INVESTMENT AGREEMENT

BETWEEN

____________________LTD
AND

MR.

INVESTMENT AGREEMENT
THIS INVESTMENT AGREEMENT IS MADE AND EXECUTED ON THIS THE ___DAY OF ____
2014 AT ______________, BY AND BETWEEN:
____________________________represented by its _______ Mr.____________,
hereinafter referred to as the COMPANY (which expression will unless repugnant to the
context or contrary to the meaning thereof be deemed to mean and include its successors-ininterest and permit assignees)
AND
MR.______________, ___________ Hereinafter referred as the Investor, (which expression
shall, unless it be repugnant to the context or meaning thereof, be deemed to mean and include
[its successors and permitted assigns]) of the Second Part;
WHEREAS:
(A)
The Company is a public limited company incorporated under the Laws of India and is
engaged interalia in the business of managing and operating _____________________and such
other activities in the field of education []1 (Business) through itself and/or its Specified
Subsidiaries. A brief description of the Company and its Specified Subsidiaries is set out at
Schedule 2 hereto.
(B)
As on the date hereof, the authorised share capital of the Company is Rs.____________
(Rupees_________________] divided into __________Equity Shares] and the issued and paid
up share capital of the Company is Rs._______ consisting of ________Equity Shares.
(C)
The Company is promoted by the Promoters, who hold collectively
___________Equity Shares constituting []% of the fully paid up share capital of the Company,
on a Fully Diluted Basis, as set out in Part A of Schedule 1 hereto, and are directly and indirectly
in control of the Company and its management. The current shareholding pattern of the
Company, on a Fully Diluted Basis, is set out in Part A of Schedule 1 hereto.
(D)

The Investor is also in the field of education and has expressed interest in __________.

(E)
The Investor showed interest in investing in the Company by subscribing to [] Equity
Shares (as defined below) in the Company (together, the Subscription Shares) and purchase
[] Equity Shares of the Company from the Promoters (the Sale Shares), on and subject to the
terms and conditions contained herein, and the Investor has, subject as aforesaid, agreed to
purchase the Sale Shares and subscribe to the Subscription Shares and further the Company and
the Promoters have, in consideration of the aforesaid, agreed to provide to the Investor, the
rights contained herein.
(F)
This Agreement sets out the agreement and relationship between the Parties hereto and
their rights and obligations in relation to the investment in the Subscription Shares (defined
below) by the Investor and other matters in connection therewith.
THE PARTIES HERETO AGREE as follows:
1.

DEFINITIONS AND INTERPRETATION

Definitions
1.1

In this Agreement, including in the Recitals, and unless the context requires otherwise, the
following words and expressions shall have the following meanings:

Accounts means the balance sheet and cash flow statement of the Company and each of the
Specified Subsidiaries as at the Accounts Date and the profit and loss account of the Company
and each of the Specified Subsidiaries in respect of the Financial Year ended on the Accounts
Date, together with any notes, reports, statements or documents included in or annexed to them,
all of which are certified by the auditors of the Company and each of the Specified Subsidiaries
and shall further include the unaudited financial statements of the Societies as of the Accounts
Date;
Accounts Date for the Company and each of the Specified Subsidiaries means [March 31,
2011];
Act means the Indian Companies Act, 1956;
Affiliate means, in relation to any Person (the Subject), any Person controlled, directly or
indirectly, by that Subject, any Person that controls, directly or indirectly, that Subject, or any
Person under common control with that Subject or, where the Subject is a natural Person, any
Relative (as such term is defined in the Act) of such Subject. For the purpose of this definition:
(i)

Control (and all forms thereof) means the power to direct the management and
policies of a Person, whether through the ownership of voting capital, by contract or
otherwise;

(ii)

A holding or subsidiary company of any Person shall be deemed to be an Affiliate of

that Person; and

(iii)

The Group Companies shall not be Affiliates of the Investor Group;

Without limiting the generality of the foregoing, with respect to the Investor, Affiliate shall
include any Investor Related Party;
Agreement means this agreement together with its Schedules and Exhibits;
Articles means articles of association of the Company;
Board means the board of directors of the Company, and where the context so permits,
including any duly appointed committee thereof from time to time;
Business shall have the meaning set out in Recital (A);
Business Day means a day (excluding Saturdays and Sundays) on which banks generally are
open in [Hyderabad, India; Bangalore, India; Port Louis, Mauritius] for the transaction of normal
banking business;
Business Plan means the business plan prepared by or on behalf of the Promoters and the
Company, including details of operations, financials, capital expenditure, and other relevant
targets, and the documents annexed to that plan in Agreed Form [and annexed as [Error!
Reference source not found.] hereto];
Completion means the occurrence of the actions mentioned in Clause ____;

Completion Date shall have the meaning set out in Clause _____;
Confidential Information means all information disclosed by the Company to the other
Parties and designated as confidential;
Connected Person/Concern of the Company includes:(i)

any company under the same management (as defined by Section 370 (1-B) of the
Act) as the Company;

(ii)

any member, director, officer, key management employee of the Company or any
Affiliate of the Company;

(iii)

the Promoters or any Affiliate of the Promoters;

(iv)

any director of the Company or of any holding company or Subsidiary of the

Company or of any Affiliate of the Company;

(v)

any trust in which the Company, the Promoters or any Affiliate of the Promoters is
a trustee or beneficiary;

(vi)

the entities mutually agreed between the Company and the Investor as being
Connected Persons/Concerns;

(vii)

any firm or unlisted company in which the Company or the Promoters or any
director of the Promoters or the Company is a partner, shareholder or director or
has any share, control or interest;

(viii)

any listed company in which the Company, the Promoters, any director of the
Company or the Promoters, or any Affiliate or partner of any such director is a
director or hold/s shares exceeding [5%] of the paid up equity share capital of such
listed company;

(ix)

Any company, the board of directors, the managing director or manager whereof
acts or is accustomed to act in accordance with the directions or instructions of the
Board of Directors of the Company or the Promoters.

Consent means any consent, approval, authorisation, waiver, permit, grant, franchise,
concession, agreement, license, certificate, exemption, order, registration, declaration, filing,
report or notice of, with, to, from or by any Person;
Contract means all loan agreements, indentures, letters of credit (including related letter of
credit applications and reimbursement obligations), mortgages, security agreements, pledge
agreements, deeds of trust, bonds, notes, guarantees, surety obligations, warranties, licenses,
franchises, permits, powers of attorney, purchase orders, Leases, and other agreements, contracts,
instruments, obligations, offers, legally binding commitments, arrangements and understandings,
written or oral;
Effective Date means the date of execution of this Agreement;
Encumbrance means any encumbrance including, without limitation, any claim, deed of trust,
right of others, security interest, legal burden, title retention agreement, Lease, covenant,
debenture, mortgage, pledge, charge, hypothecation, lien, deposit by way of security, bill of sale,
option interest, proxy, beneficial ownership (including usufruct and similar entitlements),

encroachment, public right, easement, common right, way leave, any provisional or executional
attachment and any other interest held by a third party or any agreement, arrangement or
obligation to create any of the foregoing;
Environmental Laws means any Law, statute, rule, regulation, order, ordinance, decree,
injunction, judgment, government restriction or any other requirement of law (including
common law) regulating or relating to human health, safety, natural resources, noise or the
environment, including, without limitation, laws relating to contamination and the use,
generation, management, handling, transport, treatment, disposal, storage, release or threatened
release of Hazardous Substances;
Equity Shares means the equity shares of the Company having a face value of [Rs. 10
(Rupees Ten only)] each;
Equity Subscription Price means a price of Rs. [] per Equity Share, aggregating to Rs. [] in
respect of all Equity Shares forming part of the Subscription Shares;
Events of Default shall have the meaning set out in Clause _____;
Exchanges means the Bombay Stock Exchange Limited, the National Stock Exchange of
India Limited (including, in either case, any successor thereto) and any internationally recognised
stock exchange or quotation system mutually agreed upon by the Company and the Investor;
Financial Year means a financial year commencing on 1 April and ending on 31 March in the
immediately succeeding year;
Fully Diluted Basis means the assumption that all options, warrants or other securities or
instruments convertible into equity shares of any nature or any other rights to acquire Equity
Shares or any other existing or future classes of capital of the Company have been exercised or
converted, as applicable, in full, regardless of whether any such options, warrants, convertible
securities or instruments or other rights are then vested or exercisable or convertible in
accordance with their terms;
Governmental Authority includes any nation or government, any state or other political
subdivision thereof; any entity, authority or body exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government, including, without
limitation, any government authority, agency, department, board, commission or instrumentality
of any nation or any political subdivision thereof; any court, tribunal or arbitrator; and any selfregulatory organisation; and includes SEBI, recognised stock exchanges or quotation systems, the
RBI and the FIPB;
Governmental Approvals means any consent, approval, authorisation, waiver, permit, grant,
franchise, concession, agreement, license, certificate, exemption, order, registration, declaration,
filing, report or notice of, with or to any Governmental Authority;
Indebtedness as applied to any Person, means, without duplication, (a) all indebtedness for
borrowed money, (b) all obligations evidenced by a note, bond, debenture, letter of credit, draft
or similar instrument, (c) that portion of obligations with respect to capital leases that is properly
classified as a liability on a balance sheet in conformity with Generally Accepted Accounting
Principles in India (GAAP), (d) notes payable and drafts accepted representing extensions of
credit, (e) any obligation owed for all or any part of the deferred purchase price of property or
services, (f) all guarantees of any nature extended by such Person with respect to Indebtedness of
any other Person and (g) all indebtedness and obligations of the types described in the foregoing
clauses (a) through (f) to the extent secured by any Encumbrance on any property or asset owned

or held by that Person regardless of whether the indebtedness secured thereby shall have been
assumed by that Person or is non-recourse to the credit of that Person;
Intellectual Property Rights means all patents, trademarks, service marks, logos, get-up,
trade names, internet domain names, rights in designs, copyright (including rights in computer
software) and moral rights, database rights, semi-conductor topography rights, utility models,
rights in know-how and other intellectual property rights, in each case whether registered or
unregistered and including applications for registration, and all rights or forms of protection
having equivalent or similar effect anywhere in the world which are held or beneficially owned
by, the Company;
Investment Amount means a sum of Rs. [], being the sum of the aggregate CCPS
Subscription Price and the aggregate Equity Subscription Price and the aggregate Sale Price;
Investors Consent means the prior written consent of the Investor;
Investor Director shall have the meaning set out in Clause ____;
1.2
Investors Shares means the Equity Shares and other securities of the
Company from time to time held by the Investor and any Equity Shares or securities of the
Company at any time acquired by the Investor so long as such Equity Shares and securities are
held by the Investor ;
Law includes all statutes, enactments, acts of legislature or parliament, laws, ordinances, rules,
bye-laws, regulations, notifications, guidelines, policies, directions, directives and orders of any
Government, statutory authority, tribunal, board, court or recognized stock exchange and, if
applicable, international treaties and regulations;
Leases means real property and equipment leases, sub-leases, licenses and occupancy
agreements and notices;
Litigation includes any action, cause of action, claim, demand, suit, proceeding, citation,
summons, subpoena, inquiry or investigation of any nature, civil, criminal, regulatory or
otherwise, in law or in equity, pending or threatened, by or before any court, tribunal, arbitrator
or other Governmental Authority;
Liquidation Event means any dissolution, liquidation or Winding Up, insolvency, whether
voluntary or involuntary, by an order of a court of competent jurisdiction;
Liquidity Event means a transaction or a series of transactions, including, without limitation,
a merger or other form of corporate reorganization; any exercise of drag along, tag along or
similar rights; strategic sale, which results in the acquisition of substantial assets or securities
(including the Investors Shares) of the Company in whole or in part, or results in the acquisition
of Control (either directly or indirectly) over the Company, by a third party and includes any
other transaction or series of transactions in which the Companys shareholders do not own the
majority of the outstanding shares in the surviving entity and any sale, lease, licence or other
transfer of all or substantially all of the Companys assets or any such similar transaction but shall
exclude the Scheme of Arrangement in Company Petition No. [] pending before the High
Court of Judicature of Andhra Pradesh;
Losses mean all direct and actual, losses, claims, demands, liabilities, obligations, fines,
expenses, royalties, Litigation, deficiencies, costs, and damages , including interests and penalties
with respect thereto and out-of-pocket expenses, including reasonable attorneys and
accountants fees and disbursements;

Management Accounts means the un-audited management accounts relating to the

Company [and the Specified Subsidiaries] drawn up to [] (the Management Accounts
Date);
Material Adverse Effect means any, (a) event, occurrence, fact, condition, change,
development or effect that is, or may reasonably be, materially adverse to the valuation, business,
operations, results of operations, financial condition ), properties (including intangible
properties), assets (including intangible assets) or liabilities of the Company, any Subsidiary
and/or the Business and / or the business of the Specified Subsidiaries which materially impairs
the ability of the Company, its Subsidiaries or the Promoters to perform their respective
obligations hereunder; Marketing Information means all information relating to the
marketing of any products or services, including customer names and lists, sales targets, sales
statistics, market share statistics, marketing surveys and reports, marketing research and any
advertising or other promotional material;
Memorandum means memorandum of association of the Company;
Organisational Documents means the certificate of incorporation, charter, bylaws,
Memorandum and Articles, articles of formation, regulations, operating agreement, certificate of
limited partnership, partnership agreement, and all other similar documents, instruments or
certificates executed, adopted, or filed in connection with the creation, formation, or organisation
of a Person, including any amendments thereto;
Parties means the parties to this Agreement (and Party shall be construed accordingly);
Pension Scheme means the existing schemes provided by the Company for the benefit of the
employees of the Company and listed in paragraph [to be inserted] of the Disclosure Letter;
Permission means any planning permission, approval or other equivalent Consent,
authorisation or licence given or deemed to be given pursuant to Planning and Zoning
Legislation and includes all conditions attached to it;
Person(s) means any individual, sole proprietorship, unincorporated association,
unincorporated organisation, body corporate, corporation, company, partnership, unlimited or
limited liability company, joint venture, Government Authority or trust or any other entity or
organisation;
Properties means the leasehold and / or freehold properties of the Company and the
Specified Subsidiaries and described in Error! Reference source not found.;
RBI means the Reserve Bank of India;
Representatives means, as to any Person, its accountants, counsels, consultants (including
actuarial, and industry consultants), officers, directors, employees, agents and other advisors;
Required Governmental Approvals means such Governmental Approvals, if any, as may be
necessary or advisable for the acquisition of the Investors Shares by the Investor on the terms
contained herein and the consumation of the transactions contemplated herein, including,
without limitation, any Government Approvals which are granted automatically contingent upon
requisite filing of specified documents and/or reports being made;
Sale Price means the sale price for the Sale Shares, being Rs. [] per Sale Share and
aggregating to Rs. [];

SEBI means the Securities and Exchange Board of India;

Shareholders Meeting shall have the meaning set out in Clause ____;
Subscription Shares shall have the meaning set out in _________;
Subsidiaries shall have the meaning given to such term in the Act and for the purposes of the
Company shall include the following entities, namely (i) ______________ and shall further
include future subsidiaries of the Company;
Tax or Taxation means any central, federal, state, local or foreign income, alternative,
minimum, accumulated earnings, personal, holding company, franchise, share capital, profits,
windfall profits, gross receipts, sales, use, value added, transfer, registration, transaction,
documentary, recording, listing, stamp, premium, excise, customs, severance, environmental, real
property, personal property, ad valorem, occupancy, license, occupation, wage, withholding,
provident fund, insurance, gratuity, employment, payroll, social security, disability, workers
compensation, withholding, dividend or other similar tax, duty, fee, contribution, levy, impost,
assessment or other governmental charge or deficiencies thereof (including all interests,
surcharges, fines and penalties thereon and additions thereto) due, payable, levied, imposed upon
or claimed to be owed;
Transfer includes any transfer, assignment, sale, pledge, disposal, lease or Encumbrance;
Warranties means the representations and warranties provided by the Company and the
Promoters, and set out in Clause _______hereto;
Winding Up means any voluntary or involuntary liquidation, dissolution or winding up of the
Company as defined in the Act; and
1.3

INTERPRETATION

1.4

In this Agreement, unless the context requires otherwise:

(i)

the headings are inserted for ease of reference only and shall not affect the
construction or interpretation of this Agreement;

(ii)

references to one gender include all genders;

(iii)

any reference to any enactment of statutory provision is a reference to it as it may

have been, or may from time to time be, amended, modified, consolidated or reenacted (with or without modification) and includes all instruments or orders made
under such enactment;

(iv)

words in the singular shall include the plural and vice versa;

(v)

any reference to Clause, Schedule or Appendix shall be deemed to be a reference to

a Clause, Schedule or Appendix of this Agreement;

(vi)

references to an agreement or document shall be construed as a reference to

such agreement or document as the same may have been amended, varied,
supplemented or novated in writing at the relevant time in accordance with the
requirements of such agreement or document and, if applicable, of this Agreement
with respect to amendments.

(vii) any reference to a Party to this Agreement shall include, in the case of a body
corporate, references to its successors and permitted assigns and in the case of a
natural person, to his or her heirs, executors, administrators and legal
representatives, each of whom shall be bound by the provisions of this Agreement
in the same manner as the Party itself is bound;
(viii) any reference in this Agreement to an amount in US Dollars shall include its market
rate equivalent (using official RBI published rates) at the commencement of business
on the relevant date in Indian Rupees;
(ix)

any reference to a document in Agreed Form is to a document in a form agreed

between Company and the Investor and initialled for the purpose of identification
by or on behalf of each of them (in each case with such amendments as may be
agreed by or on behalf of the Parties);

(x)

"in writing" or "written" includes any communication made by letter or facsimile or

e-mail;

(xi)

the words hereby, herein, hereof, hereunder and words of similar import
refer to this Agreement as a whole (including any Schedules and Exhibits hereto)
and not merely to the specific article, Clause or paragraph in which such word
appears;

(xii) the words "include", "including" and "in particular" shall be construed as being by
way of illustration or emphasis only and shall not be construed as, nor shall they take
effect as, limiting the generality of any preceding words;
(xiii) where a wider construction is possible, the words "other" and "otherwise" shall not
be construed ejusdem generis with any foregoing words; and
(xiv) securities has the meaning given to it in the Securities Contracts (Regulation) Act,
1956.
1.5

No provisions of this Agreement shall be interpreted in favour of, or against, any Party by
reason of the extent to which such Party or its counsel participated in the drafting hereof
or by reason of the extent to which any such provision is inconsistent with any prior draft
hereof.

2.
AGREEMENT TO INVEST IN THE SECURITIES OF THE COMPANY AND USE OF
PROCEEDS
Subscription to Equity Shares and purchase of the Sale Shares
2.1

On and subject to the terms and conditions contained in this Agreement, and subject to
the fulfilment of the Conditions Precedent to the satisfaction of the Investor in its
discretion, or waiver or extension by the Investor of one or more Conditions Precedent,
the Investor agrees, on the First Completion Date to subscribe to, and the Company
shall issue and allot to the Investor:
(i) ______________ Equity Shares of the Company ranking pari passu in all
respects with the existing Equity Shares, including as to entitlement to
dividends, at Rs. _________ (Rupees_____________ only) per Equity Share
(aggregating to Rs. __________only) all together aggregating to Rs. [] (Rupees
[] only) (Subscription Price).

On the Completion Date, upon issue and allotment of the Subscription Shares to the
Investor, the Subscription Shares shall represent [___%] of the total issued share capital
of the Company on a Fully Diluted Basis in accordance with the terms and conditions of
the Agreement.
2.2

The above subscription and purchase may be made in one or more tranches, at such times
and in such proportions, as mutually determined by the Investor and the Company
and/or the Promoters. The provisions of Clause _______ shall apply mutatis mutandis in
respect of each tranche, so that references therein to the Subscription Shares, Sale Shares
and the Subscription Price and Sale Price shall be deemed to be references to the
concerned tranche of the Subscription Shares and the Subscription Price and of the Sale
Shares and the Sale Price.

2.3

In consideration of the Investor having agreed to subscribe to the Subscription Shares and
purchase the Sale Shares on the terms and conditions contained herein and for other good,
valuable and valid consideration, including the Investment Amount, the receipt of which
the Company and the Promoters hereby acknowledge, the Company and the Promoters
agree to provide the Investor with the rights as set out in this Agreement.

2.4

The Equity Shares allotted to the Investor shall at all times rank pari passu with the existing
Equity Shares of the Company with respect to all rights, but not limited to voting rights,
dividends and rights issuance.

3.

COMPLETION

3.1

On the Completion Date _______, the Investor shall give instructions to its bankers to
remit the Subscription Price to the bank account of the Company by way of wire transfer,
the details of which are set out below (Company Account):
Name of the Bank:
Account Name:
Account Number:
IFSC Code: (if applicable)

3.2

Each of the Promoter Account and the Company Account shall be a no-lien account
and the Company shall have provided irrevocable instructions to the bank (such
instructions to be in a form satisfactory to the Investor) that:
(i)

the Investment Amount deposited therein shall not be debited from the
Company Account or the Promoter Account until the Investor has confirmed
the receipt of the relevant board resolution(s) issuing and allotting the
Subscription Shares to the Investor and the duly stamped and validly issued
share certificates representing the Subscription Shares (issued in the name of the
Investor) to the Company and the receipt of the share certificates representing
the Sale Shares as endorsed in favour of the Investor from the Company; and
further

(ii)

in the event that the Investor does not confirm the receipt of the relevant board
resolution(s) issuing and allotting the Subscription Shares to the Investor and
the duly stamped and validly issued share certificates representing the
Subscription Shares (issued in the name of the Investor) and receipt of the share
certificates representing the Sale Shares as endorsed in favour of the Investor to
the Company , and the Investor informs the Company that the Investor desires
to withdraw its investment, then, the Company shall ensure that their bankers

10

shall promptly return the Investment Amount deposited in the Company

Account and in the Promoter Account to the Investor, subject to such
Governmental Approvals as may be required (which approvals shall be
promptly procured by the Company and the Promoters), and further subject to
any expenses incurred on account of such return.
3.3

The Company shall hold a meeting of its Board, at which the following shall be resolved in
Agreed Form:
(i) The transfer of the Sale Shares to the Investor shall be approved;
(ii) the Investor shall be allotted and issued the Subscription Shares;
(iii) the issue of share certificates representing the Subscription Shares
Investor shall be approved;

to the

(iv) the name of the Investor shall be entered in the register of members maintained
by the Company as the holder of the Subscription Shares;
(v) The nominee of the Investor shall be appointed as a director on the Board of
the Company and Committees of the Board in accordance with Clause ____
(Investor Director); and
3.4

The Company shall, and the Promoters shall procure that the Company shall duly issue
and allot the Subscription Shares to the Investor and deliver to the Investor the share
certificates representing the Subscription Shares in the name of the Investor
simultaneously with the transfer of the Investment Amount, on the Completion Date.

3.5

The name of the Investor shall be entered in the Register of Members of the Company as
the holder of the Equity Shares and the Subscription .

3.6

The Equity Shares forming part of the Subscription Shares and the Equity Shares to be
issued shall rank pari passu with the remaining Equity Shares of the Company in all
respects, including with respect to entitlement to dividend.

3.7

The Company shall be responsible for the payment of any Taxes related to the allotment,
stamp duties or other similar Taxes attributable to the execution of this Agreement, and
the issuance and allotment of the Subscription Shares to the Investor, and the Promoter
shall be responsible for all stamp duties on the transfer of the Sale Shares to the Investor.

3.8

The Company and the Promoters shall severally indemnify the Investor against and in
respect of their respective defaults, if any, of this Clause _____.

4.

POST COMPLETION ACTIVITIES AND REQUIRED GOVERNMENT APPROVALS

Post Completion Activities and Conditions Subsequent

4.1

The Company shall as soon as reasonably possible, and in any event within [] ([]) days
from the Completion Date:
(i) file with the Registrar of Companies, [], all the requisite form(s) in connection with
the issuance and allotment of the Equity Shares constituting the Subscription Shares
to the Investor;

11

(ii) file with the Registrar of Companies, [], all requisite forms in connection with the
appointment of the Investor Director and the alternate director to the Investor
Director;
Required Government Approvals
4.2
The Company and the Promoters shall procure and promptly obtain all required
Governmental Approvals and shall furnish certified true copies thereof to the Investor.
5.

REPRESENTATIONS AND WARRANTIES OF COMPANY

Warranties
5.1

The Company and the Promoters, jointly and severally, represent and warrant to the
Investor, as on the Effective Date and as on Completion that each of the Warranties,
subject to the corresponding disclosure set forth in the Disclosure Letter and any actual or
constructive knowledge or investigation on the part of any of the Investor or any of
its/their agents, Representatives, officers, employees or advisers, is and will be true and
correct in all respects, and acknowledge that the Investor has entered into this Agreement
in reliance upon the Warranties being true in all respects.

5.2

Each of the Warranties shall be construed as a separate and independent warranty and
(save as expressly provided to the contrary herein) shall not be limited, restricted or
modified by reference to or inference from the terms of any other Warranty.

5.3

The Company and the Promoters undertake to notify the Investor in writing promptly if
they become aware of any fact, matter or circumstance (whether existing on or prior to the
Effective Date or arising afterwards) which would cause any of the Warranties given by
them, to become untrue or inaccurate or misleading in any respect. The Company and
each of its Subsidiaries shall not and the Promoters shall cause the Company and its
Subsidiaries to not, do, allow or procure any act or omission which would constitute a
breach of any of the Warranties as if they were given at the Completion or which would
make any of the Warranties untrue, inaccurate or misleading as if they were so given
(except only as may be necessary to give effect to this Agreement).
5.4

5.5

Where any statement in this Clause ___, or elsewhere in this Agreement is qualified by the
expression "so far as the relevant Warrantor / any Party is aware" or "to the best of the relevant
Warrantor's / Partys knowledge, information and belief" or any similar expression, that statement
shall be deemed to include an additional statement that it has been made after due and
careful enquiry where possible.

Indemnity
5.6

Subject to the contents of the Disclosure Letter, the Company, and the promoters hereby
jointly and severally, indemnify, defend and hold harmless, the Investor, his agents and
employees (Indemnified Parties), from and against, and pay or reimburse the
Indemnified Parties for any and all Losses, relating to or arising out of or in connection
with:
(i)

Any material breach of any Warranty;

12

(ii)

Material breach, default, or violation of any covenant or agreement in this

Agreement;

(iii)

any liabilities of Company or any of its Subsidiaries or any of the Societies not
disclosed to the Investor in the Accounts prior to the execution of this
Agreement;

(iv)

any default or gross negligence or wilful misconduct or fraud on the part of the
Promoters, the Company or its Subsidiaries or any of the Societies resulting in a
material breach of any terms of the Agreement;

(v)

this Agreement and any and all costs and expenses incurred by the Investor in
respect of a claim under this Indemnity.

5.7

The Company and promoters hereby jointly and severally, indemnify, defend and hold
harmless, , each of the Indemnified Parties from and against and pay or reimburse the
Indemnified Parties for, any and all Losses relating to or arising out of or in connection
with any actual claim, legal action, proceeding, suit, litigation, prosecution, arbitration,
enquiry or mediation (together Claim) by or against any Indemnified Party, where the
Claim relates to any event, matter or circumstance arising or existing in relation to
Company, any of its Subsidiaries, prior to Completion and/or relating to or arising out of
claims made by third parties or Governmental Authority relating to the ownership of
securities of Company and/or relating to or arising out of any breach of this Agreement.

5.8

The Company and the promoters shall jointly and severally indemnify the Investor
Director and the funds represented by such Investor Director against all Losses suffered
by them in the discharge of their duties, excluding Losses incurred on account of fraud,
negligence or misconduct on the part of such Investor Director but including, inter alia,
Losses suffered as a result of :
(i)

any act, omission or conduct of or by Company, the Promoters or their

employees or agents (including any action taken prior to investment by the
Investor in the Company) as a result of which, in whole or in part, any Investor
Director is made a party to, or otherwise incurs any Losses pursuant to, any
action, suit, claim or proceeding arising out of or relating to any such conduct;
or

(iii)

any action or failure to act undertaken by an Investor Director at the request of

or with the consent of the Company or any of the Promoters, other than the
decision of the Investor Director to exercise his voting rights at a meeting of the
Board; or

(iv)

contravention of any Law relating to, inter alia, [provident fund, gratuity, labour,
environment and pollution, and any action or proceedings taken against an
Investor Director in connection with any such contravention or alleged
contravention.

(ii)

5.9

The Investor shall be entitled, in its absolute discretion, to take such action as it may deem
necessary to avoid, dispute, deny, resist, appeal, compromise or contest or settle any claim
(including without limitation, making claims or counterclaims against third parties).

13

5.10 The indemnification rights of the Investor under this Agreement are independent of, and
in addition to, such other rights and remedies as the Investor may have at Law or in equity
or otherwise, including the right to seek specific performance, rescission, restitution or
other injunctive relief, none of which rights or remedies shall be affected or diminished
thereby.
5.11 Notwithstanding the foregoing, the liability of the Company and promoters under this
Clause _____ shall be limited as set out below:
(i) Exclusion of Claims:
(ii)

The Company and the Specified Subsidiaries shall have no liability in respect of any
matter, act, omission or circumstances: (i) expressly contemplated in this Agreement
or which arise from performance of the obligations of the Company and/or the
Promoters as contained in this Agreement in accordance with the terms hereof; (ii)
which have arisen as a result of the Company and/or the Promoters having acted in
accordance with any written instructions of the Investor provided in terms of this
Agreement including but not limited all matters in relation to which, the Investor
has voted in the affirmative either through the Investor Director at a meeting of the
Board or through an authorized representative of the Investor at meetings of the
shareholders of the Company.
(iii) No Double Counting
5.12 The Investor shall not be entitled to payment of any claim more than once,
provided however that if any additional Loss is caused as a result of the same facts
and circumstances, the Investor shall be entitled to make a claim under this Clause
[] for such additional Loss.
(i) General Exclusions
5.13 The Company and its promoters shall have no liability in respect of any claim to
the extent arising from:
(A)

the passing of, or change in, after the date of execution of this Agreement,
any Law, regulation or rule of any Governmental Authority or any increase
in the rate of Taxes or any imposition of Tax not in effect on the date of
execution of this Agreement.

(B)

a change after the Completion in any accounting policy, practice and

methods used by the Company approved by the Investor in accordance
with the provisions of this Agreement.

5.14
Nothing contained in this Clause [] shall apply to a breach of the
representations and Warranties by the Company and/or the Promoters.
5.15 The liability of the Company and/or the Specified Subsidiaries arising under the Clause []
as a result of a breach of representations and Warranties shall be limited as set out below:
(i) Survival of Representations and Warranties:
(ii)

The Company and/or the Promoters shall be liable to indemnify the Indemnified Persons
in relation to any claims only if notice of such claim has been given in accordance this []
before the expiry of the periods mentioned herein below:

14

(A)

All claims in respect of claims pertaining to a breach of any Warranties

pertaining to Tax ([insert reference of warranties pertaining to Tax]), shall be
made prior to the expiry of [] years from the Completion;

(B)

All claims in relation to a breach of all other Warranties can be made at any time
prior to the expiry of 4 years from the Completion.

(iii) Financial Limitations

5.16 The Company and/or the Specified Subsidiaries shall have no liability in respect
of a claim made by the Investor under Clause [] in respect of any claim arising from
any single circumstance if the amount of the claim does not exceed INR [] ([in
words]) save and except that claims relating to a series of connected matters shall be
aggregated for this purpose.
5.17 The maximum aggregate liability of the Company and the Specified Subsidiaries
(cumulatively) shall not exceed 50% (fifty per cent) of the Investment Amount (or any
portion thereof at the time of determination) in any circumstances.
5.18 The Company and/or the Specified Subsidiaries shall be liable for the payment of any
indemnity claim under this Clause [] only after the Company and/or the Specified
Subsidiaries have had an opportunity to defend such claim fully and effectually and after a
court of competent jurisdiction has passed a final order regarding such liability or claim.
6.

INVESTOR DIRECTOR

6.1

The Board of the Company shall at all times comprise a maximum of _____ (_____)
directors of whom the Promoters shall be entitled to appoint and maintain in office _____
(_________) directors and the Investor shall be entitled to appoint and maintain in office
at all times during the subsistence of this Agreement, 1 (one) non-retiring director (and to
remove from office any director so appointed and to appoint another director in the place
of the director so removed, from time to time) on the Board (Investor Director). To
the extent permissible by Law, the appointment of the Investor Director shall be by direct
nomination by the Investor and any appointment or removal under this Clause shall,
unless the contrary intention appears, take effect from the date it is notified to the
Company in writing. If Law does not permit the person nominated by an Investor to be
appointed as a director of the Company merely by nomination by the Investor, Company
and the Promoters shall ensure that the Board forthwith (and in any event within 15
(fifteen) Business Days of such nomination or at the next Board meeting, whichever is
earlier) appoints such person as a director of the Company and further that, unless the
Investor changes or withdraws such nomination, such person is also elected as a director
of the Company at the next general meeting of the shareholders of the Company.

6.2

Notwithstanding that any Investor Director may be an independent director (as such
expression is defined in any listing agreement which may be entered into at any time
between the Company and the Exchanges), the Investor Director shall not be construed or
counted by the Company as an independent director for the purpose of determining the
number of independent directors which the Company is required to have on its board by
any listing agreement.

6.3

Without prejudice to the above, the Company and the Promoters agree to exercise all
powers and rights available to them so as to fix the number of directors in accordance with
this Clause 6 and to ensure that the persons nominated by the Investor are expeditiously
appointed or removed (as the Investor may specify) as directors of the Company and the

15

appointments and removals referred to in this Clause 6 result in the persons nominated /
appointed or removed becoming or ceasing to be directors of the Company.
6.4

The Investor Director shall not be required to hold any Equity Shares or securities of the
Company in order to qualify as a director of the Company.

6.5

The Investor Director shall be a member of, or, at the option of the Investor, an invitee,
on all the committees constituted by the Board. The provisions of this Clause ___ shall
apply to all committees of the Board in the same manner as they apply to the Board.

6.6

Any appointment of external professionals / sector experts as independent directors on

the Board of the Company shall require the Investors Consent.

6.7

Subject to the relevant provisions of the Act, the Company shall pay the Investor Director
all out of pocket expenses (including international air fares) incurred by the Investor
Director in order to attend shareholder, board, committee and other meetings of the
Company or otherwise perform their duties and functions as directors of the Company or
members of any committee of the Company.

6.8

The Company shall maintain directors liability insurance for a sufficient amount and on
terms satisfactory to the Investor.
INFORMATION RIGHTS2

7.
7.1

The Company shall maintain true books and records of account in which full and correct
entries shall be made of all its business transactions pursuant to a system of accounting
established and administered in accordance with applicable Law, and shall set aside on its
books all such proper accruals and reserves as shall be required under applicable Law. The
Company shall provide to the Investor, and to any Director of the Company (including the
Investor Director), such information as they may request, including without limitation:
(i) within 30 (thirty) days after the end of each month, monthly management review
detailing key operational performance indicators and statistics;
(ii) within 30 (thirty) days after the end of each quarter, unaudited consolidated
statements of income, statements of changes in shareholders equity and statements
of cash flows of the Company and its Subsidiaries for such quarter, and an
unaudited consolidated balance sheet as of the end of such quarter;
(iii)

within 45 (forty five) days after the end of each half yearly period, unaudited
consolidated statements of income, statements of changes in shareholders equity
and statements of cash flows of the Company and its Subsidiaries for such half
yearly period, and an unaudited consolidated balance sheet as of the end of such half
yearly period;

(iv)

within 45 (forty five) days after the end of each fiscal year, unaudited consolidated
statements of income, statements of changes in shareholders equity and statements
of cash flows of the Company and its Subsidiaries for such year and an unaudited
consolidated balance sheet as of the end of such year;

16

(v)

within 90 (ninety) days after the end of each fiscal year, audited consolidated
statements of income, statements of changes in shareholders equity and statements
of cash flows of the Company and its Subsidiaries for such year and an audited
consolidated balance sheet as of the end of such year and accompanied by the report
of an independent certified public accountant of recognized standing;

(vi)

within 30 (thirty) days prior to the end of each fiscal year, a budget for the next fiscal
year including operating and capital budgets and such other information requested
by the Investor in respect of the Company and its Subsidiaries;

(vii)

minutes of board, committees and shareholders meetings of the Company and its
Subsidiaries within 15 (fifteen) days of the occurrence of such events;

(viii)

promptly details of material adverse changes affecting the business, operations,

condition (financial or otherwise), prospects, results of operations, properties, assets
or liabilities of the Company and its Subsidiaries;

(ix)

other relevant material information including business plans, capital expenditure

budgets and management reporting information apart from that set forth above, in
respect of the Company and its Subsidiaries;

(x)

such other financial and accounting reports and information as mutually agreed;

(xi)

details of any Litigation (including any winding-up proceedings or notices under any
enactment or regulation), proceedings or material dispute or adverse changes [(with
an impact of greater than [10%] of the Companys profit after tax in the immediate
preceding fiscal year)] that impedes or which is likely to adversely affect its business
or assets or otherwise; and

7.2

Upon the listing of the Equity Shares on any of the Exchanges, the Company shall, prior
to providing any unpublished price sensitive information to the Investor, ensure that such
information is published by disclosing the same in accordance with Law.

7.3

The Company and the Promoters shall give full access to the Investor and its authorised
Representatives to visit and inspect all properties, assets, corporate, financial and other
records, reports, books, contracts and commitments of the Company, and to discuss and
consult on its business, actions plans, budgets and finances with the directors and
executive officers of the concerned company and to review and take copies of any such
documents/information at the Investors discretion, upon reasonable notice. All costs
incurred in connection with such inspection shall be borne by the Investor.

7.4

The Company shall obtain the prior approval of the Board of Directors of the Company
on an annual basis to the following budgets:
(i)

Estimated sources and application of funds.

(ii)

Estimated profit and loss account.

(iii)

Estimated balance sheet.

(iv)

Projected cash flow.

(v)

Detailed assumptions underlying for the above.

17

8.

RESERVED MATTERS

8.1

No action or decision relating to any of the Reserved Matters (as contained in Schedule ---) shall be taken (whether by the Board, any committee, the shareholders of Company, its
Subsidiaries, or any of their respective employees, officers or managers) unless the
Investors Consent is obtained for such action or decision.

9.

EXERCISE OF RIGHTS

9.1

Without prejudice to the other provisions of this Agreement, the Promoters and the
Company agree to exercise all powers and rights available to them (including their voting
rights and their rights as and in respect of directors) in support of the provisions of this
Agreement and so as to procure and ensure that the provisions of this Agreement are
complied with in all respects by the Company, the Promoters, the Specified Subsidiaries if
any.

9.2

The Promoters shall vote or cause to be voted all Equity Shares bearing voting rights
beneficially owned by such shareholder at any annual or extraordinary meeting of
shareholders of the Company (the Shareholders Meeting) or in any written consent
executed in lieu of such a meeting of shareholders (the Written Consent), and shall take
all other actions necessary, to give effect to the provisions of this Agreement. In addition,
the Promoters shall vote or cause to be voted all Equity Shares beneficially owned by such
shareholder at any Shareholders Meeting or act by Written Consent with respect to such
Equity Shares, upon any matter submitted for action by Companys shareholders or with
respect to which such shareholder may vote or act by Written Consent, in conformity with
the specific terms and provisions of this Agreement and the Restated Articles.
9.3
The provisions of this clause shall mutatis mutandis apply to the Promoter in
relation to the Societies.

10.

DEALINGS IN SECURITIES
Transfer of Investors shareholding

10.1 The Subscription Shares allotted to the Investor shall be, when allotted and issued, free
from all Encumbrances. Further, the Investor shall not be required to Encumber its
Equity Shares in the Company, or provide any guarantee, recourse or any other support to
any Person, including, to any banks or financing institutions providing credit facilities to
the Company. Provided that until the shares of the Company are not listed on any stock
exchange, the Investor shall not Transfer its Equity Shares to any of the following: [ ]
10.2 Subject to Clause _____ above, the Investor shall be entitled to Transfer or in any other
manner deal with all or any part of Investors Shares in the Company (including any
beneficial interest thereto), together with any of its rights and/or obligations hereunder, at
any time to any Person including its Affiliates without any restrictions whatsoever provided
however that any such Transfer shall be subject to the Promoters right of first refusal
pursuant to Clause [] below and further subject to such Transfer not being in favour of a
competitor of the Company. The restriction herein shall however not apply to any
Transfers to Affiliates of the Investor or pursuant to or after a QIPO or OFS or ;
10.3 Subject
only
____ (Assignment):

to

this

Clause

_________and

Clause

18

(a) The Equity Shares of the Company held by the Investor shall not be subject to any
lock-in at any point of time under any circumstances and, will be freely Transferable
and tradable, excepting to a competitor of the Company;
(b) The Investor, at its sole discretion, shall have the right to Transfer their Equity
Shares (subject to the restriction on Transfer to a competitor of the Company),
without any restrictions and together with any and all rights and obligations under
the Agreement, to any other Person, including, to other financial and/or strategic
investors and the Parties shall enter into a deed of assumption and assignment to
give effect this provision upon such transfer.
Right of First Refusal
10.4 In the event that the Promoter/s (excepting in case of any inter-se sale between
Promoters, their Affiliates or between the Promoter/s and their Affiliate/s) or the Investor
intends to sell all or any of their shareholding in the Company (Selling Party), the
Investors or the Promoters as the case may be (Non-Selling Party) shall have a right of
first refusal to purchase the whole or any of the shares of the Company that are proposed
to be sold (Sale Securities), which shall be exercised in accordance with the following
procedures:
(a) the Selling Party shall first give a written notice ( Offer Notice) to the Non-Selling
Party. The Offer Notice shall state:
(i) (i) the number of shares of the Company proposed to be Transferred (Offered
Shares);
(ii)

(ii)

(iii)

(iii)
the proposed price, including the proposed amount and form of
consideration and terms and conditions offered by such proposed transferee
(Offer Price);

the name and address of the proposed transferee;

(b) if the Non-Selling Party has, within 45 Days of the receipt of the Offer Notice (Offer
Period), notified the Selling Party that it wishes to purchase all (and not less than all)
the Offered Shares (Response Notice), then the Non-Selling Party shall pay the
purchase price for, and accept a transfer of, the Offered Shares and the Selling Party
shall, on receipt of the purchase price, transfer such Offered Shares to the Non-Selling
Party. Such payment and transfer shall be completed within 30 (thirty) days of the
Response Notice. ;
(c) in the event the Non-Selling Party does not deliver a Response Notice to the Selling
Party prior to the expiry of the Offer Period or does not elect to purchase all the
Offered Shares, then, upon the expiry of the Offer Period, the Selling Party shall be
entitled to sell and transfer the Offered Shares to the proposed transferee mentioned
in the Offer Notice on the same terms and conditions and for the same consideration
as is specified in the Offer Notice.[TBD]
Tag Along Right
10.5 If one or more of the Promoters or its Affiliates, as the case may be, propose to Transfer
Equity Shares held by them in the Company to a third party, then, such Promoter/s or its
Affiliate/s shall first give a written notice (hereinafter referred to as Offer Notice) to
the Investors. The Offer Notice shall state:

19

(i) the number of Equity Shares proposed to be Transferred (hereinafter referred to as

the Offered Shares) and the number and class of Equity Shares the Promoter and
its Affiliates own at that time on an undiluted basis,
(ii) the name and address of the proposed transferee,
(iii) the proposed price, including the proposed amount and form of consideration and
terms and conditions of the proposed Transfer,
(iv) the proposed date of consummation of the proposed Transfer,
(v) a representation that the proposed transferee has been informed of the tag-along
rights provided for in this Agreement and has agreed to purchase all the Equity
Shares required to be purchased in accordance with the terms of this Schedule, and
(vi) a representation that no consideration, tangible or intangible, is being provided,
directly or indirectly, to the Promoter or its Affiliates that will not be reflected in the
price paid to an Investor on exercise of its tag-along rights hereunder.
10.6 In the event that the proposed consideration for the Transfer includes consideration other
than cash, the Offer Notice shall include a calculation of the fair market value of such
consideration and an explanation (in reasonable detail) of the basis for such
calculation. The total value of the consideration for the proposed Transfer (as determined
in accordance with this paragraph) is referred to herein as the Offer Price. Such notice
shall be accompanied by a certified true and complete copy of all documents constituting
and relating to the agreement between the Promoter and/or the Affiliate and the proposed
transferee regarding the proposed Transfer;
10.7 The Investor(s) shall be entitled to respond to the Offer Notice by serving a written notice
(the Response Notice) on the Promoter prior to the expiry of 30 (thirty) Business Days
from the date of receipt of the Offer Notice (Offer Period) requiring the Promoter/s to
ensure that, the proposed transferee of the Offered Shares also purchases such number of
the Equity Shares as mentioned in the Response Notice at the same price and on the same
terms as are mentioned in the Offer Notice, except that the Investor(s) shall not be
required to provide any representations or warranties, other than in respect of its title to
such Equity Shares, to the transferee.
10.8 The Promoter shall ensure that, along with the Offered Shares, the proposed transferee
also acquires the Equity Shares specified in the Response Notice for the same
consideration and upon the same terms and conditions as applicable to the Offered Shares,
provided that the Investor(s) may choose to receive the cash equivalent of any such
consideration which is in a form other than cash (as notified, agreed or determined above
for inclusion in the Offer Price) and the Investor(s) shall not be required to provide any
representations or warranties to the proposed transferee except in respect of its title to its
Equity Shares . The Promoter and its Affiliates shall not be entitled to Transfer any of the
Offered Shares to any proposed purchaser/transferee unless the proposed
purchaser/transferee simultaneously purchases and pays for the required number of Equity
Shares mentioned in the Response Notice in accordance with the provisions of this [].
Such sale shall be completed within 90 (ninety) days of the expiry of the Offer Period;
10.9 In the event the Investor(s) does not deliver a Response Notice to the Promoter prior to
the expiry of the Offer Period, the Promoter and/or the Affiliates shall be entitled to
Transfer the Offered Shares to the proposed transferee mentioned in the Offer Notice on
the same terms and conditions and for the same consideration as is specified in the Offer

20

Notice.. If completion of the Transfer to the proposed transferee does not take place
within the period of 45 (forty five) days following the expiry of the Offer Period, the
Promoters right to sell the Offered Shares to such third party shall lapse and the
provisions of this Clause [] shall once again apply to the Offered Shares.
10.10 The Tag Along Rights of the Investor are subject to the waiver of the non-disposal
undertaking by the Investor and would terminate 6 (six) months after the closing of a
QIPO.
11.

GENERAL PROVISIONS PERTAINING TO SHARE TRANSFERS

11.1 The Parties agree that the Transfer restrictions on the Promoters in this Agreement and/or
in the Organisational Documents of the Company shall not be capable of being avoided by
the holding of Equity Shares or securities indirectly through a company or other entity (or
one or more companies or entities either alone or together in any combination or under
Contract) that can itself (or the securities in it) be sold in order to Transfer an interest in
Equity Shares or securities free of restrictions imposed under this Agreement and the
Organizational Documents. Any Transfer, issuance or other disposal of any securities (or
other interest) resulting in any change in the control, directly or indirectly, of the
Promoters, or of any Affiliate of the Promoters which holds, directly or indirectly, any
Equity Shares, shall be treated as being a Transfer of the Equity Shares held by the
Promoters, and the provisions of this Agreement and the Organisational Documents that
apply in respect of the Transfer of Equity Shares shall thereupon apply in respect of the
Equity Shares so held.
11.2 Where an Investor requires prior legal, governmental, regulatory or shareholder Consent
or approval (Approvals) for an acquisition or disposal of Equity Shares pursuant in
accordance with Clause [13] then, notwithstanding any other provision of this Agreement
the Investor shall only be obliged to acquire or dispose of Equity Shares once such
Approvals are obtained, and the Parties shall use their reasonable endeavours to obtain any
such required approvals. Any period within which a Transfer of Equity Shares by or to the
Investor has to be completed shall be extended by such further period as is necessary for
the purpose of obtaining the above Approvals. Provided that:
(a)

if any of the Approvals are finally withheld or declined then the Investor shall be
deemed not to have offered to purchase or sell the Equity Shares; and

(b)

if any of the Approvals required to be obtained by a Person (other than the

Investor) are not obtained within [6 (six)] months of the date of the relevant notice
giving effect to the Transfer, then the Investor shall be free to sell the relevant
Equity Shares to any other Person.

11.3 Any Transfer or attempted Transfer of any Equity Shares or securities of the Company in
violation of this Agreement shall be void, no such Transfer shall be recorded on the
Companys register and the purported transferee of any such Transfer shall not be treated
as a shareholder.
11.4 Subject to any applicable Laws, the Company must register a transfer of any Equity Shares
or securities made in compliance with this Agreement.
11.5 Notwithstanding anything contained herein, there shall be no restriction on Transfer of
shares by any of the Parties subsequent to the listing of the shares of the Company.

21

12.

OTHER EXIT OPTIONS

Buy back
12.1 At any time after the expiry of 6 months from the QIPO Deadline Date, the Investor shall
be entitled to require the Company , at its option, to purchase some or all of the securities
held by the Investor in the Company at such price as will provide the Investor with the
Threshold Value. In such event, the Company shall promptly purchase such securities in
accordance with the terms set out in Error! Reference source not found.___ hereto (Buy
back).
12.2 For this purpose, without prejudice to the other rights of the Investor, the Investor, at its
absolute discretion, shall be entitled to require the Company, in accordance with the
provisions of the Act and the Private Limited Company and Unlisted Public Limited
Company (Buy-Back of Securities) Rules, 1999 (Buy Back Rules), to buy back the
Investors Shares for an amount equivalent to the Threshold Value. In this regard, the
Company and Promoters agree that no lien would be created on any of the assets of the
Company with a malafide intent to obstruct such an exit of the Investor.
12.3 In the event that all the Investors Shares cannot be bought back solely on account of any
restrictions under applicable Law (including failure to meet the requirements of Section
77A of the Act or the requirements prescribed by the Buy Back Rules), then without
prejudice to the other rights of the Investor, and if the Investor so desires, the Company
shall buy back the number of Investors Shares specified by the Investor in order to enable
the payment of the maximum amount possible and the balance shares will continue to be
retained by the Investor and be bought back as soon as the Company has legally available
funds for such a buy back.
12.4 The Promoters shall not participate in the Buy back until the Investor has received the
Threshold Value. Further, the financing for Buy back shall be raised by the Company in
the manner prescribed by the Investor, which may include one or more of the methods set
out below:
(i)

The Company shall set aside 50 % of annual profits after tax towards Buy back till
such time the Investor receives an amount equivalent to the Threshold Value;

(ii)

The Company and the Promoters shall securitise the lease rentals of any of the
real estate assets owned by the Company or its Affiliates and use the proceeds
accruing therefrom for the Buy back and for this purpose, the Company and the
Promoters shall take the actions specified in Schedule _______;

(iii)

Subject to applicable Law, the Company covenants to raise the funds required for
Buy back by conducting an outright sale or Transfer, or disposal and lease back of
the real estate assets of the Company or its Affiliates to any interested investor
(including real estate funds) in accordance with the terms and conditions and the
procedures set out in Error! Reference source not found. _____ hereto
(Auction) and accordingly the Promoters shall not participate in the Buy back
till such time the aforesaid is achieved.

Strategic Sale
12.5 In the event the Company fails to provide an exit to the Investor by way of a Buy back in
accordance with Clause [], then after the expiry of 18 months from the QIPO Deadline
Date, the Investor shall, without prejudice to its other rights, have the right at any time to

22

identify, a bona fide third party purchaser or group of purchasers (a Purchaser) to

implement a strategic sale, which could include purchase of up to 100% of the Companys
share capital at a price and on terms acceptable to the Investor in its sole discretion (a
Strategic Sale) in accordance with the terms and conditions, and procedure set out in
Error! Reference source not found.___ hereto, and the Company and the Promoters hereby
undertake to participate in such sale in the manner set out in Schedule 6. The Investor
shall have the right to require the Promoters to contribute all or such part of the
Promoters shares in the Company as are required for the purpose of consummating the
Strategic Sale. For the sake of clarity, the Parties hereby confirm and record that the terms
of sale of Promoters shares shall be the same as, and shall not be in any manner less
favourable than, the terms of sale of the Investors shares. The Promoters shall ensure that
all or such part of their shareholding as is required to be offered for the consummation of
such Strategic Sale shall be free from all Encumbrances.
12.6 The exit options mentioned above will be consummated only with the Investors Consent.
13.

EVENTS OF DEFAULT

13.1 The following shall constitute Events of Default for the purposes of this Agreement:
(i) Any change of control in the Promoters, unless the same has been effected with the
Investors Consent;
(ii) Bankruptcy, liquidation, death, incapacity or the appointment of a receiver or similar
official or institution of any such proceeding in respect of either Promoters or the
Company;
(iii) One or more members of the Promoter and/ or any Affiliate of the Promoter are
convicted or restricted in any manner (regardless of extent, context and validity of
such restrictions) from conducting business by any court of law anywhere in the
world; and/or
13.2
Upon the occurrence of an Event of Default, at any time and from time to time
thereafter, by written notice of 100 days (such notice affording the Company to rectify the
Event of Default complained of), delivered by the Investor to the Company (a Put
Notice), the Investor may , upon expiry of the notice period if the Company has not
rectified the Event of Default, put (each, an Option) up to all of the Investors Shares
held by them to the Company and/or Promoter, at such Investors sole discretion, and
require them to, jointly and/or severally, purchase such securities, and the Company
and/or Promoter, as the case may be, shall promptly purchase or redeem such shares, at
such price as will provide the Investor with a [25]% IRR on its Investment Amount from
the Completion Date to the date of receipt of the whole of such price by the Investor.
13.3 Upon exercise of the Option, the Company and for the Promoter (as applicable) shall
confirm in writing to the Investors that they accept the Option and will complete the
transfer of shares under the Put Option in accordance with this Clause [17] and Schedule
[14]. The proceeds under the Put Option must be settled in cash within a period of 60 days
from the invocation of the Option by the Investor (the Put Payment Period).
13.4 The Company and the Promoters undertake jointly and severally to assist the Investor in
the sale of the Investors Shares pursuant to this Clause, including by applying for and
obtaining all requisite approvals and Consents and taking all necessary corporate actions
and passing of all requisite resolutions.

23

13.5 The Option shall be exercised and given effect to in accordance with the procedure in
Schedule []. The Company and the Promoters shall pay all transaction fees and Taxes
relating to the Transfers made pursuant to Clause ____, other than any Tax required to be
paid by the Investor on the income of the Investor. The Company and the Promoters shall
be jointly and severally liable under this Clause ____ and the Promoters shall ensure and
procure that the Company does not default hereunder and further shall make payment of
any shortfall on the part of the Company.
13.6 Alternatively, the Company and/or the Promoters may facilitate a sale of the Investor
Shares in favour of a third party in place of honouring the Put Option, in which case the
procedure set out in Clause [] shall apply to such third party sale.
14.

LIQUIDITY AND LIQUIDATION PREFERENCE

Liquidation and Liquidity Preference

14.1 In the event of occurrence of a Liquidation Event or a Liquidity Event, subject to
applicable Laws, the total proceeds from such Liquidation Event or Liquidity Event
remaining after discharging or making provision for discharging the liabilities of Company,
shall be distributed as follows: (i) first to the Investor, an amount which is the higher of (a)
the Investment Amount; and (b) the amount equal to the Investors proportionate share
of the proceeds from the Liquidation Event in the same proportion that the Investors
Shares bear to the total share capital of the Company (calculated on an as converted basis,
assuming that the CCPS are converted in accordance with their terms), plus all declared
but unpaid dividends (Liquidation Preference Amount); (ii) second, to the other
shareholders of Company, pro rata in proportion to their inter se number of equity shares
of Company, until they have collectively received an amount equal to the amount they
have invested in Company on a per equity share basis, plus all declared and unpaid
dividends; and (iii) to the extent that there are assets available for distribution after
payment of the Liquidation Preference Amount to the Investor and the amounts to the
other shareholders in (i) and (ii) above, all shareholders (including the Investor) will share
pro rata in the distribution of such remaining assets.
14.2 For the purpose of determining the proportion that the Investors Shares bear to the total
share capital of the Company, the CCPS held by the Investor shall be deemed to have
been converted into Equity Shares in accordance with the other provisions hereof,
including without limitation, clauses [] and the characteristics of the CCPS.
14.3 In the event the above Clauses ____ and ____are not enforceable for any reason
whatsoever, the following shall apply:
(i) Subject to applicable Law, in the event of the Liquidation Event or Liquidity Event
(as the case may be), and after payment or provision for payment of debts and other
liabilities of the Company, the surplus (after such payment) shall be distributed
amongst the shareholders of the Company in proportion to their shareholding.
(ii) Subject to (a) above, in the event that the amount (if any) received or receivable by
the Investor is less than the Liquidation Preference Amount, the shareholders (other
than the Investor) shall out of the amounts received or receivable by them pay over
an amount to the Investor, or, the amounts receivable by the shareholders and the
Investor shall be allocated amongst them, such that the Investor receives an amount
equal to the Liquidation Preference Amount due to it.

24

(iii) To the extent necessary, each shareholder (other than the Investor) of the Company
waives its respective rights and entitlements to its share in any payment pursuant to
the Liquidation Event or Liquidity Event (as applicable) and to the extent that such
payments are made to, or received by, any shareholder (other than the Investor), the
shareholder(s) shall hold the payments received by it/ them in trust for the Investor.
14.4 The Parties shall apply for and obtain all such approvals and take all such actions as may
be required to permit such payment to the Investor.
14.5 To the extent permissible in Law, the terms of any Liquidation Event or Liquidity Event
shall provide for the distribution of the proceeds thereof in accordance with this Clause __.
15.

OTHER COVENANTS

Auditor
15.1 The Company has appointed Deloitte Touche and Tomatsu as the statutory auditors for
the Financial Year 2010-2011. Any removal or replacement of the statutory auditors of the
Company or changes in the terms of their appointment including variation in their
remuneration shall be subject to the Investors Consent.
15.2 The Company shall appoint an internal audit firm approved by the Investor and shall
provide it with full cooperation, assistance, access to the Companys records and all other
information. Such internal auditor shall not be removed without the Investors Consent.
All costs of such internal auditor shall be borne by the Company.
Environmental, Social and Governance Compliance
15.3 The Company shall, ensure that it:
(i)

provides safe and healthy working conditions for its employees and contractors;

(ii)

encourages the efficient use of natural resources and promotes the protection of
the environment;

(iii)

treats all employees fairly in terms of recruitment, progression, remuneration

and conditions of work, irrespective of gender, race, colour, language, disability,
political opinion, age, religion or national/social origin;

(iv)

provides forums for employees to present their views to the management;

(v)

takes account of the impact of its operations on the local community and seeks
to ensure that potentially harmful occupational health, safety, environmental and
social effects are properly assessed and monitored; and

(vi)

upholds high standards of business integrity and honesty, and operates in

accordance with local laws and international good practice (including those
intended to fight extortion, bribery and financial crime).

Connected Person
15.4 All Contracts and transactions between Company and any Connected Person/Concern
shall be entered into on arms length and market price basis.

25

More Favourable Rights

15.5 The Company and the Promoters shall not provide any investor or potential investor with
rights in relation to Company and/or its Subsidiaries which are more favourable than
those provided to the Investor hereunder.
15.6 Without prejudice to the aforesaid, any such favourable terms given to any other Person
shall be extended to the Investor as well.
Business Plan
15.7 The Company shall provide the Investor a detailed Business Plan, that will include details
of operations, financials, debt, capital expenditure and other relevant targets for the
Company and Subsidiaries every year after Completion, of the Company and its
Subsidiaries and shall be approved by the Board annually and updated/revised at the time
of approving any expansion. The Business Plan shall comprise the business strategy,
project details including project cost, means of finance, projected financial statements
including profit and loss account, balance sheet and cash flow statements for the on-going
Financial Year and the subsequent [two] Financial Years and would form the basis of
management of the business of the Company until such time that the same is duly updated
/ revised with the consent of the Board and the Investor. If the Board or the Investor fails
to approve the Business Plan before the commencement of any Financial Year as a result
of the Investor exercising their rights under Clause ___, the Business Plan most recently
approved by the Board will continue to apply until the Board approves a new Business
Plan. Notwithstanding the preceding sentence, if the Board fails to approve the Business
Plan before the commencement of any Financial Year as a result of the Investor exercising
their rights under Clause ____ and the Investor is notified in writing of a change in
circumstances occurring on or after the first day of such Financial Year relating to the
business or operations of the Company that the most recently approved Business Plan
does not address and that, if not addressed, would be reasonably likely to affect the ability
of the Company to continue as a going concern, then, the Board of the Company must
adopt an amendment to such Business Plan designed to address such change in
circumstances.
15.8 The Business Plan shall be achieved by the Company through organic and inorganic
means.
Investor not to be considered Promoter
15.9 The Company and the Promoters acknowledge that on Completion the Investor will only
be a minority financial investor and not acquire control and management of the Company.
The Company and the Promoters will ensure that the Investor shall not be considered /
classified to be the Promoter of the Company for any reason whatsoever and the
Subscription Shares are not subject to any restriction (including that of lock-in or other
restriction) which are applicable to Promoters under any applicable Law. The Promoters
shall remain in control and management of Company, subject however to the rights of the
Investor hereunder. The Promoters shall take necessary steps to reflect that the Investor is
not a Promoter of Company, including such steps as may be requested by the Investor.
16.

CONFIDENTIALITY

16.1 The Parties shall maintain the confidentiality of the terms of this Agreement, provided, that
Company and/or the Promoters may deliver or disclose such terms to any Governmental
Authority having jurisdiction over such Party to the extent required by applicable Law,

26

provided further, that the disclosing Party shall provide the other Party with prompt written
notice thereof so that the other Party may seek (with the cooperation and reasonable
efforts of the disclosing Party) a protective order, confidential treatment or other
appropriate remedy, and in any event shall furnish only that portion of the information
which is reasonably necessary for the purpose at hand and shall exercise reasonable efforts
to obtain reliable assurance that confidential treatment will be accorded such information
to the extent reasonably requested .
17.

NON COMPETE

17.1 As the investor, in the course of their association with the company, employment and/or
directorship, are likely from time to time to obtain knowledge of trade secrets and other
confidential information of Company and to have dealings with the customers and
suppliers of Company and in order to protect such trade secrets and other confidential
information and the goodwill of Company, the investor further undertake to the Company
and, as a separate undertaking, to the Company, in the terms set out below.
17.2
The investor and his nominated Director collectively and individually undertake
to the Company and the promoters that they shall (i) devote their undivided and
complete attention to the Business of the Company; (ii) not have any active
involvement in or association with any other activity or business which is similar to the
Business through any vehicle other than the Company or its Subsidiaries for a period of
[] years from the Completion Date; and (iii) pursue any activity or business conducted
by them collectively or individually in the education sector exclusively through the
Company or its Subsidiaries.
17.3 The Investor undertake to the Company and the promoters that, except as otherwise
agreed in writing by the Board and without prejudice to any other duty implied by law or
equity, during the period of his association with Company (as applicable) and for a period
of [] ([]) months after the date on which he ceases to be investor of Company or ceases
to hold such shares in Company (whichever is later) (the Termination Date), either
personally or through an agent, company or otherwise in any other manner directly or
indirectly:
(i)

except on behalf of the Company, canvass or solicit business for services similar to
those being provided by Company from any person who is a customer of the
Company;

(ii)

induce or attempt to induce any supplier of the Company to cease to supply, or to

restrict or vary the terms of supply to, the Company or otherwise interfere with the
relationship between such a supplier and Company (save and except actions taken
by the Promoters during the course of his / her employment with Company in
exercise of his power and authority as an employee of Company and in, what he
reasonably believes to be, in the interests of the Company); or

(iii)

induce or attempt to induce any director or key employee of the Company to leave
the employment of the Company (save and except actions taken by the Promoters
during the course of his / her employment with the Company in exercise of his
power and authority as an employee of the Company and in, what he reasonably
believes to be, in the interests of the Company).

17.4 The Investor undertake with the Company that he shall not use (either personally or
through an agent or otherwise, directly or indirectly) or (insofar as they can reasonably do
so) allow to be used:

27

(i) any information of a secret or confidential nature relating to the business or affairs
of the Company; or
(ii) any trade name used by the Company, or any other name calculated or likely to be
confused with such a trade name.
17.5 For the purposes of this Clause _____, a investor is concerned in a business if:
(i) it carries it on as principal; or
(ii) it is a partner, director, , of or to any person who carries on the business; or
(iii) it has a substantial financial interest (as shareholder or otherwise) in any person who
carries on the business; or
(iv) it is a partner, director, in, of or to any person who has a direct or indirect
substantial financial interest (as shareholder or otherwise) in any person who carries
on the business,
(v)

disregarding any financial interest of a person in securities which are listed or dealt in on any
generally recognised stock exchange if the investor and any Connected Person/ Concern of
such investor is interested in securities which amount to less than [1%] (one per cent) of the
issued securities of that class and which, in all circumstances, carry less than [1%] (one per
cent) of the voting rights (if any) attaching to the issued securities of that class and provided
that none of such persons are involved in the management of the business of the issuer of
the securities or any person connected with it other than by the exercise of voting rights
attaching to the securities (references to the Company shall include its successors in
business).
17.6 Any of the undertakings on the part of the investor under this Clause may be released
either generally or in any particular case with the Company Consent but not otherwise.
Each covenant contained in each clause or paragraph above shall be, and is, a separate
covenant by the company and shall be enforceable separately against the investor and
independently of each of the other covenants and its validity shall not be affected if any of
the others is invalid, and if any of the covenants is void but would be valid if some part of
the covenant were deleted the covenant in question shall apply with such modification as
may be necessary to make it valid.
18.

TERM

Termination Provisions
18.1 This Agreement shall become effective upon the execution thereof by the Parties hereto.
18.2 In the event that, at any time after Completion, the Investor cease to hold any securities of
Company, then, this Agreement shall thereupon terminate.
Survival after Termination
18.3 The provisions of Clauses _____ (Representations and Warranties and Indemnity), _____ (Notice),
____(Arbitration) _____(Governing Law and Jurisdiction) shall survive the termination of this
Agreement under Clause ____ above, subject to any limitations imposed on such survival
hereunder.

28

18.4 Any termination as mentioned above shall not affect the accrued rights of the Parties
hereunder.
19.

MISCELLANEOUS

Costs
19.1

The Company and the Promoters shall bear their own costs in connection with the
Agreement.

19.2 The Company shall bear, and be responsible for, the payment of any and all Taxes or
duties related to the issuance, allotment of the Investors Shares to the Investor and the
execution of legal documentation in respect of the transaction contemplated herein. The
Company shall bear other costs and expenses as specified in the Term Sheet dated May 30,
2011 between the Company, the Promoters and the [Investor].
No partnership or agency
19.3 Nothing in this Agreement (or any of the arrangements contemplated herein) shall be
deemed to constitute a partnership between the Parties, nor, except as may be expressly
provided herein, constitute any Party as the agent of another Party for any purpose, or
entitle any Party to commit or bind another Party in any manner.
Entire agreement
19.4 This Agreement, together with the Disclosure Letter, the Restated Articles and the other
agreements entered into , if any, sets out the entire agreement and understanding between
the Parties with respect to the subject matter hereof. This Agreement supersedes all
previous letters of intent, heads of terms, prior discussions and correspondence exchanged
between any of the Parties in connection with the transactions referred to herein, all of
which shall not have any further force or effect.
Further assurances
19.5
The Company and the Promoters agree to do all such further things and to
execute and deliver all such additional documents as are necessary to give full effect to the terms
of this Agreement.
19.6 Each of the Company and the Promoters undertake with the Investor that (so far as it is
legally able and permitted to do so) it will do or procure to be done all such further acts
and things, execute or procure the execution of all such other documents and exercise all
voting rights and powers, whether direct or indirect, available to it in relation to any Person
so as to ensure the complete and prompt fulfilment, observance and performance of the
provisions of this Agreement and generally that full effect is given to the provisions of this
Agreement.
19.7 Without prejudice to the generality of Clause ______, the Company and the Promoters
agree that if any provisions of the Articles of Association of Company at any time conflict
with any provisions of this Agreement, the Articles of Association of the Company shall
be promptly amended to the extent necessary to give effect to the provisions of this
Agreement and in order to ensure that the provisions of this Agreement shall prevail.

29

English Language
19.8 All notices or formal communications under or in connection with this Agreement shall be
in the English language.
Assignment
19.9 The Investor shall not be entitled to, nor shall they purport to, assign Transfer, charge or
otherwise deal with all or any of its/their rights and/or obligations under this Agreement
nor grant, declare, create or dispose of any right or interest in it, in whole or in part,
otherwise than as provided under this Agreement.
19.10 Subject to restrictions imposed in this behalf under this Agreement, the Investor shall be
entitled to assign its rights and Transfer its obligations hereunder to any Person including
without limitation, to any third party company/investor in such Affiliate subject to such
Affiliate signing a deed of adherence to this Agreement.
19.11 A Transfer of more than ____% (____ percent) of the shareholding of the Investor to a
third party shall automatically result in such party also becoming entitled to the rights of
the Investor hereunder provided that such assignment shall not affect the number of full
time directors of the Investor on the Board of the Company. However, such a third party
transferee shall execute a deed of adherence to this Agreement. For the avoidance of
doubt, it is clarified that the Investor shall at all times be absolutely entitled to transfer any
or all of its securities to or for his benefit in accordance with the provisions of Clause ___
(Dealings in Securities).
19.12
This Agreement shall be binding upon and inure to the benefit of the Parties
and their respective heirs, successors, permitted assigns, executors and administrators.
Severability
19.13 If any provision of this Agreement is or becomes invalid, illegal or unenforceable under
the laws of any jurisdiction, then such provision shall (so far as it is invalid or
unenforceable) be given no effect and shall be deemed not to be included in this
Agreement but without invalidating any of the remaining provisions of this Agreement
which shall not in any way be affected or impaired. The Parties hereto shall then use all
reasonable endeavours to replace the invalid or unenforceable provisions with a valid and
enforceable and mutually satisfactory substitute provision, achieving as nearly as possible
the intended commercial effect of the invalid, illegal or unenforceable provision.
Waivers and remedies
19.14 No failure or delay by the Parties in exercising any right or remedy provided by law under
or pursuant to this Agreement shall impair such right or remedy or operate or be
construed as a waiver or variation of it or preclude its exercise at any subsequent time and
no single or partial exercise of any such right or remedy shall preclude any other or further
exercise of it or the exercise of any other right or remedy.
19.15 The rights and remedies of the Parties under or pursuant to this Agreement are
cumulative, may be exercised as often as such Party considers appropriate and are in
addition to its rights and remedies under the general laws of India.

30

Variation
19.16 No variation of this Agreement (or of any of the documents referred to in this Agreement)
shall be valid unless it is made by an instrument in writing and signed by duly authorised
representatives of each of the Parties hereto. The expression variation shall include any
variation, amendment, supplement, deletion or replacement however effected.
Counterparts
19.17 This Agreement may be executed in any number of counterparts and by the Parties to it on
separate counterparts, each of which shall be an original but all of which together shall
constitute one and the same instrument.
Subsidiaries
19.18 The provisions of this Agreement shall apply mutatis mutandis to all Subsidiaries of
Company if any (as defined in Schedule []) and the Company and the Promoters and the
Specified Subsidiaries shall procure that the Subsidiaries act in accordance with this
Agreement. It is clarified that the Investor shall not be required to hold any shares of the
Subsidiaries.
20.

NOTICES

Service of Notice
20.1 Any notice or other communication to be given by one Party to any other Party under, or
in connection with, this Agreement shall be made in writing and signed by or on behalf of
the Party giving it. It shall be served by letter or facsimile transmission (save as otherwise
provided herein) and shall be deemed to be duly given or made when delivered (in the case
of personal delivery), at the time of transmission (in the case of facsimile transmission,
provided that the sender has received a receipt indicating proper transmission and a hard
copy of such notice or communication is forthwith sent by prepaid post to the relevant
address set out below) or 10 (ten) days after being despatched in the post, postage prepaid,
by the most efficient form of mail available and by registered mail if available (in the case
of a letter) to such Party at its address or facsimile number specified in Clause 20.2, or at
such other address or facsimile number as such Party may hereafter specify for such
purpose to the other Parties hereto by notice in writing.
Details for Notices
20.2 The addresses and fax numbers for the purpose of Clause 20.1 are as follows:
Company
Address: []
Fax:
[]
For the attention of: []
The Investor
Address: []
Fax: []
For the attention of: []

31

The Promoters
Address: []
Fax: []
For the attention of: []
21.

DISPUTE RESOLUTION

21.1 In the event of any dispute, controversy or claim arising out of, relating to, or in
connection with this Agreement, or the breach, termination or validity hereof, the Parties
shall first discuss with each other with the intention of resolving such disputes etc in an
amicable manner in their common interest prior to proceeding for arbitration under Clause
[] below.
21.2 Any dispute, controversy or claim arising out of, relating to, or in connection with this
Agreement, or the breach, termination or validity hereof, which is not resolved by mutual
discussions, shall be finally settled exclusively by arbitration under the Arbitration and
Conciliation Act, 1996 (Arbitration Act) by a panel of [3] arbitrators of whom the
Promoters and the Company shall appoint one arbitrator, the Investor shall appoint one
arbitrator and the two arbitrators so appointed shall appoint the third arbitrator. The venue
of the arbitration shall be []. The language of arbitration shall be English. The Arbitration
shall be conducted in accordance with the rules under the Arbitration Act.
21.3 In order to facilitate the comprehensive resolution of related disputes, and upon request of
any Party to the arbitration proceeding, the arbitration tribunal may, within 90 (ninety)
days of its appointment, consolidate the arbitration proceeding with any other arbitration
proceeding involving any of the Parties relating to this Agreement or the Restated Articles.
The arbitration tribunal shall not consolidate such arbitrations unless it determines that (i)
there are issues of fact or law common to the proceedings, so that a consolidated
proceeding would be more efficient than separate proceedings, and (ii) no Party would be
prejudiced as a result of such consolidation through undue delay or otherwise. In the
event of different rulings on this question by the arbitration tribunal constituted hereunder
and any tribunal constituted under the Restated Articles, the ruling of the tribunal
constituted hereunder will govern, and that tribunal will decide all disputes in the
consolidated proceeding.
21.4 The arbitral award shall be final and binding on the Parties. The award may include an
award of costs, including reasonable attorneys fees and disbursements. Judgment upon
the award may be entered by any court having jurisdiction thereof or having jurisdiction
over the relevant Party or its assets.
21.5 The costs of arbitration shall be borne by the losing Party unless otherwise determined by
the arbitration award.
21.6 When any dispute occurs and is under arbitration, except for the matters under dispute,
the Parties shall continue to exercise their remaining respective rights, and fulfil their
remaining respective duties and obligations, under this Agreement.
21.7 Notwithstanding this Clause ___ or any other provision to the contrary in this Agreement,
no Party shall be obligated to follow the foregoing arbitration procedure where such Party
intends to apply to any court of competent jurisdiction for an interim injunction or similar
equitable relief against any other Party, provided there is no unreasonable delay in the
prosecution of that application.

32

21.8 The provisions of Clause 21 shall survive any termination of this Agreement.
22.

GOVERNING LAW AND JURISDICTION

22.1 This Agreement and the relationship between the Parties hereto shall be governed by, and
interpreted in accordance with, the laws of India. Subject to the provisions of Clause ____,
the courts at Vishakapatna, A.P, India shall have exclusive jurisdiction in relation to all
matters arising out of this Agreement.
AS WITNESS this Agreement has been signed by the duly authorised representatives of the
Parties the day and year first before written.
[Schedules to follow]

33

SCHEDULE 1 SHAREHOLDING PATTERNS

Part A DETAILS OF PROMOTERS AND SHAREHOLDING PATTERN OF THE
COMPANY AS ON EFFECTIVE DATE
[to be inserted]
Sl.
Name and Address of the
No. Shareholder

No. of Equity Shares

held as of date of this
Agreement

% of
share
holding

Total

Part B SHAREHOLDING PATTERN OF THE COMPANY AS ON COMPLETION

[to be inserted]

34

SCHEDULE 2 DETAILS OF THE COMPANY AND ITS SUBSIDIARIES

Part A DETAILS OF THE COMPANY
1.
1.

Name and Registration

Number
Date of Incorporation

2.

Place of Incorporation

3.

Address of Registered Office

4.

Class of Company

5.

Authorised Share Capital

6.

Issued Share Capital

7.

Directors
Full Name

8.

Secretary
Full Name

9.

Accounting Reference Date

10.

Auditors

11.

Tax residence

Part B DETAILS OF THE SUBSIDIARIES

2.
12.

Name and Registration

Number
Date of Incorporation

35

13.

Place of Incorporation

14.

Address of Registered Office

15.

Class of Company

16.

Authorised Share Capital

17.

Issued Share Capital

18.

Directors
Full Name

19.

Secretary
Full Name

20.

Accounting Reference Date

21.

Auditors

22.

Tax residence

36

SCHEDULE 3

37