal
of Overdraft
Letter of Credit 1
and Bank
Guarantee not
exceeding Rs. 10
Crore, Rs.10
Crore and Rs. 4
Crore
respectively as
sub limit of RTL
I
75,00,00,000 The Rupee
Term Loan
along with the
interest
thereon, must
be repaid by
the Issuer in
27 monthly
installments in
accordance
with the
repayment
schedule. The
first of such
installment is
due on
October 15,
2015.
The Facility, all
interest thereon,
costs, charges,
expenses and all
other
monies in respect
thereof shall be
secured by:
(i) Extension of
charge by way
of registered
mortgage on
the Property
(ii) Extension of
charge by way
of registered
mortgage on
Scheduled
Receivables of
the Project
(iii) Extension of
32
S.
No
Name of
Lender
Type of
Facility
Amount
Sanctioned (in Rs.
Crores)
Principal
Amount
Outstanding
(as on
31.01.14)
Repayment
Date/
Schedule
Security*
charge by way
of registered
mortgage on
Other
Properties 1,2
& 3
(iv) Extension of
charge by way
of registered
mortgage on
Scheduled
Receivables of
the Other
Projects 1,2 &
3.
(v) Extension of
charge by way
of registered
mortgage on
security of all
rights, title,
interest,
claims,
benefits,
demands
under the
Project
documents
both present
and future.
(vi) Extension of
charge by way
of registered
mortgage on
the Escrow
Accounts of
the Project and
Other Projects
and exclusive
charge by way
of registered
mortgage on
the DSR
Account, all
monies
credited/depos
ited therein (in
whatever form
the same may
be) and all
investments in
33
S.
No
Name of
Lender
Type of
Facility
Amount
Sanctioned (in Rs.
Crores)
Principal
Amount
Outstanding
(as on
31.01.14)
Repayment
Date/
Schedule
Security*
respect
thereof.
* Notes: - For the purpose of the above table the following expressions have the meaning
provided below:
"Property" means all the pieces and parcels of land bearing CTS No. 49/1, 49/2, 49/3, 50/1pt.,
50/2, 50/3, 51/1, 51/2, 51/3, 51/4 pt., 51/5 pt., 53/2/3 and 383 pt., admeasuring about 25,644.54
sq.mtrs. in Project Azziano Phase II situate at Thane together with all buildings and structures
thereon, both present and future.
"Other Properties" means (i) Unsold saleable area admeasuring approximately 31,270 (Thirty
One thousand Two hundred and Seventy) square feet in the Project Athena located on the Thane
Land (Other Property I); (ii) all pieces and parcels of land bearing CTS No. 14/1, 15/2, 15/3, 15/4,
16/2a, 16/3, 16/4, 16/5, 16/6a, 17/3, 17/4, 17/5, 17/6 admeasuring about 9,239.12 (nine thousand
two hundred thirty nine point one two) square meters in the Project Azziano Phase I situated on
the Thane Land, together with all, (both present and future) buildings and structures thereon
(Other Property II); and (iii) all pieces and parcels of land bearing CTS No. 54/2, 54/3, 54/4, 55/1,
55/2, 55/3, 55/4 and 55/5 admeasuring approximately 13,248.25 (thirteen thousand two hundred
forty eight point two five) square meters in the Project Acura situated at Thane, together with all
(present and future) building and structures thereon (Other Property III); and
"Projects" means (i)"Athena" having saleable area of 4,88,908 (four lakh eighty eight thousand
nine hundred eight) square feet; (ii) "Azziano" having saleable area of 5,12,550 (five lakh twelve
thousand five hundred fifty) square feet; and (iii) "Acura" having saleable area of 5,39,536 (five
lakh thirty nine thousand five hundred thirty six) square feet.
The Issuer has been sanctioned a Rupee term loan of Rs.400,00,00,000/- (Rupees Four Hundred
Crores Only) from Union Bank of India with take and hold amount of Rs.100,00,00,000/-
(Rupees One Hundred Crores Only), vide sanction letters dated February 7 and 17, 2014 . The
tabulation herein below sets forth the details of the term loan sanctioned by Union Bank:
Type of
Facility
Amount
Sanctioned
(in Rs.
Crores)
Principal
Amount
Outstanding
As on March
31, 2014
Repayment
Date/ Schedule
Security
Term
Loan
400 Nil Repayment in 11
equal quarterly
installments
commencing
from June 2016
Mortgage of all piece and parcel
of land bearing CTS no 49/2,
49/3, 50/2 pt., 50/3, 51/1 pt.,
51/2, 51/3 pt., 51/4 pt., 51/5 pt.,
383 pt., 15/5 pt., 16/4 pt., 16/5
pt., 49/1 admeasuring about
15015 sq mt in Project Azziano-
D, E, F, G, H and L situated at
Thane together with the sale
34
Type of
Facility
Amount
Sanctioned
(in Rs.
Crores)
Principal
Amount
Outstanding
As on March
31, 2014
Repayment
Date/ Schedule
Security
area of 12.81 lakh sq. ft.
Escrow over receivable of the
Project Azziano (Tower D, E, F,
G, H and L with sale area of
12.81 lakhs sq. ft. for the
estimated balance amount (of
Rs.682.22/- crores) from sales
of Rs795.22/- crores after
deducting the advance booking
money of Rs.113 crores.
Corporate guarantee of KRPL.
Personal guarantee of Mr.
Boman R. Irani, Mr. Percy S.
Chowdhry and Mr. Chandresh
D. Mehta.
11.2 The Issuer confirms that as on January 31, 2014, there are 4 (four) unsecured loans availed by it,
(i) Rs.158,55,06,206.33/- (Rupees One Hundred Fifty Eight Crore Fifty Five Lakhs Six Thousand
Two Hundred and Six and Paisa Thirty Three Only) payable to KRPL; (ii) Rs.31,84,50,000/-
(Rupees Thirty One Crore Eighty Four Lakhs Five Thousand Only) payable to Suranjan Holding
& Estate Developers Private Limited; (iii) Rs.75,10,60,990/- (Rupees Seventy Five Crore Ten
Lakhs Sixty Thousand Nine Hundred Ninety Only) payable to Rustomjee Constructions Private
Limited; and (iv) Rs.40,00,000/- (Rupees Forty Lakhs Only) Payable to Intime Constructions
Private Limited.
11.3 The Issuer confirms that as of the last quarter ending on December 31, 2013, there are no non-
convertible debentures issued by the Issuer.
11.4 The Issuer has issued two corporate guarantees for Rs.80 crore each in favour of IL&FS Trust
Company Limited for securing non convertible debentures issued by Keystone Realtors Private
Limited and Rustomjee Constructions Private Limited as per the two corporate guarantees both
dated June 27, 2011.
11.5 The Issuer confirms that as of the last quarter ending on December 31, 2013, there are no
commercial papers obtained by the Issuer which are outstanding.
11.6 As on March 31, 2014, the Issuer has not issued any redeemable preference shares.
11.7 The Issuer confirms that: (a) the Issuer is prompt and regular in servicing of its existing debts and
has been paying interest and principal when due on its term loans; and (b) the Issuer has not
defaulted and, or, made any delayed payments of interest and, or, principal in any kind of term
loans, debt securities and other financial indebtedness including under any corporate guarantee
executed by the Issuer, in the past 5 (five) years.
35
11.8 The Issuer confirms that it does not have any outstanding borrowings/ debt securities which were
taken/ issued: (a) for consideration other than cash, whether in whole or in part; (b) at a premium
or discount; or (c) in pursuance of an option.
12. Details of the Promoters of the Issuer.
12.1 The Promoters of the Issuer are KRPL, Mr. Boman R. Irani, Mr. Percy S. Chowdhry and Mr.
Chandresh D. Mehta.
12.2 The following tabulation sets forth the details of the Promoters' holding in the Issuer as on March
31, 2014:
Sr.
No
Particulars 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
(%)
1. KRPL 52,41,000 8,00,000 99.999924 8,00,000 15.26
2. Mr. Boman
R. Irani
2
None 0.000038 - -
3. Mr. Percy S
Chowdhry
1 None 0.000019 - -
4. Mr.
Chandresh
D Mehta
1 None 0.000019 - -
Total 52,41,004 100% 8,00,000 15.26
13. Abridged version of audited Consolidated (wherever available) and Standalone Financial
Information (like profit & loss statement, balance sheet and cash flow statement) for at least
last three years and auditor qualifications, if any.
Particulars Audited
31-Mar-13 31-Mar-12 31-Mar-11
EQUITY AND LIABILITIES
Shareholders' fund
Share capital 52,100,000 52,100,000 952,000,000
Reserves and surplus (701,869,780) (549,103,716) (602,481,694)
(649,769,780) (497,003,716) 349,518,306
Non-current liabilities
Long-term borrowings - 1,161,851,120 -
Other long term liabilities - 39,647,677 -
Long-term provisions 8,441,664 90,417 -
8,441,664 1,201,589,214 -
Current liabilities
Short-term borrowings 3,971,365,493 274,724,573 1,415,855,784
36
Particulars Audited
31-Mar-13 31-Mar-12 31-Mar-11
Trade payables 234,350,759 246,789,200 158,780,941
Other current liabilities 2,774,167,241 1,955,538,732 1,842,274,541
Short-term provisions 24,681,798 30,203,582 8,782,894
7,004,565,291 2,507,256,087 3,425,694,160
6,363,237,175 3,211,841,585 3,775,212,466
ASSETS
Non-current assets
Fixed assets
-Tangible fixed assets 94,173,192 73,274,852 78,255,183
Non-current investments 250 251 264,939,163
Long-term loans and advances 83,367,607 768,288,833 -
Other non-current assets 63,861,064 50,339,000 -
241,402,113 891,902,936 343,194,346
Current assets
Inventories 2,676,723,642 1,743,415,669 2,013,200,307
Trade receivables 57,624,192 150,975,090 20,635,201
Cash and bank balances 1,273,328,467 272,820,120 291,331,254
Short-term loans and advances 2,048,763,139 137,001,693 1,106,851,358
Other current assets 65,395,622 15,726,077 -
6,121,835,062 2,319,938,649 3,432,018,120
6,363,237,175 3,211,841,585 3,775,212,466
14. The following sets forth the unaudited financial information as of January 31, 2014:
Particulars Unaudited
31-Jan-14
EQUITY AND LIABILITIES
Shareholders' fund
Share capital 802,100,000
Reserves and surplus (957,699,130)
(155,599,130)
Non-current liabilities
Long-term borrowings -
Other long term liabilities -
Long-term provisions 8,441,666
8,441,666
Current liabilities
37
Particulars Unaudited
31-Jan-14
Short-term borrowings 6,256,174,323
Trade payables 302,971,503
Other current liabilities 4,164,891,038
Short-term provisions 15,249,031
10,739,285,895
10,592,128,431
ASSETS
Non-current assets
Fixed assets
-Tangible fixed assets 76,271,244
Non-current investments 5,705,431,850
Long-term loans and advances 34,853,997
Other non-current assets 142,530,694
5,959,087,785
Current assets
Inventories 3,731,776,603
Trade receivables 89,325,678
Cash and bank balances 27,707,964
Short-term loans and advances 783,574,736
Other current assets 655,665
4,633,040,646
10,592,128,431
31 Jan 2014
REVENUE
Revenue from operations 1,411,250,361
Other operating income 17,468,803
Other income 19,708,743
Total revenue 1,448,427,907
EXPENSES
Changes in inventories of construction material, unsold units and work
in progress
(1,055,052,961)
38
31 Jan 2014
Construction costs 2,125,559,493
Employee benefits 60,732,929
Selling and marketing expenses 112,859,237
Finance costs 408,678,447
Depreciation and amortization expenses 11,366,972
Other expenses 40,113,140
Total expenses 1,704,257,257
(Loss)/ profit before tax (255,829,350)
Tax expenses:
-
-
(Loss)/ profit before tax (255,829,350)
15. Any material event/ development or change at the time or issue or subsequent to the issue
which may affect the Investor's decision to invest/ continue to invest in debt securities.
No material event/ development or change has occurred at the time of the Issue or subsequent to
the Issue which may affect the Issue or the A Series Debenture Holder(s) decision to invest/
continue to invest in the debt securities.
15A. The details of the corporate guarantee furnished by KRPL, one of the Promoters, is set forth at
Annexure 1 hereto.
16. Debenture Trustee and Consents thereof.
16.1 The A Series Debenture Trustee is IL & FS Trust Company Limited, having its registered office
at the IL&FS Financial Centre, Plot C-22, G Block, Bandra Kurla Complex, Bandra East,
Mumbai - 400051, with the following contact details:
Tel No: +91 22 26533333
Facsimile: +9122 26533297
16.2 The Issuer confirms that the A Series Debenture Trustee has given its consent to the Issuer for its
appointment under the Debt Regulations as the A Series Debenture Trustee to the Issue and for its
name to be included in this Disclosure Document and all its subsequent periodical
communications to be sent to the A Series Debentures Holders issued pursuant to this Issue.
16.3 A copy of the consent letter from the A Series Debenture Trustee has been provided at Annexure
3 to this Disclosure Document.
17. Credit Rating Agency.
Brickwork Ratings India Private Limited, the Credit Rating Agency has given the Issuer a credit
39
rating of BBB-. The credit rating letter dated March 13, 2014 along with the rationale adopted by
the Credit Rating Agency has been provided at Annexure 4 to this Disclosure Document. Other
than the credit rating mentioned hereinabove, the Issuer has not sought any other credit rating
from any other credit rating agency for the A Series Debentures.
18. Undertaking to use a Common Form of Transfer.
The Issuer will issue the A Series Debentures in dematerialized form only and there will not be
any A Series Debentures in physical mode. Also, the normal procedure followed for transfer of
securities held in dematerialized form shall be followed for transfer of these A Series Debentures
held in electronic form. The seller should give delivery instructions containing details of the
buyer's DP account to his Depository Participant. The Issuer undertakes that there will be a
common transfer form/ procedure for transfer of the A Series Debentures.
The A Series Debentures shall be issued only in dematerialized form in compliance with the
provisions of the Depositories Act, 1996 (as amended from time to time) and any other applicable
regulations (including of any relevant stock exchange). No physical certificates of the A Series
Debentures would be issued. The transfer of the A Series Debentures in dematerialized form shall
be in accordance with the procedure of transfer prescribed by the relevant depository and
applicable Law.
However, the Issuer would use a common transfer form for physical holdings, if at a later stage
there is any holding in physical form due to the depository giving the rematerialization option to
any investor.
19. Listing.
The A Series Debentures of the Issuer are proposed to be listed on the WDM segment of the BSE.
The Issuer shall comply with the requirements of the Debt Listing Agreement to the extent
applicable to it on a continuous basis.
The Issuer undertakes to get the A Series Debentures listed within 15 (fifteen) days from the
Deemed Date of Allotment of the A Series Debentures. In case the A Series Debentures are not
listed within 15 (fifteen) days of the Deemed Date of Allotment for any reason whatsoever, then
the Issuer shall immediately redeem/ buy back the A Series Debentures only from those A Series
Debenture Holders for whom applicable regulations including RBI/2011-12/423 A.P.(DIR Series)
Circular No. 89 dated March 1, 2012 issued by the RBI do not permit holding to be listed debt
securities if listing is not done within said 15 (fifteen) days, and in such an eventuality the Issuer
shall reimburse such A Series Debenture Holders for any and all accrued interest, costs and
expenses (including liquidity costs, hedge costs or other break costs), as determined by such A
Series Debenture Holders, that the A Series Debenture Holders may have incurred for the
investment.
20. Permission and Consent from the Creditors.
The Issuer undertakes to obtain the consent of the creditors for the issuance and allotment of the
A Series Debentures, prior to the Deemed Date of Allotment.
21. Information relating to the terms of the offer or purchase.
For information relating to the terms of the offer please refer to the summary of the term sheet
40
attached as Annexure 1 of this Disclosure Document.
22. Other Details.
22.1 Debenture Redemption Reserve: The Company shall create and maintain a debenture redemption
reserve, if required, in accordance with applicable laws.
22.2 Issue/instrument specific regulations.
• The Companies Act;
• The Debt Regulations; and
• Relevant RBI regulations, notifications and circulars, as issued from time to time.
23. Debenture Call Option.
The Promoters have a one time call option to purchase all and not less than all the A Series
Debentures, as provided in Annexure 1 and more specifically provided in the A Series Debenture
Trust Deed. Please refer to the summary of the term sheet attached as Annexure 1 of this
Disclosure Document.
24. Utilization of Issue Proceeds.
Please refer to the summary of the term sheet attached as Annexure 1 of this Disclosure
Document.
25. Summary term sheet.
A summary term sheet with brief information pertaining to the A Series Debentures is attached as
Annexure 1 to this Disclosure Document.
26. Material Documents for Inspection.
The material documents which may be inspected at the registered office of the Company from
11:00 am to 1:00 pm from the date of this Disclosure Document, until the date of the closure of
the Issue are as follows:
• The certificate of incorporation dated April 22, 2003 of the Issuer;
• The MoA and Articles of the Issuer;
• The Shareholders' resolution dated February 24, 2014 appointing M/s Shyam Malpani &
Associates, Chartered Accountants, Mumbai as the statutory auditors of the Issuer;
• The annual report for the financial year 2012-2013] along with audited balance sheet;
• The extract of resolution dated March 6, 2014 passed by the Board, for issuance of the A
Series Debentures; • The letters from IL & FS Trust Company Limited dated March 18, 2014 to the Issuer
giving their consent to act as the A Series Debenture Trustee;
• The letter from Link Intime India Private Limited dated March 14, 2014 to the Issuer
giving their consent to act as the Registrar to the Issue;
• The credit rating letter dated March 13, 2014 from Brickwork Ratings Private Limited
assigning a rating of BBB- to the Issuer for the Issue; and
• The Depository agreement between the Issuer and NSDL / CDSL for the Issue of the A
41
Series Debentures in dematerialized form.
27. Undertakings by the Company.
The Company undertakes that:
(i) it shall till the redemption of the A Series Debenture, submit to the A Series Debenture
Trustee, all information/details required as per the Debt Regulations within the timelines
mentioned therein and comply with the Debt Listing Agreement; and
(ii) complete the listing of the A Series Debentures on the BSE, on or prior to 15 (fifteen)
days of the Deemed Date of Allotment.
42
SECTION 4: OTHER INFORMATION AND ISSUE PROCEDURE
The A Series Debentures being offered as part of the Issue are subject to the provisions of the Act, the
MoA and Articles of the Issuer, the terms of this Disclosure Document, the Application Form and other
terms and conditions as may be incorporated in the A Series Debenture Trust Deed.
Mode of Transfer/ Transmission of Debentures.
The A Series Debentures shall be freely transferable. The A Series Debenture(s) shall be transferred and,
or, transmitted in accordance with the applicable Laws. The A Series Debentures held in dematerialised
form shall be transferred subject to and in accordance with the rules/ procedures as prescribed by NSDL/
CDSL and the relevant DP's of the transferor or transferee and any other applicable Laws and rules
notified in respect thereof. 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 Register of Debenture Holder(s) maintained by the Depositories under
all circumstances. In cases where the transfer formalities have not been completed by the transferor,
claims, if any, by the transferees would need to be settled with the transferor(s) and not with the Issuer.
The normal procedure followed for transfer of securities held in dematerialized form shall be followed for
transfer of these A Series Debentures held in electronic form. The seller should give delivery instructions
containing details of the buyer's DP account to his DP.
Investors may note that subject to applicable Law, the A Series Debentures of the Issuer would be issued
and traded in dematerialised form only.
Debentures held in Dematerialized form.
The A Series Debentures shall be held in dematerialised form and no action is required on the part of the
A Series Debenture Holder(s) for redemption purposes and the redemption proceeds will be paid by
cheque/ fund transfer/ RTGS to those A Series Debenture Holder(s) whose names appear on the list of
holders provided by the Depositories to the Issuer. The names would be as per the Depositories' records
on the relevant Record Date fixed for the purpose of redemption. All such A Series Debentures will be
simultaneously redeemed through appropriate debit corporate action.
The list of the A Series Debenture Holders as of the relevant Record Date setting out the relevant name
and account number, address, bank details and DP's identification number will be given by the
Depositories to the Issuer and the Registrar. Based on the information provided above, the Issuer/
Registrar will dispatch the cheque for interest/ interest payments to the A Series Debenture Holders. If
permitted, the Issuer may transfer payments required to be made in relation to any A Series Debentures,
by electronic transfer of funds/ RTGS, to the bank account of the A Series Debenture Holder for
redemption and interest/ interest payments.
Trustee for the Debenture Holder(s).
The Issuer has appointed IL&FS Trust Company Ltd to act as the trustee for the A Series Debenture
Holder(s) vide the A Series Debenture Trustee Appointment Agreement. The Issuer and the A Series
Debenture Trustee intends to enter into the A Series Debenture Trust Deed inter alia, specifying the
powers, authorities and obligations of the A Series Debenture Trustee and the Issuer. The A Series
Debenture Holder(s) shall, without further act or deed, be deemed to have given their consent to the A
Series Debenture Trustee or any of its agents or authorized officials to do all such acts, deeds, matters and
things in respect of or relating to the A Series Debentures as the A Series Debenture Trustee may in its
discretion deem necessary or require to be done for the benefit of and in the interest of the A Series
43
Debenture Holder(s), subject to the parameters provided in the A Series Transaction Documents. Any
payment made by the Issuer to the A Series Debenture Trustee on behalf of the A Series Debenture
Holder(s)/ or to the A Series Debenture Holders Account as mentioned in the A Series Debenture Trust
Deed shall discharge the Issuer pro tanto to the A Series Debenture Holder(s). The A Series Debenture
Trustee will protect the interest of the A Series Debenture Holder(s) in regard to timely payments of the
Redemption Amounts and they will take necessary action, subject to and in accordance with the A Series
Debenture Trust Deed, at the cost of the Issuer. The A Series Debenture Trust Deed shall more
specifically set out rights and remedies of the A Series Debenture Holders and the manner of enforcement
thereof.
1. The Issuer and the A Series Debenture Trustee will enter into an A Series Debenture Trust Deed,
inter alia, specifying the rights, powers, authorities and obligations of the Issuer and the A Series
Debenture Trustee in respect of the A Series Debentures.
2. All the rights and remedies of the A Series Debenture Holder(s) shall vest in and shall be
exercised by the A Series Debenture Trustee, provided however, that the prior written consent of
the A Series Debenture Holder(s) shall be procured wherever required and in the manner required,
as per the A Series Transaction Documents.
3. Any payment made by the Issuer to the A Series Debenture Trustee on behalf of the A Series
Debenture Holder(s)/ or to the A Series Debenture Holder's Account as mentioned in the A Series
Debenture Trust Deed shall discharge the Issuer pro tanto to the A Series Debenture Holder(s).
4. The A Series Debenture Trustee will protect the interest of the A Series Debenture Holder(s) in
the event of 'default' (as defined in the A Series Debenture Trust Deed) by the Issuer in regard to
timely payment of the Redemption Amount and they will take necessary action at the cost of the
Issuer.
Market Lot.
The market lot will be 1 (one) A Series Debenture. Since the A Series Debentures are being issued only in
dematerialized form, the odd lots will not arise either at the time of issuance or at the time of transfer of A
Series Debentures.
Interest on Debentures.
The Interest on the A Series Debentures shall be accrued and compounded and paid in the manner and in
accordance with the terms set out in in the summary of the term sheet attached as Annexure 1 of this
Disclosure Document.
Borrowing Powers of the Board.
Pursuant to the shareholders' resolution dated February 24, 2014, passed in accordance with the
provisions of the Act, the Board has been authorized to borrow, from banks/financial institutions or other
persons, at their discretion, an amount up to a maximum of Rs.1,600 crore.
A Debenture Holder not a Shareholder.
The A Series Debenture Holder(s) is not a shareholder under the Act.
Rights of the Debenture Holder(s).
44
• The A Series Debentures shall have all of the rights and privileges and entitlements as available
under the Act and the A Series Transaction Documents. Further, if any resolution affecting the
rights attached to the A Series Debentures is to be placed before the Board or the Shareholders,
the said resolution will first be placed before the registered A Series Debenture Holder(s) for their
consideration and approval. Any Meeting of the A Series Debenture Holders shall be conducted
in accordance with the provisions of the A Series Debenture Trust Deed.
• The A Series Debenture Holder shall be entitled to vote in respect of the A Series Debentures,
either in person or by proxy, at any meeting of the A Series Debenture Holders conducted in
accordance with the provisions of the A Series Debenture Trust Deed.
• The A Series Debentures are subject to the provisions of the Act, the MoA and Articles of the
Issuer, the terms of this Disclosure Document, the Application Form and the A Series Transaction
Documents. Over and above such terms and conditions, the A Series Debentures shall also be
subject to other terms and conditions as may be incorporated in the Debt Regulations, guidelines,
notifications and regulations relating to the issue of capital/ debt and listing of securities issued
from time to time by the Government of India and, or, other authorities and other documents that
may be executed in respect of the A Series Debentures.
• Save as otherwise provided in this Disclosure Document and the A Series Debenture Trust Deed,
the provisions contained in Annexure C and, or, Annexure D to the Companies (Central
Government's) General Rules and Forms, 1956 as prevailing and to the extent applicable, will
apply to any Meeting of the A Series Debenture Holder(s), in relation to matters not otherwise
provided for in terms of the Issue of the A Series Debentures and in the A Series Debenture Trust
Deed.
• A Register of Debenture Holder(s) will be maintained in accordance with Section 152 of the Act
and the Redemption Amount becoming due and payable in respect of the A Series Debentures
will be paid to the registered holder thereof for the time being or in the case of joint-holders, to
the person whose name stands first in the Register of Debenture Holder(s).
• The A Series Debenture Holder(s) will be entitled to their A Series Debentures free from equities
and, or, cross claims by the Issuer against the original or any intermediate holders thereof.
Modifications of Rights.
The rights, privileges, terms and conditions attached to the A Series Debentures shall not be varied,
modified or abrogated unless a prior written permission the A Series Majority Debenture Holder(s) or
with the sanction accorded pursuant to a Majority Resolution passed at a Meeting of the A Series
Debenture Holders conducted in accordance with the provisions of the A Series Debenture Trust Deed.
Depository Arrangements.
The Issuer has appointed Link Intime India Private Limited, as the Registrar to the Issue. The Issuer has
made necessary depository arrangements with NSDL and CDSL for the issue and holding of the A Series
Debentures in dematerialized form.
The investors can hold the A Series Debentures only in dematerialized form and deal with the same as per
the provisions of the Depositories Act, 1996, as amended from time to time.
45
Notices.
All notices to the A Series Debenture Holder(s) required to be given by the Issuer or the A Series
Debenture Trustee shall have been given if sent either by registered post, by facsimile or by email to the
A Series Debenture Holders as appearing in the Register of Debenture Holder(s) maintained by the
Depositories, or as may be prescribed by the applicable Law, at the address/ email/ or facsimile as
contained in such register or such other address/ email/ or facsimile as may be notified by the A Series
Debenture Holder(s) from time to time through suitable communication.
All notice(s) to be given by the A Series Debenture Holder(s) shall be sent by registered post or by hand
delivery to the Issuer or to such persons at such address as may be notified by the Issuer from time to time
through suitable communication.
Notices issued by the Issuer/ the A Series Debenture Trustee/ the A Series Debenture Holder(s) to each
other shall be deemed to have been effectively given on the 3rd day falling after the same has dispatched
the notice by registered post/ courier or when confirmation of its transmission has been recorded by the
sender's facsimile machine and email or at the time of delivery in the case of personal delivery.
Joint-Holders.
Where 2 (two) or more persons are holders of any A Series Debenture(s), they shall be deemed to hold the
same as joint holders with benefits of survivorship subject to other provisions contained in the Articles of
the Issuer.
Payment Instructions.
The RTGS details of Issuer are as under:
IFSC Code: HDFC0001799
Bank Account No.: 50200004617570
Bank: HDFC Bank Limited
Branch: Kalpataru Estate, Building No. 1, Jogeshwari Vikhroli Link Road, Andheri (E), Mumbai 400 093
List of holders of the Debentures.
The Issuer shall request the Depositories to provide a list of holders as at the end of the relevant Record
Date. This shall be the list, which will be used for payments of the Redemption Amount.
Succession.
In the event of winding-up of the holder of the A Series Debenture(s), the Issuer will recognize the
executor or administrator of the concerned A Series Debenture Holder(s), or the other legal representative
as having title to the A Series Debenture(s). The Issuer shall not be bound to recognize such executor or
administrator or other legal representative as having title to the A Series Debenture(s), unless such
executor or administrator obtains probate or letter of administration or other legal representation, as the
case may be, from a court in India having jurisdiction over the matter.
The Issuer may, in its absolute discretion, where it thinks fit, dispense with the production of probate or
letter of administration or other legal representation, in order to recognize such holder as being entitled to
the A Series Debenture(s) standing in the name of the concerned A Series Debenture Holder on
46
production of sufficient documentary proof or indemnity.
Nomination.
In the event of a deceased A Series Debenture Holder having nominated any person entitled to be
registered as the A Series Debenture Holder in the event of his/ her death, such nominee shall be
registered as the A Series Debenture Holder in place of the deceased A Series Debenture Holder,
notwithstanding anything contained herein or in any other law for the time being in force.
Mode of Payment.
All payments must be made through bank transfers/RTGS/ bank remittances as set out in the A Series
Transaction Documents/ Application Form.
Effect of Holidays.
In the event that any date defined above or elsewhere in this Disclosure Document other than the Deemed
Date of Allotment, is not a Business Day, the next Business Day shall be considered as the effective date.
In case the Record Date/ book closure date falls on a day which is not a Business Day, the day prior to
such date which is a Business Day shall be the Record Date/ book closure date.
The Interest for the interest periods shall be computed on an actual/actual days a year basis on the
principal outstanding on the A Series Debentures at the Interest rate.
Tax Deduction at Source.
(a) In the event the Issuer is required to make a tax deduction, the Issuer shall make the payment
required in connection with that tax deduction within the time allowed and in the minimum
amount required by applicable Law subject to the any maximum amount as may be agreed to in
the A Series Transaction Documents.
(b) The Issuer shall within the applicable statutory period after the due date of payment of any tax or
other amount which it is required to pay, deliver to the A Series Debenture Trustee evidence of
such deduction, withholding or payment and of the remittance thereof, to the relevant taxing or
other authority.
Letters of Allotment.
The A Series Debentures will be credited in dematerialised form within the time period specified in the
Debt Listing Agreement entered into between the Stock Exchange and the Issuer.
Deemed Date of Allotment.
All the benefits under the A Series Debentures will accrue to the Debenture Holders from the specified
Deemed Date of Allotment. The Deemed Date of Allotment for the Debentures is March 28, 2014 or the
actual date of allotment by which date the Debenture Holders would be intimated of allotment.
Payment on Redemption.
Payment on redemption will be made by way of credit through RTGS system/ funds transfer/ remittances
into the accounts of the holders of the A Series Debentures or as specified by them in accordance with the
47
A Series Transaction Documents, in the name of the A Series Debenture Holder(s) whose names appear
on the list of holders given by the Depository to the Issuer as on the Record Date.
The A Series Debentures shall be taken as discharged on payment of the full Redemption Amount by the
Issuer to the registered A Series Debenture Holder(s) whose name appears in the Register of Debenture
Holder(s) on the Record Date. Such payment will be a legal discharge of the liability of the Issuer towards
the A Series Debenture Holder(s). On such payment being made, the Issuer will inform NSDL/ CDSL
and accordingly the account of the A Series Debenture Holder(s) will be adjusted with NSDL / CDSL.
The Issuer's liability to the A Series Debenture Holder(s) towards all their rights including for payments
of the Redemption Amounts as specified under the A Series Debenture Trust Deed or otherwise shall
cease and stand extinguished post redemption and payment thereof in accordance with the A Series
Debenture Trust Deed.
Governing Law.
The A Series Debentures are governed by and shall be construed in accordance with the Indian laws. Any
dispute arising thereof will be subject to the non exclusive jurisdiction of the courts and tribunals in the
city of Mumbai. The Issuer's obligations under the A Series Debentures shall, at all times, be subject to
the directions of the Reserve Bank of India and the Securities and Exchange Board of India.
48
SECTION 5: DECLARATION
It is hereby declared that this Disclosure Document contains full disclosure in accordance with the Debt
Regulations and other regulations/ guidelines issued by the SEBI. The Issuer also confirms that this
Disclosure Document does not omit disclosure of any material fact which may make the statements made
therein, in light of the circumstances under which they are made, misleading. The Disclosure Document
also does not contain any false or misleading statement.
Signed for and on behalf of
Kapstone Constructions Private Limited
Authorised Signatory
Date: April 11, 2014
Place: MUMBAI
49
ANNEXURE 1: TERMSHEET
1. Security Name Rated, listed, unsecured, redeemable cumulative non- convertible debentures
(hereinafter "A Series Debentures").
2. Issuer Kapstone Constructions Private Limited, having its registered office at 702,
Natraj, Western Express Highway, MV Road Junction, Andheri (E), Mumbai
400 069 India.
3. Type and
Nature of
Instrument
Redeemable Cumulative Non -Convertible A Series Debentures, which shall
be Rated, Interest Bearing and shall be Rupee Denominated.
4. Status
The A Series Debentures shall constitute a direct obligation of the Issuer and
shall at all times rank pari passu inter se and without any preference or priority
among themselves.
All the A Series Debentures issued/ allotted to and held by the A Series
Debenture Holders, in terms of this Disclosure Document and the A Series
Debenture Trust Deed shall be of the same class.
5. Mode of Issue Private Placement.
6. Eligible
Investors
Only those investors who have been addressed through a communication
directly are eligible to apply. No other person can apply. All investors are
required to comply with the relevant regulations/ guidelines applicable to them
for investing in this issue of the A Series Debentures.
7. Listing The Issuer shall make an application for the final listing of the A Series
Debentures on the whole sale debt market segment ("WDM Segment") of the
Bombay Stock Exchange Limited, within 5 (five) days from the Deemed Date
of Allotment. The Issuer shall get the A Series Debentures listed on the WDM
Segment within 15 (fifteen) days from the Deemed Date of Allotment.
In case the A Series Debentures are not listed within 15 (fifteen) days from the
Deemed Date of Allotment for any reason whatsoever, the Issuer shall
immediately redeem/ buy back the A Series Debentures in accordance with the
RBI circular "RBI/2011-12/423 A.P.(DIR Series) Circular No. 89" dated
March 1, 2012 and in such an eventuality the Issuer shall reimburse such A
Series Debenture Holders, the Subscription Amount along with the Interest.
8. Credit Rating 'BBB-' by Brickwork Rating Private Limited.
9. Issue Size The Issuer and the Promoters offer subscription of 300 (three hundred) A
Series Debentures for an amount aggregating to Rs.300,00,00,000/- (Rupees
Three Hundred Crores Only).
10. Principal
Amount or
Subscription
Amount
Rs.300,00,00,000/- (Rupees Three Hundred Crores Only).
50
11. Number of
Debentures
300 (three hundred) A Series Debentures.
12. Issue Timing Issue Opening Date: March 24, 2014
Issue Closing Date: April 15, 2014
Deemed Date of Allotment: April 15, 2014
13. Option to
retain over
subscription
Not applicable.
14. Minimum
Application
Size
1 (one) A Series Debenture.
15.
Nominal Value
or Face Value
Each A Series Debenture shall have a nominal value/ face value of
Rs.1,00,00,000/- (Rupees One Crore Only) ("Nominal Value") per A Series
Debenture contributed by the A Series Debenture Holders to subscribe/ acquire
the A Series Debentures.
15A Issue Price
At par.
16. Details of
Utilization of
Issue proceeds/
Objects of the
Issue
The Subscription Amounts received by the Company shall be used for, (i)
Rs.74,00,00,000/- (Rupees Seventy Four Crores Only) towards the part
repayment of the ICICI Loan Facility and Rs.200,00,00,000/- (Rupees Two
Hundred Crores Only) towards repayment of certain existing liabilities of the
Issuer, and (ii) Rs.26,00,00,000/- (Rupees Twenty Six Crores Only) towards
contribution in RRPL by the Issuer.
The Subscription Amounts received by the Issuer shall be deposited and kept
in the Utilization Escrow Account with the Utilization Escrow Agent, until the
A Series Debentures are listed on the WDM Segment of the Stock Exchange.
The Subscription Amounts shall only be released to the Issuer upon the
successful listing of the A Series Debentures on the WDM Segment.
As on the Deemed Date of Allotment, the Issuer shall have subscribed to
11,40,00,000 (eleven crore forty lacs) non- convertible debentures of RRPL
("RRPL NCDs") against an amount of Rs.114,00,00,000/- (Rupees One
Hundred Fourteen Crores Only) contributed by the Issuer in RRPL, on the
terms and conditions set forth in the A Series Debenture Trust Deed.
17. Form of
Issuance and
Trading
Dematerialised. The Issuer shall issue the A Series Debentures in
dematerialised form on the Deemed Date of Allotment. The A Series
Debenture Holders shall hold the A Series Debentures in dematerialised form
and shall deal with the same as per the provisions of the Depositories Act,
1996, the regulations thereunder and the rules and bye laws of the Depository.
The Issuer shall maintain continuous listing until all and not less than all the A
Series Debentures are redeemed by paying the entire Redemption Amounts in
51
accordance with the A Series Debenture Trust Deed. In this regard, the Issuer
shall comply with all applicable provisions of the Debt Regulations and the
Debt Listing Agreement, as applicable, to ensure the continuous listing of the
A Series Debentures.
17A
. Mode of
Settlement
Payments to the A Series Debenture Holders shall be made by way of direct
credit through ECS / RTGS, NEFT, Swift transfer or any other means available
in the banking channel as applicable and where such facilities are not
available, the Issuer shall make payment of all amounts by way of cheques /
demand drafts.
18. Transferability The A Series Debentures shall be issued free of all encumbrances of any nature
whatsoever, together with all rights now or hereafter attaching thereto. The A
Series Debentures shall be freely transferable. The transfer of the A Series
Debentures shall be in accordance with the rules/procedures as prescribed by
the Depository and the relevant rules and regulations of the SEBI.
19. Interest/
Coupon Rate
The Company agrees and undertakes that the A Series Debentures shall carry
an interest at the rate of 21.30% (twenty one point three zero percent), p.a.
compounded quarterly, Net of Taxes (as set forth at Clause 33 below)
("Interest"). It is hereby clarified that the Interest shall be charged and payable
on any unpaid amounts of the Interest. It is hereby further clarified that the
Interest rate of 21.30% (twenty one point three zero percent) p.a. compounded
quarterly, Net of Taxes is equivalent to an annualized IRR of 23% (twenty
three percent) per annum, Net of Taxes.
20. Step Up/Step
Down Coupon
Rate
NA.
21. Interest/
Coupon
Payment
Frequency
The Issuer shall be liable to pay Interest on the A Series Debentures to the A
Series Debenture Holders on periodic basis as set forth below in Clause 27 and
in no event all of the Interest along with the aggregate Nominal Value shall be
paid later than the Final Redemption Date of the A Series Debentures.
The Interest on the A Series Debentures shall accrue from the Deemed Date of
Allotment and shall be payable in accordance with the terms and conditions of
the A Series Debenture Trust Deed. It is clarified that the Interest required to
be paid shall be calculated until the date of actual payment of the Interest.
The Interest shall be accrued and computed on a quarterly basis calculated on
the last day of each quarter (viz. 3 (three) month periods ending March 31,
June 30, September 30 and December 31). For the purposes of calculation of
the Interest between each quarter, the actual number of days from the last
quarter end date shall be considered. If any payment is made within a quarter,
then the Interest has to be computed till the date of payment.
It is expressly agreed that if there are no sufficient Distributable Amounts, then
the Interest shall accrue as provided in clauses 19 and 21 and shall be paid on
there being sufficient Distributable Amounts; provided however that
notwithstanding anything contained in this clause 21, if at the expiry of the
52
Redemption Grace Period, the Company fails to pay the entire accrued Interest
on account of there being no sufficient Distributable Amounts, then the Interest
shall remain due and payable and the A Series Debenture Holders shall be
fully entitled to enforce their rights and entitlements under clauses 26 and 42
and otherwise available to them under the Law.
22. Coupon Type Fixed.
23. Coupon Reset
Process
(including
rates, spread,
effective date,
interest rate
cap and floor
etc).
NA.
24. Day Count
Basis
Actual/Actual.
25. Tenor 5 (five) years 6 (six) months from the Deemed Date of Allotment with a grace
period of 6 (six) months.
26. Maturity Date
or Redemption
Date
Unless the A Series Debentures are redeemed earlier in accordance with the A
Series Debenture Trust Deed, the Issuer shall redeem all and not less than all
the A Series Debentures in full, by paying the entire Redemption Amounts, on
the date falling on the completion of 5 (five) years and 6 (six) months from the
Deemed Date of Allotment viz. October 14, 2019, ("Final Redemption
Date"). If the Issuer fails to redeem all and not less than all the A Series
Debentures in full, by paying the entire Redemption Amounts, on or before the
Final Redemption Date, as provided in the A Series Debenture Trust Deed, the
Issuer shall have a grace period of 6 (six) months ("Redemption Grace
Period") from the Final Redemption Date which shall expire on April 14,
2020, to mandatorily redeem all and not less than all the A Series Debentures
by paying the entire Redemption Amounts to the A Series Debenture Holders.
Notwithstanding anything contained in the A Series Debenture Trust Deed and
without prejudice to all the rights and entitlements of the A Series Debenture
Holders under the Law and the A Series Transaction Documents, if the Issuer,
by the expiry of the Redemption Grace Period, has not redeemed all and not
less than all the A Series Debentures by paying the entire Redemption
Amounts to the A Series Debenture Holders, then the following shall apply:
(i) The A Series Debenture Holders shall have the unfettered, absolute and
exclusive right and entitlement to, at any time without any further
consent of the Company and, or, RRPL and, or, the Promoters to sell,
transfer or undertake/ seek any other commercial exploitation of built up
area, flats, apartments, units, slabs, un-utilized FSI or developable areas
in the Projects by way of a development rights agreement in any manner
whatsoever, either by public auction or private contract or bulk sale or
otherwise; and with liberty to make such conditions and stipulations on
53
title or evidence of title or other matters as the A Series Debenture
Holders, may deem proper without being liable or answerable or
accountable for any loss or deterioration occasioned thereby to the
Promoters or the Company. The A Series Debenture Holders shall also
have the right to seek all remedies against the Company and, or, RRPL,
in accordance with the applicable Laws and the A Series Debenture
Holders shall be entitled to execute the necessary deeds, documents and
writings including but not limited to sale agreements or conveyances
and, or, development agreements and obtain all necessary Approvals and
do all such acts and deeds necessary to give effect to the provisions of
this paragraph, including but not limited to handing over the title deeds
of the Projects, in the custody of the Company and RRPL;
(ii) It is agreed that for the purposes of implementing any sale or transfer or
commercial exploitation as specified under paragraph (i) above, the A
Series Debenture Holders shall appoint one or more of the IPCs, and the
sale and transfer shall only take place at or above the price and on the
terms and conditions determined by the IPCs unless the Company, the
Promoters and the A Series Debenture Holders, mutually agree
otherwise. The A Series Debenture Holders shall have absolute right and
discretion to select any of the IPCs and such selection and nomination
shall be binding on all of the Promoters, the Company, RRPL and the A
Series Debenture Holders. The Company, RRPL, the Promoters and the
shareholders of the Company and RRPL shall provide the necessary
assistance and co-operation to the IPCs so appointed by the A Series
Debenture Holders. All decisions with respect to the sale and transfer
shall be taken by the A Series Debenture Holders provided that these are
in consonance with the price and terms of sale and transfer determined
by the IPCs. The A Series Debenture Holders shall also be entitled to
issue necessary instructions to the IPCs;
(iii) Any proceeds received or collected pursuant to the exercise of the right
and entitlements of the A Series Debenture Holders in the manner
provided in paragraph (i) and (ii) above in respect of the Company
Project, shall be deposited in the Construction Loan Escrow Accounts (if
any) or the Project Revenue Account and shall be first utilized for the
payment of the Company's Taxes, outstanding payments to the Land
Owners (as per the Joint Development Agreements) and meeting the
then existing liabilities of the Company pursuant to a senior secured
construction loan availed by it from a Secured Creditor. Thereafter, the
balance amounts shall be distributed between the A Series Debenture
Holders and the B Series Debenture Holders in the ratio of 80:20
respectively;
Any proceeds received or collected by the A Series Debenture Holders in
the manner provided in paragraph (i) and (ii) above in respect of the
Rustomjee Project, shall be deposited in the RRPL Revenue/
Construction Loan Escrow Account and shall be first utilized for the
payment of RRPL's Taxes, outstanding payments to the Societies Union
(as per the Rustomjee Project Agreements) and meeting the then existing
liabilities of RRPL pursuant to a senior secured construction loan availed
54
by it from a Secured Creditor. Thereafter, the balance amounts shall be
deposited in the Distribution Escrow Account and shall be distributed
between the A Series Debenture Holders and the B Series Debenture
Holders in the ratio of 80:20 respectively
(iv) The Company shall continue to complete the development/ construction
of the Company Project in accordance with the Approved Business Plan
and shall comply with the Approved Business Plan; except that any
sale/transfer/ commercial exploitation of any built up area, flats,
apartments, units, slabs, un-utilized FSI or developable areas of the
Company Project may be made by the A Series Debenture Holders in
accordance with this clause 26. Similarly, RRPL shall continue to
complete the development/ construction of the Rustomjee Project in
accordance with the RRPL Approved Business Plan and shall comply
with the RRPL Approved Business Plan; except that any sale/transfer/
commercial exploitation of any built up area, flats, apartments, units,
slabs, un-utilized FSI or developable areas of the Rustomjee Project may
be made by the A Series Debenture Holders in accordance with this
clause 26 hereof.
The A Series Debenture Holders or the A Series Debenture Trustee shall be
under no obligation to serve any Notice, reminder or intimation to the Issuer
regarding its obligation to pay the Redemption Amounts on the Final
Redemption Date and, or, on the expiry of the Redemption Grace Period and it
shall be entirely the Company's responsibility to ensure prompt and regular
payment thereof in the manner herein provided. If the Company fails to
redeem all and not less than all the A Series Debentures in full by paying the
entire Redemption Amounts on or before the Final Redemption Date or before
the expiry of the Redemption Grace Period, on account of there being no
sufficient Distributable Amounts, then at the expiry of the Redemption Grace
Period, the Redemption Amounts shall remain due and payable and the
Company shall remain liable to pay the Redemption Amounts and the A Series
Debenture Holders shall have the rights and entitlements as set forth at clause
26 and 42 and otherwise available to them under the Law. The rights and
entitlements of the A Series Debenture Holders under this Clause 26 shall be
without prejudice to the rights and entitlements of the A Series Debenture
Holders acting through the A Series Debenture Trustee to immediately invoke
and enforce the Corporate Guarantee 1 and, or, the Corporate Guarantee 2,
detailed at Clause 41; and upon such invocation and enforcement, KRPL shall
be bound to pay the entire amounts under the Corporate Guarantee 1 to the A
Series Debenture Trustee and, or, under the Corporate Guarantee 2 to the
Issuer in accordance with their respective terms.
27. Redemption
Amounts
The redemption amount shall mean the total amounts outstanding towards the
aggregate Nominal Value of the A Series Debentures plus the accrued and
unpaid amount of the Interest ("Redemption Amounts").
The amounts paid by the Company to the A Series Debenture Holders shall be
applied in following manner and order of priority:
(i) Firstly, the amounts paid by the Company shall be applied towards the
55
payment of the accrued and unpaid Interest on all the A Series
Debentures, unless the entire Interest payable on the A Series Debentures
in accordance with the A Series Debenture Trust Deed has been paid in
full by the Issuer to the A Series Debenture Holders;
(ii) Secondly, after the full and complete satisfaction of the payments set
forth paragraph (i) above is achieved, the amounts paid by the Company
shall be applied towards payment/ redemption of the Nominal Value on
all the A Series Debentures less Rs.1,000/- (Rupees One Thousand Only)
per A Series Debenture;
(iii) Lastly, after the full and complete satisfaction of the payments set forth
at paragraph (ii) above is achieved, the amounts paid by the Company
shall be applied towards payment/ redemption of the balance Nominal
Value of Rs.1,000/- (Rupees One Thousand Only) per A Series
Debenture.
For avoidance of doubt, it is clarified that (i) any amounts paid by the
Company, whether towards the Interest or the redemption, on the A Series
Debentures shall be paid proportionately to all the A Series Debenture
Holders; and (ii) the A Series Debentures shall not be deemed to be redeemed
by the Company until the entire Redemption Amounts, is received by the A
Series Debenture Holders in their respective bank accounts. It is clarified that
all amounts paid to the A Series Debenture Holders towards the Interest or
redemption, shall be adjusted while calculating the total outstanding amounts
towards the Redemption Amounts.
Any payments of the Redemption Amounts and other amounts, as required
under the provisions of this Disclosure Document and the A Series Debenture
Trust Deed, shall be made to the registered A Series Debenture Holders whose
names appear on the list of beneficial owners given by the Registrar to the
Issuer on the Record Date. Such payments shall be made by RTGS/ wire
transfer to the holders of the A Series Debentures.
It is hereby clarified that in exercise of the rights specified in Clause 26 above,
no rights or entitlements will be exercised or claimed in respect of the
Promoters' Saleable Area and the School and Medical Facilities and the same
will be completely excluded.
The Redemption Amounts payable hereunder by the Company to the A Series
Debenture Holders shall, as between the A Series Debenture Holders, inter-se,
rank pari passu without any preference or priority whatsoever on account of
the date of issue or allotment or otherwise.
28. Distribution
Escrow
Account of the
Company and
the Distribution
Escrow
Mechanism
The Issuer shall ensure that:
(i) payments received or to be received from the customers towards
purchase of units in the Company Project, including sale considerations,
booking amounts and advances and the Company Receipts, through any
medium whatsoever including cheque, demand drafts, wire transfer or
cash, shall be deposited into the Construction Loan Escrow Accounts in
56
accordance with the Lending Agreements or any financing agreement
executed by the Company with any other Secured Creditor. The
Company shall furnish the A Series Debenture Holders with copies of the
bank account statements of the Construction Loan Escrow Accounts, the
Project Revenue Account, the Expense Account, the Land Owners Bank
Account and the bank accounts of the Company mentioned at paragraphs
(viii) and (ix) below, as and when required by the A Series Debenture
Holders;
(ii) all excess amounts lying in the Construction Loan Escrow Accounts over
and above the amounts required to be maintained in the Construction
Loan Escrow Accounts or all excess amounts over and above the
amounts transferred to the account of the Secured Creditor to service the
construction loan ("Excess Amounts"), in accordance with the Lending
Agreements or any financing agreement executed by the Company with
any other Secured Creditor shall be immediately transferred, without any
demur, delay and protest to the revenue bank account of the Company
("Project Revenue Account"). For avoidance of doubt it is clarified that
the Excess Amounts, shall not be retained in the Construction Loan
Escrow Accounts and shall be immediately transferred to the Project
Revenue Account.
If the Company establishes an account ("Land Owners Bank Account")
with any of the Land Owners under the provisions of the Joint
Development Agreements, for making payments to the Land Owners in
accordance with the terms thereof, then simultaneous with the transfer of
the Excess Amounts to the Project Revenue Account from the
Construction Loan Escrow Accounts, such amounts equivalent to the
amounts required to be paid to the Land Owners, under the provisions of
the Joint Development Agreements or as shall be provided under the
Articles, shall be transferred to the Land Owners Bank Account. If the
Land Owners Bank Account is not established, then the amounts payable
by the Company to the Land Owners under the Joint Development
Agreements shall be paid to them from the Construction Loan Escrow
Account.
Further, in the event there are no Construction Loan Escrow Accounts,
(a) then the Company shall ensure that all payments received or to be
received from the customers towards purchase of units in the Company
Project, including sale considerations, booking amounts and advances
and all of the Company Receipts, through any medium whatsoever
including cheque, demand drafts, wire transfer or cash shall be
immediately and at all times be deposited in the Project Revenue
Account, without any delay, demur or protest; (b) then, subject to the
provisions of the A Series Debenture Trust Deed, the amounts that are
required to be paid to the Land Owners under the provisions of the Joint
Development Agreements shall be transferred from the Project Revenue
Account to the Land Owners Bank Account or if there is no Land
Owners Bank Account, such amounts shall be paid directly to the Land
Owners from the Project Revenue Account; and (c) if any amounts are
still being deposited into the Construction Loan Escrow Accounts then
57
the Company shall immediately transfer such funds deposited in the
Construction Loan Escrow Accounts, without any delay, demur or delay,
in the Project Revenue Account and the Company shall not utilize or use
such funds deposited in the Construction Loan Escrow Accounts in any
manner whatsoever;
(iii) all the Company Project expenses of the Company as approved in the
Cash Flow Statement ("Project Expenses"), on an ongoing basis shall be
made from 1 (one) bank account (hereinafter referred to as the "Expense
Account") in accordance with the provisions of the A Series Debenture
Trust Deed;
(iv) within first 10 (ten) days of the beginning of each calendar month, an
agreed amount based on the Project Drawdown Schedule shall be
transferred, from the Project Revenue Account to the Expense Account,
such that the Expense Account has sufficient funds to pay for the Project
Expenses, for the next succeeding 4 (four) months ("Designated Project
Expenses"). For avoidance of any doubts it is clarified that if on the 10th
(tenth) day of a relevant calendar month, the Project Revenue Account
does not have sufficient funds to meet the amount of the Designated
Project Expenses, then as and when funds are available in the Project
Revenue Account, the same shall be transferred to the Expense Account,
until the amount equivalent to the Designated Project Expenses have
been transferred to the Expense Account. The amounts required to be
transferred from the Project Revenue Account shall stand reduced to the
extent of the amounts lying unutilized in the Expense Account, which
were transferred in the prior calendar month and have not been
utilized/spent.
(v) it is clarified that any transfers from the Project Revenue Account shall
be made strictly in accordance with the Project Drawdown Schedule in
order to ensure that the construction and development of the Company
Project is not affected;
(vi) the balance/remaining amounts in the Project Revenue Account over and
above the amounts required to be transferred to the Expense Account in
accordance with paragraph (iv) above (such balance/remaining amounts
shall hereinafter be referred to as the "Company Distributable
Amounts") shall simultaneously, with the transfer of funds into the
Expense Account, be transferred by the Company (on a monthly basis or
in such internals as may be required), without any delay, demur or
protest, to the Distribution Escrow Account;
(vii) no expenses shall be made from the Project Revenue Account; and
(viii) all amounts received from unit purchasers/customers towards
Taxes (including service tax, VAT, labour cess, local body taxes) shall be
deposited into separate accounts as specified in the A Series Debenture
Trust Deed and all such Taxes shall be paid from these accounts. If there
are any credit balances in these accounts owing to any Tax credits, the
same shall be transferred to the Project Revenue Account on a quarterly
58
basis;
(ix) all amounts received from unit purchasers/customers towards
stamp duty, registration charges, society formation charges, legal
expenses and all other pass through charges shall be deposited into a
separate account as specified in the A Series Debenture Trust Deed and
all such expenses shall be paid from this account; and
(x) none of the Company Receipts shall be deposited into the
Expense Account.
The Company shall open, maintain and operate the Distribution Escrow
Account with the Distribution Escrow Agent in accordance with the terms of
the Distribution Escrow Agreement and the Articles.
On and from the Deemed Date of Allotment, the Distribution Escrow Agent,
upon the deposit/ receipt of the Distributable Amounts in the Distribution
Escrow Account, until the redemption of all and not less than all the A Series
Debentures in full by payment of the entire Redemption Amounts, shall
automatically transfer 80% (eighty percent) of the total amounts received in
the Distribution Escrow Account, to the account of the A Series Debenture
Holders as specified by the A Series Debenture Holders. The balance 20%
(twenty percent) of the amounts deposited in the Distributable Escrow Account
shall be transferred by the Distribution Escrow Agent to the account of the B
Series Debenture Holders, as specified in the B Series DSA. Such transfers
shall be made by the Distribution Escrow Agent automatically and without any
specific instructions to the Distribution Escrow Agent.
Without prejudice to the absolute obligations and liabilities of the Company to
pay the entire Redemption Amounts to the A Series Debenture Holders on or
before the Final Redemption Date, 80% (eighty percent) of the amounts shall
be mandatorily used by the Company for payments on the A Series
Debentures/ payments to the A Series Debenture Holders and application of
receipt of such amounts shall be as set forth in Clause 27 above. It is clarified
that no payments/ distributions shall be made to the Shareholders, until all and
not less than all the A Series Debentures have been redeemed in full by paying
the entire Redemption Amounts to the A Series Debenture Holders.
If there are no sufficient Distributable Amounts, then:
(i) the Interest shall continue to accrue and be and remain payable as
provided under the A Series Debenture Trust Deed and shall be paid on
there being Distributable Amounts, provided however that
notwithstanding anything contained in this paragraph, if at the expiry of
the Redemption Grace Period, the Company fails to pay the entire
accrued Interest on account of there being no sufficient Distributable
Amounts, then the Interest shall remain due and payable and the A Series
Debenture Holders shall be fully entitled to enforce their rights and
entitlements under Clauses 26 and 42 and otherwise available to them
under the Law; and
59
(ii) the Redemption Amounts shall be and remain payable as provided under
the A Series Debenture Trust Deed and shall be paid on there being
Distributable Amounts; provided however that notwithstanding anything
contained in this paragraph, if at the expiry of the Redemption Grace
Period, the Company fails to pay the Redemption Amounts on account of
there being no sufficient Distributable Amounts, then the Redemption
Amounts shall remain due and payable and the A Series Debenture
Holders shall be fully entitled to enforce their rights and entitlements
under Clauses 26 and 42 and otherwise available to them under the Law.
29. Distributions
from RRPL
The Issuer shall ensure that:
(i) payments received or to be received from the customers towards
purchase of units in the Rustomjee Project, including sale considerations,
booking amounts and advances and the RRPL Receipts, through any
medium whatsoever including cheque, demand drafts, wire transfer or
cash, shall be deposited into the RRPL Revenue/ Construction Loan
Escrow Account in accordance with the SBI Lending Agreements or any
financing agreement executed by RRPL with any Secured Creditor.
RRPL shall furnish the A Series Debenture Holders with copies of the
bank account statements of the RRPL Revenue/ Construction Loan
Escrow Account, the RRPL Expense Account and the bank accounts of
RRPL mentioned at (vii) and (viii) below, as and when required by the A
Series Debenture Holders;
(ii) all the Rustomjee Project expenses of RRPL as approved in the Cash
Flow Statement ("Rustomjee Project Expenses"), on an ongoing basis
shall be made from 1 (one) bank account (hereinafter referred to as the
"RRPL Expense Account") in accordance with the provisions of the A
Series Debenture Trust Deed. The RRPL Expense Account shall be
opened with a reputed bank;
(iii) within first 10 (ten) days of beginning of each calendar month, an agreed
amount based on the Project Drawdown Schedule shall be transferred,
from the RRPL Revenue/ Construction Loan Escrow Account to the
RRPL Expense Account, such that the RRPL Expense Account has
sufficient funds to pay for the Rustomjee Project Expenses, for the next
succeeding 4 (four) months ("Designated Rustomjee Project
Expenses"). For avoidance of any doubts it is clarified that if on the 10th
(tenth) day of a relevant calendar month, the RRPL Revenue/
Construction Loan Escrow Account does not have sufficient funds to
meet the amount of the Designated Rustomjee Project Expenses, then as
and when funds are available in the RRPL Revenue/ Construction Loan
Escrow Account, the same shall be transferred to the RRPL Expense
Account, until the amount equivalent to the Designated Rustomjee
Project Expenses have been transferred to the RRPL Expense Account.
The amounts that are required to be transferred from the RRPL Revenue/
Construction Loan Escrow Account shall stand reduced to the extent of
the amounts lying unutilized in the RRPL Expense Account which were
transferred in the prior calendar month and have not been utilized/ spent;
60
(iv) it is clarified that any transfers from the RRPL Revenue/ Construction
Loan Escrow Account shall be made strictly in accordance with the
Project Drawdown Schedule in order to ensure that the construction and
development of the Rustomjee Project is not affected;
(v) the balance/ remaining amounts in the RRPL Revenue/ Construction
Loan Escrow Account over and above the amounts required to be
transferred to the RRPL Expense Account in accordance with paragraph
(iii) above (such balance/remaining amounts shall hereinafter be referred
to as the "RRPL Distributable Amounts") shall simultaneously, with
the transfer of funds into the RRPL Expense Account, be transferred by
RRPL (on monthly basis or in such intervals as may be required),
without any delay, demur or protest, to the Distribution Escrow Account
of the Company;
(vi) no expenses shall be made from the RRPL Revenue/ Construction Loan
Escrow Account, except as permitted under the terms and conditions of
the SBI Lending Agreements;
(vii) all amounts received from unit purchasers/customers towards Taxes
(including service tax, VAT, labour cess, local body taxes) shall be
deposited into a separate account as specified in the A Series Debenture
Trust Deed and all such Taxes shall be paid from this account. If there
are any credit balances in this account owing to any Tax credits, the same
shall be transferred to the RRPL Construction/ Revenue Account on a
quarterly basis;
(viii) all amounts received from unit purchasers/customers towards
stamp duty, registration charges, society formation charges, legal
expenses and all other pass through charges shall be deposited into a
separate account specified in the A Series Debenture Trust Deed and all
such expenses shall be paid from this account; and
(ix) none of the RRPL Receipts shall be deposited into the RRPL
Expense Account.
30. Discount at
which security
is issued and
the effective
yield as a result
of such
discount
NA.
31. Put option Date NA.
32. Put option
Price
NA.
33. Withholding
Tax and other
All interest and other payments by the Issuer on the A Series Debentures shall
be made net of any withholding taxes/ TDS (subject to a maximum of 15%
61
Taxes on
interest
payment
(fifteen percent)), which shall be borne by the Issuer and be paid by the Issuer
to the tax department/ Governmental Authorities as per the applicable provisions
of the Income Tax Act, 1961 (hereinafter referred to as "Net of Taxes").
Accordingly, any Interest or other payments on the A Series Debentures shall be
grossed-up to ensure that the A Series Debenture Holders receive the entire
Interest and any other amount without any withholding taxes/ TDS (subject to
maximum withholding taxes/ TDS of 15% (fifteen percent)). Any withholding
taxes/ TDS over and above 15% (fifteen percent) shall be deducted from the
interest payments to the A Series Debenture Holders and shall be to the
account of the A Series Debenture Holders. The Issuer shall provide all
necessary withholding tax/ TDS certificates to the A Series Debenture Holders.
34. Call Option
(i) The Promoters have a one-time call option ("Call Option") to purchase
all, but not less than all of the A Series Debentures (hereinafter to as the
"Call Securities"), at the Call Option Exercise Price, at any time after the
expiry of 3 (three) years from the Deemed Date of Allotment subject to
no Event of Default by the Promoters or the Company or RRPL (which
Event of Default has not been cured in accordance with Clause 43). The
Call Option may be exercised by the Promoters, provided however that,
all and not less than all of the Call Securities shall be acquired/ purchased
by them in a single tranche on or before the Call Option Settlement Date.
(ii) If the Promoters exercise the Call Option, then the Promoters shall
deliver to the A Series Debenture Holders, a notice in writing in respect
of the acquisition of the Call Securities at the Call Option Exercise Price
("Call Option Notice"). The Promoters shall have the obligation to pay
the Call Option Exercise Price and purchase/ acquire the Call Securities,
on a date not later than 120 (one hundred twenty) days from the date of
the Call Option Notice ("Call Option Settlement Date"). If the
Promoters fail to acquire/ purchase the Call Securities in a single tranche
on or before the Call Option Settlement Date, the Promoters shall have
an additional time period of 90 (ninety) days from the Call Option
Settlement Date to pay the Call Option Exercise Price and purchase the
Call Securities and such 90th (ninetieth) day from the Call Option
Settlement Date shall be termed as the Call Option Settlement Date. The
Call Option Exercise Price shall be satisfied only by payment in full by
the Promoters of the Call Option Exercise Price for the Transfer of all
and not less than all of the Call Securities. An illustration of the
foregoing provisions is set forth below:
If the date of Call Option Notice is January 1, 2017
Then the Call Option Settlement Date shall be April 30, 2017, on or
before which date the Promoters are required to pay the Call Option
Exercise Price and purchase/ acquire the Call Securities
If the Promoters fail to purchase the Call Securities on or before April
30, 2017 then the Promoters shall have the option to purchase the Call
Securities, on or before July 29, 2017, after which the Call Option shall
lapse.
62
(iii) The Promoters shall ensure that the Call Option Exercise Price is paid in
full on the Call Option Settlement Date in accordance with the applicable
Law.
(iv) If the Call Option has been exercised, then the Promoters shall, on the
Call Option Settlement Date pay/ remit through proper banking channels
the Call Option Exercise Price to the bank account of the A Series
Debenture Holders as notified by the A Series Debenture Trustee to the
Promoters. Payment of the Call Option Exercise Price shall be deemed to
have been made only upon the Promoters providing the A Series
Debenture Holders with the proof of remittance of the Call Option
Exercise Price (being the UTR number or the swift remittance
confirmation given by the remitting bank) and simultaneously therewith
the receipt thereof, the A Series Debenture Trustee acting on behalf of all
the A Series Debenture Holders shall sign and execute the necessary
transfer deeds in respect of the sale of the Call Securities to the
Promoters, in a form and manner acceptable to the A Series Debenture
Holders and the Promoters. The completion of the Call Option shall not
occur unless and until the Call Option Exercise Price is received in full
by the A Series Debenture Holders in their respective bank accounts on
or before the Call Option Settlement Date. Notwithstanding anything
contained herein, the Call Option shall lapse and stand terminated
automatically if the Call Option Exercise Price is not paid in full to the A
Series Debenture Holders on or before the Call Option Settlement Date
for any reason whatsoever. It is hereby clarified that the annualized IRR
of 24% (twenty four percent) shall be calculated until the date of receipt
of the Call Option Exercise Price by the A Series Debenture Holders
from the Promoters in accordance with this Clause 34.
(v) In the event any regulatory Approvals are required for giving effect to the
Call Option, the Promoters shall apply for and obtain all such Approvals
prior to the Call Option Settlement Date and in no event shall the
Promoters be entitled to seek the extension of the Call Option Settlement
Date on account of any delays for obtaining any such regulatory
Approvals.
(vi) Notwithstanding anything contained herein, the Promoters shall not be
entitled to exercise the Call Option, if the A Series Debenture Trustee has
issued a Default Notice; provided however, if the Event of Default has
been cured by Promoters prior to the expiry of the Cure Period, then the
Promoter shall be entitled to exercise the Call Option, as provided under
this Clause 34.
(vii) If after the exercise of the Call Option by the Promoters, there is any
Event of Default by the Promoters, then notwithstanding the exercise of
the Call Option by the Promoters and the provisions of this Clause 34,
the A Series Debenture Holders shall have the right to issue a Default
Notice and pursuant to the issuance of such Default Notice, if the
Promoters fail to cure such Event of Default prior to the expiry of the
Cure Period, the rights and entitlements of the A Series Debenture
Holders under Clause 43 shall prevail and the Promoters shall be bound
63
to pay the amounts set forth in Clause 43 below.
(viii) The Call Option granted herein shall be a one-time call option and
accordingly, notwithstanding anything contained herein, the Call Option
shall permanently lapse and stand terminated automatically if the
Promoters exercise the Call Option and then fail to make payment of the
Call Option Exercise Price to the A Series Debenture Holders on or
before the Call Option Settlement Date for any reason whatsoever; and
the Promoters shall have no claims or demands in this regard.
(ix) The Promoters shall be entitled to purchase the Call Securities under this
Clause 34 through their nominees, except for any of the Persons listed in
the list on the specifically designated nationals list (SDN) available on
the website of the Office of Foreign Assets Control, U.S. Department of
the Treasury.
35. Depository
NSDL and CDSL.
36. Business day
convention
A day other than Saturday, Sunday and public holidays, on which the Stock
Exchange and banks are normally open for business in New Delhi and Mumbai
and in relation to any payment in any other city.
37. Record Date 3 (three) calendar days prior to the proposed date on which any payments are
required to be made in respect of the A Series Debentures to the A Series
Debenture Holders.
38. A Series
Transaction
Documents
The A Series Transaction Documents includes the following:
(i) A Series Debenture Trust Deed;
(ii) A Series DSA;
(iii) A Series Debenture Trustee Appointment Agreement;
(iv) Utilisation Escrow Agreement;
(v) Distribution Escrow Agreement;
(vi) The Personal Guarantee
(vii) The Corporate Guarantees 1;
(viii) The Corporate Guarantee 2;
(ix) The Corporate Guarantee 3;
(x) This Disclosure Document; and
(xi) Any other document that may be designated as an A Series Transaction
Document mutually by the parties to the A Series Debenture Trust
64
Deed.
39. Conditions
Precedent to
Disbursements
The subscription of the A Series Debentures by the A Series Debenture
Holders shall be subject to the fulfillment of the following conditions
precedents:
(i) Re-classification of the Existing Equity Shares: Receipt by the A Series
Debenture Holders of copies of resolutions passed by the Board and the
Shareholders along with all the necessary filings with the ROC to
evidence that the existing 42,09,999 (forty two lakh nine thousand nine
hundred ninety nine) Equity Shares of the Company held by KRPL along
with 1 (one) Equity Share held by BI have been re-classified as Class B
Equity Shares;
(ii) Re-classification of the Existing equity shares of RRPL: Receipt by the A
Series Debenture Holders of the copies of resolutions passed by the
board and the shareholders of RRPL along with all necessary filings with
the ROC to evidence that the existing 1,00,000 (one lakh) equity shares
of RRPL held by KRPL and BI have been re-classified as RRPL Class B
Equity Shares;
(iii) Acquisition of 49% (forty nine percent) of the shareholding and control
of RRPL: The Company shall have acquired 49% (forty nine percent) of
the equity shareholding, ownership and control of RRPL, in a manner
acceptable to the A Series Debenture Holders; and in this regard a
certified true copy of the resolution of the Board and Shareholders of the
Company setting forth the shareholding pattern of RRPL shall have been
provided to the A Series Debenture Holders;
(iv) Issuance and allotment of the RRPL NCDs: The Company shall and the
Promoters shall have caused RRPL to issue and allot 11,40,00,000
(eleven crores forty lakhs) RRPL NCDs to the Company for an amount
of Rs.114,00,00,000/- (Rupees One Hundred Fourteen Crores Only),
having the terms and conditions set forth in the A Series Debenture Trust
Deed;
(v) Board and Shareholders Approval of KRPL: The board of directors and
the shareholders of KRPL shall have passed a resolution, in a form and
manner acceptable to the A Series Debenture Holders, in a meeting duly
convened in accordance with the Act and the articles of association of
KRPL, inter alia approving: (a) the issuance and allotment of the A
Series Debentures by the Company; (b) execution of the A Series
Transaction Documents; (c) the issuance and allotment of the A Series
Debentures by the Company; (d) execution of the B Series DSA; and (e)
amendment of the Articles of Association. The Promoters shall have
provided the A Series Debenture Holders with the certified true copy of
the said board and shareholders resolution;
(vi) Consent from ICICI Bank: The Company shall have received in writing,
a consent letter, in a form and manner acceptable to the A Series
Debenture Holders, from ICICI Bank setting forth its approval to and
65
clearly stating that it does not have any objection inter alia to: (a)
incurring further indebtedness by issuance of non-convertible debentures
by the Company; and (b) amendment of the Charter Documents. The
Company and the Promoters shall have provided the A Series Debenture
Holders with a certified true copy of the said consent letter;
(vii) Consent from Union Bank: The Company shall have received in writing,
a consent letter, in a form and manner acceptable to the A Series
Debenture Holders, from Union Bank of India setting forth its approval
to and clearly stating that it does not have any objection inter alia to: (a)
incurring further indebtedness by the issuance of the A Series Debentures
and the B Series Debentures; (b) amendment of the Charter Documents;
The Company and the Promoters shall have provided the A Series
Debenture Holders with a certified true copy of the said consent letter;
(viii) Consent from IL & FS: The Company shall have received in writing, a
consent letter, in a form and manner acceptable to the A Series
Debenture Holders, from IL & FS setting forth its approval to and clearly
stating that it does not inter alia have any objections to the amendment to
the Charter Documents of the Company. The Company and the
Promoters shall have provided the A Series Debenture Holders with a
certified true copy of the said consent letter;
(ix) Development Management Agreement: The Company and RRPL shall
have agreed and finalized the drafts of both the development
management agreement to be executed by each of the Company and
RRPL with the development manager, in a form and manner acceptable
to the A Series Debenture Holders;
(x) Board and Shareholders Resolutions for the Amendment of the
Articles: The Board and the Shareholders of the Company shall have
approved and adopted the amended draft of the Articles in a form and
manner acceptable to the A Series Debenture Holders. The Company
shall have provided the A Series Debenture Holders with a certified true
copy of the Board and Shareholders resolutions pertaining to the
amendment and adoption of the revised Articles, along with the amended
Articles;
(xi) Listing of the A Series Debentures: The Company shall have obtained an
in-principle approval from the BSE for listing of the A Series Debentures
and shall have provided the A Series Debenture Holders with a certified
true copy of the same. The Company shall have made all requisite filings
to seek the in principle approval for the listing of the A Series
Debentures on the BSE, in accordance with the provisions of the Debt
Regulations and as per the terms and conditions set forth in this
disclosure document;
(xii) Merger Filing: The Company shall and the Promoters shall cause the
Company to file the scheme for the amalgamation of Prima Builders
Private Limited with the Company under Section 391 and 394 of the
Companies Act, 1956 with the High Court of Bombay;
66
(xiii) Execution of letters for the unsecured loans of the Company: The
Company shall have executed letter agreements with KRPL, Rustomjee
Constructions Private Limited and Suranjan Holdings & Estate
Developers Private Limited in respect of the unsecured loans availed by
the Company from the aforesaid entities, in a form and manner
acceptable to the A Series Debenture Holders;
(xiv) Execution of the Personal Guarantee to be issued by Mr. Boman R. Irani
in favour of RRPL: Mr. Boman R. Irani shall have executed a personal
guarantee in favour of RRPL ("Personal Guarantee") for an amount of
Rs.121,00,00,000/- (Rupees One Hundred Twenty One Crores Only) and
any other amounts that RRPL may be required to pay if the RRPL
Corporate Guarantee is invoked, to indemnify RRPL against any liability
or loss suffered by RRPL arising out of the RRPL Corporate Guarantee,
in the form and manner acceptable to the A Series Debenture Holders;
(xv) Consent from SBI: RRPL shall have received in writing, a consent letter
from SBI, in a form and manner acceptable to the A Series Debenture
Holders, setting forth its approval to and clearly stating that it does not
have any objection inter alia to (a) incurring further indebtedness by
issuing RRPL NCDs to the Company; (b) amendment of the charter
documents of RRPL; The Company and the Promoters shall have
provided the A Series Debenture Holders with a certified true copy of the
said consent letter;
(xvi) Purchase of 55,950 sq. ft. by RRPL from KRPL: RRPL shall have
purchased 55,950 (fifty five thousand nine hundred fifty) sq. ft. of area in
the Rustomjee Project from KRPL, through a valid and binding
agreement, in a form and manner acceptable to the A Series Debenture
Holders. RRPL shall have provided the A Series Debenture Holders with
a certified true copy of the said agreement;
(xvii) Termination of the Services Agreement executed with KRPL: The
Company and RRPL shall have terminated the services agreements dated
June 15, 2012 and June 30, 2012 respectively executed by each of the
Company and RRPL with KRPL. The Company and RRPL shall have
provided the A Series Debenture Holders with certified true copies of the
documents evidencing such termination;
(xviii) Board and Shareholders Resolutions for the Amendment of the
Articles of RRPL: The board and shareholders of RRPL shall have
approved and adopted the amended draft of the articles of association of
RRPL, in a form and manner acceptable to the A Series Debenture
Holders. RRPL and the Company shall have provided the A Series
Debenture Holders with a certified true copy of the board and
shareholders resolutions of RRPL pertaining to the amendment and
adoption of the revised articles of association of RRPL, along with the
amended articles of association;
(xix) Distribution Escrow Agreement for the Company: The Company shall
67
and the Promoters shall have caused the Company to (a) finalize the
name of the Distribution Escrow Agent; and (b) decide and finalize the
draft of the Distribution Escrow Agreement, in a form and manner
acceptable to the A Series Debenture Holders;
(xx) Certified true copies of Board/ Shareholders Resolutions: The Company,
the Promoters and RRPL shall have provided to the Investor, certified
true copies of their respective board/ shareholder resolutions; (a)
approving the execution of the A Series Transaction Documents and the
performance of the transactions contemplated therein; (b) authorizing the
relevant person as the authorized signatory of the Company and RRPL to
execute the A Series Transaction Documents;
(xxi) Execution of a Corporate Guarantee in favour of the Company:
KRPL shall have executed a corporate guarantee in favour of the
Company ("Corporate Guarantee 3"), for an amount of
Rs.160,00,00,000/- (Rupees One Hundred Sixty Crores Only) and any
other amounts that the Company may be required to be pay if the IL &
FS Corporate Guarantees are invoked, to indemnify the Company against
any liability or loss suffered by the Company arising out of the IL & FS
Corporate Guarantees, in a form and manner acceptable to the A Series
Debenture Holders;
(xxii) Letter Undertaking from the Promoters with respect to the Payments to
the Land Owners: The Promoters shall furnish to the Subscriber a letter
undertaking wherein the total amounts that have been paid by the
Company to the Land Owners under the Joint Development Agreements
shall be represented and stated; in the form and manner acceptable to the
A Series Debenture Holders;
(xxiii) Certificate from an Independent Architect: The Company shall have
provided a certificate from the an independent architect certifying the FSI
potential and the present available FSI for the Project, in a form and
manner acceptable to the A Series Debenture Holders;
(xxiv) Documents in Possession of ICICI: The Promoters shall provide a
letter containing the list of the documents pertaining to the Thane Land
which is in possession of ICICI, pursuant to the ICICI Lending
Agreements, in a form and manner acceptable to the A Series Debenture
Holders;
(xxv) Execution of the Corporate Guarantee 1 and the Corporate Guarantee:
KRPL shall have executed the Corporate Guarantee 1 and the Corporate
Guarantee 2, in the form and manner acceptable to the A Series
Debenture Holders and shall have provided the A Series Debenture
Holders with a certified true copy of the same.
40. Conditions
Subsequent to
Disbursement
(i) Within 6 (six) months of the Deemed Date of Allotment, the Company
and the Promoters shall cause:
(a) termination, revocation and release by IL &FS of the 2 (two)
68
corporate guarantees both dated June 27, 2011 executed by the
Company in favour of IL&FS for an amount of Rs.80,00,00,000/-
(Rupees Eighty Crores Only) each ("IL & FS Corporate
Guarantees"), in respect of guaranteeing the obligations of KRPL
pursuant to the issue of non-convertible debentures by KRPL and
the obligations of Rustomjee Constructions Private Limited
pursuant to the issue of non-convertible debentures by Rustomjee
Constructions Private Limited, under the IL & FS Corporate
Guarantees and upon the termination and release of the IL & FS
Corporate Guarantees by IL &FS, the Corporate Guarantee 3 shall
automatically stand released and discharged as provided
thereunder;
(b) the termination and release of the share pledge by IL & FS created
in its favour by KRPL under the share pledge agreement executed
amongst the Company, KRPL, Rustomjee Constructions Private
Limited and IL&FS for pledge of 16% (sixteen percent) of the
Share Capital of the Company held by KRPL in favour of IL&FS;
(c) release of the charge created by the Company in favour of IL&FS
on the project receivables of the Project Atelier; and
(d) release of the charge created the charge created on 14 (fourteen)
acres of the Thane Land in favour of IL&FS;
The Company shall provide the A Series Debenture Holders with filed a
certified true copy of the e-Form 17 of the Companies (Central
Government's) General Rules & Forms duly filed with the ROC, along
with receipts of filings, in respect of the above;
(e) Transfer of the Land C: Mr. Boman R. Irani shall have transferred
the Land C, as indicated in the map set forth in the A Series DSA
in favour of the Company by way of an agreement, in a form and
manner acceptable to the Investor and shall have paid all stamp
duties, fees, charges, expenses, etc., in this regard, as per the
applicable Law.
(ii) Within 10 (ten) days from the Deemed Date of Allotment the Company
and RRPL shall have applied for the approval of the Central
Government, as required under the Act, for the purposes of the payments
of the development fee by the Company and RRPL to KRPL, under their
respective development management agreement. Upon making of such
application to the Central Government, the Company and RRPL shall
execute their respective Development Management Agreement.
(iii) Within 1 (one) year of the Deemed Date of Allotment, the Company
shall and the Promoters shall cause the Company to update the mutation
records/ entries, 7/12 extracts and all other land records to reflect and
record the name of the Company as the holder of the development rights
with respect to the Land D1 and the Land D2 and owners of the Land C.
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41. Corporate
Guarantees
KRPL shall execute a corporate guarantee ("Corporate Guarantee 1"), in
favour of the A Series Debenture Trustee, for the benefit of the A Series
Debenture Holders, guaranteeing the payment (to A Series Debenture Holders)
of an amount of Rs.50,00,00,000/- (Rupees Fifty Crores Only) plus the Interest
(calculated from the Deemed Date of Allotment until the date of payments by
KRPL under such Corporate Guarantee 1), or the then outstanding Redemption
Amounts, whichever is lower, until the Company acquires title to develop or
right to develop 17,732 (seventeen thousand seven hundred thirty two) sq. mts.
of government land, adjoining or abutting the Thane Land ("Additional
Government Land"), as indicated in the map set forth at the A Series
Debenture Trust Deed and the Company shall have executed valid and binding
agreements in this regard whether through grant of sanad or other conveyance
or document for vesting of title to develop or development rights in favour of
the Company or in any other manner.
If the Company does not acquire title to develop or rights to develop the
Additional Government Land, within 42 (forty two) months from the Deemed
Date of Allotment, then then the A Series Debenture Trustee (or the A Series
Debenture Holders acting through the A Series Debenture Trustee) shall have
the right to invoke the Corporate Guarantee 1. At any time prior to the
acquisition of title to develop or rights to develop the Additional Government
Land by the Company as provided above, if there is an Event of Default and a
Default Notice has been issued, if such Event of Default has not been cured
within the Cure Period, the Corporate Guarantee 1 may also be invoked by the
A Series Debenture Trustee. If the Company does acquire title to develop or
rights to develop the Additional Government Land, within 42 (forty two)
months of the Deemed Date of Allotment, then the Corporate Guarantee 1
shall stand automatically revoked as provided thereunder. It is hereby clarified
that if the Company does not acquire title to develop or rights to develop the
Additional Government Land, it shall not amount to an Event of Default.
KRPL shall also execute an unconditional and irrevocable corporate guarantee
("Corporate Guarantee 2") in favour of the A Series Debenture Trustee, with
the Company as the confirming party, to be exercised and enforced on the
Approved Instructions of the A Series Debenture Holders, to pay to the
Company an amount of Rs.100,00,00,000/- (Rupees One Hundred Crores
Only), along with an accrued interest of 14.5% (fourteen point five percent)
per annum on the said amounts, from the Deemed Date of Allotment until the
date of payment of the said amounts to the Company ("Guaranteed
Amount"), if the Company fails to pay the entire Redemption Amounts to the
A Series Debenture Holders (in accordance with the A Series Debenture Trust
Deed) within a period not exceeding 66 (sixty six) months from the Deemed
Date of Allotment. Notwithstanding anything to the contrary contained herein,
it is clarified that the payment of the Guaranteed Amount by KRPL to the
Company, shall not release the Company of its absolute obligation to repay the
entire Redemption Amounts to the A Series Debenture Holders in accordance
with the provisions of the A Series Debenture Trust Deed. For avoidance of
doubt it is clarified the A Series Debenture Holders shall be free to recover the
Redemption Amounts from the Company, in accordance with the provisions of
the A Series Transaction Documents.
70
42. Event of
Defaults
The occurrence of one or more of the following events shall constitute an
'Event of Default' or 'Events of Default', as applicable under the A Series
Debenture Trust Deed:
(i) If the Issuer and, or, RRPL declare or pay dividend or make any
distributions on their respective share capital or purchase or buys back of
their respective securities or make any other payments to their respective
shareholders without the prior written consent of the Majority A Series
Debenture Holders, save as shall be provided in the Articles.
(ii) General Default.
(a) Any breach or default by the Promoters, the Issuer and, or, RRPL
of any of the provisions of the A Series Debenture Trust Deed;
(b) A default or breach by any of the Promoters, the Issuer and, or,
RRPL of any provisions of the A Series Transaction Documents;
(c) Any act or omission by any of the Promoters, through their agents
or employees, constituting intentional misrepresentation, fraud or
wilful misconduct in respect of or concerning the Issuer and, or,
RRPL;
(d) The A Series Debentures cease to be listed due to an act of the
Issuer or failure of the Issuer to take any necessary actions required
to list or maintain such listing; and
(e) If the Issuer and, or RRPL and, or the Promoters repudiate or
evidence an intention to repudiate the A Series Debenture Trust
Deed or any other A Series Transaction Document.
43. Consequences
of an Event of
Default
(i) Upon the occurrence of any Event of Default, the A Series Debenture
Holders shall have the right to give notice of the alleged Event of Default
("Default Notice") to the Promoters, the Company and, or, RRPL (as the
case maybe).
(ii) The Promoters, the Company and, or, RRPL (as the case maybe) shall
have a period of 60 (sixty) Business Days from the date of the Default
Notice to cure such Event of Default ("Cure Period"). If a Default
Notice has been issued then upon the expiry of the Cure Period, the
Event of Default is not rectified:
(a) if the Event of Default has occurred prior to the expiry of 3 (three)
years from the Deemed Date of Allotment, the A Series Debenture
Trustee, acting on the Approved Instructions, shall have the
absolute right and entitlement by way of a Notice, to require the
Promoters to purchase from the A Series Debenture Holders, all
and not less than all the then outstanding A Series Debentures as a
cash price equivalent to an amount that shall provide a return of an
annualised IRR of 28% (twenty eight percent), Net of Taxes on the
Redemptions Amount, outstanding as on the date of receipt of the
71
said amounts by the A Series Debenture Holders under this sub
clause (a) from the Promoters. The Promoters may at their option
require the Company to immediately redeem all and not less than
all the then outstanding A Series Debentures in full, by payment of
an amount equivalent to the annualized IRR of 28% (twenty eight
percent), Net of Taxes, on the Redemptions Amount, outstanding
as on the date of receipt of the said amounts by the A Series
Debenture Holders under this paragraph (a) from the Company; or,
(b) if the Event of Default has occurred after the expiry of 3 (three)
years from the Deemed Date of Allotment, the A Series Debenture
Trustee, acting on the Approved Instructions, shall have the
absolute right and entitlement by way of a Notice, to require the
Promoters to purchase from the A Series Debenture Holders, all
and not less than all the then outstanding A Series Debentures at a
cash price equivalent to an amount that shall provide a return of an
annualized IRR of 25% (twenty eight percent), Net of Taxes, on
the Redemptions Amount, outstanding as on the date of receipt of
the said amounts by the A Series Debenture Holders under this sub
clause (b) from the Promoters. The Promoters may at their option,
require the Issuer to immediately redeem all and not less than all
the then outstanding A Series Debentures in full, by payment of an
amount equivalent to the annualised IRR of 25% (twenty five
percent), Net of Taxes, on the Redemptions Amount, outstanding
as on the date of receipt of the said amounts by the A Series
Debenture Holders under this paragraph (b) from the Company.
The Promoters shall purchase or the Company shall redeem all and not
less than all the then outstanding A Series Debentures, as applicable, by
making payments set forth in paragraphs (a) and (b), within 90 (ninety)
days of the receipt of the Notice from the A Series Debenture Trustee.
(iii) The A Series Debenture Trustee shall also have the right to, upon
receiving the Approved Instructions, invoke the Corporate Guarantee 1
and, or, the Corporate Guarantee 2, as the case maybe, and appropriate
the proceeds of the Corporate Guarantee 1 against the Redemption
Amounts, then outstanding, if the Event of Default has not been rectified
before the expiry of the Cure Period. The amounts received by the A
Series Debenture Trustee on the invocation of the Corporate Guarantee 1
shall be adjusted towards the amounts due and payable by the Company
and, or, the Promoters to the A Series Debenture Holders. It is hereby
clarified that the amounts received by the Company pursuant to the
invocation of the Corporate Guarantee 2, as provided under this
paragraph shall be deposited in the Project Revenue Account.
(iv) It is hereby clarified that the annualized IRR of 28% (twenty eight
percent) or 25% (twenty five percent), as the case maybe, shall be
calculated until the date of receipt of the amounts set forth in paragraph
(ii) (a) or (b), as applicable, by the A Series Debenture Holders from the
Promoters and, or, the Company (as applicable).
72
(v) Any exercise of rights under Clause 26 against the Promoters shall not be
deemed to be an Event of Default by the Promoters, unless KRPL fail to
immediately pay all amounts under the Corporate Guarantee 1 and the
Corporate Guarantee 2 in terms thereof.
(vi) It is clarified that on the occurrence of an Event of Default vis-à-vis any
of the Promoters or the Company or RRPL, all of the Promoters shall
deemed to be the defaulting party.
(vii) It is agreed that non-payment of the Interest or non -payment of the
Redemption Amounts, on account of there being no sufficient
Distributable Amounts will not be an Event of Default; provided
however that the Interest and the Redemption Amounts shall remain due
and payable and the A Series Debenture Holders shall be fully entitled to
enforce their rights and entitlements under clauses 26 and 42 and
otherwise available to them under the Law. Provided however that, any
breach of clauses 26 and 42 by the Promoters shall be an Event of
Default of the Promoters. Notwithstanding anything to the contrary
contained herein, if there are Distributable Amounts in the Distribution
Escrow Account and the same is not distributed in accordance with the
provisions of the A Series Debenture Trust Deed and the Distribution
Escrow Agreement owing to any acts or defaults of the Promoters, then it
shall be an Event of Default of the Promoters and the Company.
The A Series Debenture Trustee shall have the right to appoint a Director as
its' nominee to the Board of Directors, in accordance with the applicable Laws.
Further, in the event the A Series Debenture Trustee or the B Series Debenture
Trustee, appoints a nominee director in accordance with the A Series DTD or
the B Series DTD, respectively, the B Series Debenture Trustee or the A
Series Debenture Trustee, as applicable, will also be entitled to appoint a
nominee director on the Board of the Company and the Promoters and the
Company undertake that any person nominated by the A Series Debenture
Trustee and, or, the B Series Debenture Trustee to be the Director in
accordance with this paragraph, shall be immediately appointed on the Board
of Directors of the Company.
44. General
Covenants
The Company, RRPL and the Promoters covenant, warrant, represent, assure,
confirm and undertake, jointly and severally, to the A Series Debenture
Holders and their successors in title, assigns, substitutes and replacements as
follows:
(i) Information furnished by the Company and, or, RRPL to the A Series
Debenture Trustee, from time to time, is and shall be true and correct;
(ii) The Company and, or, RRPL shall execute and deliver, from time to
time, within a reasonable time from the time the request is made by the
Majority A Series Debenture Holders, at the Company's expense, such
other documents as shall be reasonably required in the opinion of the A
Series Debenture Holders, in connection with the rights and remedies of
the A Series Debenture Holders granted or provided for by the A Series
73
Transaction Documents, and to consummate the transactions
contemplated therein; and
(iii) The Company, RRPL and KRPL shall not induct a person to their
respective board of directors, who is a director on the board of a
company which has been identified in the RBI's wilful defaulters list or if
such director is himself in the RBI's wilful defaulters list and that in case
such a person is on the board of the Company, RRPL and, or, KRPL,
they shall take expeditious and effective steps for the removal of the
person from the board of directors, provided that, the Company, RRPL or
KRPL has knowledge of the same.
Each of the General Covenants shall be construed as a separate and
independent covenant or undertakings, as the case may be, and shall not be
limited by the terms of any other covenant, save as expressly provided to the
contrary therein.
To the extent required under applicable Laws, the Company shall file all
documents, deeds and agreements (including any A Series Transaction
Document, if required) with any Governmental Authority, the Stock Exchange
or any other person within the time period prescribed under the relevant
applicable Laws.
45. Restrictive
Covenants
The Company and RRPL covenant that so long as the A Series Debentures are
outstanding, without the prior written approval of the A Series Debenture
Holders, they shall not:
(i) Undertak
e or permit any merger or any scheme of arrangement with the
shareholders under the Section 391 and 394 of the Act or similar
provision that shall be present under the new companies act that may
replace the existing Act;
(ii) Amend
or alter the memorandum or articles of association in a manner which
would materially prejudice the rights and interests of the A Series
Debenture Holders;
(iii) Apply to a court for winding up of the Issuer and, or, RRPL;
(iv) Declare or pay any dividend or make any payouts to their respective
shareholders or make any distribution on their share capital or purchase,
redeem, buyback or otherwise make any payments in respect thereof;
(v) Any sale, transfer, lease, license, assignment, mortgage, Encumbrance,
pledge, hypothecation, grant of security interest in, exchange or other
disposition of any assets/ properties of the Company and, or, RRPL,
including but not limited to rights in the Thane Land, the Company
Project, the MHAHA Land, the Rustomjee Project or any part thereof,
any built-up area, FSI or any other developable area on the Thane Land
or the MHADA Land or the Company Project or the Rustomjee Project
74
to any Person in any manner whatsoever; except (a) in accordance with
the A Series NCDs Transaction Documents; or (b) allotment or sale of
units/ spaces/ built up area/developed plots in the Company Project and,
or, the Rustomjee Project to their respective customers at or above the
price approved under the Approved Business Plan and, or, the RRPL
Approved Business Plan; or (c) sale of scrap by the Company and, or,
RRPL of an amount not exceeding Rs.2,00,00,000/- (Rupees Two Crores
Only) individually by the Company and, or, RRPL, on a cumulative basis
in any financial year; or (d) sale, transfer, lease, license or any other
disposition in favour of a society or any other body or association formed
by the flat buyers of the buildings of the Project and, or, the Rustomjee
Project, under the Maharashtra Ownership of Flats (Regulation of the
Promotion of Construction, Sale, Management and Transfer) Act, 1963
and the rules made thereunder and, or, under the Maharashtra Apartment
Ownership Act, 1970, as amended from time to time; (e) the transfer of
the Promoters Saleable Area and the Schools and Medical Facilities,
except as shall be provided in the Articles;
(vi) Any material amendment, change, modification or termination of the
Joint Development Agreement or the Rustomjee Project Agreements; and
(vii) Alter their capital structure including through issuance of any new
securities or creation of new classes of securities or reduction of share
capital or redemption of securities, except any issuance of the shares or
securities to their existing shareholders in a manner contemplated under
their respective articles of association if such alteration effects the rights
and entitlements of the A Series Debenture Holders.
Each of the Restrictive Covenants shall be construed as a separate and
independent covenant or undertaking, as the case may be, and shall not be
limited by the terms of any other covenant, save as expressly provided to the
contrary therein.
46. Financial
Covenants
The Issuer, RRPL and the Promoters covenant and undertake, jointly and
severally, to the A Series Debenture Holders and their successors in title,
assigns, substitutes and replacements :
(i) The Issuer and, or RRPL shall maintain records, in connection with the
operations and financial condition of the Issuer and, or RRPL; and
(ii) Such records as mentioned herein above, shall be open to examination by
the representative appointed by the Majority A Series Debenture Holders
and as required under the applicable Law.
Each of the Financial Covenants shall be construed as a separate and
independent covenant or undertaking, as the case may be, and shall not be
limited by the terms of any other covenant, save as expressly provided to the
contrary therein.
47. Information
Covenants
The Issuer, RRPL and the Promoters covenant, warrant, represent, assure,
confirm and undertake, jointly and severally to the A Series Debenture Holders
75
and their successors in title, assigns, substitutes and replacements, that for so
long as any amount is outstanding under the A Series Debenture Trust Deed,
they shall promptly provide to the A Series Debenture Trustee, the following:
(i) Provision of Information, Documents and Certificates by the Issuer and
RRPL.
(a) audited consolidated financial statements (viz. audited balance
sheet, profit and loss account and cash flow statement) of the Issuer
and RRPL within 120 (one hundred twenty) days of the end of
each financial year, duly certified by a director of the Issuer and
RRPL respectively;
(b) an end use certificate in a form and manner acceptable to the A
Series Debenture Trustee on a quarterly basis in accordance with
the Debenture Trustee Regulations;
(c) report containing the details on the number and nature of
grievances received from the A Series Debenture Holders and
resolved by the Issuer as required under the applicable Law;
(d) on a quarterly basis, an updated list of names and address of all the
A Series Debenture Holders and the number of the A Series
Debentures held by each A Series Debenture Holder;
(e) any legal proceeding pending or threatened, regulatory notices or
judicial orders against the Issuer or any dispute between the Issuer
and any Governmental Authority, which could have a material
adverse effect or any legal proceeding pending or threatened with
respect to or in relation of the A Series Transaction Documents;
(f)at the end of each Financial Year after the date of issue of the A Series
Debentures, an annual credit rating in respect of the A Series
Debentures;
(g) any other information as the A Series Debenture Trustee (by itself
or acting on the Approved Instructions) may reasonably request,
including without limitation those required for the purposes of
completing the KYC compliances of the Issuer; and
(h) any other document/ information required to be provided to the A
Series Debenture Trustee in accordance with the applicable Law,
including, without limitation, the Debt Regulations and as may be
required by the A Series Debenture Trustee.
(ii) The Issuer shall submit to the Stock Exchange all information and
documents that may be required under the applicable Law.
(iii) The Issuer shall, prior to its occurrence, inform the A Series Debenture
Trustee of any proposed change in the nature and conduct of the
Business.
76
(iv) The Issuer shall promptly provide the following information in respect of
the Issuer and RRPL to the A Series Debenture Trustee and the A Series
Debenture Holders, but in all cases within 15 (fifteen) Business Days
after any officer of the Issuer and, or the Promoters obtain knowledge
thereof:
(a) any event which constitutes an Event of Default, specifying the
nature of such Event of Default and any steps the Issuer, RRPL or
the Promoters are taking and propose to take to remedy the same;
(b) any Notice of any application made for winding up or receipt of
any statutory notice of winding up under the provisions of the Act
or any other notice under any other applicable Law or otherwise of
any suit or legal process intended to be filed or initiated against the
Issuer and, or RRPL and affecting the title to the properties and
assets of the Issuer and, or RRPL or if a receiver, liquidator or
custodian (or any such similar person) is appointed of any of the
properties or business or undertakings of the Issuer and, or RRPL;
and
(c) give notice of any event(s) as described in above and, or of any
event similar in nature thereto in writing, specifying the nature of
such event.
(v) Redressal of the A Series Debenture Holders' Grievances.
The Issuer shall furnish to the A Series Debenture Trustee details of all
grievances received from the A Series Debenture Holders and the steps
taken by the Issuer to redress the same. At the request of any A Series
Debenture Holder, the A Series Debenture Trustee shall, as deemed fit by
the Issuer, by Notice to the Issuer call upon the Issuer to take appropriate
steps to redress such grievances and shall, if necessary, at the request of
any A Series Debenture Holder call a Meeting of the A Series Debenture
Holders.
Each of the Information Covenants shall be construed as a separate and
independent covenant or undertaking, as the case may be, and shall not be
limited by the terms of any other covenant, save as expressly provided to the
contrary therein.
48. Role and
Responsibilities
of the
Debenture
Trustee.
The details of the role and responsibilities of the A Series Debenture Trustee
shall be as set forth in the A Series Debenture Trust Deed.
49. Representation
s and
Warranties
The representations and warranties of the Promoters, the Issuer and RRPL are
as set forth in the A Series Debenture Trust Deed.
77
50. Indemnity The Promoters have agreed to indemnify the Issuer, RRPL and the A Series
Debenture Holders as set forth in the A Series Debenture Trust Deed.
51. Meetings of the
Debenture
Holders
Any meeting of the A Series Debenture Holders shall be held in accordance
with the provisions set out in the A Series Debenture Trust Deed.
52. Governing Law
and
Jurisdiction
Indian law and courts of Mumbai will have exclusive jurisdiction. The A
Series Transaction Documents shall be governed and construed exclusively in
accordance with the laws of India.
53. Provisions
related to Cross
Default Clause
N.A.
54. Costs and
Expenses
(A) Cost and Expenses.
(i) All costs, charges and fees, stamp duties, bank charges, costs and
expenses for the issue of the A Series Debentures, fees of the Utilization
Escrow Agent under the Utilization Escrow Agreement, fees of the
Distribution Escrow Agent under the Distribution Escrow Agreement,
the A Series Debenture Trustee's fees, brokerage/ arrangement fees,
Taxes/ costs towards registration of the A Series Debenture Trust Deed,
costs and expenses in connection with enforcement or preservation of
any rights under any A Series Transaction Document; all costs, charges
and expenses in relation to the listing of the A Series Debentures; or
investigating any Event of Default, shall be borne by the Company.
(ii) In the event that the Company fails to pay the monies referred to in
paragraph (ii) above, the A Series Debenture Trustee shall be at liberty
(but shall not be obliged) to pay the same and charge the same to the
Company. The Company shall reimburse all sums paid by the A Series
Debenture Trustee in accordance with the provisions contained herein
("Reimbursables").
(iii) The Company shall repay the Reimbursables to the A Series Debenture
Trustee within a period not exceeding 30 (thirty) Business Days from the
date of the Notice of demand accompanied by a receipt evidencing the
same by the A Series Debenture Trustee.
(iv) In case of default in making such reimbursement within the period set
forth in paragraph (iii) above, the Company shall pay an interest of 2
(two percent)% p.a. on such reimbursements from the date of incurring
of the expenditure on the Reimbursable by the A Series Debenture
Trustee, until the full payment of such amounts.
(v) Enforcement costs.
The Company shall, forthwith on demand by the A Series Debenture
Trustee, pay the amount of all costs and expenses (including legal fees)
78
incurred by the A Series Debenture Trustee in connection with the
enforcement of any of their rights/ entitlements under the A Series
Debenture Trust Deed and, or, any A Series Transaction Document,
within a period of 7 (seven) Business Days from the date of any
judgment/ order/ award enforcing any such provision of the A Series
Debenture Trust Deed.
(B) Stamp Duty.
The Company shall pay and, within 5 (five) days of demand, indemnify
the A Series Debenture Holders against any cost, loss or liability
including, any penalty the A Series Debenture Holders incur in relation
to all stamp duty and registration payable in respect of the issue of and
subscription to the A Series Debentures, execution of the Utilization
Escrow Agreement, the Corporate Guarantee 1, the Corporate Guarantee
2 and the Distribution Escrow Agreement.
79
ANNEXURE 2: APPLICATION FORM
KAPSTONE CONSTRUCTIONS PRIVATE LIMITED 702, Natraj, Western Expressway
Highway, MV Road Junction, Andheri (E) 400 069
DEBENTURE SERIES APPLICATION FORM SERIAL NO.
RATED, REDEEMABLE, CUMULATIVE, TRANSFERABLE AND INTEREST BEARING
NON-CONVERTIBLE DEBENTURES
Rs.1,00,00,000/- (RUPEES ONE CRORE ONLY) EACH AGGREGATING TO RS.300,00,00,000
(RUPEES THREE HUNDRED CRORES ONLY), FULLY PAID UP FOR CASH AT PAR TO
THE FACE VALUE
A SERIES DEBENTURES APPLIED FOR: (Minimum application of ____ A Series Debentures, in increments of ____ A Series Debenture)
Number of A Series Debentures________ In words __________________________________
Amount Rs. __________________ in words Rupees __________________________
DETAILS OF PAYMENT:
Cheque / Demand Draft
No. _____________ Drawn on_____________________________________________
Funds transferred to _______________ via RTGS/NEFT/SWIFT
Dated ____________
Total Amount Enclosed
(In Figures) _____________ (In words) ______________________________________
APPLICANT'S NAME IN FULL (CAPITALS) SPECIMEN SIGNATURE
APPLICANT'S ADDRESS
ADDRESS
STREET
CITY
PIN PHONE FAX
80
APPLICANT'S PAN/GIR NO. _____________ IT CIRCLE/WARD/DISTRICT ____
WE ARE ( ) COMPANY ( ) OTHERS ( ) SPECIFY __________
WE CONFIRM RESIDENTIAL STATUS AS NON-RESIDENT
TAX STATUS NON EXEMPT ( ) EXEMPT ( ) (IF EXEMPT PLEASE SPECIFY) ____________
(IF EXEMPT, PLEASE PROVIDE SUPPORTING DOCUMENTS FROM INCOME TAX
AUTHORITIES)
We have read and understood the Terms and Conditions of the issue of A Series Debentures described in
the Disclosure Document and. we wish to apply for allotment of these A Series Debentures. We request
you to please place our name(s) on the Register of Holders.
Name of the Authorised
Signatory(ies)
Designation Signature
Applicant's
Signature
We the undersigned, are agreeable to holding the A Series Debentures of the Company in dematerialised
form. Details of my/our Beneficial Owner Account are given below:
DEPOSITORY NSDL ( ) CDSL ( )
DEPOSITORY PARTICIPANT NAME
DP-ID
BENEFICIARY ACCOUNT NUMBER
NAME OF THE APPLICANT(S)
FOR OFFICE USE ONLY
DATE OF RECEIPT ________________ DATE OF CLEARANCE ________________
(Note: Cheque and Drafts are subject to realisation)
We understand and confirm that the information provided in the Disclosure Document is provided by the
Issuer and the same has not been verified by any legal advisors to the Issuer and other intermediaries and
their agents and advisors associated with this Issue. We confirm that we have for the purpose of investing
in these A Series Debentures carried out our own due diligence and made our own decisions with respect
to investment in these A Series Debentures and have not relied on any representations made by anyone
other than the Issuer, if any.
We understand that: i) in case of allotment of A Series Debentures to us, our Beneficiary Account as
mentioned above would get credited to the extent of allotted A Series Debentures, ii) the Applicant must
ensure that the sequence of names as mentioned in the Application Form matches the sequence of name
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held with our Depository Participant, iii) if the names of the Applicant in this application are not identical
and also not in the same order as the Beneficiary Account details with the above mentioned Depository
Participant.
Applicant's
Signature
FOR OFFICE USE ONLY
DATE OF RECEIPT ______________________ DATE OF CLEARANCE _________________
(Note : Cheque and Drafts are subject to realisation)
-------------------------------------------------(TEAR HERE)--------------------------------------------
[·]- ACKNOWLEDGMENT SLIP
(To be filled in by Applicant) SERIAL NO.
Received from _______________________________________________
Address________________________________________________________________
______________________________________________________________________
Cheque/Draft/UTR # ______________ Drawn on _______________________________ for
Rs. _____________ on account of application of _____________________ A Series Debenture
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ANNEXURE 3: CONSENT LETTER FROM THE A SERIES DEBENTURE TRUSTEE
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ANNEXURE 4: CREDIT RATING LETTER