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Confidential
Private Circulation – for the Addressee only
RELIGARE FINVEST LIMITED
RELIGARE FINVEST LIMITED INFORMATION MEMORANDUM
FOR
ISSUE OF SECURED REDEEMABLE NON CONVERTIBLE DEBENTURES
ON A PRIVATE PLACEMENT BASIS
Confidential
Private Circulation – for the Addressee only
1 | P a g e
DISCLOSURES UNDER SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE
AND LISTING OF DEBT SECURITIES) REGULATIONS, 2008
(i) Name and registered office address of the Issuer
Religare Finvest Limited. (Hereinafter referred to as “the Issuer” or “the Company” or
“RFL”)
Registered & Corporate Office:
Religare Finvest Limited 19, Nehru Place, New Delhi – 110019
Tel. No. + 91-11- 3081 5100
Corporate Office:
A-3 to A-5, Plot No. 11,
GYS Global,
Sector – 125, Noida – 201 301
Tel.No. + 91 -120 -3391000
Website : www.religarefinvest.com
Compliance Officer
Punit Arora
Company Secretary
Email: [email protected]
Debenture Issue
The Company proposes to issue 2000 (Two Thousand only) Redeemable, secured, non
convertible debentures of face value of Rs. 10,00,000/- (Rupees Ten Lakhs Only ) each,
aggregating to Rs. 200,00,00,000/- (Rupees Two Hundred Crores only) on private
placement basis (“the Issue” or “ the Debentures”).
General Risk
For taking an investment decision, investors must rely on their own examination and make
their own assessment as to the suitability of investing in the Debentures of the issue of the
Debentures as per the information provided in this disclosure document as required under
Securities and Exchange Board of India (Issue and Listing of Debt Securities)
Regulations, 2008 (“Disclosure Document/Information Memorandum”). The
Debentures have not been recommended or approved by the Securities and Exchange
Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of this
Disclosure Document. This Disclosure Document has not been submitted, cleared or
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2 | P a g e
approved by SEBI. It should be clearly understood that the Company is solely responsible
for the correctness, adequacy and disclosure of all relevant information herein.
Other risks
Prospective investors should consult their own legal, regulatory, tax, financial and/or
accounting advisors about risks associated with an investment in the Debentures and the
suitability of investing in such Debentures in light of their particular circumstances.
Issuer’s absolute responsibility
The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms
that this Disclosure Document contains all information with regard to the Issuer and the
Issue, which is material in the context of the Issue, that the information contained in this
Disclosure Document is true and correct in all material respects and is not misleading in
any material
respect, that the opinions and intentions expressed herein are honestly held and that there
are no other facts, the omission of which makes this Disclosure Document as a whole or
any of such information or the expression of any such opinions or intentions misleading in
any material respect.
Stock Exchange Disclaimer Clause
It is to be distinctly understood that filing of this Disclosure Document with the Bombay
Stock Exchange Ltd (“Stock Exchange”) should not, in any way, be deemed or construed
that the same has been cleared or approved by the Stock Exchange. The Stock Exchange
does not take any responsibility either for the financial soundness of any scheme or the
project for which the Issue is proposed to be made, or for the correctness of the statements
made or opinions expressed in this Disclosure Document.
Credit rating
ICRA has assigned the Issuer rating of “LA+” (pronounced as LA plus) for Rs. 500
Crores Long Term Debt to be raised by the Company.
Listing
The secured, redeemable, Non-Convertible Debentures are proposed to be listed on
Bombay Stock Exchange Limited (“BSE”).
Trustees for the Debenture holders/Debenture Trustees
AXIS TRUSTEE SERVICES LIMITED
Registered office at Maker Towers-"F", 13th Floor, Cuffe Parade, Colaba
Mumbai-400005
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Corporate Office at Maker Towers-"F", 6th Floor, Cuffe Parade, Colaba
Mumbai-400005
Registrar to the Issue
Link Intime India Private Ltd.
A-40, 2nd
floor, Naraina Industrial Area, Phase-II
Near Batra Banquet Hall, New Delhi-110028
Sole Book Runner & Lead Arranger
Standard Chartered Bank
90, Mahatma Gandhi Road, Fort,
Mumbai – 400 001
Disclaimer of the Lead Arranger
“The Arranger does not in any manner warrant, certify or endorse the correctness,
accuracy or completeness of any of the contents of this Information Memorandum. The
Arranger has neither scrutinized nor vetted or conducted any due-diligence for
verification of the contents of this Information Memorandum. The Arranger shall use this
Information Memorandum for the purpose of soliciting subscription(s) for the NCDs to
be issued by the Company on private placement basis. It is to be distinctly understood
that the use of this Information Memorandum by the Arranger should not in any way be
deemed or construed to mean that the Information Memorandum has been prepared,
cleared, approved or vetted by the Arranger.”
This Information Memorandum under Securities and Exchange Board of India (Issue and
Listing of Debt Securities) Regulation, 2008 for private placement is neither a prospectus
nor a statement in lieu of prospectus and does not constitute an offer to the public
generally to subscribe for or otherwise acquire the Debentures issued or to be issued by
the Issuer.
Apart from this Disclosure Document, no disclosure document or prospectus has been
prepared in connection with this Issue or in relation to the Company nor is such a
prospectus required to be registered under the applicable laws. Accordingly, this
Disclosure Document has neither been delivered for registration nor is it intended to be
registered.
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This Disclosure Document has been prepared to provide information about the pricing
and other terms and conditions including the nature of the Debentures, exclusively to
potential investors to whom it is addressed and who are willing and eligible to subscribe
to the Debentures. This Disclosure Document does not purport to contain all the
information that any potential investor may require. Neither this Disclosure Document
nor any other information supplied in connection with the Debentures is intended to
provide the basis of any credit or other evaluation and any recipient of this Disclosure
Document should not consider such receipt a recommendation to purchase any
Debentures. It is the responsibility of potential investors to also ensure that they will sell
these Debentures in strict accordance with applicable laws including restrictions on who
may acquire the Debentures and so that the sale does not constitute an offer to the public
within the meaning of the Act.
None of the intermediaries or their agents or advisors associated with this Issue undertake
to review the financial condition or affairs of the Company or the factors affecting the
Debentures during the life of the arrangements contemplated by this Disclosure
Document or have any responsibility to advise any investor or potential investor in the
Debentures of any information available with or subsequently coming to the attention of
the intermediaries, agents or advisors. No person has been authorized to give any
information or to make any representation not contained or incorporated by reference in
this Disclosure Document or in any material made available by the Company to any
potential investor pursuant hereto and, if given or made, such information or
representation must not be relied upon as having been authorized by the Company. The
intermediaries and their agents or advisors associated with this Issue have not separately
verified the information contained herein. Accordingly, no representation, warranty or
undertaking, express or implied, is made and no responsibility is accepted by any such
intermediary, agent or advisor as to the accuracy or completeness of the information
contained in this Disclosure Document or any other information provided by the
Company. Accordingly, all such intermediaries, agents or advisors associated with this
Issue shall have no liability in relation to the information contained in this Disclosure
Document or any other information provided by the Company in connection with the
Debentures.
The contents of this Disclosure Document are intended to be used exclusively by those
investors to whom it is distributed. It is not intended for distribution to any other person
and should not be reproduced by the recipient, in any manner whatsoever.
The person to whom a copy of this Disclosure Document is sent is alone entitled to apply
for the Debentures. No invitation is being made to any persons other than those to whom
application forms along with this Disclosure Document have been sent. Any application
by a person to whom the Disclosure Document and the application form has not been sent
by the Company shall be summarily rejected without assigning any reason therefore. The
person who is in receipt of this Information Memorandum shall maintain utmost
confidentiality regarding the contents hereof and shall not reproduce or distribute in
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5 | P a g e
whole or part or make any announcement in public or to a third party regarding its
contents, without the prior written consent of the Company.
Each person receiving this Disclosure Document acknowledges that such person has been
afforded an opportunity to:
a) request and to review and has received all additional information considered by an
individual to be necessary;
b) to verify the accuracy of the Disclosure Document; and
c) to understand the nature of the Debentures and the risks involved in investing in them
including for any reason having to sell them or be made to redeem them before final
redemption date.
Further, such person acknowledges that he has not relied on any intermediary or agent or
advisor or underwriter that may be associated with issuance of the Debentures in connection
with its investigation of the accuracy of such information or its investment decision.
The Company does not undertake to update the Disclosure Document to reflect subsequent
events after the date of the Information Memorandum and thus it should not be relied upon
with respect to such subsequent events without first confirming its accuracy with the
Company. Neither the delivery of this Disclosure Document nor any sale of Debentures made
hereunder shall, under any circumstances, constitute a representation or create any
implication that there has been no change in the affairs of the Company since the date hereof.
The Disclosure Document is made available to potential investors on the strict understanding
that it is confidential and is provided exclusively for their use.
Disclaimer statement from the Company
The Company accepts no responsibility for statements made other than in this Information
Memorandum and/or any other material expressly stated to be issued by or at the instance of the
Company in connection with the issue of these Debentures and that anyone placing reliance on
any other source of information would be doing so at their/ its own risk.
(ii) Name and Address of the Directors of the Issuer
Sr. No. Name Designation Address
1.
Sunil
Godhwani
Director
A-2, Inayat Farm, Asola,
Fatehpur Beri, P.O. Mehrauli,
NewDelhi - 110030
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2.
Atul Gupta Whole Time
Director
Flat No-42, Prayag Appartments,
Plot No-B-1, Vasundhara Enclave,
New Delhi - 110096
3.
J.S.Grewal Whole Time
Director
F-07 Mittal Park, 44 J.R. Mhatre
Road, Opp. Godrej Bungalow,
Juhu, Mumbai- 400049
4.
Sunil Kumar
Garg
Director C-90 Ramprastha, Gaziabad,
201011, Uttar Pradesh,
5.
Padam
Narain Behl
Director D-70, Ranjit Avenue,
Amritsar - 143001
6.
J.W. Balani Director Compas De La Victoria 3, 29012
Spain-29012
7.
R.K.Shetty Alternate to
J.W.Balani
D-2, 166, Chartered Cottage
Langford Road, Bangalore
560025, Karnataka
(iii) A brief summary of the business/ activities of the Issuer and its line of business
Religare Finvest Limited
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RFL was incorporated as an investment company on January 6, 1995 as “Skylark
Securities Private Limited” under the Companies Act, 1956 (“Act”). Its CIN is
U74999DL1995PLC064132. Subsequently, on September 23, 2004 it changed its name
to “Fortis Finvest Private Limited” and on October 7, 2004 it changed its name to “Fortis
Finvest Limited”. On April 4, 2006 it changed its name to its present name.
The registered office of RFL is situated at 19, Nehru Place, New Delhi- 110 019, India.
RFL is a Non Banking Financial Company (“NBFC”) not accepting public deposits and
is registered with the Reserve Bank of India (“RBI”). RFL is currently engaged in the
business of extending personal/corporate credit, corporate finance advisory, IPO
distribution, mutual fund distribution services and DP services.
The shares of RFL are not listed on any stock exchange.
Operational coverage and expansion
RFL is registered with the RBI as a NBFC and is presently engaged in providing
personal/corporate credit such as LAS, personal loans, loan against property and loan for
commercial vehicles, PFS and IPO financing. RFL has obtained post facto permission
from the RBI for distribution of mutual fund products and has applied to the SEBI for
registration as a custodian of securities under the provisions of the Securities and
Exchange Board of India (Custodian of Securities) Regulations, 1996, as amended, to
provide custodian services to its clients. RFL believes that its pan-India coverage through
the Religare brand will allow it to continue to grow its consumer loan portfolio. RFL’s
ability to appraise credit with a quality in-house team is key to providing efficient credit
decisions, a factor that will further enhance RFL’s ability to penetrate the consumer credit
market. ICRA, one of the leading rating agencies in India, has recently rated RFL with its
rating ‘LA+’ for the long term debt for Rs. 500 crores.
RFL has ramped up its distribution business and its advisor team is 350 as on August 31,
2009 and it has increased collection of third party assets.
Operations
Religare Finvest Limited undertakes the following operations:
Lending Operations - Capital Markets Financing
LAS: RFL’s LAS business involves offering loans secured by shares held by its retail
customers. RFL’s LAS book size as on August 31, 2009 amounted to Rs. 8,156.56
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million with approximately 2,319 clients. During fiscal 2007, RFL’s LAS book size
amounted to Rs. 4,410.09 million and as of fiscal 2008, the total book size had increased
to Rs. 8,678.38 million. RFL’s LAS had a base of approximately 1,611 clients as on
March 31, 2007 which grew to approximately 2,675 as on March 31, 2008.
IPO Financing: IPO financing is focused on the retail finance market in India and is
engaged in offering secured loans to retail customers who subscribe to shares of
companies in domestic public offerings (“IPO Financing”). IPO Financing helps
customers overcome the liquidity concerns by providing leverage to make large size
applications. RFL undertakes IPO Financing with minimal incremental costs due to its
existing infrastructure and client base.
Lending Operations - Consumer Financing
Personal Loans: RFL offers unsecured personal loans at fixed rates to specific customer
segments, with focus on creditworthy individuals with low access to credit, such as
salaried employees from the lower middle class. The average maturity for such loans is
36 (thirty six) months. For the 5 (five) months period ended August 31, 2009, RFL
disbursed personal loans amounting Rs. 980.64 million. During fiscal 2007, RFL
disbursed personal loans amounting Rs. 309.37 million and in fiscal 2008, the total
disbursement increased to Rs. 1,840.93 million. During fiscal 2009 RFL disbursed
personal loans amounting Rs. 1,828.53 million. RFL’s personal loan business has been
rolled out in seven locations and has credit and sales managers across these locations.
RFL had a customer base of approximately 844 clients as on March 31, 2007 which grew
to approximately 6,221 and 10,294 as on March 31, 2008 and August 31, 2009,
respectively.
Loan for Commercial Vehicles: RFL also recently began offering loans for commercial
vehicles and is in the process of entering into certain arrangements for financing
commercial vehicles.
Loan against Property: RFL also provides loans against property and total disbursal as
on August 31, 2009 was Rs. 5,760.94 million.
Distribution Business – Personal Financial Services
Financial planning services are geared toward individuals seeking advice on how best to
manage their financial resources. This may include a debt and asset analysis, as well as
college, retirement, estate and tax planning. Customers utilizing the financial planning
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services receive periodic checks to monitor how well the plan is being followed and
performing over time.
Much of the planning revolves around developing an income and expense budget, with
advice on the types of financial investments suitable for a particular client. With a view to
leverage the strength of its branch network during the course of fiscal 2007, RFL started
distribution of mutual funds and, in fiscal 2008, it converted this segment to ‘Personal
Financial Services (“PFS”), which provides financial planning services where a single
team can advise clients across various product and service offerings.
As of August 31, 2009, RFL had approximately 83,590 PFS folios for its retail
customers, with total funds of Rs. 7,769.83 million invested in equity-related funds and
Rs. 15,47,347.57 million in debt-related funds. RFL’s PFS team now offers a diversified
spectrum of financial planning to customers, which includes insurance, IPOs and mutual
funds. RFL had about 350 dedicated PFS advisors as of August 31, 2009.
(iv) A brief history of the Issuer since its incorporation giving details of its activities
including any reorganization, reconstruction or amalgamation, changes in its capital
structure, (Authorized, Issued and Subscribed) and borrowings, if any
History
RFL was incorporated as an investment company on January 6, 1995 as “Skylark
Securities Private Limited” under the Act. Its CIN is U74999DL1995PLC064132.
Subsequently, on September 23, 2004 it changed its name to “Fortis Finvest
Private Limited” and on October 7, 2004 it changed its name to “Fortis Finvest Limited”.
On April 4, 2006 it changed its name to its present name.
The Business
An extract of one of the main objects of the Memorandum of Association of the
Company is reproduced below:
“To lend money on any terms that may be thought fit to any persons or companies or
customers having dealings with the Company.”
Changes in the capital structure
The following changes have been made to the Capital Structure of the Company:
(i) Authorized Share Capital of the Company
Date Particulars
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15/09/2004 From Rs. 25,00,000 divided into 2,50,000 equity shares of Rs. 10 each
to Rs. 2,00,00,000 divided into 20,00,000 equity shares of Rs. 10 each
23/09/2005 From Rs. 2,00,00,000 divided into 20,00,000 equity shares of Rs. 10
each to Rs. 5,00,00,000 divided into 50,00,000 equity shares of Rs. 10
each
2/2/2006 From Rs. 5,00,00,000 divided into 50,00,000 equity shares of Rs. 10
each to Rs. 55,00,00,000 divided into 50,00,000 equity shares of Rs. 10
each and 5,00,00,000 cumulative redeemable preference shares of Rs. 10
each
22/03/2006 Alteration of Authorised Share Capital from Rs. 55,00,00,000 divided
into 5,00,00,000 Cumulative Shares of Rs. 10 each and 50,00,000
Equity Shares of Rs. 10 each, to Rs. 55,00,00,000 divided into
2,50,00,000 Equity Shares of Rs. 10 each and 3,00,00,000 Cumulative
Redeemable Preference Shares of Rs. 10 each by cancellation of un-
issued 2,00,00,000 cumulative redeemable preference shares of Rs. 10
each and in lieu thereof by creation of 2,00,00,000 equity shares of Rs.
10 each.
2/12/2006 From Rs. 55,00,00,000 divided into 2,50,00,000 equity shares of Rs. 10
and 3,00,00,000 Cumulative Redeemable Preference Shares of Rs. 10
each to Rs. 90,00,00,000 divided into 6,00,00,000 equity shares of Rs.
10 each and 3,00,00,000 Cumulative Redeemable Preference Shares of
Rs. 10each.
30/12/2006 Alteration of Authorised Share Capital from Rs. 90,00,00,000 divided
into 3,00,00,000 Redeemable Preference Shares of Rs. 10 each and
6,00,00,000 Equity Shares of Rs. 10 each, to Rs. 90,00,00,000 divided
into 9,00,00,000 Equity Shares of Rs. 10 each by cancellation of un-
issued 3,00,00,000 cumulative redeemable preference shares of Rs. 10
each in lieu thereof by creation of 3,00,00,000 equity shares of Rs. 10
each
22-10-2007 From Rs. 90,00,00,000 divided into 9,00,00,000 equity shares of Rs. 10
each to Rs. 1,500,000,000 divided into 1,50,000,000 equity shares of Rs.
10 each
01-12- 2008 From Rs. 1,500,000,000 divided into 150,000,000 equity shares of Rs.
10 each to Rs. 2,500,000,000 divided into 250,000,000 equity shares of
Rs. 10 each.
(ii) Issued and Subscribed and Paid Up Capital of the Company
Date Of Allotment Particulars (No. of Shares)
17-10-1997 1,50,000 equity shares of Rs. 10/- each
25-11-1997 50,000 equity shares of Rs. 10/- each
5-11-1999 49,980 equity shares of Rs. 10/- each
29-9-2004 17,50,000 equity shares of Rs. 10/- each
30-09-2005 30,00,000 equity shares of Rs. 10/- each
28-03-2006 2,00,00,000 equity shares of Rs. 10/- each and
25000000, 6% Cumulative Redeemable Preference
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Shares of Rs.10/- each *
12-12-2006 1,25,00,000 equity shares of Rs. 10/- each
30-12-2006 5,00,00,000 equity shares of Rs. 10/- each
05-11-2007 1,21,21,760 equity shares of Rs. 10/- each
19-11-2007 1,06,95,377 equity shares of Rs. 10/- each
31-03-2008 95,90,000 equity shares of Rs. 10/- each
01-07-2009 4,71,65,000 equity shares of Rs. 10/- each
23-07-2009 20,00,000 equity shares of Rs. 10/- each
* The preference shares have been redeemed as on 12.12.2006
(v.) Details of debt securities issued and sought to be listed including face value, nature of
debt securities mode of issue i.e. public issue or private placement.
Instrument/Facility Redeemable non-convertible secured Debentures ("Debentures")
Mode of
Placement
On private placement basis to all eligible investors
Issue Price Face
Value of
Debenture
Rs 10,00,000.00 (Rupees Ten Lakhs only) each at par
Issue Amount INR 200 crores (Indian Rupees Two Hundred crores only) split
between Tranche 1, Tranche 2 and Tranche 3 as under :
Tranche 1 : ~ Rs.66 Crore
Tranche 2 : ~ Rs.67 Crore
Tranche 3 : ~ Rs.67 Crore
Redemption Bullet
Redemption and
Maturity Date
Tranche 1: 1 year from the Deemed Date of Allotment. i.e. *******
Tranche 2: 2 years from the Deemed Date of Allotment. i.e.
*******
Tranche 3: 3 years from the Deemed Date of Allotment. i.e.
*******
(vi.) Issue Size
Issue Size Rs. 200 Crores
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(vii.) Details of utilization of the Issue proceeds
The proceeds of the Issue will be utilized for general corporate purposes.
Details of the bank account where the Issue proceeds have to be deposited
Beneficiary Name Religare Finvest Limited
Credit Account No. 22505682326
Centre (Location) 23-25 M.G Road Branch, Mumbai
Bank Standard Chartered Bank
Branch 23-25 M.G Road, Fort, Mumbai-400001
Account Type Savings / Current / Over Draft
IFSC Code SCBL0036046
(viii.) A Statement containing particulars of the dates of, and parties to all material
contracts, agreements involving financial obligation of the Issuer.
1. Memorandum and Articles of Association of the Company, as amended from time to time.
2. Certificate of Incorporation of the Company dated 6th January, 1995
3. NBFC Registration Certificate issued by Reserve Bank of India dated 10th November, 2006.
4. Board resolutions approving the private placement of Debentures dated 28.08.2009
5. Tripartite Agreement between the Company, the Depository and the Registrar for the issue of
the Debentures in demat form 27.04.2005.
6. Consent letters from the trustees to the Debenture holders dated 01.10.2009.
7. Annual reports of the Company for the last five years.
8. Credit ratings assigned to the Company by ICRA dated 1st September, 2009.
9. Financial arrangements with various banks, mutual funds and corporates (As per the table
provided below).
( ix.) Details of other Borrowings including any other issue of debt securities in past.
Statement of secured loans/ unsecured loans & instruments as on 31st August 2009
S.N.
Name of the
Banks/Lenders
Date of the
sanctioned/
agreement
Type of
Instrument
Sanctioned
Amount (Amt.
in Rs. Crores)
Outstanding
amount (Amt.
in Rs. Crores)
1
Breakup of Secured
Loans:-
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HDFC BANK April,2009 8.61 1.80
Sub Total (1)
1.80
2.
Break up of unsecured
Loans:-
(i) Various Mutual Funds
Commercial
Papers 819.00
(ii) Various Mutual Funds Non Convertible
Debentures
955.00
(iii) Corporates
Inter-corporate
Deposits 17.64
(iv)
Standard Chartered
Bank (Mauritius) Limited
Compulsorily
convertible
Debentures
60.00
Interest on above 0.31
Sub Total (2)
1851.95
Grand Total (1)+(2)
1853.75
(x.) Any material event / development or change at the time of issue or subsequent to the
issue which may affect the issue or investors decision to invest / continue to invest in the
debt securities.
In the opinion of the Directors of the Company, there have been no material developments after
the date of the last financial statements as disclosed in the Disclosure Document, which would
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materially and adversely affect, or would be likely to affect, the trading or profitability of the
Company or the value of its assets or its ability to pay its liabilities.
(xi.) Particulars of the debt securities issued for consideration other than cash, whether in
whole or part, at a premium or discount or in pursuance of an option.
The Company has not issued any debt securities for consideration other than cash, whether in
whole or part, at a premium or discount or in pursuance of an option.
(xii.) A list of highest ten holders of each class or kind of securities of the Issuer as on the
date of the application along with particulars to the number of shares or debt securities
held by them and the address of each such holder.
List and address of shareholders of Religare Finvest Limited as on 31/8/2009
S. No. Name of Shareholder Number of equity shares
of Rs. 10 each
% of Issued Capital
1. Religare Enterprise Limited (REL)
19, Nehru Place, New Delhi -
110019
169,071,537
99.99
2. Mr. Malvinder Mohan Singh* 100 Negligible
3. Mr. Shivinder Mohan Singh* 100 Negligible
4. Ms. Japna Malvinder Singh* 100 Negligible
5. Ms. Aditi Shivinder Singh* 100 Negligible
6. Mr. Gurpreet Singh Dhillon* 100 Negligible
7. Mr. Gurkirat Singh Dhillon* 100 Negligible
Total 169,072,137
100.00
*Nominee of REL
(xiii.) An undertaking that the Issuer shall use a common form of transfer.
The normal procedure for the transfer of securities held in dematerialized form shall be
followed for transfer of these Debentures held in electronic form. The seller should give
delivery instructions containing details of the buyer’s Depository participant’s account to
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his Depository participant. The Issuer undertakes that there will be a common transfer
form / procedure for transfer of Debentures.
(xiv.) Redemption amount, period of maturity, coupon rate.
Redemption and
Maturity Date Tranche 1: 1 year from the Deemed Date of Allotment. i.e.
*******
Tranche 2: 2 years from the Deemed Date of Allotment. i.e.
*******
Tranche 3: 3 years from the Deemed Date of Allotment. i.e.
*******
Coupon _____% p.a., payable _______on each of the Tranches.
(xv.) Information relating to the terms of offer or purchase.
The Issuer is placing 2000 (Two Thousand only) secured, redeemable, non convertible
Debentures of face value of Rs. 10,00,000/- (Rupees Ten Lakhs Only ) each, aggregating to
Rs. 200,00,00,000 /- (Rupees Two Hundred Crores only).
Issuer Religare Finvest Ltd. (“RFL” or the “Issuer” or the “Company”)
Sole Book Runner
and Lead Arranger
Standard Chartered Bank (“Arranger/SCB”)
Instrument/ Facility Secured Redeemable Non Convertible Debentures (“Debentures”)
Issue Amount INR 200 crores (Indian Rupees Two Hundred crores only) split
between Tranche 1, Tranche 2 and Tranche 3 as under :
Tranche 1 : ~ Rs.66 Crore
Tranche 2 : ~ Rs.67 Crore
Tranche 3 : ~ Rs.67 Crore
Mode of Placement
On private placement basis to all eligible investors
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Purpose For general corporate purposes
Face Value Rs.10,00,000 (Rupees Ten Lakhs only) per Debenture
Issue Price At par
Security - First & Exclusive Charge over specific receivables to the extent of
1.5x of the Principal Amount Outstanding. All Receivables provided
as security shall be current at all times. The above cover will be
subject to a charge on receivables from secured assets to the extent of
at least 1.25x of the Principal Amount Outstanding.
- RFL to provide monthly statement showing the specific receivables
provided under first & exclusive charge to investor(s). Receivables
provided under first & exclusive charge shall not include any retail
capital market related loans and dues from associate or affiliates of
RFL, unless agreed by investor(s).
- Unconditional and irrevocable Corporate Guarantee covering
Principal and Interest from Religare Enterprises Ltd.(“REL” or
“Holding Company”)
Security should be created within 30 calendar days of the Deemed
Date of Allotment.
Rating “LA+/Stable” from ICRA
Maturity Date Tranche 1: 1 year from the Deemed Date of Allotment. i.e. *******
Tranche 2: 2 years from the Deemed Date of Allotment. i.e. *******
Tranche 3: 3 years from the Deemed Date of Allotment. i.e. *******
Redemption Bullet
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Coupon _____% p.a., payable _______on each of the Tranches.
Put & Call Option
None
Arranger Fees **************
Interest on
Application Money
Interest on application money will be paid to investors at Coupon
from the date of realization of subscription money up-to one day prior
to the Deemed Date of Allotment. Such interest shall be payable
within seven business days from the Deemed Date of Allotment.
Indicative Timing Issue Opening Date: *********
Issue Closing Date: *********
Pay in Date: *********
Deemed Date of Allotment: *********
All documentation including, but not limited to, the Information
Memorandum, Board Resolution, Rating Letter, Appointment of
Trustees, In-principle listing approval from the Stock Exchange etc.,
to be completed and made available to the Arranger 1 day prior to
subscription.
Business Day
Convention
If any payment date is not a Business Day in Mumbai, payment shall
be made on the next Business Day in Mumbai.
Business Day means a day which is not a Saturday or Sunday or a
public holiday and on which high value clearing facility is available in
Mumbai.
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Day Count Basis Actual / Actual
Stamp duty payable
in case of transfer of
Debentures
Stamp Duty on secondary market transfer as applicable under the
Bombay Stamp Act. (Presently, no stamp duty is payable on transfer
of Debentures in dematerialised form).
Security Trustee Any SEBI registered Bank/ Institution mutually acceptable to the
Issuer & Arranger
Issue of Debentures
The Issuer will issue the Debentures / Letters of Allotment in
dematerialized form within one business day from the Deemed Date
of Allotment.
Documentation Customary documentation for the Issue as required by SCB.
Conditions
precedent:
SCB’s arrangership will be subject to the following conditions and
compliance of the said conditions by the Issuer wherever applicable:
(i) the accuracy and completeness of the representations
made /to be made by the Issuer to SCB and the
information that the Issuer has furnished /would furnish to
SCB till the closure of the Issue; and compliance by the
Issuer of the terms and conditions of this Agreement;
(ii) SCB having satisfied in a form and substance acceptable
to SCB and having obtained from the Issue (a) all
applicable internal and external approvals for the Issue
have been obtained by the Issuer applicable approvals
and resolutions passed by the board of directors of the
Issuer; (b) documentation for the Transaction being
prepared as specified in (iv) below and appropriate
business description disclosure in the offering circular
(prepared by the Issuer’s counsel);
(iii) the documentation in respect of the Issue is in full
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compliance with the statutory and Arranger’s
requirements and completed to the satisfaction of the
Arranger;
(iv) the Issuer obtaining in-principle approval from the
relevant stock exchange(s) for listing of Debentures;
(v) the absence of any default or cross default in respect of
other liabilities of the Issuer.
Covenants
*************
Optional
Prepayment
************
Resolutions required The Issuer should ensure that all the consents and resolutions required
to issue Debentures are in place prior to the issue.
The Issuer should also ensure that any and all applicable regulations
pertaining to this Issue are complied with, including but not limited to
RBI’s Prudential Guidelines on banks’ investment in non-SLR
securities dated 12th November 2003, SEBI Circular on Secondary
Market for Corporate Debt Securities dated 30th September 2003 and
22nd December 2003 and SEBI Issue & Listing of Debt Instrument
guidelines dated June 6, 2008
Expenses All expenses related to the issue including but not limited to costs
relating to stamp duty, legal fee, listing fee, credit rating charges and
other expenses will be to the account of the Issuer.
Material Adverse
Circumstances
The Agreement of SCB are subject to there being no material adverse
change (or an event which is likely to result in a material adverse
change) in:
i. the business activities, financial condition and credit standing
of the Issuer (or any of its shareholders, or subsidiaries) since
the date of their respective latest published financial
statements;
ii. the international or domestic money, bank, foreign exchange
and capital markets, or in the debt syndication market,
iii. the socio-political and economic situation of India (including
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as a result of hostilities along the borders of the Republic of
India ) or any event, whether domestic or international;
which in SCB’s sole opinion/judgement, would adversely impact the
successful syndication of the Issue /materially impair subscription to
the Debentures, from the date of acceptance of this offer till the
closure of the Issue.
In such an event, SCB shall have the option to renegotiate the terms of
the Issue or terminate the Agreement.
Investor Profile Banks, Mutual Funds, Financial Institutions, Insurance Corporations,
Provident & Pension Funds, Corporate Investors, FIIs. There shall be
no negative list of investors.
Clear Market
Provision
The Issuer undertakes that it will not announce or raise from the
market, either on bilateral or syndication basis, any Debentures from
the date of acceptance of this offer till the date of closure of the Issue.
Further, the Issuer also undertakes that it shall not announce or bring
to the market any other issuance of similar tenor Debentures on terms
better than those offered under the present issue for a period of 2
weeks from the Deemed Date of Allotment of these Debentures.
Derivative
Transactions
The Issuer confirms that it will offer SCB the first right of refusal to
SCB if it transacts derivatives / swaps for the purpose of risk
management on these debentures.
Listing On the WDM segment of The Stock Exchange, Mumbai. The Issuer
shall make an application for listing on the day of the deemed date of
allotment of Debentures, and ensure listing within two working days.
Publicity &
Communication
On successful conclusion of the Issue, the Arranger reserves the right
to issue publicity material such as tombstones, advertisements etc.
after discussion with the Issuer.
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Governing Law and
Jurisdiction
The Governing law will be the Indian Law and the parties submit to
the non-exclusive jurisdiction of the courts in Mumbai.
Validity of the
Indicative Terms
These indicative terms and conditions are open for
discussion*****************on October ******2009 after which
time these outline terms and conditions shall lapse if the Issuer has not
signed these terms and conditions by that time.
Over and above such terms and conditions, the Debentures shall also be subject to the
applicable provisions of the Depositories Act, 1996 and the laws as applicable,
guidelines, notifications and regulations relating to the allotment and issue of capital and
listing of securities issued from time to time by the Government of India ( “GoI”),
Reserve Bank of India , Securities & Exchange Board of India (“SEBI”), concerned
Stock Exchanges(s), or any other authorities and other documents that may be executed
in respect of the Debentures.
The terms of the Issue are as given below.
Nature and status of Debentures
1) The Company shall issue redeemable, secured, and non convertible Debentures. The
Debentures will constitute direct obligations of the Company and covered by pari passu
Mortgage over the Company’s Immovable property situated at plot no. 37, survey no. 35
of Mouje Irana of Kadi Taluka, Distt. Mehasana, Gujarat, and pari passu charge on
business receivables by way of hypothecation.
Deemed Date of Allotment
All the benefits under the Debentures, including the payment of interest/coupon, will
accrue to the investor(s) from the Deemed Date of Allotment. The Company shall ensure
that the demat accounts of the investors who have been allotted the Debentures are
credited within 1 (one) working day from the Deemed Date of Allotment.
Listing
The Debentures are proposed to be listed on the BSE within 2 (two) working days from
the Deemed Date of Allotment.
Issue in demat form
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The Company shall issue Debentures in dematerialized form only and has made
necessary arrangements with National Securities Depository Limited (“NSDL”) for the
same. Investors shall hold the Debentures in de-mat form and deal with the same as per
provisions of Depositories Act, 1996 / rules as notified by NSDL from time to time.
Investors should, therefore mention their Depository participant’s name, DP-ID and
Beneficiary Account Number in the appropriate place in the application form. The
Company shall take necessary steps to credit the Depository Account of the investor with
the number of Debentures allotted.
Mode of transfer / transmission of Debentures
The Debenture(s) shall be transferred and / or transmitted in accordance with the
applicable provisions of the Act. The provisions relating to transfer and transmission and
other related matters in respect of shares of the Company contained in the Articles of
Association of the Company and the Act shall apply, mutatis mutandis ( to the extent
applicable to Debentures) to the Debentures as well. The Debentures held in
dematerialized form shall be transferred subject to and in accordance with the rules /
procedures as prescribed by Depository participant of the transferor/transferee and any
other applicable laws and rules notified in respect thereof. The transferee(s) should
ensure that the transfer formalities are completed prior to the record date. In absence of
the same, principal and coupon will be paid/redemption will be made to the person,
whose name appears in the register of Debenture holders/record of the Depository. In
such cases, claims, if any, by the transferee(s) would need to be settled with the
transferor(s) and not with the Company.
Interest on application money
Interest on application money, if any, will be payable at the specified coupons (subject to
deduction of tax at source at the rates prevailing from time to time under the provisions of
Income Tax Act, 1961 or any statutory modification or re-enactment thereof), on the
entire application money on all valid applications. The same will be released within 7
(seven) business days from the Deemed Date of Allotment.
Such interest shall be paid for the period commencing from the date of realization of
cheque (s) / draft(s) up to one day prior to the Deemed Date of Allotment. The Interest
Warrants will be dispatched by registered post, courier or by way of bank transfer /
RTGS instruction at the sole risk of the applicant, to the sole / first applicant. No interest
on application money would be payable in cases of invalid applications.
Effect of holidays
Should any of dates defined above or elsewhere in the Disclosure Document, excepting
the Deemed Date of Allotment, fall on a Sunday or a Public Holiday, or a day in which
banks are closed for clearing, for the general public, the preceding working day shall be
considered as the effective date. However the payment of coupon shall be computed and
paid as per coupon rate.
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In case the principal redemption date falls on a Sunday or a Public Holiday, or a day in
which banks are closed for clearing for the general public, the payment due shall be made
on the preceding working date ( the effective date as mentioned above).
For the purposes of this clause, a Public Holiday or a day on which banks are closed for
clearing for the general public will be with reference to Mumbai, India.
Tax Deduction at Source
Income tax will be deducted at source from interest on application money/Debentures as
per applicable provisions of the Income Tax Act, 1961 and as applicable from time to
time. In respect of interest on application money, the relevant document (Form
15AA/15H) should be submitted along with the application form.
Where any deduction of income tax is made at source, the Company shall send to the
Debenture holder a Certificate of Tax Deduction at Source at the end of the Financial
Year.
Tax benefits.
The Debenture holder is advised to consider in his own case the tax implications in
respect of subscription to the Debentures after consulting his tax advisor.
Letter of allotments & Debenture certificate
The Company will allot to the investors, the Debentures in due course after verification
of the application form(s), the accompanying documents and on realization of application
money.
The de-mat account of the investors with NSDL/CDSL will be credited on completion of
all statutory formalities and such credit will be substituted for the number of Debentures
allotted.
There shall be first & exclusive charge over specific receivables to the extent of 1.5x of
the Principal Amount Outstanding. All Receivables provided as security shall be current
at all times. The above cover will be subject to a charge on receivables from secured
assets to the extent of at least 1.25x of the Principal Amount Outstanding.
RFL to provide monthly statement showing the specific receivables provided under first
& exclusive charge to investor(s). Receivables provided under first & exclusive charge
shall not include any retail capital market related loans and dues from associate or
affiliates of RFL, unless agreed by investor(s).
Unconditional and irrevocable Corporate Guarantee covering Principal and Interest from
Religare Enterprises Ltd.(“REL” or “Holding Company”)
Security should be created within 30 calendar days of the Deemed Date of Allotment.
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Execution of Trust Deed and other security documents
The Company shall execute a deed of hypothecation in favour of the Debenture Trustees
creating a pari passu charge on business receivables by way of hypothecation within 30
(thirty) days from the Deemed Date of Allotment of Debentures to secure the Debentures
for the benefit of the Debenture holders.
Stamp Duty
The Company will pay all stamp duties in relation to the Debentures and all documents
executed in relation to the Debentures including any security documents.
Redemption
There shall be bullet redemption of Debentures.
Procedure for redemption
In case of the Debentures held in de-mat form, no action is required on the part of the
Debenture holder(s) at the time of redemption of the Debentures and on the
redemption date the redemption proceeds would be paid by cheque or by way of
RTGS instruction to the Depositories by the Company. The name(s) would be as per
the Depositories’ records on the Record Date fixed for the purpose of redemption. All
such Debentures will be simultaneously redeemed through appropriate debit
corporate action. Interest and/or principal repayment shall be made to the person
whose name appears as sole or first holder in the register of Debenture
holders/beneficiaries on the Record Date.
In case of cheque issued towards redemption proceeds, the same will be dispatched
by courier or hand delivery or registered post at the address provided in the
application or at the address as notified by Debenture holder(s) or at the address as
per the Depositories’ records. Once the cheque for redemption proceeds is
dispatched to the Debenture holder(s) at the addresses provided or available from the
Depositories’ records, the Company’s liability to redeem the Debentures on the date
of redemption shall stand extinguished and the Company will not be liable to pay any
interest/coupon, income or compensation of any kind from the date of redemption of
the Debenture(s).
The Debentures will not carry any obligation for interest, or otherwise, after the
Maturity Date.
Succession
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Where Debentures are held in joint names and one of the joint holders dies, the
survivor(s) will be recognized as the holders(s) of the said Debentures. It would be
sufficient for the Company to delete the name of the deceased Debenture holders after
obtaining satisfactory evidence of his death.
In the event of demise of the sole /first holder of the Debentures(s), the Company will
recognize the executors or administrator of the deceased Debenture holder, or the
holder of the succession certificate or other legal representative as having title to the
Debentures only if such executor or administrator obtains and produces probate of a
will or letter of administration or is the holder of the succession certificate or other
legal representation, as the case may be, from an appropriate Court in India. The
Directors of the Company in their absolute discretion may, in any case, dispense with
production of probate of the will or letter of administration or succession certificate or
other legal representation.
Record Date
The Record Date shall be 10 (ten) calendar days before the redemption or interest
payment date of Debentures. The Company shall request the Depository (ies) to
provide a list of Beneficial Owners as at the end of the Record Date. This shall be the
list, which shall be considered for payment of coupon or repayment of principal
amount, as the case may be.
REPRESENTATIONS AND WARRANTIES
The Company declares represents and warrants as of the date hereof that:
1. Consent/approval required for the issue of Debentures
All corporate and other action necessary for the issuance of the Debentures have
been obtained by the Company and the Company will at all times keep all such
approvals /consents valid and subsisting during the term of the Debentures. The
company has obtained consent from Debenture Trustee holding prior charge for
creation of security for the Debentures.
2. Absence of defaults with Memorandum/ Articles of Association or any
other agreements in respect of transaction/ transaction document
The Disclosure Document and other documents executed in pursuance hereof,
including towards creation of the security, when executed and delivered, will
constitute valid and binging obligations of the Company and will not contravene
any applicable laws, statutes or regulations and will not be in conflict with the
Memorandum of Association/ Articles of Association of the Company or result
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in the breach of, any of the terms, covenants, conditions and stipulations under
any existing agreement to which the Company is a party.
3. Filings and registration
The Company shall duly and in a timely manner complete all filings and
registrations as may be required under law from time to time for the purposes of
the issue and maintenance of the Debentures and the creation of security.
4. No immunity under laws
Neither the Company nor its assets has any immunity (sovereign or otherwise)
from any suit or any legal proceeding under the laws of India.
5. Solvency
The Company is currently solvent and the Company has not taken any corporate
or other action, nor have any steps been taken or legal proceedings of any manner
been initiated/ threatened against the Company for its winding up, dissolution,
insolvency, bankruptcy or for appointment of receiver on its assets or its business.
6. No debt/contingent liability other than as disclosed in the annual audited
accounts
The Company has no debts or contingent liabilities outstanding except as
disclosed in its annual audited financial statement dated March 31, 2009. Debts as
on 31st August 2009 is given in point (ix) of this Disclosure Document.
7. Indebtedness
The Company is not in default with respect to any loans or deposits or advances
or other financial facilities availed by the Company in the capacity of the
Borrower.
COMPANY’S COVENANTS
(A) Affirmative covenants:
The Company shall:
(i) Disclosure Documents to conform to the Debenture Trust Deed
Ensure that the debenture trust deed executed in favour of the Debenture Trustees
(“Debenture Trust Deed”) and other security documents when executed shall be
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to the satisfaction of the Debenture Trustees and Debenture holders at all times ,
and will be in accordance with the terms and conditions as contained herein.
(ii) Validity of transaction documents
Ensure that the Disclosure Document, the Debenture Trust Deed and other
documents creating the security shall be validly executed and delivered, will
continue in full force and effect and will constitute valid and binding obligations
of the Company.
(iii) Notice of winding up or other legal process
Promptly inform the Debenture Trustees if it has notice of any application for
winding up having been made or any statutory notice of winding up under the
provisions of the Act, or any other notice under any other act or otherwise of any
suit or other legal processes intended to be filed or initiated against the
Company and affecting the title of the Company to its assets or if a Receiver is
appointed over any of the properties or businesses or undertakings of the
Company.
(iv) Annual Accounts
Submit to the Debenture Trustees it’s duly audited Annual Accounts, within 6
(six) months from the close of its accounting year. In case statutory audit is not
likely to be completed during this period, the Company shall get its accounts
audited by an independent firm of chartered accountants and furnish the same to
the Debenture Trustees.
(v) Memorandum and Articles of Association
Carry out such alterations to its Memorandum of Association and Articles of
Association as may be deemed necessary in the opinion of Debenture
holders/Debenture Trustees to safeguard the interests of the Debenture holders.
(vi) Preserve corporate status
Diligently preserve its corporate existence and status and its license to conduct
business as a non banking financial institution.
(vii) Furnish information to Debenture Trustees
Give to the Debenture Trustees or their nominee(s) such information as they shall
require as to all matters relating to the business, property and affairs of the
Company and at the time of the issue thereof to the shareholders of the Company
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furnish to the Debenture Trustees copies of every report, balance sheet, profit and
loss account, circulars or notices issued to the shareholders and the Debenture
Trustees shall be entitled if they deem fit, from time to time to nominate an
accountant or agent to examine the books of account, documents and property of
the Company or any part thereof and to investigate the affairs thereof and the
Company shall allow any such accountant or agent to make such examination and
investigation and shall furnish him with all such information as he may require
and shall pay all costs, charges and expenses incidental to such examination and
investigation.
(viii) Shall furnish quarterly report to the Debenture Trustees containing the
following particulars –
1) Updated list of the names and addresses of the Debenture holders.
2) Details of the interest due, but unpaid and reasons thereof.
3) The number and nature of grievances received from the Debenture holders and
resolved by the Company.
4) A statement that those assets of the Company which are available by way of
security are sufficient to discharge the claims of the Debenture holders as and
when they become due.
(ix) Promptly and expeditiously attend to and redress the grievances, if any, of the
Debenture holders. The Company further undertakes that it shall promptly
comply with the suggestions and directions that may be given in this regard, from
time to time, by the Debenture Trustees and shall advise the Debenture Trustees
periodically of the compliance.
(x) Corporate Governance
Confirm to all mandatory recommendations and make all disclosures as contained
in the listing agreement for privately placed Debentures or under the Act.
(xi) Due payment of public and other demands
Confirm that the Company is not, and will continue not to be, in arrears of any
undisputed public demands such as income-tax, corporation tax and all other taxes
and revenues or any other statutory dues payable to Central or State Governments
or any local or other authority.
(xii) Maintain listing
Confirm that the Company shall take all necessary steps and comply with the
listing agreement to ensure that the Debentures remain listed at all times during
the term of the Debentures.
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(xiii) Maintenance of rating
Confirm that the Company will comply with any agreement with the rating
agency and provide any necessary information to the rating agency so as to
continue to maintain a credit rating.
(xiv) Comply with provisions of Section 205C of the Companies Act, 1956
Comply with the provisions of Section 205C of the Act relating to transfer of
unclaimed / unpaid amounts of interest/coupon on Debentures and redemption of
Debentures to Investor Education and Protection Fund (“IEPF”), if applicable to
it.
EVENTS OF DEFAULT
The occurrence of any of the following events, or events similar thereto, shall each
constitute an Event of Default (“EOD”):
(i) Default in payment of principal sums of the Debentures Default has occurred in the payment of principal sums and/or coupon of the
Debentures on the due dates.
(ii) Default in performance of covenants and conditions Except for the events contained in paragraph (i) above, default has occurred in
the performance of any other covenants, conditions or agreement on the part
of the Company under these presents and such default has not been remedied
within 30 (thirty) days from the date of receipt of such notice.
(iii)Supply of misleading information Any information given by the Company in the Disclosure Document, reports
and other information furnished by the Company in accordance with the
reporting system and the warranties given/deemed to have been given by the
Company to the Debenture holders / Debenture Trustees is misleading or
incorrect in any material respect.
(iv) Proceedings against company The Company has voluntarily or involuntarily become the subject of
proceedings under any bankruptcy or insolvency law and such proceedings
have been admitted by a competent court or the Company is voluntarily or
involuntarily dissolved.
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(v) Appointment of receiver A receiver or a liquidator has been appointed or allowed to be appointed over
all or any part of the properties of the Company.
(vi) Inability to pay debts on maturity The Company has admitted in writing that the Company is unable to pay its
debts as they fall due.
(vii) Attachment or restraint on company’s properties If there is an attachment or restraint on assets of the Company, of value in
excess of Rs. 50,00,00,000/- (Rupees Fifty Crores).
(viii) Failure to create Security The Company fails to create the security as mentioned herein within 90
(ninety) days of the issue of the Debentures.
(ix) Breach of covenants The Company breaches any of the covenants as provided herein in relation to
the listing of the Debentures.
(x) Litigation against the transaction documents If the Company, for any reason whatsoever, initiates proceedings before any
court, challenging the validity of any of the documents in relation to the
Debentures.
(xi) Effectiveness of transaction documents If any of the documents in relation to the Debentures are found to be invalid
or unenforceable under the laws of India.
(xii) Illegality It is found to be, or becomes illegal under the laws of India, either wholly or
in part, for any reason whatsoever, for the Company to maintain the
Debentures, or the Company becomes obligated, under Indian laws, to
withdraw the Debentures, in any manner.
(xiii) Material adverse effect If there is an event of material adverse change which has or is likely to have,
in the reasonable view of the Debenture holder(s) / Debenture Trustees, a
material adverse effect on the Company’s business and financial operations.
Consequences of an EOD
In the event of the happening of an EOD, the Debenture Trustees will have a right to
accelerate the repayment of the Debentures along with all applicable outstanding dues
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including coupon and demand immediate repayment of the principal. The Debenture
Trustees will also have the right to enforce the security for such repayment.
Amendment of the terms of the Debentures
The rights, privileges, terms and conditions attached to the Debentures may be varied,
modified or abrogated with the consent, in writing, of those holders of the Debentures
who hold at least three fourths of the outstanding amount of the Debentures or with the
sanction accorded pursuant to a special resolution passed at a meeting of the Debenture
holder(s), provided that nothing in such consent or resolution which modifies or varies
the terms and conditions of the Debentures shall be operative against the Company, if the
same are not accepted by the Company.
Trustees for the Debentures holders
The Company has appointed Axis Trustee Services Limited to act as trustees for the
Debenture holders (“Debenture Trustees”). The Company and the Debenture Trustees
will enter into a Debenture Trust Deed, inter alia, specifying the powers, authorities and
obligations of the Debenture Trustees and the Company. The Debenture holder(s) shall,
without further act or deed, be deemed to have irrevocably given their consent to the
Debenture Trustees or any of their agents or authorized officials to do all such acts,
deeds, matters and things in respect of or relating to the Debentures as the Debenture
Trustees may in their absolute discretion deem necessary or require to be done in the
interest of the Debenture holder(s), except as expressly provided herein.
The Debenture Trustees will protect the interest of the Debenture holder(s) in the event of
default by the Company with regard to timely payment of coupon and repayment of
principal and they will take necessary action at the cost of the Company.
The investors can refer to the Debenture Trust Deed to be entered into with the Debenture
Trustees in order to know the powers, liabilities, rights, retirement, and removal etc. of
the Debenture Trustees.
Rights of Debenture holder(s)
The Debenture holder(s) will not be entitled to any rights and privileges of shareholders
other than those available to them under statutory requirements. The Debentures shall
not confer upon the holders the right to receive notice, or to attend and vote at the general
meetings of the Company. The Debentures shall be subject to other usual terms and
conditions as incorporated in the application form (Annexure I).
Future Borrowings
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The Company shall be free to borrow / raise loans or avail financial assistance in
whatever form, and also issue promissory notes / debentures or other securities in any
manner having such ranking, pari passu or otherwise and change the capital structure
including the creation of any security over any assets including the assets forming part of
the security for the Debentures, or issue of shares of any class, on such terms and
conditions as the Company may deem appropriate, without the consent of, or intimation
to the Debenture holder(s) / Debenture Trustees in this connection. Provided that at the
time of raising such further issue of debentures and/or further term loans and/or availing
deferred payment credit/guarantee facilities the Company maintains the security cover as
stipulated herein in respect of the Debentures.
Governing Law
The Debentures are governed by and shall be construed in accordance with the existing
Indian laws. Any dispute arising thereof will be subject to the jurisdiction of the courts
of Mumbai.
Debenture redemption reserve
As per the circular of the Department of Company Affairs (N0.6/3/2001-CL.V) dated 18th
April, 2002, debenture redemption reserve is not required to be created for issue of
privately placed debentures by Non-Banking Financial Companies registered with the
Reserve Bank of India under Section 45 (1) A of the RBI (Amendment) Act, 1997.
Who Can Apply
The following categories of investors, when specifically approached, are eligible to apply
for this private placement of Debentures.
• Banks
• Financial Institutions
• Insurance Corporations
• Mutual Funds
• Foreign Institutions
• FIIs
• Provident & Pension Funds
• Corporate Investors
There shall no negative list of investors.
Documents to be provided by investors
• Memorandum and articles of association/constitutional documents
• PAN
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• Resolution/authority authorizing the investment
• Certified true copy of power of attorney (if applicable)
• Form 15AA for investors seeking exemption from tax deduction at source
• Specimen signature of authorized signatories
Submission of Completed application form
All applications duly completed and accompanied with all necessary documents shall
be submitted to the Company at its registered office.
Rights to accept / reject applications
The Issuer is entitled at its sole and absolute discretion to accept or reject any
application, in part or in full, without assigning any reason. Application forms which
are incomplete or which do not fulfill the terms and conditions indicated on the back
of the application form are liable to be rejected.
Compliance Officer
In case of any pre-Issue / post-Issue related problems such as non-receipt of letters of
allotment / refund orders etc., the investors are requested to contact the Compliance
Officer whose details are given below:
Mr. Punit Arora
Company Secretary
Email: [email protected]
Telephone +91 -120 - 3391000
Depository arrangement
The Company has appointed Link Intime India Private Ltd. as registrar and transfer
agents (“Registrar”) for the Issue. The Company has entered into depository
arrangement with National Securities Depository Limited.
Purchase / Re-Issue of Debentures / Cancellation of Debentures
The Company may, at any time and from time to time, purchase Debentures at a
discount, at par, or at a premium, in the open market or otherwise in accordance with
the applicable laws. Such Debentures may, at the option of the Company be
cancelled, held or reissued at such a price and on such terms and conditions as the
Company may deem fit and as permitted by law.
Where the Company has redeemed any such Debenture, subject to the provisions of
the Act and other applicable provisions, the Company shall have and shall be deemed
always to have and the right to keep such Debentures alive for the purpose of re-issue
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and in exercising such right, the Company shall have and shall be deemed always to
have had the power to re-issue such Debentures either by re-issuing the same
Debentures or by issuing other debentures in their place.
Register of Debenture holders
The Company shall maintain a register of Debenture holders containing necessary
particulars at its registered office.
Notices
All the notices, communications and writings to the Debentures holder(s) required to
be given by the Issuer shall be deemed to have been given if sent by registered post /
courier / hand delivery to the address of the Debenture holder(s) registered with the
Company.
All notices, communications and writings to be given by the Debenture holder(s)
shall be sent by registered post / courier / hand delivery to the Registrars to the Issue
or to the Compliance Officer of the Issuer at the registered office and/or corporate
office of the Company or to such persons at such address as may be notified by the
Issuer, from time to time and shall be deemed to have been received on actual receipt.
(xvi) The discount at which such offer is made and the effective price for the
investor as a result for such discount
The Offer for issue of Debentures is being made at the face value and not at discount
to offer price.
(xvii) The Debt Equity Ratio Prior to and after Issue of the debt security
Amount in Rs. Crores
Particulars Debt Equity Ratio as per latest Un-Audited Balance
Sheet as on 31st August, 2009
Share Capital:-
- Paid up Share
Capital* 229.07
- Reserves and Surplus 1253.66
Total Equity Funds 1482.73
Loan funds:-
- Secured Loans 1.80
- Unsecured Loans 1791.96
Total Debt Funds 1793.76
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Debt Equity Ratio 1.21 : 1
*Including Compulsorily Convertible Debentures of Rs. 60 Crores
Amount in Rs. Crores
Particulars Debt Equity Ratio as per latest Audited Balance Sheet as
on 31th
March, 2009
Share Capital
- Paid up Share
Capital* 1163.21
- Reserves and Surplus 279.48
Total Equity Funds 1442.69
Loan Funds:-
- Secured Loans 39.50
- Unsecured Loans 606.13
Total Debt Funds
645.63
Debt Equity Ratio 0.45 : 1
* including
(a) Share Application Money of Rs. 943.30 Crores; and
(b) Compulsorily Convertible Debentures of Rs. 100 Crores
Debt Equity ratio will vary as and when the Company issues the proposed secured non-
convertible redeemable Debentures. The same shall be intimated to the BSE accordingly.
(xviii) Servicing behavior on the existing debt securities, payment of due interest on
due dates on term loans and debt securities
The Company has been discharging all its liabilities in time including the payment of interest
due on loan facility(s) availed and on debt securities of the Company, principal repayments
and payments on redemption, including repayments to banks, mutual funds and financial
institutions. The Company also undertakes to fulfill its future obligations whenever it arises.
(xix) Permission /consent from prior creditors for the charge being created in favour of
the Debenture Trustees.
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The company has obtained consent from Debenture Trustee holding prior charge for creation
of security for the Debentures.
(xx) The names of the Debenture Trustees shall be mentioned with the statement to the
effect that Debentures Trustees has given his consent to the Issuer for his appointment
under Regulation 4 (4) and also in all the subsequent periodical communications sent to
the holder(s) of the debt securities.
Axis Trustee Services Limited has given its consent for its appointment as the Debenture
Trustees to the present issue under Regulation 4 (4) and also in all the subsequent periodical
communications to be sent to the holders of the Debentures.
(xxi) The rating rationale
ICRA has assigned the Issuer rating of “LA+” (pronounced as LA plus) for the long term
debt issue of 500 Crores to be raised by the company. The rating indicates adequate-credit-
quality.
(xxii) Names of all the recognized Stock Exchanges where the securities are proposed to
be listed clearly indicating the designated stock exchange and also whether in-principle
approval from the recognized stock exchange has been obtained
The Debentures are proposed to be listed on the Bombay Stock Exchange Limited . The
Company has obtained in-principle approval from BSE for listing of the Debentures vide its
letter dated [*].
(xxiii) A summary term sheet shall be provided which shall include brief information
pertaining to the secured non convertible debt securities (or a series thereof) as follows
(where relevant
Issuer Religare Finvest Ltd. (“RFL” or the “Issuer” or the “Company”)
Sole Book Runner
and Lead Arranger
Standard Chartered Bank (“Arranger/SCB”)
Instrument/ Facility Secured Redeemable Non Convertible Debentures (“Debentures”)
Issue Amount INR 200 crores (Indian Rupees Two Hundred crores only) split
between Tranche 1, Tranche 2 and Tranche 3 as under :
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Tranche 1 : ~ Rs.66 Crore
Tranche 2 : ~ Rs.67 Crore
Tranche 3 : ~ Rs.67 Crore
Mode of Placement
On private placement basis to all eligible investors
Purpose For general corporate purposes
Face Value Rs.10,00,000 (Rupees Ten Lakhs only) per Debenture
Issue Price At par
Security - First & Exclusive Charge over specific receivables to the extent of
1.5x of the Principal Amount Outstanding. All Receivables provided
as security shall be current at all times. The above cover will be
subject to a charge on receivables from secured assets to the extent of
at least 1.25x of the Principal Amount Outstanding.
- RFL to provide monthly statement showing the specific receivables
provided under first & exclusive charge to investor(s). Receivables
provided under first & exclusive charge shall not include any retail
capital market related loans and dues from associate or affiliates of
RFL, unless agreed by investor(s).
- Unconditional and irrevocable Corporate Guarantee covering
Principal and Interest from Religare Enterprises Ltd.(“REL” or
“Holding Company”)
Security should be created within 30 calendar days of the Deemed
Date of Allotment.
Rating “LA+/Stable” from ICRA
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Maturity Date Tranche 1: 1 year from the Deemed Date of Allotment. i.e. *******
Tranche 2: 2 years from the Deemed Date of Allotment. i.e. *******
Tranche 3: 3 years from the Deemed Date of Allotment. i.e. *******
Redemption
Bullet
Coupon _____% p.a., payable _______on each of the Tranches.
Put & Call Option
None
Arranger Fees **************
Interest on
Application Money
Interest on application money will be paid to investors at Coupon
from the date of realization of subscription money up-to one day prior
to the Deemed Date of Allotment. Such interest shall be payable
within seven business days from the Deemed Date of Allotment.
Indicative Timing Issue Opening Date: *********
Issue Closing Date: *********
Pay in Date: *********
Deemed Date of Allotment: *********
All documentation including, but not limited to, the Information
Memorandum, Board Resolution, Rating Letter, Appointment of
Trustees, In-principle listing approval from the Stock Exchange etc.,
to be completed and made available to the Arranger 1 day prior to
subscription.
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Business Day
Convention
If any payment date is not a Business Day in Mumbai, payment shall
be made on the next Business Day in Mumbai.
Business Day means a day which is not a Saturday or Sunday or a
public holiday and on which high value clearing facility is available in
Mumbai.
Day Count Basis Actual / Actual
Stamp duty payable
in case of transfer of
Debentures
Stamp Duty on secondary market transfer as applicable under the
Bombay Stamp Act. (Presently, no stamp duty is payable on transfer
of Debentures in dematerialised form).
Security Trustee Any SEBI registered Bank/ Institution mutually acceptable to the
Issuer & Arranger
Issue of Debentures
The Issuer will issue the Debentures / Letters of Allotment in
dematerialized form within one business day from the Deemed Date
of Allotment.
Documentation Customary documentation for the Issue as required by SCB.
Conditions
precedent:
SCB’s arrangership will be subject to the following conditions and
compliance of the said conditions by the Issuer wherever applicable:
(i) the accuracy and completeness of the representations
made /to be made by the Issuer to SCB and the
information that the Issuer has furnished /would furnish to
SCB till the closure of the Issue; and compliance by the
Issuer of the terms and conditions of this Agreement;
(ii) SCB having satisfied in a form and substance acceptable
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to SCB and having obtained from the Issue (a) all
applicable internal and external approvals for the Issue
have been obtained by the Issuer applicable approvals
and resolutions passed by the board of directors of the
Issuer; (b) documentation for the Transaction being
prepared as specified in (iv) below and appropriate
business description disclosure in the offering circular
(prepared by the Issuer’s counsel);
(iii) the documentation in respect of the Issue is in full
compliance with the statutory and Arranger’s
requirements and completed to the satisfaction of the
Arranger;
(iv) the Issuer obtaining in-principle approval from the
relevant stock exchange(s) for listing of Debentures;
(v) the absence of any default or cross default in respect of
other liabilities of the Issuer.
Covenants
*************
Optional
Prepayment
************
Resolutions required The Issuer should ensure that all the consents and resolutions required
to issue Debentures are in place prior to the issue.
The Issuer should also ensure that any and all applicable regulations
pertaining to this Issue are complied with, including but not limited to
RBI’s Prudential Guidelines on banks’ investment in non-SLR
securities dated 12th November 2003, SEBI Circular on Secondary
Market for Corporate Debt Securities dated 30th September 2003 and
22nd December 2003 and SEBI Issue & Listing of Debt Instrument
guidelines dated June 6, 2008
Expenses All expenses related to the issue including but not limited to costs
relating to stamp duty, legal fee, listing fee, credit rating charges and
other expenses will be to the account of the Issuer.
Material Adverse The Agreement of SCB are subject to there being no material adverse
change (or an event which is likely to result in a material adverse
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Circumstances change) in:
i. the business activities, financial condition and credit standing
of the Issuer (or any of its shareholders, or subsidiaries) since
the date of their respective latest published financial
statements;
ii. the international or domestic money, bank, foreign exchange
and capital markets, or in the debt syndication market,
iii. the socio-political and economic situation of India (including
as a result of hostilities along the borders of the Republic of
India ) or any event, whether domestic or international;
which in SCB’s sole opinion/judgement, would adversely impact the
successful syndication of the Issue /materially impair subscription to
the Debentures, from the date of acceptance of this offer till the
closure of the Issue.
In such an event, SCB shall have the option to renegotiate the terms of
the Issue or terminate the Agreement.
Investor Profile Banks, Mutual Funds, Financial Institutions, Insurance Corporations,
Provident & Pension Funds, Corporate Investors, FIIs. There shall be
no negative list of investors.
Clear Market
Provision
The Issuer undertakes that it will not announce or raise from the
market, either on bilateral or syndication basis, any Debentures from
the date of acceptance of this offer till the date of closure of the Issue.
Further, the Issuer also undertakes that it shall not announce or bring
to the market any other issuance of similar tenor Debentures on terms
better than those offered under the present issue for a period of 2
weeks from the Deemed Date of Allotment of these Debentures.
Derivative
Transactions
The Issuer confirms that it will offer SCB the first right of refusal to
SCB if it transacts derivatives / swaps for the purpose of risk
management on these debentures.
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Listing On the WDM segment of The Stock Exchange, Mumbai. The Issuer
shall make an application for listing on the day of the deemed date of
allotment of Debentures, and ensure listing within two working days.
Publicity &
Communication
On successful conclusion of the Issue, the Arranger reserves the right
to issue publicity material such as tombstones, advertisements etc.
after discussion with the Issuer.
Governing Law and
Jurisdiction
The Governing law will be the Indian Law and the parties submit to
the non-exclusive jurisdiction of the courts in Mumbai.
Validity of the
Indicative Terms
These indicative terms and conditions are open for
discussion*****************on October ******2009 after which
time these outline terms and conditions shall lapse if the Issuer has not
signed these terms and conditions by that time.
For Religare Finvest Limited
Sd/-
Sunil Kumar Garg
Director
Date: October 13, 2009
Place :New Delhi
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Annexure I
APPLICATION FORM
Religare Finvest Limited
(Incorporated under the Companies Act, 1956)
Regd. Office: 19, Nehru Place, New Delhi – 110019
Tel. No. + 91-11- 3081 5100
Website: www.religarefinvest.com
Dear Sirs,
Having read and understood the contents of the Information Memorandum, we apply for
allotment to us of the secured, redeemable, and Debentures being privately placed. The
amount payable on application as shown below is remitted herewith. On allotment, please
place our name on the register of Debenture holders. We bind ourselves to the terms and
conditions as contained in the Information Memorandum. We note that the Company is entitled
in its absolute discretion to accept or reject this application whole or in part without assigning
any reason whatsoever.
(PLEASE READ THE INSTRUCTIONS CAREFULLY BEFORE FILLING THIS FORM)
Form in which certificate is to be issued
We understand that in case of allotment of Debentures to us, our Beneficiary Account as
mentioned above would be credited to the extent of Debentures allotted. We also understand
that Debentures will be issued to us and will have to be held by us in dematerialized form only
and no physical certificates will ever be issued by the Company.
The application shall be for a minimum of 1(One) Debenture and in Multiples of 1 (One)
Debenture thereafter (Each Debenture of Rs. 10,00,000/- (Ten Lakhs rupees only))
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Remittance through Cheque/Draft
Remittance through STEPS/RTGS
We are applying as Tick(√) whichever is applicable
1 Company 2 Commercial Bank
3
Eligible Financial
Institution 4 Insurance Companies
5 NBFC & Residuary NBFC 6 Mutual Fund
7 FII 8 Provident & Pension Fund
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Details of Bank Account of the First Applicant:
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ACKNOWLEDGEMENT SLIP
Religare Finvest Limited
(Incorporated under the Companies Act, 1956)
Regd. Office: 19, Nehru Place, New Delhi – 110019
Tel. No. + 91-11- 3081 5100
Website: www.religarefinvest.com
Application Form Sr. No:
Received from ______________________________________________________
Address ________________________________ __________________________
an application for _____ Debentures along with Cheque/Demand Draft No.
__________ Dated _________ Drawn on _____________ for Rs. __________
(Rupees_________________________ _____________________________ only)
(Note: Cheques and Drafts are subject to realization)
STEPS/RTGS Remittance Particulars