Draft Offer Documents
(Offer Document will be updated upon filing with the ROC).
Caution : This Draft Offer Document would be updated and modified
to incorporate the comments of Securities and Exchange Board of India (SEBI)
and Stock Exchanges. The Draft Offer Document will be suitably modified to
incorporate changes recommended by regulatory bodies and updated before filing
with the Registrar of Companies, Gujarat under Section 60 of the Companies Act,
1956. This Draft Offer Document does not constitute an offer or an invitation
to any person to subscribe to the Equity shares of Wonder Craft Industries
Limited and is being issued for the sole purpose of ascertaining the demand for
the Equity Shares. The contents of this Draft Offer Document are intended to be
used exclusively by the persons to whom it is distributed.
WONDER CRAFT INDUSTRIES LIMITED
The Company was incorporated on July 15,1996 in Gujarat, under the
provisions of the Companies Act, 1956, (hereinafter referred to as the Act) as
a Private Limited company under the name and style " Wonder
Craft-Packaging Private Limited " and was subsequently converted into a
Public Limited Company and received Fresh Certificate for Incorporation on 9th
May 2000 from The Registrar of companies, Gujarat, Dadra and Nagar Haveli. The company was renamed as Wonder Craft
Industries Limited on 12th July, 2000.
Registered Office :
B/3, Neekunj Apartments,
Opp. Krishna Talkies, Siddhnath Road, Baroda - 1
Tel. No. : 0265- 42 43 76.
Tele Fax no.: 0265 - 42 43 76
Factory :
P.O. Box No.14, Navi Jitharadi, Karjan Dhavat Road, Tal - Karjan,
Dist - Baroda - 391
204, Tele Fax : 02666 - 32455.
Issue of * Equity Shares of Face Value of Rs.10/- each for cash at
Rs. ** aggregating to Rs. 400.00 lacs. The Issue includes a Book Built Portion
of 75% aggregating to Rs. 300.00 lacs and
Fixed Portion of 25% aggregating to Rs. 100.00 lacs.
RISK IN RELATION TO THE FIRST ISSUE
This being the first issue of the company, there has been no
formal market for the securities of the company. The Issue price (as has been
determined by the Company in consultation with Allocation committee comprising
of a representative from each Book Running Lead Manager, on the basis of
assessment of market demand for the offered securities by way of Book Building)
should not be taken to be indicative of the market price of the Equity Shares
after the shares are listed. No assurance can be given regarding an active or
sustained trading in the shares of the Company nor regarding the price at which
equity shares will be traded after listing.
GENERAL RISKS
Investment in equity and equity related securities involve a
degree of risk and investors should not invest any funds in this offer unless
they can afford to take the risk of losing their investment. Investors are
advised to read the risk factors carefully before taking an investment decision
in this offering. For taking an
investment decision investors must rely on their own examination of the issuer
and the offer including the risks involved. The securities have not been
recommended or approved by Securities and Exchange Board of India nor does
Securities and Exchange Board of India guarantee the accuracy or adequacy of
this document.
(Investors are advised to
refer page no. (...) of the Offer
Documents for statement of Risk Factors).
ISSUER'S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries, accepts
responsibility for, and confirms that this Draft Offer 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 Offer 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 document as
a whole or any of such information or the expression of any such opinions
or intentions misleading in any
material respect.
LISTING
The Equity Shares are proposed to be listed on the Vadodra Stock
Exchange (Regional Stock Exchange), The Stock Exchange , Ahemdabad and the The
Stock Exchange, Mumbai.
1. The company vide letter dated
...../ .... /...... has received approval from Vadodra Stock Exchange
for listing and trading of its Equity
Shares.
2. The company vide letter dated
...../ .... /...... has received approval from Ahemdabad Stock Exchange for listing and trading of
its Equity Shares.
3. The company vide letter dated
...../ .... /...... has received approval from Mumbai Stock Exchange for
listing and trading of its Equity
Shares.
BOOK RUNNING LEAD MANAGER
ARYAMAN FINANCIAL SERVICES LIMITED
SEBI REGN. NO. : MB/INM
000006807
35, 3rd Floor, Atlanta Building,
Nariman Point, Mumbai -
400 021.
Tel : (022) 282 64 64 / 65
/ 66
Fax : (022) 282 64 67.
e-mail : aryaman@bom2.vsnl.net.in
REGISTRAR TO THE ISSUE
INTIME SPECTRUM REGISTRY PVT. LTD.
SEBI REGN NO. - INR000003761
260, Shanti Industrial Estate,
Sarojini Naidu Road,
Mulund (West), Mumbai - 400 080.
Tel. No. : (022) 564 77 31 / 567 27 16.
Fax No. : (022) 567 26 93.
e-mail : isrl@vsnl.com
ISSUE PROGRAMME
BID OPENS ON :
BID CLOSES ON :
ISSUE OPENS ON :
ISSUE CLOSES ON :
TABLE OF CONTENTS
PARTICULARS
Page No.
Definition/Abbreviations
Risk Factors and Management Perceptions Thereof
Highlights
PART - I
General Information
Capital Structure of the Company
Terms of the Present Issue
Tax Benefits
Particulars of the Issue
Company and Management And Project
Management Discussions and Analysis
Basis of issue price
Risk Factors and Management Perception There of
Outstanding Litigation's, Defaults and Material Developments
PART - II
General Information
Financial Information
Statutory and Other Information
Main Provisions of the Articles of Association
Material Contracts and Documents for Inspection
PART - III
Declaration
DEFINITION AND ABBREVIATIONS
Application Form
The form in terms of which the investors shall apply for the
Equity Shares of the company.
Allocation Committee
Committee consisting of one representative of each book running
Lead Manager
Articles
Articles of Association of
Wonder Craft Industries Ltd.
AGM
Annual General Meeting.
Applicant
Any prospective investor who makes an application for shares in
terms of the prospectus in the Fixed Price Portion
WCIL
Wonder Craft Industries Limited.
BA
Beneficiary Account
Bid
An indication to make an offer by a prospective investor to subscribe
to Equity Shares of the Company at a designated price (which is at or above the
floor price), during the Bidding Period and includes all revisions and
modifications thereto.
Bid Amount
Means the highest value of the optional Bids indicated in the Bid
Form and payable by the Bidder on submission of the Bid in the Book Built
Portion
Bid Closing Date
The date after which the Syndicate Members to the offer would not
accept any bids; any such date shall be notified through a notice in a English
national newspaper, Hindi national newspaper and Regional language newspaper
(Where the registered office of Wonder Craft Industries Limited is situated) with wide circulation.
Bid Form/ Bid cum Application Form
The form in terms of which the Bidder shall Bid for the Equity
Shares of the company and shall, upon allocation of the Equity Shares by the
BRLM and filing of the Offer Document with the RoC, be considered as the
application for allotment of the Equity Shares in terms of this Offer Document.
Bid Opening Date
The date on which the Syndicate Members to the offer would start
accepting Bids; such date shall be the date notified and communicated through a
notice in an English national newspaper, Hindi national newspaper and Regional
language newspaper (Where the registered office of Wonder Craft Industries
Limited) with wide circulation.
Bidder
Any prospective investor who makes a Bid in terms of this Draft
offer Document.
Bidding Period
The period between the Bid Opening Date and the Bid Closing Date
inclusive of both days and during which period prospective investors can submit
their bids.
BOD / Board
Board of Directors of Arrow Cables Ltd Limited or a committee
thereof
Book Built Portion
Means the Net Public offer less than the Fixed Price Portion
BRLM/ Book Runner
Book Running Lead Manager(s), in this case being Aryaman Financial
Services Ltd.,
BV / NAV
Book value / Net
asset value
Company, Issuer,
Means Arrow Cables Ltd.
CAN
Confirmation of Allocation Note: means the note or advice or
intimation for allocation of shares to the Bidders who have been allocated
Shares in the Book Built Portion.
CDSL
Central Depository Services (India) Ltd.
CKM
Cable Kilometres
Deemed Date of Allotment
Date of Allotment for the Book Built Portion, which shall be the
deemed date of allotment of all the shares issued in this Issue. The allotment
in this Issue shall be for all relevant purposes be deemed to have been made
from such date.
DP
Depository Participant.
Draft Offer Document
Mean this document which is not a Prospectus under section 60 of
the Companies Act, 1956.
Escrow Account of the Company
Means that account opened with the Escrow Collection Bank(s) and
in whose favour the bidder will issue cheques in respect of the Bid amount at
the time of submitting the Bid and such amounts payable on receipt of CAN where
the margin rate specified is nil, and in which account the cheques will be
deposited by the syndicate member.
Escrow Account of the Syndicate member
Account opened with one or more of the Escrow Collection Bank(s)
and in whose favour the Bidder will issue cheques or drafts in respect of the
Margin amount at the time of the submitting the Bid and such amounts payable on
receipt of the CAN where the margin rate specified is grater than zero but less
than 100% which account the cheque/ demand drafts will be deposited by the
Syndicate Members(s).
Escrow Collection Bank(s)
The banks at which the Escrow Account of the company and the
syndicate members will be opened and which will act as such, in terms of this
Draft offer Document and the Escrow Agreement(s).
EPS
Earnings Per Share.
FIIs
Foreign Institutional Investors, who are registered with SEBI.
Fixed Price potion
Means the portion equivalent to 25% of the net public offer which
is reserved for allotment to individual investors who have not participated
book built portion or those individual investors who have not obtained any
allocation in the Book Built Portion.
Floor Price
The price as advertised by the company prior to the Bid Opening
Date and Below which the issue price will not be finalised and below which the
bidder cannot bid.
GOI
Government of India.
I.T.Act
Income-tax Act 1961.
Institutional Bidders
Means the Bidders who are institutions specified in Section 4A of
the companies act, 1956, Banks, Mutual Funds or Foreign Institutional Investors
registered with SEBI.
Issue/Offer
Public Issue of (.......)Equity Shares of Rs.10/- each, at a price of Rs (......) per Equity Shares
aggregating an amount not exceeding Rs. 990 lacs.
The Issue includes a Book Built Portion of Rs 594 lacs and a Fixed Prices Portion
of Rs 396.
Issue /Offer Price
Price determined by the company in consultation with the
Allocation Committee on the pricing date after the Biding Period and which
shall be set forth in the Offer Document to be filed with RoC, at which price,
the equity shares of the company offered under this Draft offer document will
be allotted. The issue size will not be lower than the floor Price. The issue
price will be advertised within two days of the allocation for the Issue in the
leading English Daily, One Hindi Daily and one Regional Daily.
Issue Closing Date
The date on which the issue closes for subscription.
Issue Opening Date
The date on which the Book Built Portion opens for automatic
subscription by Bidders who have received allocation and have paid at least the
Issue Price for their allocation into the Escrow Account. This date shall also
mean the date on which the Fixed Price Portion opens for subscription by the
public.
Issue Period
The period between the Issue Opening Date and Issue Closing date
for Fixed Portion and includes both these dates.
Margin Amount
Means the amount arrived at by multiplying the bid amount and
Margin rate applicable to that bidder and payable on submission of the Bid in
the Book Built Portion. Such amount shall be deposited in the Escrow Account of
the Syndicate member.
Margin Rate
Means the percentage of the Bid Amount by the bidder on submission
of the Bid in the Book Built Portion as applicable to various categories of
Bidders and as finalised in the syndicate agreement filed with the SEBI.
Memorandum
Memorandum of Association of the company i.e. Wonder Craft
Industries Limited.
NRI(s)
Non-Resident Indian (s)
NSDL
National Securities Depository Limited
OCB(s)
Overseas Corporate Bodies as defined under Indian laws
Pay-in-Period
For the Book Built Portion, Pay-in-Period means the period
commencing on the Bid Opening Date and extending till the Bid Closing Date,
during which the bidders have to pay their maximum bid amount into the Escrow
Account during the bidding period, unless such requirement of payment, waived
by the Syndicate Members for Institutional Bidders. In case of requirement of
payments, for Institutional Bidders, during the Bidding Period is waived by the
Syndicate Members the closure of the Pay-in-Period for such Bidders, for
payment into the Escrow Account, shall be within four calendar days of
communication of the allocation list of the Syndicate Members by the BRLM.
Project
The proposal of the company to set up a plant to manufacture
Optical Fibres Cables ( OFC ) for which the issue is being raised.
Pricing Date
The date on which the Company in consultation with the BRLM(s)
finalises the Offer Price
Prospectus / Final Offer Document/ Offer Document
The Offer Document field with the ROC containing inter alia the
Issue price that is determined at the end of the Book Building process, and the
number of Equity Shares to be issued, Issue Price and other incidental
information
Public Issue Account
Account opened with Bankers to the Issue for collection of
Application Money in the Fixed Price Portion and for the purpose of transfer of
monies from the Escrow Account on or after the Issue Opening Date.
Proportionate Retail Book
Built Portion
Means that portion of the Book Built Portion comprising 15% of the
Net public Offer, which is reserved for allocation to individual investor who
bid for a minimum of 500 equity shares, in multiples of 100 equity shares, And
to a maximum 1000 equity shares in all their options.
Proportionate Whole sale Book
Built Portion
Means that portion of Book built portion comprising a minimum of
60% of the net public offer, which is reserved for allocation to Institutional
Bidders bidding for more than 1000 equity shares (i.e. a minimum of 1100 equity
shares and in Multiples of 100 equity shares thereafter) in all of their
bidding options.
RBI
Reserve Bank of India.
Regional Stock Exchange
The Stock Exchange, Vadodara
Registrars to the Issue
INTIME SPECTRUM REGISTRY PVT. LTD.
Retail Bidders(s)
Means the Bidder who are individuals (including NRIs and HUFs) and
who have not Bid for higher than 1000 equity share in any of their bidding
options in the Book Built Portion.
Revision Form
The form used by the Bidders to modify the quantity of Equity
shares or the Bid Price in any of the Bid options as per their Bid Forms and as
modified by their subsequent Revision From(s), if any
ROC
Registrar of Companies.
SEBI
Securities and Exchange Board of India constituted under the
Securities and Exchange Board of India Act, 1992 (as amended)
Syndicate
The Book Running Lead Manager(s) and Syndicate Members(s)
WCIL
Wonder Craft Industries Limited
In the Draft Offer Document all reference to "Rs" refer
to Rupees, the lawful currency of India, reference to one gender also refers to
another gender and the word "Lakh" or "Lac" means "one
hundred thousand" and the word "million" means "ten
lac" and the word "crore" means "ten million".
RISK FACTORS AND MANAGEMENT PERCEPTION
The investor should consider the following risk factors carefully
in evaluating the Company and its business before making any investment
decision.. This Draft Offer Document contains forward-looking statements that
involve risks and uncertainties. None
of the Company, the BRLM, the Syndicate Members of their respective affiliates
has any obligation or other circumstances arising after the date hereof or to
reflect the occurrence of unanticipated events.
INTERNAL RISK FACTORS
(R) Cost of project and
means of finance has not been appraised by any bank or financial Institution
and are based on the Company's own estimates. The deployment of funds collected
in this issue will be at the sole discretion of the management of the company.
Thus there will be no independent Body monitoring the use of Proceeds and the
Utilisation of issue proceeds is at the total discretion of the management.
(P) The management of
the company has in consultation with the Technical Consultants drawn out a
business plan for the activities to be pursued for the proposed business. The
company believes that it has professional expertise to assess the cost of
project and implement the same and at this time does not foresee any borrowing
requirements under this plan. Thus the company has not approached any bank or
financial Institution for appraisal. The management of the company comprises
businessmen with a proven track record and the public issue proceeds will be
utilised only for the objects of the issue mentioned in the offer document
(R) The proposed
project is mainly financed by the present issue of equity shares and any delay
in raising funds from the public issue would adversely effect the
implementation and performance of the project.
(R) The Land acquired
by the company for the UNIT 2 includes plots purchased from one of the core
promoter of the company, Shri. Pravinbhai P Patel.
(P) The land has been
purchased at the prevailing market rates in the area and the company found it
advantageous in view of its location adjacent to existing units
(R) The registered
office of the company is owned by one of the relatives of core promoter and no formal written agreement is being signed
between company and the owner of the office.
(R) The company has yet
to apply to the bank for the working capital limit of Rs.146.64. lacs
(P) The company is in
the process of applying for sanction of additional facilities for UNIT 2 which
would be required at the time of the commencement of commercial production.
(R) The land acquired
by the company for the proposed project, is yet to be registered in the name of
the company.
(P) The company has
already submitted all the documents to the concerned Sub Registrar office and
it generally takes 4 to 6 months to complete all the formalities of
registration. The company does not foresee any problems in this regard.
(R) The Company has yet
to place orders for Plant & Machinery amounting to Rs.287.27lacs, Misc.
fixed assets amounting to Rs. 20.22 lacs, forming 41.78% of the total project
cost.
(P) The Company has
already short-listed the suppliers for purchase of plant & machinery & other fixed assets and the orders of
the key plant & machinery & other fixed assets will be placed at the as
per the schedule of implementation.
(R) A substantial
portion of the Company's movable assets has been hypothecated and the company
has mortgaged its immovable assets to secure financing facilities with its
lenders. If the company were to default on repayment of Debt, its lenders could
enforce their security interests in respects of the Company's assets, limiting
the Company's ability to carry out its operations and could have a material
adverse effect on the Company. In addition, default under the Company's credit
facilities could limit the Company's ability to raise additional funds in the
future. In event of liquidation of the Company, these creditors will have
priority over unsecured creditors of the company and Company's shareholders.
(P) The Company is an
existing profit making company and is expanding its operations to achieve
economies of scale and to meet the increase in the demand for its products not
only from its existing customer base but also from the potential customer base.
(R) The SWOT analysis
given of the Company's operations is exposed to certain threats and weaknesses,
details for which is given on page no----..
(P) The threat are
general in nature and is applicable to any company in the industry. The
weakness is being addressed by way of the present expansion plan.
EXTERNAL RISK FACTORS
(R) Competition from
existing established companies and the future entrants into the industry.
(P) The Company is
confident that its quality products will find a suitable market in the
competitive industry as the demand for Corrugated Packaging Products and Paper
Shopping Bags will continue to witness consistent growth.
(R) Any adverse change
in the government policies may affect the performance and profitability of the
company.
HIGHLIGHTS
1. Existing profit making company
2. Strong customer base of leading corporates.
3. Listing proposed at Mumbai, Vadodara and Ahemdabad Stock
Exchanges.
NOTES
The investors are advised to refer to the para on 'Basis for Issue
Price" before making an investment in this issue.
Investors may note that in case of over-subscription allotment
shall be on proportionate basis and will be finalised by the Executive Director
of the Vadodra & Mumbai Stock Exchange along with the Lead
Merchant Banker and the Registrars to the Issue.
PART I
GENERAL INFORMATION
WONDER CRAFT INDUSTRIES LIMITED
(The Company was incorporated on July 15,1996 in Gujarat, under
the provisions of the Companies Act, 1956, (hereinafter referred to as the Act)
as a Private Limited company under the name and style " Wonder
Craft-Packaging Private Limited " and was subsequently converted into a
Public Limited Company and received Fresh Certificate for Incorporation on 9th
May 2000 from The Registrar of companies, Gujarat, Dadra and Nagar Haveli. The company was renamed as Wonder Craft
Industries Limited on 12th July, 2000.)
Registered Office :
B/3, Neekunj Apartments,
Opp. Krishna Talkies, Siddhnath Road, Baroda - 1
Tel. No.: 0265- 42 43 76.
Factory :
P.O. Box No.14, Navi Jitharadi, Karjan Dhavat Road, Tal - Karjan,
Dist - Baroda - 391 204,
Tele Fax: 02666 - 32455.
Issue of * Equity Shares of Face Value of Rs.10/- each for cash at
Rs. ** aggregating to Rs. 400.00 lacs. The Issue includes a Book Built Portion
of 75% aggregating to Rs. 300.00 lacs and
Fixed Portion of 25% aggregating to Rs. 100.00 lacs.
I GENERAL
INFORMATION
Wonder Craft Industries Limited (hereinafter referred to as WCIL)
("The Company") was incorporated on July 15, 1996 as a private
company and got a fresh certificate of incorporation on 9th May, 2000.
The Book Built portion is for 75% of the total issue size of which
60% of the issue size shall be allotted to Qualified Institutional Bidders
(QIBs) on discretionary basis and the remaining 15% shall be available for
allotment to non-institutional investors on proportionate basis. The Fixed
price portion is for 25% of the total issue size of Rs.100.00 lacs.
AUTHORITY FOR THE PRESENT ISSUE
Pursuant to Section 81(1A) of the Companies Act, 1956, the present
offer of 40,00,000 Equity Shares has been authorised vide Special Resolution
passed at Extra-ordinary General Meeting held on 15/11/2000
GOVERNMENT APPROVALS
The Company is exempted from seeking a clearance from the
Pollution Control Board as it is classified under non-polluting industry as per
Circular No.P-328/24403 dtd.28th November 1995 & No.P-328/389 dtd.5th
January 1996.
The Company does not require any further letter of intent or
industrial license from the GOI for carrying out its current operations or
projects proposed in the offer document except as stated in the offer document.
It must be distinctly understood that the Government of India does
not take any responsibility for the financial soundness of any scheme or
project or correctness of any of the statements made or opinions expressed with
regards to them.
DISCLAIMER CLAUSE
AS REQUIRED, A COPY OF THIS OFFER DOCUMENT HAS BEEN SUBMITTED TO
THE SECURITIES & EXCHANGE BOARD OF INDIA (SEBI). IT IS TO BE DISTINCTLY
UNDERSTOOD THAT THE SUBMISSION OF THE OFFER DOCUMENT TO SEBI SHOULD NOT IN ANY
WAY BE DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY
SEBI. SEBI DOES NOT TAKE ANY
RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR PROJECT FOR
WHICH THE OFFER IS PROPOSED TO BE MADE, OR FOR THE CORRECTNESS OF ANY OF THE
STATEMENTS MADE OR OPINIONS EXPRESSED IN THE OFFER DOCUMENT. LEAD MANAGER,
ARYAMAN FINANCIAL SERVICES LTD., HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE
OFFER DOCUMENTS ARE GENERALLY
ADEQUATE AND ARE IN CONFORMITY WITH SEBI GUIDELINES FOR DISCLOSURE AND INVESTOR
PROTECTION FOR THE TIME BEING IN FORCE. THIS REQUIREMENT IS TO FACILITATE
INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED
OFFER. IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE OFFEROR IS PRIMARILY
RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL THE RELEVANT
INFORMATION IN THE OFFER DOCUMENT, THE LEAD MANAGER IS EXPECTED TO EXERCISE DUE
DILIGENCE TO ENSURE THAT THE COMPANY DISCHARGES ITS RESPONSIBILITY ADEQUATELY
IN THIS BEHALF AND TOWARDS THIS PURPOSE, THE LEAD MANAGER, M/S ARYAMAN
FINANCIAL SERVICES LTD., HAS FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE
DATED 30.11.2000 IN ACCORDANCE WITH SEBI (MERCHANT BANKERS) REGULATIONS, 1992
WHICH READ AS FOLLOWS:
I WE HAVE EXAMINED
VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO LITIGATION LIKE COMMERCIAL
DISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS, ETC., AND OTHER MATERIALS
IN CONNECTION WITH THE FINALISATION OF THE OFFER DOCUMENT PERTAINING TO THE
SAID OFFER;
II ON THE BASIS OF
SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY, ITS DIRECTORS AND OTHER
OFFICERS, OTHER AGENCIES, INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING
THE OBJECTS OF THE OFFER, PROJECTED PROFITABILITY, PRICE JUSTIFICATION AND THE
CONTENTS OF THE DOCUMENTS MENTIONED IN THE ANNEXURE AND OTHER PAPERS FURNISHED
BY THE OFFEROR;
WE CONFIRM THAT
A. THE OFFER DOCUMENT
FORWARDED TO SEBI IS IN CONFORMITY WITH THE DOCUMENTS, MATERIALS AND PAPERS
RELEVANT TO THE OFFER;
B. ALL THE LEGAL
REQUIREMENTS CONNECTED WITH THE SAID OFFER AS ALSO THE GUIDELINES,
INSTRUCTIONS, ETC., ISSUED BY SEBI, THE GOVERNMENT AND ANY OTHER COMPETENT
AUTHORITY IN THIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND
C. THE DISCLOSURES
MADE IN THE OFFER DOCUMENT ARE TRUE, FAIR AND ADEQUATE TO ENABLE THE INVESTORS
TO MAKE A WELL INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED OFFER.
III WE CONFIRM THAT
BESIDE OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE OFFER DOCUMENT ARE
REGISTERED WITH SEBI AND THAT TILL DATE SUCH REGISTRATION IS VALID;
IV WE HAVE SATISFIED
OURSELVES ABOUT THE UNDERWRITERS TO FULFIL THEIR UNDERWRITING COMMITMENTS.
V WE CERTIFY THAT
WRITTEN CONSENT FROM SHAREHOLDERS HAS BEEN OBTAINED FOR INCLUSION OF THEIR
SECURITIES AS PART OF PROMOTERS' CONTRIBUTION SUBJECT TO LOCK-IN AND THE
SECURITIES PROPOSED TO FORM PART OF PROMOTERS' CONTRIBUTION SUBJECT TO LOCK-IN,
WCILL NOT BE DISPOSED/SOLD/TRANSFERRED BY THE PROMOTERS DURING THE PERIOD
STARTING FROM THE DATE OF FILING OF THE DRAFT OFFER DOCUMENT WITH SEBI TILL THE
DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT OFFER DOCUMENT.
THE FILING OF OFFER DOCUMENT DOES NOT, HOWEVER, ABSOLVE THE
COMPANY FROM ANY LIABILITIES UNDER SECTION 63 OF THE COMPANIES ACT, 1956 OR
FROM THE REQUIREMENT OF OBTAINING SUCH STATUTORY OR OTHER CLEARANCES AS MAY BE
REQUIRED FOR THE PURPOSE OF THE PROPOSED ISSUE. SEBI, FURTHER RESERVES THE
RIGHT TO TAKE UP, AT ANY POINT OF TIME, WITH THE LEAD MANAGER(S) (MERCHANT
BANKERS) ANY IRREGULARITIES OR LAPSES IN OFFER DOCUMENT.
DISCLAIMER IN RESPECT OF JURISDICTION
This offer is made in India to persons resident in India
(Including Indian nationals resident in India who are majors, Hindu Undivided
Families, companies, corporate bodies and societies registered under the
applicable laws in India and authorised to invest in shares, Indian mutual
funds registered with SEBI, Indian financial institutions, commercial banks,
regional rural banks, co-operative banks (subject to RBI permission), Trust
registered under the Societies Registration Act, 1860, or any other Trust law and who are authorised in their
constitution to hold and invest in shares) and to NRIs, OCBs and FIIs as
defined under Indian Laws. This offer document does not, however, constitute an
offer to sell or an invitation to subscribe to shares issued hereby in any
other jurisdiction to any person to whom it is unlawful to make an offer or invitation
to such jurisdiction. Any person into whose possession this offer document
comes is required to inform himself about and to observe any such restrictions.
Any disputes arising out of this offer will be subject to the jurisdiction of
appropriate courts.
GENERAL DISCLAIMER
It should be noted that the Company accepts no responsibility for
statements made other than in the offer document or in the advertisements or
any other material issued by or at the instance of the Company and that anyone
placing reliance on any other source of information would be doing so at
his/her own risk. The company and BRLM accepts no responsibility, save to the
limited extent as provided in terms of the Memorandum of Understanding entered
into by the company and itself and the Underwriting agreement entered into by
the Company, BRLM and the Syndicate Members. The BRLM accepts no responsibility
for any breach, failure or any default on the part of the Syndicate Members and
has been fully indemnified in that behalf.
FILING
A copy of this offer document, along with the documents required
to be filed under Section 60 of the Act having attached thereto, has been
delivered for registration to the Registrar of Companies, Gujarat, Dadra &
Nagar Haveli A copy of the Prospectus has also been filed with SEBI, Mumbai.
A copy of the documents referred to elsewhere in the offer
document has been kept open for public inspection at the Registered Office of
the Company.
LISTING
Initial Listing Application have been made to Vadodra Stock
Exchange. (The Regional Stock Exchange), The Stock Exchange, Ahemdabad and
Mumbai Stock exchange for permission to list the Equity Shares and for an
official quotation of the equity shares of the Company.
In case the permission to deal in and for official quotation of
the shares is not granted by these Stock Exchanges, the issuer shall forthwith
repay, without interest, all monies received from applicants in pursuance of
this offer document within 70 days from the issue closing date of the fixed price
portion and if such money is not repaid within 8 days after the day from which
the Company is liable to repay it, the Company shall pay interest as prescribed
under Section 73(2) of the Act.
(Trading in the equity shares of the Company shall be
dematerialised form only)
IMPERSONATION
Attention of the applicant is specifically drawn to the provisions
of sub-section (1) of Section 68-A of the Act, which is reproduced below :
"Any person who-
Makes in a fictitious name an application to a company for
acquiring or subscribing for any shares therein.
Or
Otherwise induces a Company to allot, or register any transfer of
shares therein to him, or any person in a fictitious name, shall be punishable
with imprisonment for a term which may extend to five years."
PROHIBITION BY SEBI
The Company, its Directors or any of the Company's associates or
Group Companies have not been
prohibited from accessing the capital markets under any order or direction
passed by SEBI.
MINIMUM SUBSCRIPTION
IF THE COMPANY DOES NOT RECEIVE A MINIMUM SUBSCRIPTION OF 90% OF
THE NET OFFER TO THE PUBLIC INCLUDING DEVOLVEMENT OF UNDERWRITERS WITHIN 60
DAYS FROM THE DATE OF CLOSURE OF THE
ISSUE, OR IF THE SUBSCRIPTION LEVEL FALLS BELOW 90% AFTER THE CLOSURE OF THE
ISSUE ON ACCOUNT OF CHEQUES HAVING BEEN RETUNRED UNPAID OR WITHDRAWAL OF
APPLICATIONS, THE COMPANY SHALL FORTHWITH REFUND THE ENTIRE SUBSCRIPTION AMOUNT
RECEIVED. IF THERE IS A DELAY BEYOND 8 DAYS AFTER THE COMPANY BECOMES LIABLE TO
PAY THE AMOUNT, THE COMPANY SHALL PAY INTEREST AS PER SECTION 73 OF THE
COMPANIES ACT, 1956.
WITHDRAWL OF OFFER
If the price discovered through the Book Building mechanism is
lower than the announced/ revised floor price, the company reserves the right
to withdraw the offering from the market without assigning any reason thereof.
ISSUE PROGRAMME
BOOK BUILT PROGRAMME
Bidding period
BID
OPENS ON :
BID
CLOSES ON :
Bids and any revision in bids shall be accepted only between
10.a.m and 3.p.m during the Bidding as mentioned above at the bidding centres
mentioned on the Bid cum Application Form.
The Book Building issue shall remain open as the commencement of
banking hours and shall close at the close of banking hours on the days as
mentioned below:
BOOK
BUILT PORTION OPENS ON :
BOOK
BUILT PORTION CLOSES ON :
During this period the Escrow Collection Bank shall transfer the
funds from the Escrow Account to the Public Issue Account with the Bankers to
the Issue.
FIXED PRICE PORTION
The subscription list will open at the commencement of banking
hours and will close of banking hours on the days mentioned below :
FIXED
PRICE PORTION OPENS ON :
FIXED
PRICE PORTION CLOSES ON :
Distribution of information to investors
BRLM/Co-Book Runners/Syndicate Members and the Company shall make
all information available to the public and investors at large and no selective
or additional information would be available for a section of investor in any
manner whatsoever.
ISSUE MANAGEMENT TEAM
BOOK RUNNING LEAD MANAGERS
Aryaman Financial Services Ltd.
SEBI REGN. NO. : INM 000006807
35, Atlanta, 3rd Floor,Nariman Point,
Mumbai - 400 021.
Tel : 022 - 282 64 64 / 65 / 66
Fax : 022 - 282 6467
E-Mail: aryaman@bom2.vsnl.net.in
CO-BOOK RUNNING LEAD MANAGERS
REGISTRAR TO THE ISSUE
INTIME SPECTRUM REGISTRY PVT. LTD.
SEBI REGN NO. - INR000003761
260, Shanti Industrial Estate,
Sarojini Naidu Road,
Mulund (West),
Mumbai - 400 080.
Tel. No. : (022) 564 77 31 / 567 27 16.
Fax No. : (022) 567 26 93.
AUDITORS
S. F. TAI & ASSOCIATES
CHARTERED ACCOUNTANTS,
416, Payal Complex `C',
Near New Stock Exchange,
Sayajigunj,
Baroda - 390 005.
Tel. No. : 36 13 21.
BANKERS TO THE COMPANY
STATE BANK OF SAURASHTRA (KARJAN).
Tal - Karjan, Dist- Baroda
Code No. 316
Ph no.: 02666 - 32 082
SHRI SWAMINARAYAN CO-OP BANK LTD.
Patthargate, Main Branch,
Baroda - 1.
Ph. No.: 0265 - 41 55 74
THE VYSYA BANK LTD.
Overseas Branch, Opera House
Mumbai - 40004.
Ph. No.: 022 - 382 14 70
COMPANY SECRETARY
The Company has not appointed a Company Secretary as required U/s
383A of the Companies Act, 1956. However, the Company is in the process of
appointing a Company Secretary.
ESCROW COLLECTION BANKS
SYNDICATE MEMBERS
BANKERS TO THE OFFER
COMPLIANCE OFFICER
Shri. Ulpesh Pandya
B/3, Neekunj Apartments,
Opp. Krishna Talkies,
Siddhnath Road, Baroda - 1
Tel. No.: 0265- 42 43 76.
The investors may contact the aforesaid compliance officer in case
of any pre-issue/post-issue related problems such as non-receipt of letters of
allotment/share certificate/refund orders/cancelled stock invest etc.
CREDIT RATING
This being an Issue of Equity Shares, no credit rating is
required.
TRUSTEES
This being an Issue of Equity
Shares, appointment of Trustees is not
required.
BOOK BUILDING PROCESS
Book building refers to the collection of Bids from investors,
which is based on an indicative price range, the Issue Price being fixed after
the Bid Closing date. The principal parties/ intermediaries involved in a book
building process are:
1. The company
2. A Book Running Lead Manager who is a category I Merchant
banker, in this case, Aryaman Financial Services Limited. The Book Running Lead
Manager is also the Lead Merchant Banker.
3. Syndicate Members who are intermediaries registered with SEBI
to act as underwriters. Syndicate Members are appointed by the Book Running
Lead Manager.
The company has decided to adopt the Book Building Process for
obtaining subscription to the Book Building Portion of the present issue. In
this regard, the Company has appointed Aryaman Financial Services Limited as
the Book Running Lead Manager (BRLM) to the Issue. The BRLM has formed a
Syndicate consisting of the Book Running Lead Manager, and the syndicate
members to procure the subscription for the equity shares.
The Process of Book Building under SEBI guidelines is relatively
new and Investors are advised to make their own judgment about investment
through this process prior to making a Bid or application in the Issue.
Investor must :-
1) Check whether the investor is eligible for Bidding.
2) Bidder necessarily needs to have a demat account.
3) Fill up Bid Form as per instruction given elsewhere in this
Draft Offer Documents and the Bid form.
UNDERWRITING
Book Built Portion
After determination of the final price and prior to filing of the
Final Offer Document with ROC, the company
would enter into an Underwriting Agreement with the BRLM and the
Syndicate Members for the equity shares proposed to be offered through the Book
Built Portion. Equity shares reserved for individual bidders will only be
underwritten by the BRLM and the Syndicate members. In terms of the arrangement
for the Book Built Portion, the BRLM shall be responsible for bringing in the
amount devolved in the event that the Syndicate Members do not fulfill their
underwriting obligations.
The details of Underwriting for the Book Building Portion are as
given below* :
Sr. No
Name & Address of Underwriter
Date of Agreement
No of shares to be Underwritten.
Underwriting (Amount)
1
2
3
BRLM and the Syndicate Members intend to underwrite --% and --% of
the Book Built Portion respectively. However, the final allocation may not
correspond to the respective underwriting agreements.
In the opinion of the Board of Directors (based on certificate
given to it by BRLM) and in the opinion of BRLM on the basis of the
declarations by the syndicate members/underwriters, the resources of all the above
mentioned syndicate members/underwriters are sufficient to enable them to
discharge their respective underwriting obligations in full. All the
above-mentioned syndicate members / underwriters are registered under SEBI
under section 12(i) of the SEBI Act, 1992. All letters of underwriting
mentioned above have been accepted by the Board of Directors of the company at
their meeting held on ------- and letters of acceptance have been issued by the
company to the syndicate members/ underwriters.
* This portion has been intentionally left blank and will be
filled in before filing of the Final Offer Document with ROC.
Fixed Price Portion
The equity shares proposed to be offered through Fixed Price
Portion are fully underwritten. The details of underwriting for Fixed Price
Portion are as given below*
Sr.No
Name & Address of the Syndicate Members
Date of Agreement
No of shares to be Underwritten.
Underwriting (Amount)
1
2
3
In the opinion of the Board of Directors and in the opinion of the
BRLM, the resources of all the above mentioned Underwriters are sufficient to
enable them to discharge their respective underwriting obligations in full. all
the above underwriters are registered
with SEBI under section 12(i ) of the SEBI Act, 1992. All letters of
underwriting mentioned above have been accepted by the Board of Directors of
the company at their meeting held on ------- and letters of acceptance have
been issued by the company to the syndicate members/ underwriters.
* This portion has been intentionally left blank and will be
filled in before filing of the Final Offer Document with ROC.
CAPITAL STRUCTURE OF THE COMPANY
Particulars
Face Value (Rs.)
Aggregate Amount (Rs.)
A.
AUTHORISED (note a)
1,10,00,000
Equity Shares of Rs. 10/- each
11,00,00,000
B.
ISSUED, SUBSCRIBED & PAID UP
26,40,000
Equity Shares of Rs. 10/- each
2,64,00,000
C.
PRESENT OFFER TO PUBLIC {note(b)}
-----------
Equity Shares of Rs. * each
-----------
7,36,00,000
D.
OUT OF THE PRESENT ISSUE
Equity Shares of Rs.* each
reserved for firm allotment basis to
Promoters/Directors ,their Friends, Relatives & Associates
3,36,00,000
E.
NOW OFFERED IN TERMS OF THIS PROSPECTUS
Equity shares of Rs * each
4,00,00,000
-----------
-----------
-----------
(a) Book Building portion of
Equity shares of Rs * each
Of Which { note (c)}
(i) Reserved for QIB's
Equity shares of Rs * each
(ii) Reserved for individuals
Equity shares of Rs * each
-----------
-----------
-----------
3,00,00,000
2,40,00,000
60,00,000
-----------
(b) Net offer to public
Equity shares of Rs 10 each
-----------
1,00,00,000
F.
PAID-UP EQUITY SHARE CAPITAL AFTER THE OFFER {note (d)}
-----------
Equity Shares of Rs.10 each
-----------
10,00,00,000
G
Share Premium Account {note (d)}
Before the Offer
Nil
After the Offer
Rs. **
Footnotes:
a. Initially the
company was registered with an authorized capital of Rs. 1,00,000 and the
changes by passing a special resolution took place are as follows: -
Date of Special Resolution
Increase in authorized share capital
(Amt. In Rs.)
Total Authorised Share Capital on that date
(Amt. In Rs.)
27.03.1998
49,00,000
50,00,000
26.02.2000
50,00,000
1,00,00,000
15.11.2000
10,00,00,000
11,00,00,000
b. The number of equity shares to be allocated / allotted in the
present Offer to Public will be derived by dividing the amount of Present Offer
to Public by the issue price determined through Book Building Process. If the
number of equity shares so derived are not a multiple of 100, the equity shares
to be allocated/ allotted will be rounded of to the nearest 100. Of such number
of shares, 75% will be offered to the bidders in the Book Built Portion and the
remaining number of shares will be offered in the Fixed Price Portion.
c. Out of the Book Built Portion, not more than Rs. 240.00 lacs
will be available for allocation to Qualified Institutional Buyers and not more
than Rs. 60.00 lacs will be available for allocation to non-institutional
investors on a proportionate basis.
d. The share premium account balance after the issue will be
determined based on the Issue Price discovered through Book Building.
Notes to the Capital Structure:
1. Details of
Contribution by Promoters and the friends, relatives & associates of
Promoters/Directors and
lock-in period are as follows:
Ref.
Allotment Date & date when made fully paid-up
Consideration (Cash, bonus, kind, etc.)
No. of Equity Shares
Face Value (Rs.)
Issue Price (Rs.)
% to Post Issue Capital*
Lock in Period*
(note 1)
Subscribers to Memorandum
Cash
300
10
10
B
28-07-1998
Cash
4,36,333
10
10
B
14-11-2000
Cash
21,05,990
10
10
B
29.11.2000
Cash
97,377
10
10
D
To be allotted
Cash
33,60,000
10
**
Total
60,00,000
* This portion is intentionally left blank and will be filled in
after the number of shares are finalised in the proposed issue.
** This portion is intentionally left blank, it will be filled up
once the issue price is determined
Note (1): The promoters have undertaken to offer 20% of the post
issue capital, for lock-in for a period of 3 years from the date of allotment
in this issue or commencement of commercial operation whichever is later. The
balance of the shares will be locked in for a period of 1 year from the date of
allotment in this issue or commencement of commercial operation whichever is
later.
2. The equity shares
held by the promoters under the lock-in period, shall not be sold /
hypothecated / transferred during the lock-in period. However, inter-se
transfers between the promoters named as such would be permitted, provided that
the requirement of the lock-in period guidelines continues to apply, to the
extent initially prescribed.
3. Details of contribution and lock-in in respect of promoters
whose name figure in the paragraph on "Promoters and their
Background" :-
S.no.
Name of the promoter
Allotment Date & date when made fully paid-up
Consideration (Cash, bonus, kind, etc.)
No. of Equity Shares
Face Value (Rs.)
Issue Price (Rs.)
% to Post Issue Capital*
Lock in Period*
(note 1)
1
Mr. Pravinbhai P. Patel.
**
14.11.00
Cash
Cash
100
2,73,600
10
10
2
Mr. Sanjay T. Patel.
Subscriber to memorandum
28.07.98
14.11.00
Cash
Cash
Cash
100
70,551
1,45,900
10
10
Total
4,90251
* This portion is intentionally left blank and will be filled in
after the number of shares are finalised in the proposed issue.
** The shares were originally held by a subscriber to memorandum
and subsequently transferred in the name of the above said promoter.
Note (1) : The promoters have undertaken to offer 20% of the post
issue capital, for lock-in for a period of 3 years from the date of allotment
in this issue or commencement of commercial operation whichever is later.
4. The subscription by the Promoters/Directors, their friends,
relatives and associates for has already been brought in. The Company would
furnish a certificate from their Auditors confirming the contribution to SEBI.
The Equity Share to be allotted under this category shall be for a minimum amount of Rs. 25,000/- in case of
individuals and Rs. 1,00,000/- in the case of Corporate Bodies.
5. There is no buy back or stand-by arrangement or other similar
arrangements for the purchase of securities offered through this Offer Document
by the Promoters, Directors, Relatives, friends, associates, the BRLM, or
merchant bankers directly or otherwise.
6. There has been no issue of shares by the Company for
consideration other than cash or out of revaluation reserves at any point of
time.
7. Details of the top ten shareholders of the Company 2 years
before the date of filing the Draft Offer Document
Sr. No.
Name
No. of Shares
1.
Mansukh V. Patel.
437800
2.
Pravin P. Patel.
273700
3.
Sanjay T. Patel
216551
4.
Bhikabhai P. Patel.
151500
5.
Hiraben P. Patel.
147500
6.
Usha B. Patel.
217377
7.
Thakarbhai B. Patel.
102882
8.
Manish T. Patel.
79150
9.
Priyakant Patel.
55000
10.
Bhikabhai P. Patel. (Kot)
55000
8. Details of the top
ten shareholders of the Company 10 days before the date of filing the Offer
Document with SEBI are given below:
Sr. No.
Name
No. of Shares
1.
Mansukh V. Patel.
437800
2.
Pravin P. Patel.
273700
3.
Sanjay T. Patel
216551
4.
Bhikabhai P. Patel.
151500
5.
Hiraben P. Patel.
147500
6.
Usha B. Patel.
120000
7.
Thakarbhai B. Patel.
102882
8.
Manish T. Patel.
79150
9.
Priyakant Patel.
55000
10.
Bhikabhai P. Patel. (Kot)
55000
9. Details of the top ten shareholders of the Company as on the
date of filing the Offer Document with SEBI are given below :
Sr. No.
Name
No. of Shares
1.
Mansukh V. Patel.
437800
2.
Pravin P. Patel.
273700
3.
Usha B. Patel.
217377
4.
Sanjay T. Patel
216551
5.
Bhikabhai P. Patel.
151500
6.
Hiraben P. Patel.
147500
7.
Thakarbhai B. Patel.
102882
8.
Manish T. Patel.
79150
9.
Priyakant Patel.
55000
10.
Bhikabhai P. Patel. (Kot)
55000
10. The Promoters Group/Directors have not purchased and/or
sold/financed any shares of the Company during the past six months.
11. The Company has not raised any bridge loan against the
Proceeds of this public issue. However,
the Company reserves the right to raise any bridge loan against the proceeds of
this public issue if the need so arises.
12. The securities offered through this public issue shall be made
fully paid-up or may be forfeited within 12 months from the date of allotment
of securities. To this effect the entire amount payable per equity share will
be called within twelve months from the date of allotment. If the investor
fails to make the shares fully paid-up within twelve months from the date of
allotment, the subscription money already paid may be forfeited.
13. The Share holding pattern of the Company as on and the likely
shareholding pattern after allotment of equity shares in the issue is as
follows :
S. No.
Category of the Shareholders
Existing
After the Offer
No. (Shares)
%
No. (Shares)
%
1
Core Promoter
4,90,251
18.57
**
**
2
Friends, relatives and associates
21,49,749
81.43
**
**
TOTAL
26,40,000
100
**
**
14. A Bidder can not
make a bid for more than the number of shares offered through book building and
an applicant in the fixed priced portion can not make an application for more
than Shares offered through fixed price portion.
14. The company presently does not have any intention for
alteration of the capital Structure, either by way of split shares or
additional issue of capital, preferential or otherwise.
15. An over subscription to the extent of 10% of the fixed portion
of the offer can be retained for the purpose of rounding off to the nearer
multiple of 100 while finalising the allotment.
TERMS OF THE PRESENT ISSUE
The equity shares being issued /offered are subject to the terms
of this offer document, the terms and conditions contained in the Memorandum
and Articles of Association of the Company, provisions of the Act, the bid
form, the revision form, the application form, the guidelines of listing of
securities issued by the Stock Exchange and Government of India and /or any
other statutory bodies and the guidelines for Disclosure and investor
Protection issued by the Securities and Exchange Board of India ("SEBI
Guidelines) and the Depositories Act, 1996, as in force on the date of the
offer and to the extent applicable.
AUTHORITY FOR THE PRESENT ISSUE
Pursuant to Section 81 (1A) of the Act, the present issue of
Equity Shares has been authorised by the Shareholders of the Company by a
Special Resolution passed at the Extra Ordinary General Meeting of the Company
held on 15/11/2000.
RANKING OF EQUITY SHARES
The equity shares to be offered shall be subject to the Memorandum
and Articles of Association of the company and shall rank pari passu with the
existing equity shares of the company, save and except that the holders of the
equity shares now being issued, will not be entitled to dividend, if any,
declared or paid by the company for any period prior to the date of allotment.
They will be entitled to dividend, if any, declared or paid on the equity
shares only in such proportion as is attributable to such part of the financial
year, after the deemed date of allotment of such equity shares of the Fixed
Price Portion and including the Book Built Portion. All the shares being
offered through this Draft Offer Document will have similar rights inter-se
with regard to dividend and all other rights of Shareholders from the date of
allotment.
RIGHTS OF MEMBERS
1. Right to receive dividend if declared.
2. Right to attend general meeting and exercise voting rights
unless prohibited by law.
3. Right to vote either personally or if on a poll, by a proxy as
well.
4. Right to receive offer for rights shares and be allotted bonus
shares.
5. Right to receive surplus on liquidation.
6. Right to nominate
7. Such other rights, as may be available to a shareholder of a
public company under the Companies Act.
FACE VALUE/ISSUE PRICE AND TRADEABLE LOT
Equity shares of Face value of Rs.10 each are being offered at a
price of Rs (**) per share equity share. The Company undertakes that, at any
given time there shall be one denomination of shares and the company shall
comply with disclosure and accounting norms as prescribed in this respect, from
time to time.
In Terms of the SEBI Guidelines, the trading of securities shall only be in dematerialised
form for all the investors
The Tradable lot of the company's equity shares is 1 (one) equity
share. Physical Share certificates, wherever issues will be done in the lots of
100 equity shares.
Allotment of the equity shares will be done in the lots of 100
equity shares.
ISSUE STRUCTURE
For the convenience of the Bidders/ Applicants the salient
features of the Issue structure are summarised below:-
Book Built Portion
Fixed Price Portion
Institutional Investor
Individual Investor
Amount Available for allocation
Maximum - Rs.240.00Lacs
Maximum -Rs.60.00Lacs
Maximum - Rs.100.00Lacs
Percentage of total issue size
60%
15%
25%
Basis of allotment
Discretionary
Proportionate
Proportionate
Minimum Bid / Application size and multiples
Minimum bid of 1100 equity shares and in multiples of 100 equity
shares thereafter.
Minimum bid of 500 equity shares and in multiples of 100 equity
shares thereafter.
Minimum application of 200 equity shares and in multiples of 100
equity shares thereafter
Maximum Bid / Application size
A bid cannot be submitted for more than the equity shares offered
for subscription under book building portion.
Maximum of 1000 equity shares.
A application cannot be submitted for more than the equity shares
offered for subscription under fixed price portion .
Allotment Mode
Compulsorily in Demat
Demat or Physical
Demat or Physical
Trading
Compulsory in Demat
Compulsory in Demat
Compulsory in Demat
Who can apply
Institutions specified in section 4A of the Act, Banks, Mutual
Funds and FIIs registered with SEBI.
Individuals, HUF (Karta to apply on behalf of HUF).
Individuals, HUF (Karta to apply on behalf of HUF). Who have not
Participated in the Book Built portion or did not receive any allocation in the
Book Built Portion.
Terms of Payment
As specified under the Section " Terms of Payment " in
the Draft offer Document and the Bid cum application form
As specified under the Section " Terms of Payment " in
the Draft offer Document and the Bid cum application form
As specified under the Section " Terms of Payment " in
the Draft offer Document and the Bid cum application form
Notes to the Issue Structure:
Book Built Portion
1) A minimum of 60% of the Net Offer to the public is being
reserved for Institutional Bidders and would be allocated to Bidders who have
Bid at or above the issue price. The above portion would be allocated in the
Discretionary Book Built Portion.
2) The balance of Book built portion ( i.e. other than the portion
referred above ) would be reserved for individual investors who bid through the
syndicate member provided it is found that their Bids are at or above the offer
price. In case of over subscription in this category, allocation will be made
on proportionate basis. For the purposes of this paragraph the individual
investors means those individuals who bid for up to 10 tradable lots i.e. 1000 equity shares of the company.
3) The company in consultation of with the BRLM will have the
discretion to allocate to any of the investors, who have bid, at the offer
price.
4) The company in consultation of with the BRLM reserves the right
to reject any bid procured by any or all Syndicate Members without assigning
any reason therefore.
Fixed Price Portion
1) The present offer also contains a Fixed Price Portion, which
will be equal to 25% of the Net Public offer. Individual Investors who for any
reason(s) could not participate in the book building Portion during Bidding
period or did not receive an allocation or CAN from the Syndicate member
through whom they participated, Can apply for equity shares out of the fixed
price portion. However, investors who have been successful in getting an
allocation in the book Built Portion are barred from applying for the Fixed
Price Portion.
2) The equity shares to be offered under the fixed price portion
shall also be made available at the offer price. The Fixed Price Portion shall be available for subscription
during the issue period only and not during the Bidding Period.
3) Investors may note that in case of over subscription in the
Fixed Price, allotment will be made on proportionate basis, in consultation
with regional stock exchange. In case
of under subscription in the fixed price portion, the company has the option to
allocate such under subscribed equity shares to which ever category of investor
it deems fit.
Conversion Option of Bid into a application in the Fixed Price
Portion
1. Only Individual Bidders who for any reason(s) did not receive
an allocation or CAN from the Syndicate Members through whom they participated,
shall have the option of being considered for allotment in the Fixed Price
Portion subject to their fulfilling the following conditions:-
2. The Individual Bidders should clearly exercise the option of
conversion of their Bid in the Book Built Portion into an Application in the
Fixed Price Portion by filling the relevant portion in the Bid Form. In case
the Individual Bidders does not exercise such option or does not fill the
relevant portion of the Bid Form properly, it shall be deemed that the
individual Bidder has not opted for such conversion option.
3. The Individual Bidders should not have received an allocation
of any Equity Shares in the Book Built Portion. The Registrars to the Issue
without any reference or intimation to the Individual Bidders who opts for the
conversion will verify this aspect.
4. The Individual Bidders should have Bid for the Equity Shares at
or above the Issue Price.
5. The Individual Bidders should have deposited the entire Bid
amount in the Escrow Account at the time of making the Bid. The amounts
deposited by the Individual Bidders into the Escrow Collection Banks under the
Book Built Portion shall be entirely transferred into the Public Issue
Account. The Bid of the Individual
bidder who exercise the conversion option will be considered to be an
application for the Fixed Price Portion for such number of equity shares
(rounded off to the lower multiple of 100) as are derived by dividing the Bid
Amount paid by such Individual Bidders by the Issue Price.
6. Individual Bidders who exercise the above conversion option,
but do not fulfil any of the above conditions will receive refund from the
Escrow Account in terms of this Draft Offer Document. The refunds payable for
excess amounts deposited by the individual Bidders, who have exercised
conversion options, which fulfils the above conditions, shall be paid out of
the Public Issue Account as per the terms of the Fixed Price Portion.
7. Bidders option for the conversion option cannot make another
application in the Fixed Price Portion as first/sole applicant. In case the
Bidder makes such additional application(s), all the applications including the
application resulting from the conversion of the Bid, would be treated as
multiple applications and would be liable to be rejected.
8. It is hereby clarified that by the exercise of the spill over
option, the bid form shall be deemed to convert into an Application Form for the
Fixed Price Portion, if all the above conditions are fulfilled.
SIZE OF BID/APPLICATION AND TERMS OF PAYMENT
Book Building Portion
Institutional Segment
In case of the Institutional Bidders in the Discretionary Book
Built Portion, bid must be for a minimum of 1100 Equity Shares and in multiples
of 100 Equity Shares thereafter. A bid cannot be submitted for more than the
equity shares offered for subscription under Book Building Portion. The bid
price has to be paid at the time of bidding based on the highest bidding option
of the bidder. Where payment of bidding is waived at the discretion of the
Syndicate Member the offer price is to be paid within 3 days of communication
by the BRLM of the list of bidders who have been allocated equity shares to the
Syndicate Members. Where a Bidder has been allocated lesser number of shares
than he or she had bid for the excess amount paid on bidding, if any will be
refunded to such Bidder.
The Non-Institutional Segment
In case of the Individual Bidders in the Discretionary Book Built
Portion, bid must be for a minimum of 500 Equity Shares and in multiples of 100
Equity Shares thereafter upto a maximum of 1000 equity shares.
The terms of payment for bidders in the Non-institutional segment
of the Book Built Portion of the offer would be mutatis mutandis similar to
those for the institutional Portion of the Book Built Portion of the Offer.
Fixed price portion
Application must be for a minimum of 200 equity shares and in
multiples of 100 thereafter. The entire application price has to be paid at the
time of application. A application cannot be submitted for more than the equity
shares offered for subscription under fixed price portion .An applicant, who
has been allotted lesser number of shares than he she had applied for, will be
refunded the excess amount paid on application.
In case of allotment of shares, any excess amount paid on
application shall be adjusted towards the amount due on allotment and the
balance amount, if any, will be refunded by the company to the applicants.
INTEREST IN CASE OF DELAY IN DESPTACH OF ALLOCATION NOTE/
ALLOTMENT LETTER/ REFUND ORDERS.
The Company agrees that allocation of securities for the Book
Built Portion shall be made and refund orders (if any) shall be despatched to
bidders within 15 days of the Bid Closing Date for the Book Built Portion,
failing which the Company will pay interest @ 15% per annum (except in case of
bids accompanied by Stockinvest) on the subscription amount. However
application received after the aforesaid date in fulfilment of underwriting
obligations, shall not be entitled for the said interest.
The Company agrees that the allotment of securities offered to the
public through the Fixed Price Portion shall be made within 15 days of the
Issue closing Date for the Fixed Price Portion of the public issue. The company
further agrees that it shall pay interest @ 15% per annum on the subscription
amount if allotment is not made within 15 days from the date of closure of the
fixed price portion of the Public Issue. However applications received after
the closure of the Issue in fulfilment of underwriting obligations to meet the
minimum subscription requirement, shall not be entitled for the said interest.
The Company also agrees that as far as possible refund orders shall be
despatched within 15 days from the closure of the fixed price portion of the
Public Issue failing which the Company will pay interest @ 15% per annum
(except in case of applications accompanied by Stockinvest) on the amount of
refund due.
ARRANGMENTS FOR DISPOSAL OF ODD LOTS
The Company has not made any arrangements for disposal of odd
lots. However, the trading in the equity shares of ACL will be exclusively in
the dematerialised form.
NOMINATION FACILITY TO INVESTOR
As per Section 109 A of the Companies Act, 1956, the sole or first
Bidder or applicant, along with other joint bidders or applicant may nominate
any one person in whom,in the event of the death of the sole bidder or
applicant or in case of joint bidders or applicants, death of all the bidders
or applicants, as the case may be, the equity shares allotted, if any, shall
vest.A person, being a nominee, becoming entitled to the equity shares by
reason of the death of the original holder(s) shall in accordance with
section109 A of the Act, be entitled to the same advantages to which he would
be entitled if he were the registered holder of the equity share(s). Where the
the nominee is a minor, the holder(s) may make a nomination to appoint, in the
prescribed manner, any person to become entitled to equity share(s) in the
event of his or her death during the minority. A nomination shall stand
rescinded upon a sale of equity shares
by the person nominating. A buyer will be entitled to make a fresh nomination
in the manner prescribed. Fresh nomination can be made only on the prescribed
form available on request at the registered office of the company or the
Registrar to the issue.
Any person who becomes a nominee by virtue of the provisions of
the section 109 A of the act, shall upon the production of such evidence as may
be required by the board, elect either :
1. To register himself as a holder of equity shares or
2. To make such transfer of the equity shares, as the deceased
holder could have made.
Further, the board may at any time give notice requiring any
nominee to elect either to be registered himself or to transfer the equity
shares, and if the notice is not complied within 90 days, the board may
thereafter withhold payment of all dividends, bonuses or other monies payable
in respect of the equity shares until the requirements of the notice have been
complied with.
HOW TO APPLY - AVAILABILITY OF FORMS, PROSPECTUS AND MODE OF
PAYMENT
I. Book Built Portion
a) Bid Form
Bidders shall only use the Bid Form for the purpose of making a
Bid in terms of this Draft Offer Document. The Bid Form should bear the stamp
of the Syndicate Member or else it would be rejected. The Bidder shall have the
option to make a maximum of three Bids in their Bid Form and such options shall
not be considered as multiple applications.. Upon the allocation of shares and
dispatch of CAN and filing of Draft Offer Document with the ROC, the Bid Form
shall be considered as the application form and upon issue of share, shall
function as an authority given to the Company by the Bidder to sign the
authority pursuant to which the shares in physical or demat form will be
transferred. On filling the Bid Form, the Bidder is deemed to have authorised
the Company to make the necessary changes in the Draft Offer Document and the
Bid Form as would be required for filing of Draft Offer Document with the ROC
and as would be required by the ROC
after such filing, without any prior or subsequent notice of such changes to
the Bidder.
Do's:
1) Check who can Bid
2) Fill up the Bid Forms after reading the instruction carefully
regarding:
a) Payment details
b) Bank details
c) Usual Signatures
d) PAN/GIR Nos.
e) DP details
3) Enter correct details of DP and Beneficiary Account as
allotment in Institutional Book Built Portion is compulsorily in demat form and
trading of equity shares of the company will be in demat form only. The
syndicate member(s) has the right, but not the responsibility, to ask for proof
of the DP Account.
4) Submit Bid at Bidding Centres only and obtain Transaction
Registration Slip (TRS) from the Syndicate Members.
5) Bid Form should bear the stamp of the Syndicate Member, if not,
the same would be liable to be rejected.
6) In case the Bidder wants to revise the Bid, The Bidder should
submit the Revision form to the same Syndicate Member along with the TRS
through whom the Original Bid was placed and obtain a revised TRS for the
revised Bid.
Don'ts :
1) Do not Bid for lower than minimum Bid Size applicable to the
Bidder.
2) Do not bid at less than the Floor Price.
3) Do not bid at cut-off price.
4) A bidder should not Bid on another Bid Form after his/her Bids
on one Bid Form have been submitted to any Syndicate Member: the same may be
rejected as multiple Bidding.
5) Bid amount is not to be paid in cash otherwise the same may be
rejected.
6) Bid forms should not be sent by post, but hand delivered.
b) Who can Bid
1. Indian nationals resident in India who are majors, in single or
joint names (not more than three)
2. Hindu Undivided Families (HUF) in the individual name if the
Karta.
3. Companies, Corporate Bodies and Societies registered under the
applicable laws in India and authorise to invest in these shares.
4. Indian Mutual Funds registered with SEBI.
5. Indian Financial Institutions, Commercial Banks and Regional
Rural Banks, Co-operative Banks subject to permission from RBI.
6. Trust registered under Societies Registration Act, 1860, or any
other Trust Law and are authorised under their constitution to hold and invest
in shares.
7. Non Resident Indians (NRIs), Overseas Body Corporate (OCBs) and
Foreign Institutional Investors (FIIs) on non-repatriation basis subject to
applicable laws and RBI permission.
Bids from Indian Nationals, Hindu Undivided Families applying
through Karta and NRIs applying for upto 1000 Equity Shares would be considered
as Individual Bidder
Note : Book Running Lead
Managers, Syndicate Members and any associates of Book Running Lead Managers,
Syndicate Members (except Asset Management Companies of the mutual funds, banks
and Indian Financial Institutions) cannot participate in the Book Built
Portion. Further the BRLM and the Syndicate Member(s) shall not be entitled to
subscribe to the Issue in any manner, except as per the terms of the
underwriting agreements.
Steps to be taken upfront by the Bidders
a) To check whether he/she is eligible for Bidding.
b) Bidder necessarily needs to have a demat Account
c) Filling up of Bid Forms as per instructions given elsewhere in
the Draft Offer Document and the Bid Form.
c) Bidding Process
1. The BRLM/Syndicate Members will circulate copies of the Draft
Offer Document along with the Bid Form to their clients.
2. Investor desirous of obtaining the Draft Offer Document along
with the Bid Form can obtain the same from the Registered Office of the Company
or from any BRLM or from a Syndicate Member.
3. The Company and the BRLM shall declare the Bid Opening Date and
Bid Closing Date and publish the same in three widely circulated newspapers
(one each in English, Hindi and regional). This advertisement shall contain the
salient features of the Draft Offer Document as specified under Form 2A, the
method and process of bidding and the names and addresses of the BRLM/Syndicate
Members. The BRLM/Syndicate Members shall start accepting bids from the bidders
from the Bid Opening Date.
4. Investors who are interested in subscribing to the Company's
Equity Shares should approach any of the BRLM/Syndicate Members or their
authorised agent(s) to register their bid.
5. The Bids should be compulsorily submitted on the prescribed Bid
Form only.
d) Escrow Mechanism
The Company and the Syndicate Members shall open Escrow Accounts with
one or more Escrow Collection Banks in whose favour the Bidder shall make out
the cheque or demand draft in respect of his or her Bid and/or revision. The
Escrow Collection Banks will act in terms of this Draft Offer Document and an
Escrow Agreement to be entered into between the BRLM, the Company/respective
syndicate member, the Escrow Collection Bank, and the Registrars to the Issue.
The Escrow collection Banks shall maintain the monies deposited by the Bidders
in the Escrow account of the company for and on behalf of the bidders. The
Escrow Collection Bank shall not exercise any lien over the monies deposited
therein, and shall hold the monies therein in trust for the Bidders, and on or
after the Issue Opening Date transfer the monies to the Public Issue Account
with the Bankers to the Issue as per the terms of the Escrow Agreement.
The Bidders are informed that the Escrow Mechanism is not
prescribed by SEBI and the same has been established as an arrangement between
the Escrow Collection Bank(s), the company, the Registrars to the Issue and the
BRLM, the facilitate collections from the Bidders.
e) Payment Into The Escrow Collection Account
Each Bidder shall, with the submission of the Bid cum Application
Form draw a cheque/demand draft/stockinvest for the maximum amount of his bid
in favour of the Escrow Account of the Escrow Collection Bank and submit the
same to the Syndicate Member(s). Bid form accompanied by cash shall not be
accepted the maximum bid price has to be paid at the time of bidding based on
the highest bidding option of the bidder. Where the Bid is at cut-off price,
the investor will be required to make payment at the highest price in the
indicative price band. The Syndicate Member(s) shall deposit such cheque/demand
draft/stockinvest with the Escrow Collection Bank, which will hold the monies
for the benefit of the Bidders till such time as the Issue Opening Date. On the
Issue Opening Date, the Escrow Account, as per the terms of the Escrow
Agreement, into the Public Issue Account with the Bankers to the Issue.
The Syndicate Member(s) may at their discretion waive such
requirement of payment at the time of the submission of the Bid Form for
Wholesale Bidders. Where such payment at the time of bidding is waived at the
discretion of the Syndicate Member or where there is a shortfall as a result of
cut-off price being more than the highest price in the indicative price band,
the Issue Price or the difference, as the case may be would be paid, favouring
the Escrow Account, within 3 days on communication by the BRLM of the lost of
Bidders who have been allocated Equity Shares to the Syndicate Members. If the
payment is not made favouring the Escrow Account within the time stipulated
above, the Bid of the Bidder is liable to be cancelled.
However, if the BRLM/Syndicate Member does not waive such payment,
the full amount of payment has to be made and the BRLM/Syndicate Member will
not accept partial payment.
The payment instruments for payment into the Escrow account of the
company should be drawn in favour of
"ESCROW ACCOUNT- WCIL PUBLIC ISSUE".
The payment instruments for payment into the Escrow account of the
syndicate member should be drawn in favour of
"NAME OF SYNDICATE MEMBER-ESCROW ACCOUNT- WCIL PUBLIC ISSUE".
Where the bidder has been allocated lesser number of Equity
Sharers than he or she bid for, the excess amount paid on biddings, if any,
after adjustment for allocation, will be refunded to such bidder within 15 days
from the Date of Bid Closing. In case of Individual Bidders who have exercised
the conversion option and are eligible allotment in the Fixed Price Portion,
the entire amount will be transferred to the Public Issue Account and the
excess amount if any after allotment will be refunded to such Individual
Bidders in terms of the procedure for refunded for the Fixed Price Portion.
(Also refer to the "Para Conversion Option of Bid into a Application in
the Fixed Price Portion")
f) Bidding
Each Bid Form will give the Bidder the choice to Bid for up to
three optional price and demand (i.e. number of shares bid for) levels. The
Price and demand options submitted by the Bidder in the Bid Form will be
treated as optional demands from the Bidder and will not be cumulated. After
discovery of the Issue Price, the maximum number of shares bid for by a Bidder
at or above the issue price will be considered as his only Bid during the
allocation process.
The Bidder cannot bid on another Bid Form after his bids on one
Bid Form have been submitted to any Syndicate Member. Submission of a second
Bid Form to either the same or to another Syndicate Member will be treated as
multiple bidding and is liable to be rejected either before entering the Bid
into the electronic bidding system or at any point of time prior to the
allotment of Equity Shares in the Issue.
Along with the bid Form, all bidders will submit a cheque or draft
payable to the Escrow Account or Stockinvest (subject to applicable laws/
guidelines) favouring the company. The amount of such payment will have to be
considered at the highest value of the optional bids submitted in the Bid Form.
If one of the Bidder's option is at the cut off price, the payment will have to
be considered at the highest price in the price band for that option. The
syndicate member can waive this requirement of payment to the Escrow account
for any bidder as per his discretion. However, if the syndicate member does not
waive such payment, the full amount of payment has to be made and the Syndicate
Member will not accept partial payment.
The BRLM/Syndicate Member will enter each option into the
electronic biding system as a separate bid and generate a Transaction
Registration Slip (TRS) for each option and give the same to the Bidder.
Therefore, a Bidder can receive up to three for each Bid Form.
The Bid Forms should bear the stamp of the Syndicate Members;
otherwise, the same would be rejected.
g) Bids At Different Price Levels
The floor price of Rs.10 per share is likely to be advertised on
-----, 2000 prior to the Bid Opening Date in English Daily, Hindi Daily and a
regional daily. The company and the BRLM reserve the right to finalise the
Issue Price at or above the Floor Price without prior approval of or
information to the bidders. Any change in the price will be widely advertised
through advertisements released in the above dailies. The Offer price as
determined by the Company in consultation with the BRLM may be above the floor
price.
Bidders will have their bids at a price, which may be at or above
the floor price. The bids above the floor price will be in additions of Rs.2/-
thereof. Bids at intermediate price will be treated as bids at the price, which
is the intermediate, lower multiple of Rs.2/-. However, the Bidders cannot bid
below the floor price.
An investor will not have an option of putting a "cut off
Price Bid" and such bids will be treated as invalid.
h) Electric Registration Of Bids
The BRLM/Syndicate Members will register the Bids using the
on-line facilities of NSE (National Stock Exchange)/BSE (The Stock Exchange,
Mumbai). There will be atleast one BSE on-line connectivity to each of the
Biding Centres.
NSE/BSE/ASE will offer a screen-based facility for registering
Bids for the Issue. This facility will be available on the terminals of
BRLM/Syndicate Members during the Bidding Period. BRLM/Syndicate Members can
also set up facilities for off-line electronic registration of bids subject to
the condition that they will subsequently download the off-line data file into
the on-line facility for Book Building.
At the time of registering the Bid, the BRLM/Syndicate Members
shall enter the following details of the investor in the on-line system:
1. Name of the Investor
2. Investor Category - Individual / HUFs / FIs( Financial
Institution and Banks) /Corporate / NRI / OCB / FII / MF.
3. Number of Shares
4. Bid Price
5. Bid Form Number
6. Whether payment is made upon submission of Bid Form.
After the above data is entered, the system will generate a Unique
Transaction Identification Code (UTIC), which will indicate the Syndicate
Members' identity and the investor's registration with him. A system generated
Transaction Registration Slip (TRS) (or the Order Confirmation Note) will be
given to the Investor as a proof of the registration of each Bid Option. It is
the Bidders responsibility to obtain the TRS from the Syndicate Member. The
registration of the Bid by the Syndicate Member does not guarantee that the
shares shall be allocated either by the Syndicate Members or the Company or the
BRLM .
Such TRS will be non-negotiable and by itself will not create any
obligation of any kind.
The BRLM/Syndicate Member has the right to vet the Bid.
Consequently, the Syndicate Member also has the right to accept the Bid or
reject it without assigning any reason. In case the Syndicate Member does not
waive the requirement of payment into the Escrow Account during the Bidding
Period, the Bid of the Bidder shall not be rejected except on technical
grounds.
Bidders may note that the Syndicate Member(s) are bound by the
terms and conditions of the undertakings signed by them with the relevant Stock
Exchange(s) and by the circulars and instructions issued by the exchanges there
under.
It is to be distinctly understood that the permission given by BSE
to use their network and the software of the Online IPO System should not in
any way deemed or constructed that the compliance with various statutory and
other requirements by the Company, BRLM etc. are cleared or approved by BSE,
nor does it in any manner warrant, certify or endorse the correctness or
completeness of any of the compliance with the statutory and other requirements
nor does it take any responsibility for the financial or other soundness of
this Issuer, its promoters, its management or any scheme or project of this
Issuer.
It is also to be distinctly understood that the approval given by
BSE should not in any way be deemed or construed that the Prospectus has been
cleared or approved by BSE; nor does it in any manner warrant, certify or
endorse the correctness or completeness of any of the contents of this
Prospectus; nor does it warrant that the securities will be listed or will
continue to be listed on the Exchange.
The Company clarifies that every person who desires to apply for
or otherwise acquire any securities in this issue may do so pursuant to an
independent enquiry investigation and analysis and shall have no claim against
BSE whatsoever by reason of any loss which may be suffered by such person
consequent to or in connection with such subscription / acquisition whether by
reason of anything stated or omitted to be stated herein or any reason
whatsoever.
i) Build Up Of The Book & Revision Of Bids
1. Bids registered by various Bidders through their BRLM/Syndicate
Member(s) shall be electronically transmitted to the NSE/BSE/ASE mainframe on
an on-line basis.
2. The book would get built up at various price levels. This
information will be available to the BRLM on an on-line basis.
3. During the Bidding Period, any Bidder who has registered his or
her interest in the equity shares at a particular price level is free to revise
his or her Bid using the printed Revision Form.
4. The revision can be made in both the desired quantity of shares
and / or the Bid Price by using the Revision Form. The Bidder must fill his or
her Bid Form Number, details of all the options in his or her Bid Form or
earlier Revision Form and revisions for all the options as his Bid form or earlier
revision Form. For example if a Bidder has bid in three options in the Bid Form
and he is changing only one of the options in the Revision Form, he must fill
the details of the other two options in the Revision Form as unchanged. The
Syndicate Member will not execute incomplete or inaccurate Revision Forms.
5. The Bidder can make this revision any number of times during
the Bidding Period. However, for any revision(s) in the earlier Bid, the Bidder
will have to use the services of the same Syndicate Member through whom he has
placed the original Bid, otherwise the revised bid is liable for rejection.
6. In case of revision of the Bid it should be accompanied by
payment in the form of cheque or demand draft or stockinvest for the balance
amount of the revised Bid if any, to be paid on the account of the revised Bid.
The excess amount paid, if any shall be returned to the Bidder at the time of
refunding, according to the terms of this Draft Offer Document. The Syndicate
Member may at his sole discretion waive the payment requirement at the time of
one or more revisions. The Bidder has a sole responsibility of accurately
paying the incremental amount payable on revision of bids and the Syndicate
Members will not be responsible for the consequences of any short payment. If
the sum total of cleared balance on account of the original payment of Bid
Amount and incremental amounts paid on revision thereafter is short of the
total amount payable by the bidder, then the bid of the bidder or any
allocation made thereon is liable to be cancelled at any point of time upto
allotment of the equity shares.
7. When a Bidder revises his or her bid, he or she shall surrender
the earlier TRS and get a revised TRS from the Syndicate Member. It is the
responsibility of the Bidder to request for and get the revised TRS, which will
as proof of his / her having revised the previous Bid.
8. In case of discrepancy of data between NSE/BSE/ASE and the
Syndicate Member, the decision of the BRLM based on the records of NSE/BSEASE
is final and bidding to all concerned.
j) Technical Grounds On Which Bids Can Be Rejected.
1. The syndicate members registrars to the issue BRLM or the
company will have the right but not the obligation to reject any Bid one or
more of the following grounds :-
2. If the number of equity shares bid for is lower than the
minimum Bid size as applicable in the respective category.
3. If the bid amount/margin amount paid is lower then the amount
payable as per the draft offer document and bid form.
4. If the bid amount/margin amount is not paid as per the payment
instructions in the draft offer document and the bid form.
5. If the bid form is not complete or not duly filled in as per
the instructions in the draft offer document and the bid form.
6. A Bidder bids on another Bid Form after his/her bid on one Bid
Form has been submitted to any Syndicate Member the same may be rejected as
multiple Bidding.
7. A stamp of a syndicate member does not accompany the bid form.
8. If the Syndicate members or the registrars to the issue have
reasons to deem the bid to be multiple bidding.
9. If the bid forms are not delivered by the bidders within the
time prescribed as per the bid form, bid opening date advertisement and the
draft offer document and the bid form.
10. If the bid form does not conform to any other terms and
instructions laid out in the Draft offer document and the Bid form.
k) Payment Instructions for Book Built Portion:
Cash payment will not be accepted by the BRLM/Syndicate Members
for the Book Built Portion. Payment may be made by way of cheque or stockinvest
(subject to applicable laws/guidelines) or demand draft drawn on any bank,
including a cooperative bank which is situated at and is a member or sub-member
of the Bankers Clearing House located at the place where the Bid Form or
Revision Form is submitted. Outstation cheques or bank drafts, or bank draft
drawn on bank not participating in the clearing process will not be accepted.
Non-MICR cheque will not be accepted in cities where use of MICR cheque is
prevalent. Bidders based in cities other than bidding centres can give demand
drafts payable at the location of the Bidding Centre where the Bid cum
Application Form or Revision Form is submitted. Such Bidders based in cities
other than the bidding centres can submit the Bid cum Application Forms or
Revision Forms only by hand delivery to the BRLM/Syndicate Member. Bids sent by
post will not be registered by the BRLM/Syndicate Member.
All cheques or drafts must be made payable to Escrow Collection Bank(s)
and favouring "Name of the Bank Escrow A/c WCIL-Public Issue" and
crossed "A/c Payee Only". A
separate cheque or bank draft or Stockinvest must accompany each Bid Form and
Revision Form. Bidders are advised to mention the serial number of the Bid cum
Application Form on the reverse of the instruments to avoid misuse of
instruments submitted along with the bids for the Equity Shares.
Where the maximum Bid for equity shares by a Bidder is for total
value of Rs. 50,000 or more, i.e. the actual no of securities bid for
multiplied by the bid price, is Rs 50,000 or more the bidder or in the case of
a bid in joint names, each of the bidders should mention his or her Permanent
Account Number (PAN) allotted under Income-tax Act, 1961 or where the same has not
been allotted, the GIR Number and the Income-Tax Circle/ Ward/ district. In
case, neither the PAN nor the GIR number has been allotted, the Bidder must
mention " Not Allotted" in the appropriate place. Bid Forms without
this information will be considered incomplete and are liable to be rejected.
l) Payment by Stock invest
The bidder who is an individual or a mutual fund has the option to
use stockinvest in lieu of cheques or bank drafts for payment of application
money, subject to applicable laws guidelines. The bidder using stockinvest
should submit the Bid Form or Revision Form along with the instrument to the
collection centre of the Syndicate Member mentioned in the Bid Form.
Stock-invest instruments are payable at par at all the branches of the issuing
bank and as such, outstation stockinvest instruments can be attached to the Bid
Form or Revision Form. Stockinvest can be obtained from any Bank issuing such
instrument in various denominations by making the necessary applications and
depositing the amounts with the respective banks. The stock-invest will be
issued to the Bidder in blank format after authentication of the date of offer
by the designated branch. The stock-invest duly completed should be submitted
along with the Bid Form or Revision Form to the collection centre of the
Syndicate Member mentioned in the Bid Form
The Bidder may approach the banks concerned for obtaining
stockinvest and detailed instructions for same. The stock-invest should be made
payable in favour of "Wonder Craft Industries Limited- Public Issue"
The Bidder has to fill in
the following particulars:
1. Title of the account i.e. "Wonder Craft Industries
Limited- Public Issue"
2. The number of equity shares bid for;
3. The maximum amount payable as per the options in the Bid Form
or Revision Form;
4. The name and address where the stock-invest should be returned
in case of non-allotment; and
5. The Bid Form number on the reverse of the instrument.
The Bidder should thereafter sign the instrument. The stock-invest
should bear "Account Payee" and "Non-Negotiable" crossing
and will be payable only to the account of the Issuer Company. i.e.
"Wonder Craft Industries Limited- Public Issue". Stock-invest should
be utilised by the purchaser(s) and the purchaser's name / name of one of the
purchasers should be invariably indicated as the first applicant in the
composite application form. Thus if the signature of the purchaser on the
stock-invest and the signature of the first applicant on the application form
does not tally, the application would be treated as having been accompanied by
a third party stock-invest and is liable for rejection.
Stock-invests are to be used by the purchaser(s) within 10 days of
its issue and for this purpose the last day for use of the stock-invest for
submitting application to the Bankers to the Offer should be indicated on the
face of the stock-invest with a notation "To be used before
____________".
No refund will be made to those Bidders using stock-invest for
payment of money due under the Bid Form or Revision Form. In case of
non-allotment of equity shares, the cancelled stock-invest instrument will be
returned to the Bidder, who will have to approach the issuing bank branch for
lifting of lien.
Applications with stock-invest not fulfilling the above criteria
are liable to be rejected. The service charges, if any, for procuring the
stock-invest shall be borne by the Bidder.
The applicant should not fill in the portion to be filed up by the
Registrar to the Offer (right hand portion of the instrument). The Registrar to
the Offer will fill up the right hand portion of the stock-invest indicating
the equity shares allotted to the applicant and also the amount calculated as
follows:
In case of full allotment, the number of equity shares and the
amount on the right hand side will be the same as the left-hand side of the
instrument.
In case of partial allotment, the number and the amount after
adjusting allotment money, if any, payable in respect of equity shares so
allotted, filled up by the Registrar (on the right hand side of the instrument)
will be less than or equal to the number and the amount filled up by the
applicant (on the left hand side of the instrument).
In case the allotment is nil, the number and the amount filled up
by the Registrar on the right hand side of the instrument will be nil.
The Registrar to the Offer has been authorised by the Company vide
a Board Resolution passed on -----/2000 to sign on behalf of the Company for
realising the proceeds of the stock-invest of the successful allottees from the
issuing bank or to affix non-allotment advice on the instrument or to cancel
the stock-invest of the non-allottees or partly successful allottees who can
enclosed more than one stock-invest. The cancelled instrument shall be sent
back by the Registrar to the Investor directly.
Only mutual funds and individuals are entitled to use
stock-invest. There is a ceiling of Rs 50,000/- per individual per stock-invest
for individual applicants. This ceiling is not applicable for mutual funds.
The above information is given for the benefit of the investors
and the company is not liable for any modification of the terms of stock-invest
or procedure there of by issuing banks. Inquiries relating to stock-invest may
be addressed only to the registrar to the offer and not to the issuing bank.
m) Disposal Of Application Made By Stock-Invest
The procedure for disposal of applications made by
cash/cheque/demand draft will apply mutatis mutandis to stock-invest except the
following:
In case of non-allotment, stock-invest will be cancelled by the
Registrar to the Offer and returned to the Bidder. The Stock-invest will bear
stamps such as "CANCELLED" and "NOT ALLOTTED" across the
face of the instrument. The issuing bank will lift the lien on the account on
surrender of the same by the Bidder. In case the cancelled stock-invest is not
received by the investor from the Registrar to the Offer, lien will be lifted
by the issuing branch on expiry of four months from the date of offer against
an indemnity bond from the applicant.
In case of allotment / partial allotment, the Registrar to the
Offer shall fill in the amount in the stock-invest which would be less than or
equal to the amount filled by the bidder and present the stock-invest duly
discharged on behalf of the Company for collection of payment to the extent of
allotment to the respective issuing Bank. The issuing bank will lift the lien
on the balance amount, if any, of the deposit.
Inquiries relating to shares applied through stock-invest may be
addressed only to the Registrar to the Offer and not to the issuing bank.
Multiple applications under a stock-invest are liable to be
rejected, as each application is required to be accompanied by a separate
instrument.
Above information is given for the benefit of the Bidder and the
company is not liable for any modification of terms of stock-invest or
procedure thereof by issuing bank.
1. Shares and in multiples of 100 Equity Shares thereafter subject
to a maximum of 1000 Equity Shares.
2. For Institutional Bidders, the Bid must be for a minimum of
1100 Equity Shares and in multiples of 100 Equity Shares thereafter. A Bid
cannot be submitted for more than the sharers offered for subscription under
Book Building Portion.
3. In single name or in joint names (not more then three).
4. A Magistrate under his or her official seal must attest Thumb
impressions and signatures other than in the languages specified in the Eight
Schedule in the Constitution of India.
5. The company reserves the right to reject any Bid without
assigning any reason for such rejection and consequent refunds shall be made by
cheque or pay order or draft and will be send to the Bidder's address at the
applicant's risk.
ii) Bidder's Bank Details.
The name of the Sole or first Bidder's Bank, branch, type of
account and account numbers must be filled in the Bid cum Application Form.
This is required for the Bidder's own safety so that these details can be printed
on the refund orders. Bids without these details are liable to be
rejected.
iii) Bidder's Depository Account Details.
All the Bidders have an option to get their Equity Shares using
the Depository mode. It is mandatory for Wholesale Bidders to get their shares
using their Depository Mode. All
Bidders desirous of availing this facility should mention their Depository
Participant's name, DP-ID and Beneficiary Account Number in the Bid Form. In
case a Bidder seeks allotment of certain number of shares in dematerialised
form and the remaining in physical form, these would be clubbed for the purpose
of arriving at the basis of allotment. Applicants must indicate in the
Application Form, the number of Equity Shares they wish to receive in the
electronic form and in the physical form. Further it may be noted that in such
cases the allotment of Equity Shares would be first be done in electronic form
and the remaining in physical form. However, if the same Applicant submits two
Application Forms, one for Equity Shares in electronic form, such Application
will as multiple applications and are liable to be rejected. In case of
Application Forms submitted in joint names, it may be ensured that the
Depository Account is also held in the same joint names and are in the same
sequence in which they appear in the Application Form. Further, Syndicate
Members reserve a right to ask for suitable documentary proof of Depository
Account from the Bidder to ensure that correct Depository Account details are
given by the Bidder, (for details refer para on option to hold shares in
electronic form with CDSL/NSDL).
iv) Bids under Power of Attorney
In case of bids made under Power of Attorney or by limited
companies, corporate bodies, registered societies, etc., a certified copy of
the Power of Attorney or the relevant resolution or authority, as the case may
be along with a certified copy of the Memorandum & Article of Association
and/or Bye Laws must be lodged along with the Bid cum Application Form with the
Syndicate Member. Failing this, the Issuer reserves the right to accept or
reject any bid in whole or in part, in either case, without assigning any
reason thereof .
v) Submission of Bid Form
All Bids cum Application Forms or Revision Forms duly completed
and accompanied by Account cheques or drafts or Stock-invest shall be submitted
to the BRLM/Syndicate Member at the time of submitting the Bid. The
BRLM/Syndicate Member may at his discretion waive the requirement of payment of
at the time of submission of the Bid cum Application Form and Revision Form in
the case of Wholesale Bidders.
No separate receipts shall be issued for the money payable on
submission of Bid cum Application Form or Revision Form. However, the
collection centre of the BRLM/Syndicate Member will acknowledge the receipt of
the Bid cum Application Forms or Revision Forms by stamping and returning to
the Bidder the acknowledgement slip. This acknowledgement slip will serve as
the duplicate of the Bid Form for the record of the Bidder.
II FIXED PRICE PORTION
a) Availability of Forms and Prospectus
Application forms together with Memorandum containing salient
features of the offer document may be obtained from the Registered Office of
the Company, Lead Manager to the Offer, Registrar to the Offer and Bankers to
the Offer named herein or from their branches as stated on the reverse of the
application form. Any person desiring to have a full copy of the offer document
may write to the Lead Manager or to the Registered Office of the Company.
b) Who can apply -
1. Indian nationals resident in India who are majors, in single or
joint names (not more than three)
2. Hindu Undivided Families in the individual name of the Karta.
3. NRIs on non repatriable basis
c) Procedure For Making Application
Application must be
made only: -
1. On the prescribed application form accompanying the memorandum
containing salient features of the offer document.
2. Completed in full in BLOCK LETTERS in English except
signatures, in accordance with the instructions contained herein and in the
application form. Applications not so made are liable to be rejected.
3. For a minimum of 200 equity shares and in multiples of 100
thereafter.
4. In single name or joint names (not more than three).
5. A magistrate or a Notary Public or a Special Executive
Magistrate under his or her official seal must attest Thumb impression and
signatures other than in the languages specified in the eighth schedule in the
constitution of India.
6. The company reserves the right to reject any application without
assigning any reason for such rejection and consequent refunds shall be made by
cheque or pay order or draft and will be send to the applicant's address at the
applicant's risk.
All communications should be addressed to the Registrar to the
Issue.
Applicant's Bank Details.
The name of the Sole or first Applicant's Bank, branch, type of
account and account numbers must be filled in the Application Form. This is
required for the Applicant's own safety so that these details can be printed on
the refund orders. Bids without these details are liable to be rejected.
Applicant's Depository Account Details.
All the Applicant's have an option to get their Equity Shares
using the Depository mode. All Applicant's desirous of availing this facility
should mention their Depository Participant's name, DP-ID and Beneficiary
Account Number in the Application Form. In case a Bidder seeks allotment of
certain number of shares ion dematerialised form and the remaining in physical
form, these would be clubbed for the purpose of arriving at the basis of
allotment. Applicants must indicate in the Application Form, the number of
Equity Shares they wish to receive in the electronic form and in the physical
form. Further it may be noted that in such cases the allotment of Equity Shares
would be first be done in electronic form and the remaining in physical form.
However, if the same Applicant submits two Application Forms, one for Equity
Shares in electronic form, such Application will as multiple applications and
are liable to be rejected. In case of Application Forms submitted in joint
names, it may be ensured that the Depository Account is also held in the same
joint names and are in the same sequence in which they appear in the
Application Form. Further, Syndicate Members reserve a right to ask for
suitable documentary proof of Depository Account from the Bidder to ensure that
correct Depository Account details are given by the Bidder, (for details refer
para on option to hold shares in electronic form with CDSL/NSDL).
Applications under Power of Attorney
In case of Applications made under Power of Attorney, a certified
copy of the Power of Attorney or the relevant resolution or authority, as the case
may be along with a certified copy of the Memorandum & Article of
Association and/or Bye Laws must be lodged along with the Application with the
registrar to the issue. Failing this, the Issuer reserves the right to accept
or reject any bid in whole or in part, in either case, without assigning any
reason thereof
d) Instruction For Payment
Payments should be made in cash or cheque or demand draft or
stock-invest drawn on any bank (including a Co-operative Bank), which is
situated at, and is a member or a sub-member of the Bankers' "Clearing
House" located at the Centres (indicated in the Application Form) where
the application is accepted. A separate cheque / demand draft / stock-invest
should accompany each application.
Applicants residing at places where no collection centres have
been opened may submit to may be crossed A/c "Wonder Craft Industries
Limited- Public Issue" You are requested to mention the Application Form
Number on the reverse of the Cheque / Draft / Stock-invest.The applications should
be submitted at the designated collection centres of the bankers to the issue
before the issue closing date.
When application for equity shares is for the total value of
Rs.50000/- or more, i.e. the actual number of securities applied for multiplied
by the Issue Price, is Rs.50000/- or more the applicant or in the case of an
application in the joint names, each of the applicants must mention their
Permanent Account Number (PAN) allotted under thr IT Act, 1961 or where the
same not been allotted, the GIR number and the Income Tax
Circles/Ward/District. In case neither the PAN nor the GIR number has been
allotted the applicant must mention, "NOT ALLOTTED" in the
appropriate place. Application form without this information will be considered
incomplete and are liable to be rejected.
Money orders, postal orders, outstation cheques or demand drafts,
cheques / draft drawn on banks not participating in the "clearing
house" will not be accepted and applications accompanied with such
instruments may be rejected.
No separate receipts will be issued for the application money.
However, the Bankers to the Offer receiving the application form will
acknowledge receipt of the application by stamping and returning to the
applicant the Acknowledgment Slip at the bottom of each application form.
In case payment is effected in contravention of the conditions
mentioned herein, the application money will be refunded and no interest will
be paid thereon.
Application (s) will not be accepted by the lead manager to the
offer or registrar to the offer.
e) Disposal Of Application And Application Money
No receipt will be issued for application money. However, the
Bankers to the Offer receiving the application will acknowledge the receipt of
the application by stamping and returning the detachable acknowledgment slip
appended to each application.
The sum received in respect of the offer will be kept in separate
bank accounts and the Company will not have any access to the funds unless
approval of the Regional Stock Exchange i.e. the Stock Exchange, Mumbai is
obtained for the basis of allotment and listing approval from the Stock
Exchange where listing is proposed.
The Company reserves the full unqualified and absolute right to
accept or reject any application in whole or part and in either case without
assigning any reason thereof.
f) Payment by Stock invest
The Applicant who is an individual has the option to use
stock-invest in lieu of cheques or bank drafts for payment of application
money, subject to applicable laws guidelines. The Applicant using stock-invest
should submit the Application Form along with the instrument to the Bankers to
the issue/collection centre mentioned in the Application Form. Stock-invest
instruments are payable at par at all the branches of the issuing bank and as
such, outstation stock-invest instruments can be attached to the Application
Form. Stock-invest can be obtained from any Bank issuing such instrument in
various denominations by making the necessary applications and depositing the
amounts with the respective banks. The stock-invest will be issued to the
applicant, in blank format after authentication of the date of offer by the
designated branch. The stock-invest duly completed should be submitted along
with the Application Form to the Bankers to the issue.
The Applicant may approach the banks concerned for obtaining
stock-invest and detailed instructions for same. The stock-invest should be
made payable in favour of "Wonder Craft Industries Limited- Public
Issue"
The Applicant has to fill
in the following particulars:
Title of the account i.e. "Wonder Craft Industries Limited-
Public Issue"
The number of equity shares applied for;
The amount payable as per the Share(s) applied for in the
Application Form;
The name and address where the stock-invest should be returned in
case of non-allotment; and
The Application Form number on the reverse of the instrument.
The Applicant should thereafter sign the instrument. The
stock-invest should bear "Account Payee" and "Non-Negotiable"
crossing and will be payable only to the account of the Issuer Company. i.e.
"Wonder Craft Industries Limited- Public Issue". Stock-invest should
be utilised by the purchaser(s) and the purchaser's name / name of one of the
purchasers should be invariably indicated as the first applicant in the
composite application form. Thus if the signature of the purchaser on the
stock-invest and the signature of the first applicant on the application form
does not tally, the application would be treated as having been accompanied by
a third party stock-invest and is liable for rejection.
Stock-invests are to be used by the purchaser(s) within 10 days of
its issue and for this purpose the last day for use of the stock-invest for
submitting application to the Bankers to the Offer should be indicated on the
face of the stock-invest with a notation "To be used before
____________".
No refund will be made to those Applicants using stock-invest for
payment of money due under the Application Form. In case of non-allotment of
equity shares, the cancelled stock-invest instrument will be returned to the
Bidder, who will have to approach the issuing bank branch for lifting of lien.
Applications with stock-invest not fulfilling the above criteria
are liable to be rejected. The service charges, if any, for procuring the
stock-invest shall be borne by the Bidder.
The applicant should not fill in the portion to be filed up by the
Registrar to the Offer (right hand portion of the instrument). The Registrar to
the Offer will fill up the right hand portion of the stock-invest indicating
the equity shares allotted to the applicant and also the amount calculated as
follows:
In case of full allotment, the number of equity shares and the
amount on the right hand side will be the same as the left-hand side of the
instrument.
In case of partial allotment, the number and the amount after
adjusting allotment money, if any, payable in respect of equity shares so allotted,
filled up by the Registrar (on the right hand side of the instrument) will be
less than or equal to the number and the amount filled up by the applicant (on
the left hand side of the instrument).
In case the allotment is nil, the number and the amount filled up
by the Registrar on the right hand side of the instrument will be nil.
The Registrar to the Offer has been authorised by the Company vide
a Board Resolution passed on ------/2000 to sign on behalf of the Company for
realising the proceeds of the stock-invest of the successful allottees from the
issuing bank or to affix non-allotment advice on the instrument or to cancel
the stock-invest of the non-allottees or partly successful allottees who can
enclosed more than one stockinvest. The cancelled instrument shall be sent back
by the Registrar to the Investor directly.
Only mutual funds and individuals are entitled to use
stock-invest. There is a ceiling of Rs 50,000/- per individual per stock-invest
for individual applicants. This ceiling is not applicable for mutual funds.
The above information is given for the benefit of the investors
and the company is not liable for any modification of the terms of stock-invest
or procedure there of by issuing banks. Inquiries relating to stock-invest may be
addressed only to the registrar to the offer and not to the issuing bank.
g) Disposal Of Application Made By Stock-invest
The procedure for disposal of applications made by
cash/cheque/demand draft will apply mutatis mutandis to stock-invest except the
following:
In case of non-allotment, stock-invest will be cancelled by the
Registrar to the Offer and returned to the Applicant. The Stock-invest will
bear stamps such as "CANCELLED" and "NOT ALOTTED" across
the face of the instrument. The issuing bank will lift the lien on the account
on surrender of the same by the Applicant. In case the cancelled stock-invest
is not received by the investor from the Registrar to the Offer, lien will be
lifted by the issuing branch on expiry of four months from the date of offer
against an indemnity bond from the applicant.
In case of allotment / partial allotment, the Registrar to the
Offer shall fill in the amount in the stock-invest which would be less than or
equal to the amount filled by the Applicant and present the stock-invest duly
discharged on behalf of the Company for collection of payment to the extent of
allotment to the respective issuing Bank. The issuing bank will lift the lien
on the balance amount, if any, of trial Instructions stated below are applicable
to both, the Fixed Price Portion and Book Built Portion.
The company reserves full, unqualified and absolute right, to
accept or to reject any application or Bid, in whole or in part, and in either
case without assigning any reason thereof.
i) Section 269SS of the Income Tax Act, 1961
Having regard to provisions of Section 269SS of the Income Tax
Act, 1961, the subscription against the equity shares application for an amount
of Rs. 20,000 or more should not be effected in cash and must be offered only
by an A/c payee cheque / bank draft / stock-invest. In case payment is effected
in contravention of the provisions, the application is liable to be rejected
and application money will be refunded without interest.
ii) Joint Applications:
An application or Bid may
be made in single or joint names (not more than three) as mentioned elsewhere
in the offer document. In case of a joint application, refund pay order (if
any) and dividend / warrants, etc. will be made out in favour of the first applicant.
All communications will be addressed to the applicant whose name appears first
and will be dispatched to the first applicant's address stated in the
Application Form or Bid Form.
iii) Multiple Applications:
An Applicant or a Bidder should submit only one Application Form
or Bid Form (and not more than one) for the total number of equity shares
required or Bid for. Applications or Bids may be made in single or joint names
(not more than three). Two or more Application Forms or Bid Forms, in single
and / or in joint names will be deemed to be multiple application or Bid if the
sole and / or first applicant is one and the same. However separate Bids can be
made in respect of each scheme on a separate bid form of Indian Mutual Fund
registered with SEBI and that such applications will not be treated as multiple
application provided that the applications made by AMC/ Trust/Custodians
clearly indicated their intention as to each scheme concerned for which
application has been made. The company reserves the right to reject in its
absolute discretion all or any multiple application(s).
Separate Applications or Bids for electronic and physical shares
by the same first and / or sole applicant will be treated as multiple
applications and are liable to be rejected.
The fixed price portion is reserved for individual investors who
have not received allocations in the Bidding process. Those who have
participated in the bidding process and have received allocation shall not be
eligible to make an application in the Fixed Price Portion. Such applications
will be treated as multiple applications and are liable to be rejected.
iv) Application under Power of Attorney :
In case of Applications/ Bids under a Power of Attorney or by
limited companies or bodies corporate or societies, the relevant Power of
Attorney or the relevant resolution or authority to make the application, as
the case may be, together with a certified true copy thereof along with a copy
of Memorandum and Articles of Association and /or bye-laws must be attached to
the application form at the time of making the application or lodged for
scrutiny separately indicating the Serial No. of the application form with the
Registrar to the Offer within 10 days from the closure of the offer/ Bid,
failing which, the issuer reserve the full, unqualified and absolute right to
accept or reject any application/ Bid in whole or in part and in either case
without assigning any reason thereof.
The applicant/ Bidder should mention the Application form/ Bid
Form number on the reverse of the instrument through which payment is made.
v) Applicants/ Bidders are advised that it is mandatory for them
to indicate in the space provided in the application form, details regarding
their Saving Bank / Current Account Numbers and the name of the branch of the
bank to which they want the proceeds of refund to be credited. Applications not
containing such details are liable to be rejected.
vi) Depository option to investors
AS PER SEBI GUIDELINES DATED 16TH FEBRUERY,2000, IT HAS BEEN
DECIDED THAT , TRADING IN SECURITIES OF COMPANIES MAKING AN INITIAL OFFER SHALL
BE IN DEMATERLISED FORM ONLY.
As per the provisions of the Depositories Act, 1996, the shares of
a body corporate can be in a dematerialised form, i.e. not in the form of physical
certificates but be fungible and be represented by the statement issued through
electronic mode. Many companies and investors are now opting for
dematerialisation of their securities. The company will also opt for this
method subject to investors exercising their option to hold the shares in
dematerialised form, for which necessary columns have been provided in the
respective applications forms. The Company has already applied to NSDL/CDSL for
allotment of ISDN No.
In this context:
A tripartite agreement will be signed between the Company, the
registrar to the issue and the depositories, i.e., NSDL/CDSL.
Institutional Bidder has to compulsory seek allocation of equity
shares in electronic form. The Institutional Bidder, however, reserves the
right to dematerialise their shares after allotment. The Individual Bidder/
Applicant has an option to seek allotment of equity shares in electronic and/or
physical mode. Such an option if exercised, should be indicated in the
Depository Instruction Section in the application form itself.
Separate application or Bids for electronic and physical equity
shares by the same applicant shall be considered as multiple application,
hence, will result in rejection of application for shares in electronic mode
and only the application for physical mode will be considered as a valid
application.
Applicants or Bidders who wish to apply for equity shares in
electronic form need to have at least one Beneficiary Account with a Depository
Participant prior to making the application.
Applicants or Bidder's name in the Depository Instruction Section
in the application form should be the same as appearing in his or its
Beneficiary Account. In case of joint applicants, in addition to the name, the
sequence of the names in the DIF and Beneficiary Account should be the same.
If incomplete/incorrect investor account details are given in the
application or the Bid form, it may result in issuance of physical Equity Share
Certificate.
Allotment Letters/Refund Orders will be directly send to the
investors by the Registrar.
Responsibility for correctness of the demographic details given to
the Depository Participants, for opening of Beneficiary Account would rest with
the applicant.
Shares in electronic form can be traded only on Stock Exchanges
having electronic connectivity with NSDL/CDSL.
In case of partial allotment, allotment will be done in demat
option for the shares sought in demat and balance, if any, will be allotted in
physical shares.
Investors who have indicated their preference for holding their
shares in a dematerialised (demat) form, will have to follow the steps
mentioned below:
The applicant will fill-up the Depository Instructions Section in
the application form which will authorise the Company to allot shares to him in
the electronic form.
The applicant may apply for part of shares in dematerialised
(demat) form and balance in the physical form. This should be indicated under
the heading' "Request for shares in Electronic Form" in the
application form.
PRICE DISCOVERY, ALLOCATION AND ALLOTMENT
A. Book Built Portion
i) Price Discovery
After the Bidding Closing date, the BRLM shall analyse the demand
for the equity shares based on the Bids received by the syndicate members at
various price levels, and discuss the pricing strategy with the Company. The
Company in consultation with BRLM will finalise the 'Issue Price', and the
allocation to successful Bidders in both the categories. The BRLM shall then
intimate the Syndicate Member(s) of the Issue Price and allocation for the
respective bids received through them. In any event, Issue Price shall not be
less than the floor price.
ii) Allocation in the Book Built Portion
Discretionary Institutional Bidders
Allocation in the Institutional Book Built Portion will be made to
Institutional Bidders who have bid at or above the Issue Price. Such allocation
in the Institutional Book Built Portion will be made at the discretion of the
Company in consultation with the BRLM.
Individual Bidders
Bids received from the individual Bidders (including HUF and NRIs)
who have bid for upto 10 tradable lots, i.e. a maximum of 1000 Equity Shares at
or above the Issue Price shall be grouped together to determine the total
demand under this category. In case of under subscription full and firm
allocation will be made to the bidders in this portion. In case of over
subscription allocation in the individual book Built Portion will be made on a
proportionate Basis as described in the Part II of the draft offer document.
Allocation in this category shall be finalised in consultation with the
regional stock exchange.
iii) Allotment in Fixed
Price Portion
Individuals, HUFs (who apply in the name of Karta) and NRIs on non
repatriable basis are entitled to participate in and subscribe to the equity
shares of the company and may participate in the fixed Price Portion (also
refer section on "Issue Structure" ). In case of over
subscription in the Fixed Price Portion, allotment will be made on a
proportionate basis as described in Part-II of the Draft Offer Document. In
case of under subscription in the Fixed price Portion the company has the
option to allocate such under subscribe equity shares to which ever category of
investors it deems fit or allow such under subscribed portion to lapse.
iv) Announcement of
Advertisement
After the Company determines the Issue Price in consultation with
the Allocation Committee, a statutory advertisement will be issued by the
company either prior to or after filing of the Final Offer Document with ROC.
This advertisement shall in addition to the information that has to be set out
in the statutory advertisement shall indicate the price of the Equity Shares along
with a table showing the number of Equity Shares and the amount payable by an
investor.
v) Signing Of Underwriting Agreement & Roc
Filing
The BRLM/Syndicate Member(s) and the Company shall enter into an
underwriting agreement on being intimated about the Issue Price and
allocation(s) to their Bidders prior to ROC filling.
The Draft Offer Documents shall be finalised and filed with the
ROC soon after signing of the Underwriting agreements.
vi) Issuance of
Confirmation of Allocation Note in the Book Built Portion.
The BRLM/Registrar shall send to the Syndicate Members a list of
their Bidders who have been allocated shares in the Book Built Portion.
The receipt of the list of allocation for their Bidders by the
Syndicate Members shall constitute acceptance of the Bids set out in the Said
lists for the Issue and the same shall be deemed to be a valid and binding
contract. The Bidders shall be deemed to have knowledge of such acceptance
immediately upon the receipt by the Syndicate Members of the list of allocation
for their Bidders. The Syndicate member is, for this limited purpose deemed to
be the agent of the Bidders.
The BRLM/Syndicate Members would then send the CAN to their
Bidders who have been allocated shares in the Book Built Portion and who have
not paid into the Escrow Account of the company at the time of Bidding, shall
directly pay the amount payable in the Escrow Account.
Bidders who have been allocated Equity Shares and who have already
paid into the Escrow Account at the time of bidding shall directly receive the
CAN from registrar to the Issue subject, however, to realisation of their
cheques or demand drafts. No further action is required from such Bidders. In
case the issue price is higher than the Bid amount paid, the Bidders who have
paid lesser than the face value of their allocated equity shares at the issue
price will be required to pay such shortfall as per the instructions given in
the CAN.
Equity shares shall, after the receipt of the entire Issue
proceeds, be allotted to the investors within 15 days of the Issue Closing Date
for the Book Built Portion.
DISPATCH OF SHARE CERTIFICATES / ALLOTMENT LETTERS / REFUND ORDERS
The Company shall dispatch, Letter(s) of Allotment/Share
Certificate(s) and/or Letters of Regret together with Refund Orders/Pay Orders,
if any, within 10 weeks from the closure of the Issue to the Sole / first named
applicant at his/her sole risk. In case
of delay in refund of such amount beyond the stipulated period, the Company
will pay interest to the applicants at the prescribed rates as per
the provisions of Section 73 of the Act'.
The Company shall ensure dispatch of Refund Orders of value up-to
Rs.1,500/- under Certificate of Posting
and those over Rs.1,500/- and
Share Certificates by registered post only and that adequate
funds for the
purpose will be made available
to the Registrars to the Issue.
In accordance with the Act, the Stock Exchange requirements and
SEBI Guidelines the Company further undertake that:
Allotment of securities relating to the Fixed Portion offered to
the public shall be made within 15 days of the Issue Closing Date for Fixed Price Portion and
Allotment of securities relating to the Book Built Portion shall
be made within 15 days of the Issue Closing Date for Book Built Portion and
refunds for the Book Built portion shall be made within 15 days of Bid Closing
Date, except for those bidders who have opted for the conversion option.
it shall pay interest @ 15% p.a. (for delay beyond 15 days as
mentioned above) except for the applicants applying through stock-invest, if
allotment has not been made and/or the refund orders have not been
dispatched to the investors within 15 days from the date of closure of the
offer.
The company will provide adequate funds to the Registrars to the
Issue, for this purpose
UNDERTAKING BY THE COMPANY
The company undertakes the following: -
1. The complaints received in respect of the issue shall be
attended to by the issuer company expeditiously and satisfactorily.
2. The company undertakes that all the steps for completion of
necessary formalities and commencement of trading at all stock exchanges where
the securities are to be listed will be taken within 7 working days of
finalisation of basis of allotment .
3. The funds required for the dispatch of refund orders/ allotment
letters / certificates by registered post shall be made available to the
Registrar to the issue by the company.
4. The promoter's contribution in full, wherever required, shall
be brought in advance before the issue opens for public subscription and the
balance, if any, shall be brought in pro rata basis before the calls are made
on public.
5. The certificates of the shares / refund orders to the
non-residents Indians shall be dispatched within specified time.
6. No further issue of securities shall be made till the shares
offered through this offer document are listed or till the application moneys
are refunded on account of non - listing, undersubscription, etc.
FURTHER the Company accept full responsibility for the accuracy of
the information given in this offer document and confirm that to the best of
their knowledge and belief, there are no other facts the omission of which make
any statement in this offer document misleading, and they further confirm that
they have made all reasonable inquiries to ascertain such facts.
UTILISATION OF ISSUE PROCEEDS
The sum received in respect of the offer will be kept in a
separate bank account and the Company will not have access to such funds unless
allotment of equity shares has been made in consultation with the Regional
Stock Exchange and listing approval has been received from the Stock Exchanges
where listing has been sought.
The Board of Directors of the Company certifies that -
1. All monies received out of this issue to the Public shall be
transferred to a separate bank account other than the bank account referred to
in sub-section (3) of Section 73 of the Act.
2. Details of all monies utilised out of this issue referred to in
sub-item (a) shall be disclosed under an appropriate separate head in the
Annual Report of the Company indicating the purpose for which such monies have
been utilised; and
1. Details of all unutilised monies out of the issue, if any,
referred to ____.
2. The details of all unutilised monies out of the fund received
under promoters contribution and from firm allotments and reservations shall be
disclosed under a separate head in the balance sheet of the company indicating
the form in which such unutilised monies have been invested.
TAX BENEFITS
M/s. S. F. Tai & Associates, Chartered Accountants, have
advised WCIL vide their Letter dated 20th
November, 2000, that as per the current provisions of the Income Tax
Act, 1961 and the existing laws for the time being in force, the following
benefits, interalia, will be available to WCIL and the Members as given below
:-
A. TO THE COMPANY :
I) EXPENDITURE
INCURRED, IF ANY, OF THE NATURE SPECIFIED IN SECTION 35-D OF THE INCOME TAX ACT
CAN BE AMORTISED OVER A PERIOD OF TEN YEARS, SUBJECT TO LIMITS SPECIFIED
THEREIN.
II) UNDER SECTION
80-HHC OF THE INCOME TAX ACT, THE COMPANY WILL BE ENTITLED TO A DEDUCTION IN
RESPECT OF PROFITS DERIVED FROM EXPORT OF GOODS COMPUTED IN THE MANNER
SPECIFIED IN THE SECTION.
III) UNDER PROVISIONS
OF SECTION 80-JJAA OF THE INCOME TAX ACT, 1961 THE COMPANY WOULD BE ENTITLED TO
DEDUCTION OF AN AMOUNT EQUAL TO 30% OF ADDITIONAL WAGES PAID TO THE NEW REGULAR
WORKMEN EMPLOYED BY THE COMPANY FOR THREE ASSESSMENT YEARS INCLUDING THE ASSESSMENT
YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SUCH EMPLOYMENT IS PROVIDED.
IV) UNDER SECTION
115-JAA OF THE INCOME TAX ACT, 1961, THE COMPANY WILL BE ENTITLED TO CARRY
FORWARD A TAX CREDIT IN RESPECT OF TAX PAID ON DEEMED INCOME UNDER SECTION
115-JA UPTO A PERIOD OF THE FIFTH ASSESSMENT YEAR IMMEDIATELY SUCCEEDING THE
ASSESSMENT YEAR IN WHICH SUCH TAX CREDIT BECOMES ALLOWABLE.
V) UNDER SECTION
10(33) OF THE INCOME TAX ACT, 1961, INCOME BY WAY OF DIVIDENDS RECEIVED FROM
OTHER DOMESTIC COMPANIES, WILL NOT BE CHARGEABLE TO TAX IN THE HANDS OF THE
COMPANY.
VI) UNDER THE
PROVISIONS OF SECTION 122 OF INCOME TAX ACT, LONG TERM CAPITAL GAIN WOULD BE
CHARGED TO TAX AS PER OPTION ONE AT THE RATE OF 20% OR SALE CONSIDERATION
DEDUCTED BY INDEXED COST OF ACQUISITION OR AS PER OPTION TWO AT THE RATE OF 10%
ON SALE CONSIDERATION DEDUCTED BY COST OF ACQUISITION WHICHEVER TAX IS LOWER.
B. TO THE
SHAREHOLDERS OF THE COMPANY :
I) INCOME TAX :
(I) DIVIDENDS RECEIVED
FROM THE COMPANY WILL BE EXEMPTED FROM INCOME TAX IN THE HANDS OF THE
SHAREHOLDERS AS PER THE PROVISIONS OF SECTION 10(33) OF THE INCOME TAX ACT,
1961.
(II) UNDER SECTION 112
OF THE INCOME TAX ACT, 1961 CAPITAL GAIN OR TRANSFER OF A LONG TERM CAPITAL
ASSET, BEING LISTED SECURITIES, EXCEEDS 10% OF THE AMOUNT OF CAPITAL GAINS
BEFORE GIVING EFFECT TO SECOND PROVISION OF SECTION 48, THE, SUCH EXCESS SHALL
BE IGNORED FOR THE PURPOSE OF COMPUTING THE TAX PAYABLE BY THE ASSESSEE.
(III) IN ACCORDANCE WITH
AND SUBJECT TO THE CONDITIONS AND TO THE EXTENT SPECIFIFED IN SECTION 54-EC OF
THE INCOME TAX ACT, 1961 THE SHAREHOLDERS WOULD BE ENTITLED TO EXEMPTION FROM
LONG TERM CAPITAL GAINS ON SALE OF THEIR SHARES IN THE COMPANY.
(IV) IN CASE OF A
SHAREHOLDER, BEING AN INDIVIDUAL OR A HINDU UNDIVIDED FAMILY, IN ACCORDANCE WITH
AND SUBJECT TO THE CONDITIONS AND TO THE EXTENT SPECIFIED IN SECTION 54-F OF
THE INCOME TAX ACT, 1961 THE SHAREHOLDERS WOULD BE ENTITLED TO LONG TERM
CAPITAL GAINS ON THE SALE OF THEIR SHARES IN THE COMPANY.
(V) NO INCOME TAX WILL
BE DEDUCTED AT SOURCE UNDER THE PROVISIONS OF SECTION 94 OF THE INCOME TAX ACT,
1961 BY THE COMPANY FROM THE DIVIDENDS DISTRIBUTED BY IT TO IT SHAREHOLDERS.
II. WEALTH TAX :
(VI) TOTAL EXEMPTION
FROM WEALTH TAX WOULD BE AVAILABLE ON INVESTMENT IN SHARES OF THE COMPANY.
III. Gift Tax :
(vii) Effective from
october 1, 1998, no gift tax shall be levied on gift of shares of the company.
PARTICULARS OF ISSUE.
OBJECTS OF THE ISSUE
1) To set up
factory at Karjan (Dist. Baroda) as
UNIT 2 for the purpose of:
a. For increase in Installed Production Capacity by 7200 MT p.a.
of Corrugated Boxes, Sheets and Rolls
b. To start manufacturing new product known as Paper Shopping Bags
with an installed capacity of 30 lacs pieces p. a.
2) To augment long
term working capital resources of the Company.
3) To get the shares
listed on Mumbai, Ahemdabad and Vadodara Stock Exchanges.
COST OF THE PROJECT & MEANS OF FINANCE
The Total Cost of the Project is Rs 736.00 Lacs as detailed
hereunder. The said Cost of Project / Means of Finance have not been appraised
by any Bank and the same have been estimated by the Company.
COST OF PROJECT
(Rs. in Lacs)
PARTICULARS
TOTAL
Land
11.00
Site Development.
16.04
Building.
118.33
Equipments, Plant & Machineries
332.42
Electrical Installations.
13.61
Miscellaneous Fixed Assets.
20.22
Preoperative Expenses
16.71
Capital Issue Expenses
36.00
Contingences.
25.03
Margin For Working Capital
146.64
TOTAL
736.00
MEANS OF FINANCE
The Company proposes to finance the funding requirements from the
proceeds of the Issue details of which is as under :-
(Rs.
in Lacs)
PARTICULARS
Amount (Rs. in lacs)
Share Capital :
- From Promoters, Friends, Relatives & Associates
336.00
- From Indian Public
400.00
TOTAL
736.00
DEPLOYMENT OF FUNDS IN THE PROJECT
Auditors' of the Company, M/S.S.F.TAI & ASSOCIATES, Chartered
Accountants, has certified the statement of deployment of funds of Rs. 87.47 as
on 25.11.2000 vide their letter dated November 25, 2000. The Details are as
under:
Sources of Funds
Amount(Rs. In lacs)
Promoters and their associates
87.47
Total
87.47
Application of Funds
Land and Site Development
13.25
Building under Construction
55.09
Advance for Plant & Machinery
18.03
Pre-operative Expenses
1.10
Total
87.47
YEAR WISE BREAK-UP OF THE EXPENDITURE TO BE INCURRED ON THE SAID
PROJECT
As the amount procured from the issue will be utilised in the year
2001, year wise break up is not required.
V. COMPANY, MANAGEMENT
& PROJECT
BRIEF HISTORY AND PRESENT
BUSINESS OF THE COMPANY
The company is being promoted by Mr. Pravinbhai Patel and Mr.
Sanjay T Patel.
Wonder Craft Industries Ltd. was incorporated as a Private Limited
Company on 15th July, 1996 under the name and style of Wonder Craft Packaging
Pvt. Ltd. with the objective of manufacturing and marketing of Corrugated
Boxes, Sheets and Rolls used for Packing all types of Products like Food
Products, Textiles, Pharmaceuticals, Electrical, Electronics, Consumer
Durables, Engineering, Soaps & Detergents, Plastics etc.. The company was
subsequently converted into a Public Limited Company and received Fresh
Certificate for Incorporation on 9th May 2000 from The Registrar of companies,
Gujarat, Dadra and Nagar Haveli. The
company was renamed as Wonder Craft Industries Limited on 12th July, 2000.
MAIN OBJECTS OF THE COMPANY
The main object clause of the Company as set out in its Memorandum
and Articles of Association was originally
as follows :-
1. To carry on the
business of manufacturers, processors, designers, buyers, sellers, exporters,
importers and/or otherwise dealers in cardboard packing, polyethylene packing,
gunny bags and whether made of plastic of any man made fibre, leather or of
other material including high and low density polyethylene, polypropylene,
plastic PVC chemicals and other man made fibrous material used in manufacture
of cardboard packing, corrugated packing, plastic packing, polyethylene
packing, gunny bags, containers, bottles and hollow wares and to manufacture,
process, buy, sell, import, export or otherwise deal in all or any such
products.
2. To carry on
business as manufacturers of/and dealers in, or as stockists, importers and
exporters of packing cartons, boxes and cases made of paper, boards, wood,
glass, plastic, pulp, cellulose, films, polyethylene, rubber, flexible,
treated, laminated or other materials.
The company in the last quarter of 2000 acquired Shreeji Copper
Private Limited engaged into manufacturing of Copper and Brass Tubes. So as to
include the said activities in the main object clause the clause was altered on
June 9, 2000 by passing a special resolution in the EGM held on the same date
to include the following:
3. To carry on in
India or elsewhere the business as manufacturers, producers, processors,
importers, exporters, buyers, sellers, stockists, agents, contractors,
exchangers, providers, distributors, jobworkers, collaborators, consultants,
transporters, suppliers and dealers in all kinds, classes, applications,
specifications, descriptions, characteristics, colours and uses of papers,
boards and pulp.
4. To carry on
business as manufacturers, formulators, processors, producers, makers, buyers,
sellers, re-sellers, importers, exporters, distributors, suppliers,
fermentators, distillers, refiners, stockists, agents, merchants, developers,
consultants and dealers, in all types, forms (solid, liquid and gaseous) and of
all kinds of chemicals and chemicals compounds (organic and inorganic) heavy chemicals,
acids, alkalies, tannis, tannin extracts, solvents, dyestuffs, dyes, pigments,
colours, resins, chemicals auxiliaries, microcrystalline, bio and colloidal
chemicals, including coating materials natural and synthetic depolymeries
products, sparay dried product synthesiced coating spreads, carbon and
intermediates, derivatives suspensions, gels, poweders, formulations,
downstreams, ingredients and by-products and their related preparations
articles and products.
5. To promote, run,
establish, install or set up mini steel plants, integrated steel plants,
composits steel plants, hot rolling steel mills, cold rolling mills, blooms and
billet mill, steel furnace, concocts, rolling mills, induction furnace for the
manufacturing, converting, extracting, treating or processing of all types,
grades and sizes of steels, stainless steels, special steels, high speed
steels, die-steels, electrical steels, forging steels, alloy steels, including
direct hardening steels, case hardening steels, nitriding steels, ball bearing
steels, corrosion resisting steel, heat resisting steel, fee cutting steels,
spring steels, silicon manganese steels, structural steels, hip building
quality steels, armour steels, magnet steel, hot rolled and cold rolled grain
oriented electrical steels or any types of steels present or future compounds
and alloys thereof and to act as agent, stockists, trader, buyer, seller,
importer, exporter and jobworker.
6. To carry on the
business of consultancy and development of computer software and business of
medical transcription and other information technology enabled services and to
provide turn key solution for the same and also to provide software solutions
and to carry on in India of overseas, offshore of on site, the business of
system study, analysis, design, coding, testing, documentation, development and
implementation of software relating to commercial and non-commercial usages
through the use of various magnetic media, digital media and internet, provide
recrutment and placement services in India and abroad for computer in field
like software, hardware, communication, media, computer etc. and information
technologies consultancy, web site designing, hosting and maintenance,
development of e-commerce technologies, web related systems development,
internet and internet development and to carry on in India of overseas the
business of trading, importing and exporting and to act as consultants in
software, hardware related to commercial and non-commercial usages, training in
information technology in software and hardware and to work as teching
educational institute and appoint franchise in India and overseas and to
provide bureau for providing computer service to process data and develop
system of all kind by processing jobs and hiring out machine time and assist to
set up, operate and surpvise the operation of data processing division of
companies in India or overseas and to provide all or any of the following
services namely: Internet service providers, basic telephone service, cellular
telephone service, electronic mail services, net connectivity E-mail service,
internet access services related services thereof, such as store and forward
services, (indexed file transfer, worldwide web (WWW), on line services such as
internet technology, cyber café or cyber bureau service, video-telephone or
video-conference and electronic communication services, cellular mobile
telephone services, radio paging services, public mobile radio trunked
services, voice mail/audio tex services, closed users group domestic, 128 kbps
data network VSAT services via INSAT satellite systems, videotex services, data
communication services, paging services, multimedia services and value added
services and value added infotech and cyber services.
PRESENT BUSINESS OF THE COMPANY
The Company is presently engaged in Manufacturing of Corrugated
Boxes, Sheets and Rolls at its existing Unit now designated as Unit-1.
The company registered office is owned by one of the relative of one of the promoter of the company. The
company does not pay any rent for the said premises and also there is no formal
agreement for using the office.
The company has further taken on leave and license basis office
premises admeasuring 250 sq ft in Borivli, Mumbai on a monthly rent of Rs.
3,000 from Ms Shantaben H Purohit for a period of 11 months starting from June,
2000. The company has also paid a security deposit of Rs.75,000. The said
office has been designated as Head Office of the company in view of the
business potential offered by the city.
The Company has Unit-1 (Factory) at Block No. 18 & 20, Navi
Jithradi, Karjan, Dharat Road, Tal-Karjan, Dist - Baroda a Category II backward
area entitled to hosts of Incentives as per the Scheme of Government of
Gujarat. The Unit is located on Plot adm. 2890 Sq.mtrs. with Factory Building
adm. 7858 Sq.Ft. and has an Installed Capacity of 1200 Mt p.a.
Now the company has decided to expand its operations substantially
by setting up Unit-2 with state-of-the-art Plant and Machineries with an
Installed Capacity of 7200 MT p.a. of Corrugated Boxes, Sheets and Rolls and
new product line of Paper Shopping Bags with a capacity of 30 Lacs pcs p.a. The
expansion will not only help the company achieve substantial economies of scale
but widen the product range to attract large volume customers in Consumer
Durables, Plastics, Pharmaceuticals Industries etc..
SUBSIDIARIES OF THE COMPANY
During the last quarter of fiscal 1999-2000 the company took over
the entire operations of Shreeji Copper Private Limited for engaged into manufacturing
of Copper and Brass Tubes having an Installed Capacity of 600 M.T. p.a. with
facilities located in Tal-Wada, Dist - Thane Maharashtra a state notified D+
backward zone entitled to host of Sales
Tax & Income Tax Incentives. The Company acquired 100% of the shareholding
of the Promoters of Shreeji Copper Private Limited. The company has acquired
7,16,700 Equity Shares at Rs. 10/- per
share aggregating to Rs. 71.67 lacs.
The details of Shreeji Copper Private Limited are as follows:
Date of Incorporation : November 2, 1995
Nature of Activities : Manufacturing of Copper and Brass Tubes having
an Installed Capacity of 600 M.T. p.a. with facilities located in Tal-Wada,
Dist - Thane
(Rs.
in lacs)
Particulars
1997-98
1998-99
1999-00
Equity Capital
10.44
10.44
71.67
Share Application Money
57.08
72.26
--
Reserves (excluding revaluation reserves)
0.05
0.29
0.57
Sales
3.47
48.82
56.95
Profit after tax (PAT)
0.14
0.39
0.28
Earning per share
0.13
0.37
0.04
Net Asset Value (NAV) Rs.
64.28
78.26
9.92
LIST OF MAJOR CLIENTS
1. Sugam
Dairy,Baroda.
2. The Antifricticon
Bearings Corp. Limited. (ISO
9002)
3. Alembic Glass
Works Limited.
4. Alembic Chemical
Works Limited. (ISO
9002)
5. Viacom Electronics
P. Limited. (AIWA & TCL TV) (ISO 9002)
6. Art Groups of
Industries.
7. Mudrica Ceramics
(I) Limited.
8. Miranda Tools
Limited. (ISO
9002)
9. Miranda Amsow
Limited. (ISO
9002)
10. JCT Electronics
Ltd.
PROMOTERS AND THEIR BACKGROUND
WCIL is promoted by Shri. Sanjay T Patel and Shri. Pravinbhai P
Patel.
Shri. Sanjay T. Patel, aged 31 years, is a Commerce Graduate and
has done specialised certificate course in Corrugated Packaging conducted under
the aegis of Indian Institute of Packaging. He has more than ten years of experience
in all aspects of manufacturing and marketing of Corrugated Boxes, Sheets and
Rolls,
Shri Pravinbhai P. Patel, aged 38 years, has more than ten years
of experience in handling of Finance, Administration functions of a medium
sized Diamond Concern as its Manager and is guiding Shri. Sanjay T. Patel in
handling the affairs of WCIL. The Promoters are ably assisted by a team of
experienced personnel in day to day management of the Corrugated Packaging Unit
at Tal. Karjan, Baroda.
MANAGEMENT AND MANAGERIAL COMPETENCE
The day to day management of WCIL is headed by Shri. Sanjay T.
Patel who looks after the manufacturing and marketing operations of the Unit.
The Finance and Administrative functions are looked after by Shri. Pravinbhai
Patel. Both the Promoters are ably
assisted by a team of experienced personnel and have relevant competence in all
aspects of Corrugated Packaging Business.
BOARD OF DIRECTORS
The present Directors of the Company are as follows :-
Name, address and Occupation of the Directors
Designation
Age
Qualification
Other Directorships
Mr. Pravinbhai P. Patel
A-803, Sminu Apartment, Mandpeshwar Road, Borivali (W), Mumbai
- 400092.
Occupation : Business
Director
38Yrs
SSC
Nil
Mr. Sanjay T. Patel
B/3, Nikunj Apartment, Opp. Krishna Talkies,
Siddhath Road, Baroda.
Occupation : Business
Director
31 Yrs
B. Com.,
Nil
Mrs. Hiraben P. Patel
A-803, Sminu Apartment, Mandpeshwar Road, Borivali (West), Mumbai
- 400092.
Occupation : Business
Director
36 Yrs
SSC
Nil
Mr. Bhikhubhai P. Patel
Bldg, 58, Ashoknagar Society, Katargam,
Singanpor Road, Surat - 395004.
Occupation : Business
Director
33 Yrs
HSC
Nil
Mr. Mansukhlal Patel
25, Belgielei 20/8, Antwerd, Belgium.
Occupation : Business
Director
42 Yrs
B.Com
Nil
Ms. Sheetal Sanjay Patel
B/3, Nikunj Apartment, Opp. Krishna Talkies,
Siddhath Road, Baroda.
Occupation : Business
Director
29 yrs
H.Sc.
Nil
Bio-data of other directors
Mrs. Hiraben P. Patel, aged 36 years, is SSC, and she has over 8
years of experience in general administration. She looks after general
administration of the company.
Mr. Bhikhubhai P. Patel, aged 33 years, has experience in the
field of diamond manufacturing and trading for over 13 years.
Mr. Mansukhlal Patel, aged 42 years, is B.Com., having experience
in the field of diamond trading and manufacturing for more than 20 years.
KEY MANAGEMENT PERSONNEL
Details of the Key Management Personnel is as under :
Sr.
No.
Name and date of joining
Designation
Qualification
Previous Company & Work Experience
Experience
in years
1
Mr. Jatin Patel
01.12.98
Production Manager
SSC.
Hitkari Packaging
Experience of over 10 years in handling production operations of
Corrugated Packaging Industry.
10 Yrs.
2
Mr. Chetan Patel
01.01.99
Marketing Manager
B.Com
Kamal Packaging
Experience of over two and half years in handling Marketing
aspects of Corrugated Packaging Industry.
2.5 Yrs.
3
Mr. Ulpesh Pandya
01.04.2000
Manger Accounts
B.Com.
Unique Fabricators
He has experience of 4 years into accounts, taxation,
4 yrs
In addition to the above the Company is in the process of building
up its team under the recruitment programme drawn by them in line with the
expansion plan.
CHANGES IN THE KEY MANAGERIAL PERSONNEL DURING THE LAST 3 YEARS
There have been no changes in the key managerial personnel except
the appointments as stated above in the prospectus
THE PROPOSED PROJECT
The Company has undertaken an expansion scheme envisaging setting
up of state-of-the-art facilities, through a separate Unit (Unit-2) for
manufacture of 7200 MTPA of Corrugated Boxes, Sheets and Rolls and 30 Lac pcs
of Paper Shopping Bags at Navi Jithradi, P. O. Box No. 14, Karjan Dhavat Road,
Karjan, Dist. Baroda - 391 240. On completion of the scheme, the total
installed capacity of the Company would go upto _8400 MT p.a.
LOCATION
The Project is being located at Block Nos.18,19 &20 at Moje,
Navi Jithradi, P. O. Box No. 14, Karjan Dhavat Road, Taluka -Karjan, Dist.
Baroda - 391 240. The site is adjacent to the existing Unit of the Company and
is well connected by road and rail, The unit are located about 4 Kms from
Karjan Stations, and 40 Kms.from Baroda .
LAND
The Company has acquired 12,545 Sq. Mtrs. of Land of Freehold
Non-agricultural Land from Shri. Pravinbhai Popatbhai Patel and Alpeshbhai B.
Patel through three Sale Deeds for total consideration of Rs. 11,00,270/-
(incl. the Cost of Registration and Stamp Duty). The Land has been transferred
to the Company and the documents have been lodged for the registration to The
Sub-Registrar, Karjan. The Land is yet to be registered in the name of the
Company. The Land acquired from Shri. Pravinbhai P Patel and Alpeshbhai B.
Patel is free from all encumbrances and has the clear and marketable title.
The land purchased includes plot no 18 & 20 from one of the
promoter Mr. Pravinbhai Patel, details for which are as follows:
Mr. Pravinbhai patel, director and promoter of the company,
resident of A-803, Sminu Apartment, Mandpeshwar Road, Borivali (W), Mumbai
- 400092 has sold the plots no 18 &
20 as mentioned in the location above to the company at a value of Rs. 3.11
lacs. The plots have been purchased at the prevailing market price. The company
has already paid whole of the amount by way of cheque drawn on State Bank of
Saurashtra, Karjan.
SITE DEVELOPMENT :
The cost of Site Development including Levelling, construction of
Internal Roads, Compounds, Walls, Gates is estimated at Rs. 16.04 Lacs. The
Site Development is scheduled to be completed by April, 2001. The details as
per quotation for site development received from Yogi Consultants, Engineers
and Constructors vide their letter dated 5th September, 2000 are as under:
S.No.
Particulars
Qty
Rate
Amoun
(Rs. in lacs)
1
Compound wall
2600 sq ft
Rs.210/sq ft
5.46
2
Fencing
378 rft
Rs. 19/rft
0.07
3
Levelling
13850 sq ft
Rs. 40/sq ft
3.52
4
Construction of W.B.M. road
-
-
5.54
5
Landscaping
-
-
1.25
6
Gate of factory
-
-
0.20
Total
16.04
BUILDINGS
The Company has already commenced the construction of Factory
Buildings on freehold land purchased for the purpose of Unit 2 in the month of
October, 2000. The company has given the contract for construction to M/s Yogi
Consultants, Engineers and Constructors for an aggregate value of Rs. 118.33
lakhs. Based on their quotation dated 5th September, 2000, the details of which
are as follows:
S.No.
Particulars
Qty
Rate
Amoun
(Rs. in lacs)
1
Construction of Factory Building with AC sheet roof truss
26425 sq ft
Rs. 416/ sq ft
109.93
2
Construction of Labour Quarters
1448 sq ft
Rs. 342/ sq ft
4.95
3
Fees of consultant & Architects
3.45
Total
118.33
PLANT & MACHINERIES
The Company proposes to purchase the following Plant &
Machineries for its Expansion Project, Quotations for which have been received
by the Company from various suppliers and the details are as follows :
SR
NO.
DESCRIPTION OF MACHINERY
SUPPLIER'S NAME
TOTAL
AMOUNT
(including Excise, Sales Tax etc.)
1
SUN-UP Export Quality 5 Ply
in Line
High Speed Combined Automatic Corrugating Board Plant Size
62".
SUN-UP (INDIA) MACHINERY CO. Pvt Ltd.
192.60
2
SRL 4 x 12 ROTARY
SUN-UP (INDIA)
MACHINERY CO. Pvt Ltd.
1.96
3
SUN-UP Export Quality 3
Ply in Line
High Speed Combined Automatic Corrugating Board Plant Size
62".
SUN-UP (INDIA) MACHINERY CO. Pvt Ltd.
32.22
4
SUN-UP Export Quality 3
Ply in Line
High Speed Combined Automatic Corrugating Board Plant Size
62" with C Flute Roll.
SUN-UP (INDIA)
MACHINERY CO. Pvt Ltd.
23.48
5
Accessories for Export
Quality 3 Ply In Line Combined Automatic Corrugating Plant Size 62".
SUN-UP ENGINEERS.
15.54
6
Thermopac Thermic Fluid
Heather
Model TP-06 FO FIRED.
THERMAX LIMITED.
7.25
7
Double Colour Flexo
Printing Machine Size 52" x 90".
MICRO MACHINERY CO. PVT. LTD.
22.30
8
Flexo Printing Machine 52
x 90
NIRALI TRADING COMPANY.
4.52
9
Keshaka Brand Sheet
Pasting Machine.
KESHAKA WORKS.
1.17
10
AVELIN Brand Mechanical
Portable Platform Steel Yard Scale.
VIVID WEIGHING MACHINES CO.
0.24
11
Prakash Make Stitching
Machine Size 48".
SWETA MARKETING
0.41
12
EVERITE - 68 Heavy Duty
Cutting & Creasing 48" x 68" Machine.
SOND ASSOCIATES (ENGG.) PVT. LTD.
7.67
13
EVERITE - 36 Heavy Duty
Cutting & Creasing 25" x 36" Machine.
SOND ASSOCIATES (ENGG.) PVT. LTD.
3.41
14
EVERITE - 41 Heavy Duty
Cutting & Creasing 28" x 41" Machine.
SOND ASSOCIATES (ENGG.) PVT. LTD.
4.19
15
MICRO Rotary Cutting and
Creasing Size 105".
SHREE PRINTERS EMPORIUM.
2.37
16
Corrugating Winding Unit.
SUN-UP ENGINEERS.
0.21
Total
319.54
Add : Cost of Installations, Boiler Piping, Chimney, fittings,
freight & insurance
12.88
Grand Total
332.42
ELECTRICAL INSTALLATIONS
The Electrical Installations for the UNIT 2 are estimated to cost
Rs. 13.61 Lacs as per the quotation received from the M/s. Shree Krishna
Engineers, Licensed Electrical Contractor vide their letter 5th October, 2000.
Electrical installations as provided in the project cost mainly consists of
laying of control cables, bus-bar panel board, electric motors, street lights,
complete wiring of the factory, purchase of two DG sets( one of 35 HP and
another of 15 HP), fans, other accessories, etc.
MISCELLANEOUS FIXED ASSETS
The details of Miscellaneous Fixed Assets are as follows:
S.No.
Items
Name of the Supplier
Amount (Rs. in lacs)
1
Furniture and Fixtures
Sanjay Decorators, Baroda
Vide their letter dated 9.10.00
7.01
2
Computers & Accessories
New Gujarat Electric House, Baroda
Vide their letter dated 3.10.00
7.83
3
Fire Fighting Equipments
Vishan Distributors, Baroda
Vide their letter dated 2.10.00
5.38
Total
20.22
PREOPERATIVE EXPENSES
The Company proposes to incur Rs.16.71 lakhs for the Preoperative
Expenses details for which are as follows:
S.No.
Particulars
Amount (Rs. in lacs)
1
Travelling - Inland
1.50
2
Legal & Professional Fees
5.00
3
Legal Expenses
1.00
4
Remuneration to Project team
2.29
5
Establishment Expenses
1.02
6
Insurance during Construction period
0.75
7
Deposit for Power Connection
1.75
8
Market Launch & Trial Exp of Paper Bags for shopping
3.40
Total
16.71
PUBLIC ISSUE EXPENSES
An amount of Rs.36.00
Lakhs has been provided in the Project Cost to meet the issue related
expenses like Book Running Lead Manager's Fees, Brokerage & Underwriting
Listing fees, SEBI fees, Commission, Registrars Fees, Postage, Printing,
Statutory Advertisements, Publicity, Stamp Duty & RoC Charges for increase
in authorized capital etc.
CONTINGENCIES
Contingencies have been estimated at Rs.25.03 Lacs to meet any
eventualities of inflationary pressures during the time of implementation of
the Project. The said amount has been estimated @ 5% of the envisaged project
cost of site development, building, plant & machineries, electrical
installations and misc. fixed asset combined together .
MARGIN MONEY FOR WORKING
CAPITAL
The company has assessed the total margin money for working
capital requirement for expansion project for which details are as under:
S. No.
Particulars
Holding Period
Estimate of 2001-02
1.
Current Assets :-
2) Inventory
- Stock of Raw Material.
- Stock of W.I.P.
- Stock of Finished Goods.
1 Month
4 Days
7 Days
78.28
13.77
23.78
2.
Sundry Debtors
2.5 Months
255.73
TOTAL (A)
371.56
Less : Current Liabilities
(B)
- Sundry Creditors
1 Month
78.28
Working Capital Requirement (A-B)
293.28
.
Funded by :
- Working Capital Borrowing from Bank
- Public Issue
146.64
146.64
TOTAL
293.28
The company is in the process of applying for sanction of
additional facilities for UNIT 2 to the extent of Rs. 146.64 lakhs which would
be required at the time of the commencement of commercial production.
Present Limits enjoyed:
Name of the Institution
Type of Loan
Sanctioned Limit ( Lacs )
Outstanding Amount ( Rs. In Lacs )
31-03-2000 25-11-2000
State Bank of Saurashtra
Cash Credit
30.00
25.28
35.36
State Bank of Saurashtra
Term Loan
50.00
44.51
39.97
State Bank of Saurashtra
Tempo Loan
2.81
2.31
Kotak Mahindra
Car Loan
0.00
3.41
The major terms and conditions for the limits with bank are as
follows:
1.
Security Terms and Conditions : M.
T. Loan of Rs. 50.00 (Rupees Fifty Lacs Only)
Security : Mortgage
of Factory, Land & Building and Plant & Machinery Worth Rs. 79.46 Lacs.
Margin : Against
Land : 60%
Against Building : 50%
Against Machinery : 25%
Interest : 16.57%
Inclusive of Interest Tax. P.A. with quarterly rests subject to change as per
RBI directives from time to time.
Repayment Programmed : The
advance is to be repaid by 20 equal quarterly instalments with a moratorium
period of 6 months.
Insurance : To be
obtained for full market value of Fixed Assets & Machinery in the Joint
names of bank and the borrowers. Insurance policy shall have to be handed over
to the Bank.
2.
Security Terms and Conditions : Cash
Credit of Rs 30.00 lakhs
Security, terms and conditions for advances against stocks and
book-debts.
Security : Raw
Materials :Hypo. Of Stocks of Craft Paper, Gum etc.
Finished Goods : Corrugated
Boxes
Stock-In-Process\Sheets etc. Book-debts.
:Book-debts & all other Current Assets.
Basis of Valuation : Raw
Materials : At Invoice\Market\Govt. Controlled Price Whichever is lower.
Margin 25%
of Raw Materials.
25% of Finished Goods.
25% of Stock-in-Process.
50% of Book-debts.
Sub-limits Proposed if any : Finished
Goods : Rs. 8.00 (Rupees Eight
Lacs Only)
Other Stipulations : Book-debts
older than 90 days shall not be financed.
Insurance : All Stocks
to be insured against all risks in the joint names of the Bank and Borrower
under Comprehensive risk policy, Insurance Policy to be handed over to the
Bank.
Interest : 16.32%
Inclusive of Interest Tax with quarterly rest, subject to change as per RBI
Guide Lines.
Period of Sanction : One
Year.
1) Demand Bills (Documentary)
Exchange\Commission Chargeable: Presently
65 Paise Percent + out of Pocket Expenses + Collection Charges Subject to
revision from time to time.
2) Demand Bills (Clear)
Exchange\Commission Chargeable: Presently
65 Paise Percent + out of Pocket Expenses + Collection Charges Subject to
revision from time to time.
Other General Terms & Conditions are as follows:-
Company to submit C.A. Certificate for capital of Rs. 43.61 Lacs
and Unsecured borrowing of Rs. 10.00 Lacs in line of subsidy before release of
the loan.
Company shall pay proposal processing charges and upfront fee
amounting to Rs. 8000/- before release of the advance.
The Loans shall be collaterally secured by Equitable Mortgage of
Company's entire fixed Assets acquired / to be acquired.
The Loans shall be collaterally secured by Equitable Mortgage of
Residential Building situated at Surat and owned by Shri. Bhikhabhai Popatbhai
Patel. Director of Company.
The Loans shall be collaterally secured by personal guarantee of
all the Directors of the Company.
The Loans shall be collaterally secured by Third party guarantee
of Shri. Thakorbhai Patel and substantiated by Equitable Mortgage of his
Residential Flat situated at Baroda.
The Charge over primary security of Term Loan shall be extended to
cover Working Capital loans and vice-versa.
Any change in management / share holding / line of activity or
expansion of project etc and any major step will be taken by the Company with
prior permission consent of the Bank in writing.
Tempo & Car Loan
These loans are being taken on normal terms and conditions.
TECHNICAL ARRANGEMENTS
The company has not entered into any Technical Arrangement
RAW MATERIALS :
The main raw material required for the manufacturing of corrugated
Boxes, Rolls and Sheets are Craft Paper, Gum, Stitching Wire and Printing Inks.
At the Installed Capacity of the
Project of Unit-2 (7200 Mtpa) 7560 MT of Craft Paper, 446 MT of Gum, 173
MT of Stitching Wire and 58061 Ltrs. Of printing Inks would be required. All
the raw material are easily available in the domestic market and the major
producers of Deluxe Craft Board Pvt. Ltd., Khatima Fibres Ltd,. Bhadrachalam
Paper Mills, Babin Enterprises, Gujarat Sheetal Engineering, Mumbai, Dolphin
Inks, Pune etc.. No difficulties are envisaged in procuring the required
quantity of raw materials from the indigenous sources.
Water
Water is required only for sanitation and personal consumption,
which is being sourced from Company's own borewell within the Factory Premises.
Power
The Unit-2 will require 45 H.P. of Power Necessary application to
Gujarat Electricity Board has already been made. There are many other units
including the Company's Unit-I are already existing around the said location
and hence we do not face any problem in availing power connection. Further, the
Company is also proposing to install two DG Sets of 35 HP and 15 HP as 100%
Standby arrangement.
Pollution & Effluent Disposal
The Company's manufacturing operations do not generate any
effluents / pollution. The Company is exempted from seeking a clearance from
the Pollution Control Board as it is classified under non-polluting industry as
per Circular No.P-328/24403 dtd.28th November 1995 & No.P-328/389 dtd.5th
January 1996.
FUEL :
The Company proposes to install new generation Thermo Pac Thermic
Fluid Heater which will be utilised to operate the main Corrugating Machineries
instead of using conventional electricity. The use of this Heater not only
results in reduction in power consumption but also improves the productivity of
the Machineries. In order to operate this Heater, the company will require
43200 Ltrs. of Low Speed Diesel Oil which is easily available freom Companies
like Indain Oil Corporation etc...
MANPOWER
At present the company is having the following manpower:
DESCRIPTION
Nos.
Factory Employees :
Production Managers/Supervisors
Skilled Workers
Unskilled Workers
Administration
3
7
8
1
TOTAL
19
The total requirement of manpower for the proposed project would
be 132, the details of which are as under:
DESCRIPTION
Nos.
Factory Employees :
Production Managers/Supervisors
Skilled Workers
Unskilled Workers
Others
Administration
10
34
59
5
24
TOTAL
132
The Company has already recruited one Production Manager. The
other factory employees would be recruited at the appropriate time. The Company
is a well established player in Karjan and no difficulty is envisaged in
recruitment of requisite personnel for the new unit.
MANUFACTURING PROCESS :
a) CORRUGATED BOXES,
ROLLS & SHEETS :
The main raw materials required in the process of Manufacturing
are Craft Paper, Gum Stitching wire and Printing Inks. The Manufacturing
Process will be carried out on Corrugation Machinery for manufacturing
Corrugated Boxes, Rolls and Sheets as may be required, the process of which is
as under :-
(i) Craft Paper is being
tested to meet with the order requirements.
(ii) As per order of the Boxes, Rolls and Sheets, the required
Craft Paper of two ply, three ply, five ply and seven ply would be fed in the
Corrugating Machine for corrugation.
(iii) The Corrugated Paper would be then cut on Cutting Machine in
required dimensions.
(iv) Required ply would be pasted and then the creasing and
slotting or punching of the plyed paper would be done.
(v) It would then be stitched to make a Box of specified size.
(vi) All the Boxes will go for inspection in pre-delivery Quality
Control Department and thereafter, it would be bundled for despatch.
(vii) In case a order includes Printing as well, the paper after
testing in the initial stages would be printed on Offset Printing Machine or
Flexo Printing Machine and then sent for pasting as per ply requirements.
(viii) In case the order is only for Sheets or Rolls,they would be
bundled for despatch without going to the stage of rotary,slotting and
stitching.
TESTING OF CRAFT PAPER
CORRUGATION
CUTTING
PRINTING
PLY PASTING
CREASING
SLOTTING
PUNCHING
STICHING
INSPECTION
BUNDLING
READY FOR DESPATCH
B) PAPER BAGS FOR
SHOPPING :
The Raw Material in the form of paper of specified characteristics
is procured and tested. The lot of paper will be then cut into required sizes
and sent to printing department. As per the requirement of the customer,
necessary rubber plates depicting the relevant design and colours will be made
under the Company's supervision on job work basis. Thereafter, the said process
of printing will be carried out by using the rubber plates. The Sheets so
printed will be further cut into the required smaller sizes and punched, glued
and fit with accessories like Cords, Rivets, etc...to make it in to a Paper
Bags used for Shopping and Carrying Goods. The average weight carrying capacity
of the Bags will be ranging from 5 to 7 kgs.
SCHEDULE OF IMPLEMENTATION
OF PROJECT
SR. NO.
PROJECT DETAILS
COMMENCEMENT
COMPLETION BY
1
Acquisition of Land
Already Completed
2
Site Development
October, 2000
April, 2001
3
Building
November, 2000
April, 2001
4
Plant & Machinery, Electrical Installations
- Placement of Order
- Delivery
- Erection ( will be done simultaneously with delivery)
November, 2000
April, 2001
April, 2001
January, 2001
May, 2001
May, 2001
5
Misc. Fixed Assets
April, 2001
May, 2001
6
Connections
- Power
- Water
October, 2000
OWN BORWELLS
March, 2001
Trial Production
End May,2001
Commercial Production
June, 2001
PRODUCTS
The man products of the Company are Corrugated Boxes with or
without Printing, Corrugated Sheets and Rolls. Corrugated Packaging offers
unique blend of advantages unmatched by other modes of packaging.
The structural rigidity and flutings endow the corrugated box with
cushioning property to make it ideal for packaging even fragile articles.
Corrugated boxes, being collapsible, are compact, easy and
convenient to store. Unlike wooden boxes, which are heavy, corrugated boxes are
light-weight and easy to handle. The reduction in tare weight, which could be
as much as 66%, results in saving of
transportation costs.
Corrugated boxes are strong enough to be stacked up to 25 ft to 30
ft height which is beneficial considering the high costs of floor space.
Corrugated boxes, being tailor-made products can be designed to
suit pallet sizes, container sizes godown space etc... The boxes are suitable for handling by various types of
material handling equipment.
Another major advantage of corrugated boxes is their printability.
Multi-colour printing makes the boxes attractive, eye-catching and enhances
shelf-appeal.
Corrugated boxes can be designed innovatively with easy- to- carry
handles and other fitments for adding comfort and convenience for use as retail
packs and transport packs.
Corrugated boxes can be treated to provide effective protection
against water, grease, oil, static electricity, abrasion, etc.
Unlike a wooden box which can be opened and resealed, contents in
a corrugated box cannot be pilfered unless the box is torn which makes it
pilfer-evident.
Ideal for packaging a variety of products of any shape and size -
both as transport containers and as consumer packs- corrugated boxes are
extremely versatile and can be used effectively for packing heavy, bulky as
well as fragile and perishable products.
Unlike other containers such as metal, plastic, glass, etc.,
corrugated boxes, made out of kraft paper have an eternally renewable resource-
trees. Therefore, use of corrugated packaging supports ecological balance.
Corrugated boxes can be reused, salvage, repulped and remade into
boxes. The recyclability and eco-friendliness of corrugated boxes contribute to
conservation of natural resources and environmental protection.
INDUSTRY SCENARIO, MARKET & MARKETING ARRANGEMENTS
The word 'packaging' no more sounds new even to the common man.
Today, most of the products are offered in packages that are convenient, modern
and attractive. Packaging has come to play a vital role in today's life. More
and more people both producers and consumers of goods are becoming aware
of the importance of effective
packaging. In the present competitive market, packaging contributes
significantly to the success or failure of product.
Almost all products are required to be packed scientifically in
order to ensure that the product reaches in its original from and shape to the
end consumer.
Packaging, which is a concept considerably advanced from packing,
is today inextricably interwoven into the matrix of our marketing system. This,
in turn, is a sequel to the rapid urbanisation and industrialisation that is
taking place in our country. The range and variety of the products now being
manufactured and the increasing public awareness of the advantages of buying
packaged items have made the packaging industry one of the most dynamic
segments of our industrial economy. In the sphere of exports too, packaging has
assumed special importance because it helps realise higher returns in value
terms.
Among the various modes of packaging that are being continuously
developed, Corrugated Packaging stands out as the most versatile, secure, efficient
and economical. The very fact that almost 95% of all the products in the
western world are packed in corrugated boxes as transport containers
establishes that corrugated packaging is the most viable and internationally
accepted mode of packaging. The growing awareness of the need to maintain
environmental and ecological balance has further enhanced the importance of
corrugated packaging in the modern world.
It is a well-known fact that corrugated packaging contributes to
the conservation of forests as they are accepted as ideal substitutes to wooden
packaging.
From a small beginning in early 50's, the use of corrugated
packaging has grown by leaps and bounds. In the early days, corrugated boards
were imported and a few box units supplied corrugated packaging- mainly to
soaps, cigarettes and textile industries.
Now four decades later, the major industries in India which use
corrugated packaging are : food; Pharmaceutical; Electrical; Engineering;
Consumer Durables; Soaps and Cosmetics; Cigarettes; Glass; Defence; etc.
There is perhaps no product that cannot be effectively packed in a
corrugated box. From small, fragile and delicate products like crockery and
large products like washing machines, refrigerators... to perishables like
fruits and vegetables, almost all products can be effectively and economically
packed in a corrugated box.
It has been conclusively proven that generally any item weighing
up to 30kg can be properly packed in a corrugated box. In specific cases,
products weighing up to 200 kg are also packed in corrugated boxes.
With the development of new and better materials and techniques in
the field of corrugated packaging, the range of applications is widening.
In the recent times, corrugated packaging has made a big through
in various fields.
Traditional method of packaging fresh fruits in wooden boxes has
now become obsolete. Grapes, Mangoes, Apples, Strawberries, and other fresh
fruits are now seen in the market, using attractive multicolour, die-cut
corrugated boxes. Similarly, fresh vegetables are also packed in corrugated
boxes, especially for exports.
Corrugated boxes also find increased use for packaging processed
foods like jams, ketchups, etc., and confectionery.
Corrugated boxes are also being used for packing a wide variety of
articles by Defence Stores Equipments and Supplies. These include : Brush ware
; Cookware; Plastic and Rubber Items; Heating/Lighting Equipments and
Accessories; Screw-drivers and other tools; etc.
Keeping with the times, corrugated packaging is also protecting
latest products such as Computers, Laser Printers, Fax Machines, Modems,
Cellular Phones, etc.
Point of Purchase Displays are also being made innovatively with
corrugated boards and they have proved to be cost- effective and eco-friendly
substitutes.
Being a versatile material, it finds uses in non-packaging
applications.
INDUSTRY-WISE CONSUMPTION OF CORRUGATED PACKAGING
PARTICULARS
%
Food Products
27 %
Textile
18 %
Pharmaceutical
09 %
Electrical & Electronics
08 %
Engineering
07 %
Consumer Durables
07 %
Soaps & Cosmetics
07 %
Tobacco, Cigarettes
06 %
Glass
02 %
Defence
01 %
Others
08 %
TOTAL
100 %
(Source : Federation of Corrugated Box Manufacturers Association)
During the last few years, the Industry has grown at a steady rate
and the Industry today converts nearly 10 lacs tons of Kraft paper into
corrugated boards and boxes.
TONNAGE OF CRAFT PAPER CONVERTED BY THE INDUSTRY :
ACCOUNTING YEAR
In Lakh Tonnes
1995 - 1996
8.75
1996 - 1997
9.25
1997 - 1998
10.00
1998 - 1999
11.00
1999 - 2000
12.50
(Source : Federation of Corrugated Box Manufacturers Association)
Corrugated packaging, designed to conform to international
standards of strength and performance, has contributed significantly to the
increase of exports, especially in the fields of fruits, vegetables, textiles,
processed foods, pharmaceuticals and certain non- traditional items.
In the years to come, corrugated packaging will be a vital factor
to ensure India's increasing share in the world market.
The manufacture of corrugated packaging in India began in a small
way in the early fifties. The manufacturing units were located only in two or
three centres. Today, there are over 1000 units spread all over the country.
With increasing demand, newer units are coming up in the vicinity of consuming
centres and remote industrial towns.
Today, the corrugated packaging industry is attracting more and
more technocrats, engineers and packaging specialists who are are transforming
it into a progressive and dynamic industry.
The industry is converting over 11 lakh tonnes of paper per year
into boxes/boards.
Keeping in view the need for ecological balance, the corrugated
packaging industry has supported the development of non-conventional raw
materials as well as use of waste paper in the manufacture of its major raw
material - kraft paper.
The corrugated packaging industry has been effectively and
completely meeting the packaging requirements of the industry both for domestic
need and for exports. There has been no imports of corrugated boxes into the
country.
The per capita consumption of paper and paperboard in India at 3
kgs. is one of the largest in the world against a world average of over 45 kgs.
With 315 kg, in USA, 225kg in JAPAN, 218kg in SINGAPORE and 18kg in CHINA,
there exists tremendous potential for the corrugated packaging Industry in
India.
MARKETING STRATEGY
The company has adopted Direct Marketing Approach wherein the top
management develops the lead and draw out requisite samples for the potential
customers and on approval of the samples prices are finalized. The company
proposed to continue the aforesaid approach which will be supplemented by
liasioning with leading agents operating in the industry. Through its present
system it caters to leading corporates
like Viacom (Aiwa), Alembic Chemical
Works, Tainwala Personal
Products, etc. The Company has
approached several large volume players for their Packaging requirements and
have been indicated that once it achieves certain critical capacity levels, it
can enter into regular contracts. With the completion of expansion, the Company
will become one of the top ten players in the Western India Market.
Marketing of Paper Shopping Bags ( New Division)
With increasing consciousness to the negative impact of plastic
carry bags throughout the country and imposition of ban by the local municipal
corporations, the demand for the shopping bags made out of recyclable
paper has increased phenomenally. In
order to tap this tremendous potential the company proposes to install an
integrated division for manufacturing of various type of Paper Shopping Bags
with customization of designs and printing requirements. The company proposes
to appoint network of distributors in principal cities on agency terms and
which will be ably supported by dedicated team of marketing personnel belonging
to the company.
COMPETITION
The company does not envisages any major competition in the field
of Paper Shopping bags as there are no major players in the organised sector.
In view of the tremendous potential for demand of such products there exists
room for new entrants as well.
INSTALLED CAPACITY/CAPACITY BUILD UP
The details of the Capacity building of the production facilities
at the Company's existing Unit I since
commencement of commercial production are as under :-
P A R T I C U L A R S
Installed Capacity as at the end of the year (MT pa)
Actual Productions
Capacity Utilisation
1998 - 99
(*Commercial Production
Commenced on 24.11.1998)
1200*
120
(4 Months Period)
30%
1999-2000
1200
780
65%
April, 2000 to October, 2000
(*annualised)
1200
595*
85%*
After proposed expansion as envisaged - Corrugated Boxes, Rolls
& Sheets
8400
-----
-----
Paper Shopping Bags
30 lacs pieces
The Company is scaling up its operations substantially mainly to
achieve critical capacity needed to approach large volume customers in Consumer
Durable, Pharmaceutical Industry etc.. The Capacity build-up will also help us
in achieving economies of scale in order to improve further margins as well as
face the competition.
STOCK MARKET DATA
Presently the equity shares of the company are not listed on any
of the Stock Exchange.
MANAGEMENT DISCUSSION & ANALYSIS (last three years)
STATEMENT OF PROFITS & LOSSES
(Rs. in Lacs)
Financial Year Ended
31-3-1997
31-3-1998
31-3-1999
31-3-2000
25-11-2000
Sales / Income from Operations :
Sales
16.64
120.00
154.24
TOTAL
16.64
120.00
154.24
Other Income.
0.19
0.92
1.05
Increase/(Decrease) in Stock.
18.73
16.32
(12.59)
Total (A)
35.56
137.24
142.70
Expenditure :
Consumption of Raw Materials
26.23
82.02
91.74
Manufacturing Expenses
3.50
14.21
13.89
Administrative, Selling & Distribution Expenses
2.61
8.63
9.43
Interest.
4.88
11.82
7.08
Depreciation.
4.19
13.19
10.19
Misc. Expenditure Written Off.
0.19
0.19
0.12
Total (B)
41.60
130.06
132.45
Profit Before Tax. (A - B)
(6.05)
7.19
10.25
Provision for Taxation.
Nil
0.83
1.18
Profit After Tax.
(6.05)
6.36
9.07
Dividend & Tax on Dividend
Nil
Nil
Nil
Retained Earnings
RATIOS :
Net Worth
1.13
31.21
45.70
46.19
262.28
RONW (%)
-
-
-
14.57%
5.35%*
Book Value Per Share (Rs.)
376.67
10,403.33
10.47
10.58
10.32
EPS (Rs.) Simple Average
-
-
-
1.46
0.54*
Note : None of the assets are being revalued since incorporation
Statement of Assets and Liabilities
(Rs. in Lacs)
Financial Year Ended
31-3-1997
31-3-1998
31-3-1999
31-3-2000
25-11-2000
A) Fixed Assets at Cost
Nil
29.05
102.37
115.11
140.51
Less : Depreciation
Nil
Nil
4.19
17.39
27.58
Net Block
Nil
29.05
98.18
97.72
112.93
Capital Work in Progress
5.85
18.92
55.09
B) Investments
Nil
Nil
Nil
71.67
71.67
C) Current Assets, Loans & Adv :
Inventories
Nil
Nil
18.73
35.05
22.46
Debtors
Nil
Nil
6.56
43.12
93.86
Cash and Bank
Balances
0.03
0.01
1.27
7.35
11.35
Loans and Advances
1.01
0.05
1.22
0.52
10.05
TOTAL (A)
1.04
0.06
27.78
86.04
137.72
D) Current Liabilities & Prov. :
Current Liabilities
Nil
Nil
Nil
Nil
Nil
Provisions
0.01
3.73
3.81
94.68
34.07
TOTAL (B)
0.01
3.73
3.81
94.68
34.06
E) Net Current Assets (A-B)
1.13
-3.68
23.97
(8.64)
103.65
F) Misc. Expenses not W/Off
0.01
0.11
1.66
1.48
1.36
G) Profit & Loss Account
Nil
Nil
6.05
Nil
Nil
H) Total Assets
1.14
31.32
129.86
181.15
344.70
Represented By :
I) Share Capital
0.03
0.03
43.66
43.66
254.26
J) Share Application Money
1.11
31.29
3.70
3.70
Nil
K) Reserves and Surplus
Nil
Nil
Nil
0.31
9.38
L) Secured Loans
Nil
Nil
72.91
72.61
81.06
L) Unsecured Loans
Nil
Nil
9.59
60.87
Nil
M) Total Liabilities
1.14
31.32
129.86
181.15
344.70
Notes on Accounts :
1) Significant
Accounting Policies :
(i) The financial
statements are prepared under the historical cost convention and in accordance
with the applicable Accounting Standards issued by the Institute of Chartered
Accountants of India and relevant presentational requirements of the Companies
Act, 1956.
(ii) Recognition of
Expenditure :
The Company follows the accrual method of accounting and all
liabilities are provided on that basis.
(iii) Raw Materials,
Work-in-Progress and Finished Goods are valued at cost or realizable value
whichever is less on FIFO basis.
(iv) Fixed Assets and
Depreciation :
a) Fixed Assets are
stated at cost. Cost of Assets is inclusive of all other incidental expenses.
b) Depreciation is
provided on Written Down Value Method in accordance with the Schedule XIV of
the Companies Act, 1956.
2) Write off of
Preliminary Expenditure :
Preliminary Expenses are being written off over a period of 10
years from the date of commencement of commercial production.
3) Term Loan from
State Bank of Saurashtra, Karjan Branch is secured by way of first equitable
mortgage of Land, Building, Plant and Machineries, Dies and Tools, etc. as well
as Personal Guarantee of all the Directors.
Cash Credit from State Bank of Saurashtra, Karjan Branch is
secured by Hypothecation of Raw Material, Work-in-Process as well as Finished
Goods and Personal Guarantee of all the Directors.
Temp Loan from State Bank of Saurashtra, Karjan Branch is secured
by Hypothecation of Tempo and Personal Guarantee of Directors.
4) No provision has
been made for Gratuity since the payment of Gratuity Act, 1972 is not applicable
to the Company.
5) The Company has
made Trade Investment in Shreeji Copper Private Limited. The Investment is made
at Rs. 10/- per Share. Due to the said Investment, Shreeji Copper Private
Limited becomes wholly owned subsidiary.
6) Balances of Sundry
Debtors, Sundry Creditors, Secured Loans and Bank balance, etc. are subject to
confirmation and reconciliation, if any.
7) In the opinion of
the Board, all the known Liabilities are provided for and at all the Current
Assets, Loans and Advances have a value on realization as near to the value
stated in the Balance Sheet if realized in ordinary course of business.
8) Auditor's
Remuneration : Audit Fees : Rs.
10,500/-.
9) Directors'
Remuneration : Rs. 48,000/-
10) A) Value of Imports on CFI Basis : Nil.
B) Expenditure in Foreign Currency : Nil.
C) Earning in Foreign Exchange : Nil.
D) On Export of Goods FOB Basis : Nil.
11) During the year,
the Authorised Share Capital of the Company was increased from Rs.
1,00,00,000/- (Rupees One Crore Only) to RS. 11,00,00,000/- (Rupees Eleven
Crores Only). The formalities for filing necessary forms with the Registrar of
Companies, payment of Stamp Duty and Registration Fees are still pending.
12) Figures of the
Current Year are for the period from 1st April, 2000 to 25th November, 2000.
Thus, the figures of the previous year are not comparable with that of the
previous year.
13) All Schedules forms
and integral part of the Audited Accounts.
1. MANAGEMENT DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION
AND RESULTS OF THE OPERATION AS
(Rs. in Lakhs)
Particulars
97-98
98-99
99-00
Total Income (A)
-
35.56
137.24
% Change
Total Expenditure (B)
-
41.60
130.06
% Change
Profit after Tax
-
(6.05)
6.36
% Change
EPS
-
Nil
1.46
% Change
Note : The company started its operations in November 1998 only as
a result of which the financial year ended 31.03.99 showed a loss of Rs. 6.05
lakhs
Management Discussion And Analysis of Financial results :-
Unusual or infrequent events or transaction
There are no unusual or infrequent transactions in the last three
years
Significant economic changes that materially affected or are
likely to effect income from continuing operations
The company is dealing in the Corrugated Packaging Products and
hence any economic changes related to the same field will materially affect the
operations. Some of the factors may be as follows:
* Changes in the tax structures in States within the Union of
India
* Any slow down in the economy
Known trends or uncertainties that have had or are expected to
have a material adverse impact on sales , revenue, or income from continuing
operation:
* Competition from other Indian companies in the organised as well
as unorganised sector.
* Solvency & payment abilities of clients
Future changes in relationship between costs and revenues in case
events such as labour or material costs or prices that will cause a material
change are known.
As the company is engaged in the business of conversion, normally
there are no major changes between the cost and revenue.
The extent to which material increase on net sales or revenue are
due to increase sales volume, introduction of new products or services or
increased sales prices.
Total turnover of each major industry segment in which the Company
operated
The industry size is estimated at about Rs. 2,750 crores with
conversion of about 11 lacs tons of craft paper on an annual basis.
(Source : Federation of Corrugated Box Manufacturers Association)
Status of any publicly announced new products or business segment
None
The extent to which business is seasonal.
Non seasonal
Any significant dependence on a single or few suppliers or
customers.
The company is not dependent on single or few suppliers &
customers for its purchase & sales respectively.
SWOT ANALYSIS BY THE COMPANY:
STRENGTHS :
* Existing profit making operations for last one and half years
and expanding to achieve economics of scale and critical capacity size to cater
to large volume customers.
* Promoters have good experience in the Corrugated Packaging
Industry and have developed good efficiency and quality standards.
* Present Customer base includes leading Corporates like Viacom (AIWA),
Alembic Chemicals Works, Alembic Glass Works, JCT Electronics, Sugam Diary
etc...
* Corrugated Packaging Industry is consistently enjoying steady
growth for last several years.
WEAKNESS :
* The present capacity is relatively small to enter into any long
term relationship with large volume customers
OPPORTUNITIES :
* The large volume players amongst the present customers are
willing to enter long term relationship on achieving critical capacity size to
ensure efficient & regular servicing of orders.
* Corrugated Packaging Industry cater to wide spectrum of
Industries enjoying steady growth.
* Paper Shopping Bags is one of
the fastest growing segments in view of negative impact of Plastic Bags
on environment.
* Very few players in Paper Shopping Bags in the Organised Sector.
THREATS:
* The Corrugated Industry has low entry barriers and is exposed to
potential competition.
MATERIAL DEVELOPMENTS
There are no material developments after the date of the latest
audited balance sheet as on November 25,2000 which may materially effect the
performance or prospects of the Company.
As per the opinion of the Directors, no circumstances have arisen
since the date of last financial statement disclosed in the prospectus that
materially and adversely affect or are likely to affect the profitability of
the Company, or the value of its assets, or its ability to pay its liabilities
within the next twelve months.
FINANCIALS OF GROUP COMPANIES.
The company has acquired Shreeji Copper Pvt. Ltd. details for
which are already shown under the heading Subsidiaries of the Company in the
prospectus.
Further, Mr. Pravin P Patel, one of the promoters is interested in
M/s Sawan Gems, Mumbai as partners. The firm is engaged in trading and export
of diamonds. The details of the said firm are as follows:
Date of Establishment : June, 1995
Nature of Activities : Trading and exports of diamonds
Partners' Capital as on 31.03.00 : 56.79 lakhs
Sales for the year 99-00 : 282.35 lakhs
Net Profit for the yr 99-00 : 61.47
lakhs
PARTICULARS OF ISSUES MADE BY COMPANIES UNDER THE SAME MANAGEMENT
IN THE LAST THREE YEARS
There have been no issues in the last three years made by Companies under the same management as
defined under Section 370 (1B) of the Act.
OUTSTANDING LITIGATION / DISPUTES / DEFAULTS
There are no pending litigation against the Company &
Promoters of the Company.
There are no defaults to the Financial Institutions, Banks
,Re-schedulement of loans to Banks/FI's by the Company. However dues pending for
payment to the Financial Institutions are highlighted below.
There are no pending litigation ,disputes defaults non payment of
statutory dues , proceedings initiated for offences (including the past cases and irrespective of whether specified
in paragraph (i) of part I of schedule XIII of the act against the promoters ,
Family Members, and their other business ventures .
There are no cases of litigations pending against the
Company/Group Companies whose outcome
could have a materially adverse effect on the position of the Company.
There are no pending litigation's against the Promoters /
Directors in their personal capacities and also involving violation of
statutory regulations or criminal offences.
No directors of the company have any litigation towards tax
liabilities, any criminal \civil prosecution against them for any offences etc.
There are no pending proceedings initiated for economic offences
against the Directors, Promoters, Companies and Firms promoted by the
promoters.
There are no outstanding litigation's, disputes pertaining to the
matters likely to affect the operations and Financials of the Company including
disputed tax liability, prosecution under any enactment in respect of Schedule
XIII of the Companies Act, 1956.(1 of 1956) and civil / criminal prosecution
against promoters / Directors of the company.
There are no litigations outstanding against the
promoters/Directors in their personal Capacity. The Company, its
promoters/Directors and other Companies with which promoters are associated
have neither been suspended by SEBI nor any disciplinary action has been taken
by SEBI. There are no prosecutions launched by Income Tax Authorities and no
liability compounded by the Promoters/ Company/Companies/Ventures with which
the promoters are associated is subsisting.
There are no cases of pending litigation/defaults in respect of
the firms / Companies with which the Promoters are associated in the past but
are no longer associated.
Present Limits enjoyed:
Name of the Institution
Type of Loan
Sanctioned Limit ( Lacs )
Outstanding Amount ( Rs. In Lacs )
31-03-2000 25-11-2000
State Bank of Saurashtra
Cash Credit
30.00
25.28
35.36*
State Bank of Saurashtra
Term Loan
50.00
44.51
39.97
State Bank of Saurashtra
Tempo Loan
2.81
2.31
Kotak Mahindra
Car Loan
0.00
3.41
* Note : This figure is as per audited financial statements and
the reconciliation statement confirms to bank limits.
STOCK MARKET DATA
As the shares of the Company are yet to be listed on any Stock
Exchanges, no quotation for the market price of its shares is available.
BASIS OF ISSUE PRICE
Quantitative Factors
1. Adjusted EPS
Year
E.P.S (Rs.)
Weights
1997-98
-
-
1998-99
-
-
1999-00
1.46
-
Weighted Average for last 3 years (Rs.)
(note 1)
Note 1: The company started its operations in November 1998 only
as a result of which the financial year ended 31.03.99 showed a loss of Rs.
6.05 lakhs
EPS represents basic earnings per share = Profit after tax divided
by Number of outstanding shares at the end of the year. Each share is
considered of Rs. 10/- each.
3. Price/Earning ratio (P/E ratio) in relation to issue price Rs.
* per share
*Note : to be determined after the issue price is being finalized.
Industry (Packaging):
Highest 19.7
Lowest 1.7
Average (Industry composite)
10.5
(Source - Capital Markets Vol XV/17, November 12, 2000)
Industry (Paper):
Highest 17.8
Lowest 2.3
Average (Industry composite)
7.2
(Source - Capital Markets Vol XV/17, November 12, 2000)
3. Return on Net Worth % (RONW)
RONW
Weights
31/03/98
-
-
31/03/99
-
-
31/03/2000
14.57
-
4. Minimum return on total net worth after the issue needed to
maintain EPS at Rs. 5.31 is
*%
*Note : to be determined after the issue price is being finalized.
5. Net Asset Value (NAV) per share.
a. As on 31.03.2000 Rs.
10.79
b. After issue Rs.
*
c. Issue Price Rs.
*
*Note : to be determined after the issue price is being finalized.
INVESTOR GRIEVANCES AND REDRESSAL SYSTEMS
Since this is the first public issue of shares by the Company,
there is no past history of Investor grievances. For the public issue and on completion of this public issue, the Company has made arrangements with the
Registrars to the Issue to handle and redress investor grievances promptly for
a period of 6 months beginning from the last date of despatch of letters of
allotment / share certificates/ refund orders and keep the Company appraised of
their redressal to complaints/
grievances on weekly basis. By
the time of completion of the six months period, the Company will put in place
a suitable infrastructure / mechanism for prompt and effective redressal of
invest or grievances. The Company has
nominated Mr. R. Sridharan as the Compliance Officer to deal with grievances
and redressal system.
RISK FACTORS AND MANAGEMENT PERCEPTION
The investor should consider the following risk factors carefully
in evaluating the Company and its business before making any investment
decision.. This Draft Offer Document contains forward-looking statements that
involve risks and uncertainties. None
of the Company, the BRLM, the Syndicate Members of their respective affiliates
has any obligation or other circumstances arising after the date hereof or to
reflect the occurrence of unanticipated events.
INTERNAL RISK FACTORS
(R) Cost of project and
means of finance has not been appraised by any bank or financial Institution
and are based on the Company's own estimates. The deployment of funds collected
in this issue will be at the sole discretion of the management of the company.
Thus there will be no independent Body monitoring the use of Proceeds and the
Utilisation of issue proceeds is at the total discretion of the management.
(P) The management of
the company has in consultation with the Technical Consultants drawn out a
business plan for the activities to be pursued for the proposed business. The
company believes that it has professional expertise to assess the cost of
project and implement the same and at this time does not foresee any borrowing
requirements under this plan. Thus the company has not approached any bank or
financial Institution for appraisal. The management of the company comprises
businessmen with a proven track record and the public issue proceeds will be
utilised only for the objects of the issue mentioned in the offer document
(R) The proposed
project is mainly financed by the present issue of equity shares and any delay
in raising funds from the public issue would adversely effect the
implementation and performance of the project.
(R) The Land acquired
by the company for the UNIT 2 includes plots purchased from one of the core
promoter of the company, Shri. Pravinbhai P Patel.
(P) The land has been
purchased at the prevailing market rates in the area and the company found it
advantageous in view of its location adjacent to existing units
(R) The registered
office of the company is owned by one of the relatives of core promoter
and no formal written agreement is
being signed between company and the owner of the office.
(R) The company has yet
to apply to the bank for the working capital limit of Rs.146.64. lacs
(P) The company is in
the process of applying for sanction of additional facilities for UNIT 2 which
would be required at the time of the commencement of commercial production.
(R) The land acquired
by the company for the proposed project, is yet to be registered in the name of
the company.
(P) The company has
already submitted all the documents to the concerned Sub Registrar office and
it generally takes 4 to 6 months to complete all the formalities of
registration. The company does not foresee any problems in this regard.
(R) The Company has yet
to place orders for Plant & Machinery amounting to Rs.287.27lacs, Misc.
fixed assets amounting to Rs. 20.22 lacs, forming 41.78% of the total project
cost.
(P) The Company has
already short-listed the suppliers for purchase of plant & machinery & other fixed assets and the orders of
the key plant & machinery & other fixed assets will be placed at the as
per the schedule of implementation.
(R) A substantial
portion of the Company's movable assets has been hypothecated and the company
has mortgaged its immovable assets to secure financing facilities with its
lenders. If the company were to default on repayment of Debt, its lenders could
enforce their security interests in respects of the Company's assets, limiting
the Company's ability to carry out its operations and could have a material
adverse effect on the Company. In addition, default under the Company's credit
facilities could limit the Company's ability to raise additional funds in the
future. In event of liquidation of the Company, these creditors will have priority
over unsecured creditors of the company and Company's shareholders.
(P) The Company is an
existing profit making company and is expanding its operations to achieve
economies of scale and to meet the increase in the demand for its products not
only from its existing customer base but also from the potential customer base.
(R) The SWOT analysis
given of the Company's operations is exposed to certain threats and weaknesses,
details for which is given on page no----..
(P) The threat are
general in nature and is applicable to any company in the industry. The
weakness is being addressed by way of the present expansion plan.
EXTERNAL RISK FACTORS
(R) Competition from
existing established companies and the future entrants into the industry.
(P) The Company is
confident that its quality products will find a suitable market in the
competitive industry as the demand for Corrugated Packaging Products and Paper
Shopping Bags will continue to witness consistent growth.
(R) Any adverse change
in the government policies may affect the performance and profitability of the
company.
HIGHLIGHTS
1. Existing profit
making company
2. Strong customer
base of leading corporates.
3. Listing proposed
at Mumbai, Vadodara and Ahemdabad Stock Exchanges.
PART II
A. GENERAL INFORMATION
Consents
Consents in writing of the Directors, Auditors, Bankers to the
Company, Bankers to the Offer, Book Running Lead Managers, Co-Book Running Lead
Managers to the Offer, Compliance Officer and Registrars to the Offer to act in
their respective capacities have been obtained and filed with the Registrar of
Companies, Gujarat, Dadra & Nagar Haveli, Gujarat, together with a copy of
this offer document as required under Section 60 of the Companies Act, 1956 and
such consents have not been withdrawn
upto the time of delivery of the copy of this offer document for registration
with the Registrar of Companies, Gujarat, Dadra & Nagar Haveli, Gujarat.
M/s S. F. Tai & Associates, Chartered Accountants, Baroda, the
statutory auditors of the Company, have also given their written consent to the
inclusion of their report as appearing hereinafter in the form and context in
which it appears in this offer document and also the tax benefits accruing to
the Company and to the Members of the Company and such consent and report have
not been withdrawn upto the time of delivery of the copy of this offer document
for registration with the Registrar of Companies, Gujarat, Dadra & Nagar
Haveli, Gujarat.
Expert Opinion
The Issuer had sought expert opinion from M/s S. F. Tai &
Associates, Chartered Accountants, Statutory Auditors to the company with
regard to the tax benefits available to the Company and its members which has
been reproduced elsewhere in this Offer Document.
CHANGE IN DIRECTORS DURING THE LAST THREE YEARS
Sr. No.
Name and Address
Date of Appointment
Date of Resignation
Reason of Change
1
Mr. Irfan F Tai
Since Incorporation
20.02.97
Resigned due to personal reasons
2
Ms Alka M Mehta
Since Incorporation
20.02.97
Resigned due to personal reasons
3
Mr Sanjay T Patel
Since Incorporation
4
Mr. Bhikhubhai P Patel
20.02.97
5
Mrs. Hiraben P Patel
20.02.97
6
Mr Pravinbhai P Patel
21.11.97
7
Ms Sheetal S Patel
20.06.00
8
Mr Mansukh V Patel
02.11.00
CHANGES IN AUDITORS SINCE INCORPORATION
There has been no change in the Auditors since incorporation
.
Authority for the Present offer
The Present issue made Pursuant to the resolution under Section
81(1A) of the Companies Act, 1956, passed by the Members of the Company in
their Extraordinary General meeting held on 15/11/2000 and is in accordance
with the guidelines issued by Securities Exchange Board Of India and Listing
Guidelines of Stock Exchanges.
Procedure and time schedule for allotment/ allocation and issue of
share certificates.
The company subject to SEBI guidelines/ Stock Exchanges norms
reserves the right to accept or reject any Bid/application inn whole or in part
at its sole, absolute and uncontrolled discretion. In case any Bid/Application
is rejected in full, the whole of the money received with the Bid Form or
application will be refunded to the Bidder/ applicant. In case a Bid/
application is rejected in part, the excess application money will be refunded
to the Bidder/applicant within 10 weeks of the closing of the subscription list
provided that the company will allot the equity shares within 15 days from the
closing Date for Fixed Price Portion and shall pay interest @ 15% p.a for the delayed period if the
allotment is not made and / or the refund
orders are not dispatched within 15 days from Issue Closing Date for
Interest on Refund of Excess Application Money
Payment of interest at the rate of 15% per annum on the excess application money will be made to
the applicants for the delayed period, if any, beyond 30 days from the date of
closure of the subscription list, in terms of the provisions of the Act and the
guidelines issued by the Ministry of Finance vide Letter No.F/8/6/SE/79 dated
July 21, 1983 and as amended by Letter No.F/14/2/SE/85 dated September 27, 1985
addressed to Stock Exchanges and as further modified by SEBI's circular dated
May 15, 1996. No interest will be paid on stock-invest.
Delivery of Share
Certificates
The Equity Share certificates will be dispatched through registered
post within 30 days from the date of allotment in exchange of allotment letters issued, if any, or
within such further time as may be allowed by the Mumbai Stock Exchange or the
Company Law Board as per the provisions of section 113 and other relevant
provisions of the Act.
APPLICATION OF SECTION 269SS OF THE INCOME TAX ACT,1961.
In respect of provisions of section 269SS of I.T.Act,1961 The
Subscription against equity shares should be effected only by account payee
Cheque / Draft or Stock Invest, If the amount payable is Rs.20000/- or more. In
case the payment is made in contravention of this provision, The application
Money will be refunded and no interest will be paid.
COMPANY INFORMATION AND ISSUE MANAGEMENT TEAM
Wonder Craft Industries Limited
REGISTERED OFFICE
B/3, Neekunj Apartments,
Opp. Krishna Talkies,
Siddhnath Road, Baroda - 1
Tel. No. : 0265- 42 43 76.
BOOK RUNNING LEAD MANAGERS
Aryaman Financial Services Ltd.
SEBI REGN. NO. : INM 000006807
35, Atlanta, 3rd Floor,
Nariman Point,
Mumbai - 400 021.
Tel : 022 - 282 6464/5/6
Fax : 022 - 282 6467
E-Mail: aryaman@bom2.vsnl.net.in
Co-BOOK RUNNING LEAD MANAGERS
REGISTRAR TO THE ISSUE
INTIME SPECTRUM REGISTRY PVT. LTD.
SEBI REGN NO. - INR000003761
260, Shanti Industrial Estate,
Sarojini Naidu Road,
Mulund (West),
Mumbai - 400 080.
Tel. No. : (022) 564 77 31 / 567 27 16.
Fax No. : (022) 567 26 93.
AUDITORS
S. F. TAI & ASSOCIATES
CHARTERED ACCOUNTANTS,
416, Payal Complex `C',
Near New Stock Exchange,
Sayajigunj,
Baroda - 390 005.
Tel. No. : 36 13 21.
COMPLIANCE OFFICER
Shri. Ulpesh Pandya
B/3, Neekunj Apartments,
Opp. Krishna Talkies,
Siddhnath Road, Baroda - 1
Tel. No.: 0265- 42 43 76.
The investors may contact the aforesaid compliance officer in case
of any pre-issue/post-issue related problems such as non-receipt of letters of
allotment/share certificate/refund orders/cancelled stock invest etc.
BANKERS TO THE COMPANY
STATE BANK OF SAURASHTRA (KARJAN).
Tal - Karjan, Dist- Baroda
Code No. 316
Ph no.: 02666 - 32 082
SHRI SWAMINARAYAN CO-OP BANK LTD.
Patthargate, Main Branch,
Baroda - 1.
Ph. No.: 0265 - 41 55 74
THE VYSYA BANK LTD.
Overseas Branch, Opera House
Mumbai - 40004.
Ph. No.: 022 - 382 14 70
BANKERS TO THE OFFER
ESCROW COLLECTION BANKS
SYNDICATE MEMBERS
COMPANY SECRETARY
The Company has not appointed a Company Secretary as required U/s
383A of the Companies Act, 1956. However, the Company is in the process of
appointing a Company Secretary.
CREDIT RATING
This being an Issue of Equity Shares, no credit rating is
required.
TRUSTEES
This being an Issue of Equity Shares, appointment of Trustees is not required.
AUDITOR'S REPORT
To,
The Board of Directors,
Wonder Craft Industries Limited,
B/3, Neekunj Apartments,
Opp. Krishna Talkies, Siddhnath Road,
Baroda - 390 001.
Dear Sirs,
We have examined the Books of Accounts of Wonder Craft Industries
Limited for the year ended 31st March, 2000/25th November 2000 being the last
date upto which the Accounts of the Company have been made up, audited by us
and adopted by the Members and have relied upon the accounts audited by the
earlier auditors of the Company. In accordance with the requirements of Clause
24 of Part II of Schedule II to the Companies Act, 1956 and read with
requirements of the Securities and Exchange Board of India vide its
Clarification Nos. XIII and XIV of the Guidelines for Disclosure and Investor's
Protection, we report that :
(A) Profit & Losses
: The Profits & Losses of the Company for each of the five financial years
ended 31st March, 2000 are as set out below. The Profits read with Significant
Accounting Policies and Notes annexed hereto, have been arrived at after
charging all expenses of working and management including Depreciation and
after making such regroupings and adjustments as are, in our opinion,
appropriate.
STATEMENT OF PROFITS & LOSSES
(Rs. in Lacs)
Financial Year Ended
31-3-1997
31-3-1998
31-3-1999
31-3-2000
25-11-2000
Sales / Income from Operations :
Sales
16.64
120.00
154.24
TOTAL
16.64
120.00
154.24
Other Income.
0.19
0.92
1.05
Increase/(Decrease) in Stock.
18.73
16.32
(12.59)
Total (A)
35.56
137.24
142.70
Expenditure :
Consumption of Raw Materials
26.23
82.02
91.74
Manufacturing Expenses
3.50
14.21
13.89
Administrative, Selling & Distribution Expenses
2.61
8.63
9.43
Interest.
4.88
11.82
7.08
Depreciation.
4.19
13.19
10.19
Misc. Expenditure Written Off.
0.19
0.19
0.12
Total (B)
41.60
130.06
132.45
Profit Before Tax. (A - B)
(6.05)
7.19
10.25
Provision for Taxation.
Nil
0.83
1.18
Profit After Tax.
(6.05)
6.36
9.07
Dividend & Tax on Dividend
Nil
Nil
Nil
Retained Earnings
RATIOS :
Net Worth
1.13
31.21
45.70
46.19
262.28
RONW (%)
-
-
-
14.57%
5.35%*
Book Value Per Share (Rs.)
376.67
10,403.33
10.47
10.58
10.32
EPS (Rs.) Simple Average
-
-
-
1.46
0.54*
Note : None of the assets are being revalued since incorporation
Statement of Assets and Liabilities
(Rs. in Lacs)
Financial Year Ended
31-3-1997
31-3-1998
31-3-1999
31-3-2000
25-11-2000
A) Fixed Assets at Cost
Nil
29.05
102.37
115.11
140.51
Less : Depreciation
Nil
Nil
4.19
17.39
27.58
Net Block
Nil
29.05
98.18
97.72
112.93
Capital Work in Progress
5.85
18.92
55.09
B) Investments
Nil
Nil
Nil
71.67
71.67
C) Current Assets, Loans & Adv :
Inventories
Nil
Nil
18.73
35.05
22.46
Debtors
Nil
Nil
6.56
43.12
93.86
Cash and Bank
Balances
0.03
0.01
1.27
7.35
11.35
Loans and Advances
1.01
0.05
1.22
0.52
10.05
TOTAL (A)
1.04
0.06
27.78
86.04
137.72
D) Current Liabilities & Prov. :
Current Liabilities
Nil
Nil
Nil
Nil
Nil
Provisions
0.01
3.73
3.81
94.68
34.07
TOTAL (B)
0.01
3.73
3.81
94.68
34.06
E) Net Current Assets (A-B)
1.13
-3.68
23.97
(8.64)
103.65
F) Misc. Expenses not W/Off
0.01
0.11
1.66
1.48
1.36
G) Profit & Loss Account
Nil
Nil
6.05
Nil
Nil
H) Total Assets
1.14
31.32
129.86
181.15
344.70
Represented By :
I) Share Capital
0.03
0.03
43.66
43.66
254.26
J) Share Application Money
1.11
31.29
3.70
3.70
Nil
K) Reserves and Surplus
Nil
Nil
Nil
0.31
9.38
L) Secured Loans
Nil
Nil
72.91
72.61
81.06
L) Unsecured Loans
Nil
Nil
9.59
60.87
Nil
M) Total Liabilities
1.14
31.32
129.86
181.15
344.70
Notes on Accounts :
1) Significant
Accounting Policies :
(i) The financial
statements are prepared under the historical cost convention and in accordance
with the applicable Accounting Standards issued by the Institute of Chartered
Accountants of India and relevant presentational requirements of the Companies
Act, 1956.
(ii) Recognition of
Expenditure :
The Company follows the accrual method of accounting and all
liabilities are provided on that basis.
(iii) Raw Materials,
Work-in-Progress and Finished Goods are valued at cost or realizable value
whichever is less on FIFO basis.
(iv) Fixed Assets and
Depreciation :
a) Fixed Assets are
stated at cost. Cost of Assets is inclusive of all other incidental expenses.
b) Depreciation is
provided on Written Down Value Method in accordance with the Schedule XIV of
the Companies Act, 1956.
2) Write off of
Preliminary Expenditure :
Preliminary
Expenses are being written off over a period of 10 years from the date of
commencement of commercial production.
3) Term Loan from
State Bank of Saurashtra, Karjan Branch is secured by way of first equitable
mortgage of Land, Building, Plant and Machineries, Dies and Tools, etc. as well
as Personal Guarantee of all the Directors.
Cash Credit from State Bank of Saurashtra, Karjan Branch is
secured by Hypothecation of Raw Material, Work-in-Process as well as Finished
Goods and Personal Guarantee of all the Directors.
Temp Loan from State Bank of Saurashtra, Karjan Branch is secured
by Hypothecation of Tempo and Personal Guarantee of Directors.
4) No provision has
been made for Gratuity since the payment of Gratuity Act, 1972 is not
applicable to the Company.
5) The Company has
made Trade Investment in Shreeji Copper Private Limited. The Investment is made
at Rs. 10/- per Share. Due to the said Investment, Shreeji Copper Private
Limited becomes wholly owned subsidiary.
6) Balances of Sundry
Debtors, Sundry Creditors, Secured Loans and Bank balance, etc. are subject to
confirmation and reconciliation, if any.
7) In the opinion of
the Board, all the known Liabilities are provided for and at all the Current
Assets, Loans and Advances have a value on realization as near to the value
stated in the Balance Sheet if realized in ordinary course of business.
8) Auditor's
Remuneration : Audit Fees : Rs. 10,500/-.
9) Directors'
Remuneration : Rs. 48,000/-
10) A) Value of Imports on CFI Basis : Nil.
B) Expenditure in Foreign Currency : Nil.
C) Earning in Foreign Exchange : Nil.
D) On Export of Goods FOB Basis : Nil.
11) During the year,
the Authorised Share Capital of the Company was increased from Rs.
1,00,00,000/- (Rupees One Crore Only) to RS. 11,00,00,000/- (Rupees Eleven
Crores Only). The formalities for filing necessary forms with the Registrar of
Companies, payment of Stamp Duty and Registration Fees are still pending.
12) Figures of the
Current Year are for the period from 1st April, 2000 to 25th November, 2000.
Thus, the figures of the previous year are not comparable with that of the
previous year.
13) All Schedules forms
and integral part of the Audited Accounts.
As per our Report of even date attached.
For S. F. Tai & Associates,
Chartered Accountants,
Sd/-
(S. F. Tai.)
Partner
M. No. 45811.
Place : Baroda.
Dated : 25th November, 2000.
TAXATION STATEMENT
(Rs. In Lacs)
Year Ended March 31,
1996
1997
1998
1999
2000
Tax at Notional Rate
-
-
-
-
1.30
Adj. Export Profits
-
-
-
-
-
Depreciation between Tax Depreciation and Book Depreciation
-
-
-
-
3.84
Other Adjustment
-
-
-
-
-
Net Adjustments
-
-
-
-
3.84
Tax Savings thereon
-
-
-
-
1.47
Total Taxation on Extra Ordinary Items
-
-
-
-
-
Tax on Profits before Extra Ordinary Items
-
-
-
-
1.30
CAPITALISATION STATEMENT
(Rs. in lacs)
PARTICULARS
PRE-ISSUE
AS ON 25.11.00
POST ISSUE
AS ON
Short Term Debt
35.36
176.64
Long Term Debt
45.69
40.87
Shareholder's Funds
Share Capital
254.26
1000.00
Share Application Monies
-
-
Reserves
9.38
9.38
Total Shareholders Fund
263.64
1009.38
Short Term Debt / Equity
0.13 : 1
0.17 : 1
Long Term Debt / Equity
0.17 : 1
0.05 : 1
STATUTORY AND OTHER INFORMATION
MINIMUM SUBSCRIPTION
If the Company does not receive the minimum subscription of 90% of
the amount payable on application form public subscription or the subscription
level falls below 90% on account of cheques returned or withdrawal of
applications, the Company shall forthwith refund the entire subscription amount
received. If there is a delay beyond 8 days after the date from which the
Company becomes liable to pay the amount, Company shall pay interest as per
Act.
EXPENSES OF THE PRESENT OFFER
The expenses of the offer including fees to the Lead Manager and
Registrar to the Offer, stamp duty, printing and stationery, distribution and
publication expenses, legal and professional charges, bank charges, auditors
fees and other miscellaneous expenses estimated at Rs. 82 lacs are payable of
the present offer. Fees for listing the Company's shares at stock exchanges
will be paid by the Company.
FEES PAYABLE TO THE LEAD MANAGER TO THE OFFER
The fees payable to the Lead Manager to the Offer (apart from
reimbursement of actual out of pocket expenses) is set out in their letter of
appointment, copies of which are kept open for inspection at the registered
office of the Company.
FEES PAYABLE TO THE REGISTRAR TO THE OFFER
The fees payable to the Registrar to the Offer as set out in their
offer letter, copies of, which are kept open for inspection at the registered
office of the Company. In addition to the above, the expenses incurred for
postage, envelops, binding charges, binders labour and other incidental
expenses are to be reimbursed on an actual basis.
UNDERWRITING COMMISSION AND BROKERAGE
Brokerage will be paid by the Company @ 1.5% on the equity shares
on the basis of allotment made against applications bearing the stamp of a
member of any recognised stock exchange of India in the brokers column in the
application form. Brokerage at the same rate will also be payable to the
bankers to the offer in respect of allotment made against applications procured
by them provided applications forms bear their respective stamps in the brokers
column. In case of tempering or over stamping of the broker codes on the
application form, the Company's decision to pay brokerage in this respect will
be final and no further correspondence will be entertained in this matter.
PREVIOUS OFFER OF CAPITAL DURING LAST FIVE YEARS
The Company has not made any public offer of equity/debentures
previously.
OFFER AT A PREMIUM OR DISCOUNT
No shares of the Company have been offered at either a premium or
at a discount since its incorporation.
PREVIOUS COMMISSION AND BROKERAGE
No sum has been paid by the Company since its incorporation or is
payable as commission for subscribing or procuring or agreeing to subscribe or
procure subscription for any shares or debentures of the Company.
PREVIOUS OFFER OF SHARES OTHERWISE THAN FOR CASH
There is no issue of shares or debentures as fully or partly
paid-up otherwise than for cash since incorporation.
REDEEMABLE PREFERENCE SHARES AND DEBENTURES
The Company has not issued any redeemable preference shares or
debentures since its incorporation.
CAPITALISATION OF RESERVES AND PROFITS
There has been no capitalisation of reserves or profits since its incorporation.
OPTION TO SUBSCRIBE
Except as otherwise stated in this offer document, the Company has
not entered into any contract or arrangement nor does it at present proposes to
enter into any contract or arrangement whereby any option or preferential right
of any kind has been or is proposed to
be given to any person to subscribe for any shares or debentures of the
Company.
The investor shall have an option either to receive the security
certificates or to hold the securities in dematerialised form with a
depository.
PURCHASE OF PROPERTY
Save as elsewhere stated
in this offer document and save in respect of the property purchased or
acquired or to be purchased or acquired under the contract referred to herein
below under the heading Material Contracts and Documents for Inspection, there
is no property which the Company has purchased or acquired or proposes to
purchase or acquire which is to be paid, wholly or partly out of the proceeds
of the present offer or the purchase or acquisition of which has not been
completed on the date of issue of this offer document, other than the
following:
The contract for the purchase or acquisition whereof entered into
or may be entered into, in the ordinary course of the company's business, such
contract not being made in contemplation of the offer or in consequence of the
contract, or,
in respect of which the amount is not material. Except as stated
in this offer document, the Company has not purchased any property in which any
of its promoters and/or directors have any direct or indirect interest in any
payment made thereof.
INTEREST OF DIRECTORS AND PROMOTERS
Save as elsewhere stated in this offer document, all the Directors
may be deemed to be interested to the extent of remuneration and fees, if any,
payable to them for attending meetings of the Board or Committee thereof as
well as to the extent of other remuneration, reimbursement of incidental
expenses payable to them, if any, for such attendance's as per the Articles. All the Directors/ Promoters of the
Company shall be deemed to be interested to the extent of shares already held
by them in the Company and/or their friends and relatives and which may be
allotted to them out of the present offer,
and are deemed to be interested to the extent of remuneration and
perquisites being drawn by them from the Company.
No Director of the Company is interested in the appointment of any
of the Manager, Registrar and Bankers to the Offer. Save as other wises stated
else where in offer document No
Director of the Company is interested in any property acquired by the Company
since incorporation or proposed to be acquired by it.
Mr. Pravinbhai patel, director and promoter of the company, is
interested in the purchase of land by the company for the proposed factory. The
company has paid him an amount of Rs. 3.11 lacs against the land purchased from
him at the prevailing market rates
PAYMENT OR BENEFITS TO DIRECTORS AND OFFICERS OF THE COMPANY
Save as stated herein, no amount or benefit has been paid or given
to the Company's Director or Officers of the Company except the normal
remuneration and/or reimbursement for services as Directors, Officers or
Employees of the Company.
BONUS ISSUE & REVALUATION OF ASSETS
There has not been any Revaluation of Assets since Incorporation.
(D) MAIN PROVISIONS OF
THE ARTICLES OF ASSOCIATION OF THE COMPANY
SHARE CAPITAL
5. (a) The Authorised share Capital of the
Company is Rs. 1,00,00,000/- (Rupees One Crore Only) divided into 10,00,000
(Ten Lacs) Equity Shares of Rs. 10/- (Rupees Ten Only) each with rights to
alter the same in whatever way as deemed fit by the Company. The Company may
increase the Authorised Capital which may consist of Equity and/or Preference
Shares as the Company in General Meeting may determine in accordance with the
law for the time being in force relating to Companies with power to increase or
reduce such capital from time in accordance with the Regulations of the Company
and the legislative provisions for the time being in force in this behalf and
with power to divide the shares in the Capital for the time being into Equity
Share Capital or Preference Share Capital and to attach thereto respectively
and preferential, qualified or special rights, privileges or conditions and to
vary, modify and abrogate the same in such manner as may be determined by or in
accordance with these presents.
(b) Subject to the rights of the holders of
any other shares entitled by the terms of issue to preferential repayment over
the equity shares in the event of winding up of the Company, the holders of the
equity shares shall be entitled to be repaid the amounts of capital paid up or
credited as paid up on such equity shares and all surplus assets thereafter
shall belong to the holders of the equity shares in proportion to the amount
paid up or credited as paid up on such equity shares respectively at the
commencement of the winding up.
INCREASE REDUCTION AND ALTERATION OF CAPITAL
6. The Company may
from time to time in general meeting increase its share capital by the issue of
new shares of such amounts as it thinks expedient.
On What Conditions the new shares may be issued
(a) Subject to the
provisions of sections 80, 81, and 85 to 90 of the Act, the new shares shall be
issued upon such terms and conditions and with such rights and privileges
annexed thereto by the general meeting creating the same as shall be directed
and if non direction be given as the Directors shall determine and in
particular such shares may be issued subject to the provisions of the said
sections with a preferential or qualified right to dividends and in
distribution of assets of the Company and subject to the provisions of the said
sections with special or without any right of voting and subject to the
provisions of Section 80 of the Act any preference shares may be issued on the
terms that are or at the option of the Company are liable to be redeemed.
Further Issue of Shares
(b) Where at the after
the expiry of two years from the formation of the Company or at any time after
the expiry of one year from the allotment of shares in the Company made for the
first time after its formation, whichever is earlier, it is proposed to
increase the subscribed capital of the Company by allotment of further shares
whether out of the unissued capital or out of the increased share capital then
:
(i) Such further shares shall be offered to
the persons who at the date of the offer, are holders of the equity shares of
the Company, in proportion, as near as circumstances admit, to the capital paid
up on those shares at the date.
(ii) Such offer shall be made by a notice
specifying the number of shares offered and limiting a time not less than
thirty days from the date of the offer and the offer if not accepted, will be
deemed to have been declined.
(iii) The offer aforesaid shall be deemed to
include a right exercisable by the person concerned to renounce the shares
offered to them in favour of any other person and the notice referred to in sub
clause (b) hereof shall contain a statement of this right.
PROVIDED
THAT the Directors may decline, without assigning any reasons to allot any
shares to any person is whose favour any member may renounce the shares offered
to him.
(iv) After expiry of the time specified in the
aforesaid notice or on receipt of earlier intimation from the person to whom
such notice is given that he declines to accept the shares offered, the Board
of Directors may dispose off them in such manner and to such perinea(s) as they
may think, in their sole discretion, fit.
(c) Notwithstanding
anything contained in sub-clause (1) thereof, the further shares aforesaid may
be offered to any person (whether or not those persons include the persons
referred to in clause(a) of sub-clause (1) here of) in any manner whatsoever.
(i) If a special resolution to that effect
is passed by the Company in General Meeting, or
(ii) Where no such special resolutions in
passed, if the votes cast (whether on a show of hands or on a poll as the case
my be) in favour of the proposal contained in the resolution moved in the
general meeting (including the casting vote, if any, of the chairman) by the
members who, being entitled to do so, vote in person, or where proxies are
allowed, by proxy, exceed the votes, if any, cast against the proposal by members,
so entitled and voting and Central Government is satisfied, on an application
made by the Board of Directors in this behalf, that the proposal in most
beneficial to the Company.
(d) Nothing is
sub-clause (c) of (1) hereof shall be deemed :
(i) To extend the time within which the
offer should be accepted; or
(ii) To authorise any person to exercise the
right of renunciation for a second time on the aground that the person in whose
favour the renunciation was first made has declined to take the shares
comprised in the renunciation.
(e) Nothing in this
Article shall apply to the increase of the subscribed capital of the Company
caused by the exercise of an option attached to the debenture issued or loans
raised by the Company :
(i) To convert such debentures or loans
into shares in the Company; or
(ii) To subscribe for shares in the Company
(whether such option is conferred in these Articles or otherwise).
PROVIDED THAT the terms of issue of such debentures or the terms
of such loans include a term providing for such option and such term:
(i) Either has been
approved by the Central Government before the issue of the debentures or the
raising of the loans or is in conformity with the Rules, if any, made by that
Government in this behalf; and
(ii) in the case of
debentures or loans or other than debentures issued to or loans obtained from
Government or any institution specified by the Central Government in this
behalf, has also been approved by a special resolution passed by the Company in
General Meeting before the issue of the debentures or raising of the loans.
Directors may allot shares as fully paid up
(f) Subject to the
provision of the Act and these Articles, the Directors may issue and allot
shares in the capital of the Company on payment or part payment for any
property or assets of any kind whatsoever sold or transferred, goods or
machinery supplied or for services rendered to the Company in the conduct of
its business and any shares which may be so allotted may be issued as fully
paid up or partially paid up otherwise than in cash, and if so issued, shall be
deemed to be fully paid up or partly paid up shares as the case may be.
Same as original capital
(g) Except so far as
otherwise provided by the conditions of issue or by these presents, any capital
raised by the creation of new shares shall be considered as part of the
original capital and shall be subject to the provisions herein contained with
reference to the payment of calls, installments, transfers, transmission,
forfeiture, lien, surrender, voting and otherwise.
Power to issue Redeemable Preference Shares
7. (a) Subject to the provisions of Section 80
of the Act and subject to the provisions on which any shares may have been
issued, the Company may issue preference shares which are or at the option of
the Company are liable to be redeemed;
Provided that :
(i) no such shares shall be redeemed except
out of the profits of the Company which would otherwise be available for
dividend or out of the proceeds of a fresh issue of Shares made for the purpose
of redemption;
(ii) no such shares shall be redeemed unless
they are fully paid;
(iii) the premium, if any, payable on
redemption shall have been provided for out of the profit of the Company or out
of the Company's share premium account before the shares are redeemed;
(iv) where any such shares are redeemed
otherwise than out of the proceeds of a fresh issue, there shall, out of
profits which would otherwise have been available for dividend, be transferred
to a reserve fund, to be called "the capital redemption reserve
account" a sum equal to the nominal amount of the shares capital of the
Company Shall, except as provided in Section 80 of the Act, apply as if the
capital redemption reserve account we paid up share capital of the Company.
(b) Subject to the
provisions of the Section 80 of the Act and subject to the provisions on which
any shares may have been issued, the redemption of preference shares may be
effected on such terms and in such manner as may be provided in these Articles
or by the terms and conditions of thereto in such manner as the Directors may
think fit.
(c) The redemption of
preference shares under these provisions by the Company shall not be taken as
reducing the amount of its authorised Share Capital.
(d) Where in pursuance
of this Article, the Company has redeemed or is about to redeem any preference
shares, it shall have power to issue shares upto the nominal amount of the
shares redeemed or to be redeemed as if those shares had never been issued; and
accordingly the Share capital of the Company shall not, for the purposed of
calculating the fees payable under Section 611 of the Act, be deemed to be
increased by the issue of shares in pursuance of this clause.
Provided that where new shares are issued before the redemption
of the old shares, the new shares shall
not so far as relates to stamp duty be deemed to have been issued in pursuance
of this clause unless the old shares are redeemed within one moths after the
issue of the new shares.
(e) The Capital
Redemption Reserve Account may notwithstanding anything in this Article, be
applied by the Company, in paying up unissued shares of the Company to be
issued to members of the Company as fully paid bonus shares.
Provision in case of Redemption of preference Shares
8. The Company shall
be at liberty at any time, either at one time or from time to time as the
Company shall think fit, by giving not less than six months previous notice in
writing to the holders of the preference shares to redeem at par the whole or
part of the preference shares for the time being outstanding, by payment of the
nominal amount thereof with dividend calculated upto the date or dates notified
for payment (and for this purpose the dividend shall be deemed to accrue and
due from day to day) and in the case of redemption of part of the preference
shares the following provisions shall take effect :
(a) The shares to be
redeemed shall be determined by drawing of lots which the Company shall cause
to be made at its registered office in the presence of one Director at least;
and
(b) Forthwith after
every such drawing, the Company shall notify the Shareholders whose shares have
been drawn for redemption its intention to redeem such shares by payment at the
registered office of the Company at the time and on the date to be named
against surrender of the Certificates in respect of the Shares to be so
redeemed and at the time and date so notified each such shareholder shall be
bound to surrender to the Company the Shares Certificates in respect of the
Shares to be faded and thereupon the Company shall pay the amount payable to
such shareholders in respect of such redemption. The Shares to be redeemed
shall cease to carry dividend from the date named for payment as aforesaid. Where
any such certificate comprises any shares which have not been drawn for
redemption, the Company shall issue to the holder thereof a fresh certificate
therefor.
Reduction of Capital
9. The Company may
from time to time by special resolution, subject to confirmation by the court
and subject to the provision of Sections 78, 80 and 100 to 104 of the Act,
reduce its share capital and any Capital Redemption Reserve Account or premium
account in any manner for the time being authorised by law and in particular
without prejudice to the generality of the foregoing power may be:
(a) extinguishing or
reducing the liability on any of its shares in respect of Share Capital not
paid up;
(b) either with or
without extinguishing or reducing liability on any of its shares, cancel paid
up share capital which is lost or is unrepresented by available assets; or
(c) either with or
without extinguishing or reducing liability on any of its shares, pay off any
paid up shares capital which is in excess of the wants of the Company;
and may, if and so far as is necessary, alter its Memorandum, by
reducing the amount of its share capital and of its shares accordingly.
Division, Sub-Division, Consolidation, Conversion and Cancellation
of Shares
10. Subject to the
provisions of Section 94 of the Act, the Company in general meeting may be an
ordinary resolution alter the conditions of its Memorandum as follows, that is
to say, if may:
(a) consolidate and
divide all or any of its Shares Capital into shares of larger amount than its
existing shares;
(b) sub-divide its
shares or any of them into shares of smaller amount than originally fixed by
the Memorandum subject nevertheless to the provisions of the Act in that behalf
and so however that in the sub-division the proportion between the amount paid
and the amount if any, unpaid on each reduced shares shall be the same as if
was in the case of the shares from which the reduced share is derived and so
that as between the holders of the shares resulting from such sub-division one
or more of such shares may, subject to the provisions of the Act, be given any
preference or advantage over the others or any other such shares.
(c) convert, all or
any of its fully paid up shares into stock, and re-convert that stock into full
paid up shares of any denomination.
(d) cancel, shares
which at the date of such general meeting have not been taken or agreed to be
taken by any person, and diminish the amount of its share capital by the amount
of the shares so cancelled.
Notice to Registrar of Consolidation of Share Capital, Conversion
of Shares into stocks etc..
11. (a) If the Company has :
(i) consolidated and divided its Share
Capital into shares of larger amount than its existing shares;
(ii) converted any shares into stock;
(iii) reconverted any stock into shares;
(iv) sub-divided its share or any of them;
(v) redeemed any redeemable preference
shares; or
(vi) cancelled any shares otherwise than in connection
with a reduction of Share Capital under Sections 100 to 104 of the Act,
the
Company shall within one months after doing so, give notice thereof to the
Registrar specifying as the case may be, the shares consolidated, divided,
converted, sub-divided, redeemed or cancelled or the stocks reconverted.
(b) The Company shall
thereupon request the Registrar to record the notice and make any alterations
which may be necessary in the Company's Memorandum of Articles or both.
Modifications of rights
12. If at any time the
share capital, by reason of the issue of Preference Shares or otherwise, is
divided into different classes of shares, all or any of the rights and
privileges attached to any class (unless otherwise provided by the terms of
issue of the shares of that class) may, subject to the provisions of Sections
106 and 107 of the Act and whether or not the Company is being wound up, be
varied, modified, commuted, affected or abrogated with the consent in writing
of the holders of three-fourths in nominal value of the issued shares of that
calls or with the sanction of Special Resolution passed at a separate general meeting of the holders of
the shares of the class. This Article shall not derogate from any power which
the Company would have if this Article were omitted. The provisions of these
Articles relating to general meetings shall mutatis mutandis apply to every
such separate meeting but so that if at any adjourned meeting of such holders a
quorum as defined in Article 102 is not present, those persons who are present
shall be quorum.
DEMATERIALIZATION OF SECURITIES
28 (a) Not withstanding
anything contained in these Articles, the Company shall be entitled to
dematerialize its securities in a DEMATERIALIZED form pursuant to the
Depositories Act, 1996.
Options for Investors
Every person subscribing to securities offered by the Company
shall have the option to receive security certificates or to hold the
securities with a depository. Such a person who is the beneficial owner of the
securities can at any time opt out of a depository. If permitted by the law, in
respect of any security in the manner provided by the Depositories Act, and the
Company shall, in the manner and within the time prescribed, issue to the
beneficial owner the required Certificates of Securities.
If a person opts to hold his security with a depository, the
Company shall intimate such depository the details of allotment of the security
and on receipt of the information the depository shall enter in its record the
name of the allottee as the beneficial owner of the security.
Securities in depositories to be in fungible form
All securities held by a depository shall be DEMATERIALIZED and be
in fungible form.
Nothing contained in Sections 153, 153A, 153B, 187C and 372A of
the Act shall apply to a depository in respect of the securities held by it on
behalf of the beneficial owners.
Transfer of Securities
Nothing contained in Section 108 of the Act or these Articles
shall apply to a transfer of securities effected by a transferor and transferee
both of whom are entered as beneficial owners in the records of a depository.
Register and Index of beneficial owners
The Register and Index of beneficial owners maintained by a
depository under Depositories Act, 1996, shall be deemed to be the Register and
Index of Members and Security holders for the purposes of these Articles.
NOMINATION
28 (b) Every Shareholder or
debentureholder of the Company may at any time nominate, in the prescribed
manner, a person to whom his shares in, or debenture of the Company shall vest
in the event of his death.
Where the shares in or debenture of the Company are held by more
than one person jointly, the joint-holders may together nominate, in the
prescribed manner, a person to whom all the rights in the shares or debentures
of the Company as the case may be, shall vest in the event of death of all the
joint holders.
Notwithstanding anything contained in any other law for the time
being in force or in any disposition, whether testamentary or otherwise, in
respect of such shares in or debentures of the Company, where a nomination made
in the prescribed manner purports to confer on any person the rights to vest
the shares in or debentures of the company, the nominee shall, on the death of
the shareholder or debenture holder or, as the case may be, on the death of the
joint-holders, become entitled to all the rights in such shares or debentures
or as the case may be, all the joint holders in relation to such shares or debentures,
to the exclusion of all other persons unless the nomination is varied,
cancelled in the prescribed manner.
Where the nominee is a minor, it shall be lawful for the holder of
the shares or debentures, to make the nomination to appoint, in the prescribed
manner, any person to become entitled to the shares in or debentures of the
Company, in the event of his death, during the minority.
TRANSMISSION IN CASE OF NOMINATION
A nominee upon production of such evidence as may be required by
the Board and subject as hereinafter provided, elect, either-
i) to be registered himself as the holder of share or debenture,
as the case may be; or
ii) to make such transfer of share or debenture, as the case may
be, as the deceased shareholder or debentureholder, could have made;
iii) if the nominee elects to be registered as holder of the share
or debenture, himself, as the case may be, he shall deliver or send to the
Company, a notice in writing signed by him stating that he so elects and such
notice shall be accompanied with the death certificate of the deceased
shareholder or debenture holder as the case may be;
iv) a nominee shall be entitled to the same dividends and other
advantages to which he would be entitled to, if he were the registered holder
of the share or debenture except that he shall not, before being registered as
a member in respect of his share or debenture, be entitled in respect of it to
exercise any right conferred by membership in relation to meetings of the
Company.
Provided further that the Board may, at any time, give notice
requiring any such person to elect either to be registered himself or to
transfer the share or debenture, and if the notice is not complied within
ninety days, the Board may thereafter withhold payments of all dividends,
bonuses or other moneys payable or rights accruing in respect of the share or
debenture, until the requirements of the notice have been complied with.
INTEREST OUT OF CAPITAL
Interest out of Capital
29. Where any shares
are issued for the purposes of raising money to defray the expenses of the
construction of any works or building or the provisions of any plant, which
cannot be made profitable for lengthy period, the Company may pay interest on
so much of that share capital as is for the time being paid up, for the period,
at the rate and subject to the conditions and restrictions provided by Section
208 of the Act and may charge the same to capital as part of cost of
construction of the work or building or the provision of the plant.
UNDERWRITING COMMISSION AND BROKERAGE
Power to pay certain commission and prohibition of payment of all
other commissions discounts etc.
30. (A) The Company may pay a commission to any
person in consideration of :
(i) his subscribing or agreeing to
subscribe whether absolutely or conditionally, for any shares in or debentures
of the Company, subject to the restrictions specified in sub-section (4A) of
Section 76 of the Act, or
(ii) his procuring or agreeing to procure
subscription, whether absolute or conditional for any shares in or debentures
of the Company, if the following conditions are fulfilled, namely:
(a) the commission paid or agreed to be paid
does not exceed in the case of shares, five percent of the price at which the
shares are issued and in the case of debentures, two and half percent of the
price at which the debentures are issued;
(b) the amount or rate percent of the
commission paid or agreed to be paid on shares or debentures offered to the
public for subscription, is disclosed in the Prospectus, and in the case of
shares or debentures not offered to the public for subscription, is disclosed
in the Statement in lieu of Prospectus and filed before the payment of the
commission with the Registrar, and where a circular or notice, not being a Prospectus
inviting subscription for the shares or debentures is issued is also disclosed
in that circular or notice;
(c) the number of shares or debentures with
such persons have agreed for a commission to subscribe, absolutely or
conditionally is disclosed in the manner aforesaid and
(d) a copy of the contract for the payment
of commission is delivered to the Registrar at the time of delivery of the
prospectus or the statement in lieu of prospectus for registration.
(B) Save as aforesaid
and save as provided in Section 75 of the Act, the Company shall not allot any
of its shares or debentures or apply any of its moneys, either directly or
indirectly, in payment of any commission, discount or allowance, to any person
in consideration of :
(i) his subscribing or agreeing to
subscribe, whether absolutely or conditionally, for any shares in, or
debentures of the Company or;
(ii) his procuring or agreeing to procure
subscription, whether absolutely or conditionally, for any shares in, or
debentures of the Company whether the shares, debentures, or money be so
allotted or applied by, being added to the purchase money of any property
acquired by the Company or to the contract price of any work to be executed for
the Company or the money be paid out of the nominal purchase money or contract
price, or otherwise.
(C) Nothing in this
Article shall affect the power of the Company to pay such brokerage as it has
hereto before been lawful for the Company to pay.
(D) A vendor to,
promoter of, or other person who received payment in shares, debentures or
money from the Company shall have and shall be deemed always to have had power
to apply any part of the shares, debentures or money received for payment of
any commission, the payment of which, if made directly by the Company would
have been legal under Section 76 of the Act.
(E) The commission may
be paid or satisfied (subject to the provisions of the Act and these Articles)
in cash, or in shares, debentures or debenture-stocks of the Company.
CALLS
Directors may make calls
31. The Directors may
from time to time and subject to Section 91 of the Act and subject to the terms
on which any share/debentures may have been issued and subject to the
conditions of allotment, by a resolution passed at a meeting of the Board (and
not by circular resolution) make such calls as they think fit upon the
members/debenture holders in respect of all moneys unpaid on the
share/debentures held by them respectively and such member/debenture holders
shall pay the amount of every call so made on him to the persons and at the
time and places appointed by the Directors. A call may be made payable by
installments. A call may be postponed or revoked as the Board may determine.
Calls to date from Resolution
32. A call shall be
deemed to have been made at the time when the resolution of the Directors
authorising such call was passed any may be made payable by members/debenture
holders on a subsequent date to be specified by the Directors.
Notice of Call
33. Thirty day notice
in writing shall be given by the Company of every calls made payable otherwise
than on allotment specifying the time and place of payment provided that before
the time of payment of such call, the Directors may by notice in writing to the
members/debenture holders revoke the same.
Directors may extend time
34. The Directors may,
from time to time, at their discretion, extend the time fixed for the payment
of any call, and may extend such time as to all or any of the members/debenture
holders who from residence at a distance or other cause, the Directors may deem
fairly entitled to such extension, but no member/debenture holder shall be
entitled to such extension, save as a matter of grace and favour.
Sums Deemed to be Calls
35. Any sum, which by
the terms of issue of a share/debenture becomes payable on allotment or at any
fixed date whether on account of the nominal value of the share/debenture or by
way of premium, shall for the purpose of these Articles be deemed to be a call
duly made and payable on the date on which by the terms of issue the same
becomes payable, and in case of non-payment, all the relevant provisions of
these Articles as to payment of interest and expenses, forfeiture or otherwise,
shall apply as if such sum had become payable by virtue of a call duly made and
notified.
Instalments on Shares to be duly paid
36. If by the condition
of allotment of any shares the whole or part of the amount of issue price
thereof shall be payable by installments, every such installment shall, when
due, be paid to the Company by the person who, for the time being and from time
to time, shall be the registered holder of the share or his legal
representative.
Calls on Shares of the same class to be made on uniform basis
37. Where any calls for
further Share Capital are made on shares, such calls shall be made on a uniform
basis on all shares falling under the same class.
Explanation : For the purpose of this provision, shares of the
same nominal value on which different amounts have been paid up shall not be
deemed to fall under the same class.
Liability of Joint holders of Shares
38. The joint holders
of a share shall be severally as well as jointly liable for the payment of all
installment and calls due in respect of such shares.
When interest on call or Installment payable
39. If the sum payable
in respect of any call or installment be not paid on or before the day
appointed for payment thereof or any such extension thereof, the holder for the
time being or allottee of this share in respect of which a call shall have been
made or the installment shall be due, shall pay interest as shall be fixed by
the Board from the day appointed for the payment thereof or any such extension
thereof to time of actual payment but the Directors may waive payment of such
interest wholly or in part.
Partial payment not to preclude forfeiture
40. Neither a judgment
nor a decree in favour of the Company for calls or other moneys due in respect
of any shares nor any part payment or satisfaction thereof nor the receipt by
the Company of a portion of any money which shall from time to time be due from
any member in respect of any shares either by way of principal or interest nor
any indulgence granted by the Company in respect of payment of any such money
shall preclude the forfeiture of such shares as herein provided.
Proof on trial of suits for money due on Shares
41. On the trial or
hearing of any action or suit brought by the Company against any member or his
legal representative for the recovery of any money claimed to be due to the
Company in respect of any shares it shall be sufficient to prove that the name
of the member in respect of whose shares the money is sought to be recovered
appears in the Register of Members as the holder or one of the holders, at or
subsequent to the date at which the money sought to be recovered is alleged to
have become due, of the shares in respect of which such money is sought to be
recovered, and that the resolution making the call is duly recorded in the
Minute Book, and that the notice of such call was duly given to the member or
his representatives, sued in pursuance of these presents, and it shall not be
necessary to prove the appointment of the Directors who made such calls nor
that a quorum of Directors was present at the Board at which any call was made,
nor that the meeting at which any call was made was duly convened or
constituted nor any other matters whatsoever, but the proof of the matters
aforesaid shall be conclusive evidence of the debt.
Payment in anticipation of calls may carry interest
42. (a) The Directors may, if the think fit,
subject to the provisions of Section 92 of the Act, agree to and receive from
any member willing to advance the same whole or any part of the moneys due upon
the shares held by him beyond the sums actually called for, and upon the amount
so paid or satisfied in advance, or so much thereof as from time to time
exceeds the amount of the calls then made upon the shares in respect of which
such advance has been made, the Company may pay interest as such rate, to the
member paying such sum in advance and the Directors agree upon provided that
money paid in advance of calls shall not confer a right to participate in
profits or dividends. The Directors may at any time repay the amount so advanced.
(b) The member shall not however be entitled
to any voting rights in respect of the moneys so paid by him until the same
would but for such payment, become presently payable.
Term of issue of Debenture
43. Any debenture,
debenture-stock or other securities may be issued at a discount, premium or
otherwise and may be issued on condition that they shall be convertible into
shares of any denomination and with any privileges and conditions as to
redemption, surrender, drawing, allotment of shares, attending (but not voting)
at the General Meeting, appointment of Directors and otherwise Debentures with
the right to conversion into or allotment of shares shall be issued only with
the consent of the Company in the General Meeting by a Special Resolution.
LIEN
Company's lien on Shares/Debentures
44. The Company shall
have first and paramount lien upon all the shares/debenture (other than fully
paid up shares/debentures) registered in the name of each member/debenture
holder (whether solely of jointly with others) and upon the proceeds of sale
thereof for all moneys (whether presently payable or not) called or payable at
a fixed time in respect of such shares/debentures and no equitable interest in
any shares/debenture shall be created except upon the footing and condition
that Article 25 hereof will have full effect. And such lien shall extend to all
dividends and bonuses from time to time declared in respect of such
shares/debenture. Unless otherwise agreed the registration of a transfer of
shares/debentures shall operate as a waiver of the Company's lien if any on
such shares/debentures. The Directors may at any time declare any
shares/debentures wholly or in part to be exempt from the provisions of this
Clause.
As to enforcing lien by sale
45. For the purpose of
enforcing such lien, the Board may sell the share/debentures subject thereto in
such manner as they shall think fit, and for that purpose may cause to be
issued a duplicate certificate in respect of such shares and/or debentures and
may authorise one of their member or appoint any office or agent to execute a
transfer thereof on behalf of and in the name of such member/debenture holder. No sale shall be made until such
period, as may be stipulated by the Board from time to time, and until notice in
writing of the intention to sell shall have been served on such member and/or
them in payment, fulfillment, or discharge of such debts, liabilities or
engagements for fourteen days after such notice.
Application of Proceeds of Sale
46. (a) The net proceeds of any such sale shall
be received by the Company and applied in or towards payment of such part of
the amount in respect of which the lien exists as is presently payable and the
residue if any, shall (subject to a like lien for sums not presently payable as
existed upon the shares before the sale) be paid to the persons entitled to the
shares and/or debentures at the date of the sale.
Outsiders lien not to affect Company's lien
(b) The Company shall
be entitled to treat the registered holder of any share or debenture as the
absolute owner thereof and accordingly shall not (except as ordered by a court
of competent jurisdiction or by statute required) be bound to recognise
equitable or other claim to, or interest in, such shares or debentures on the
part of any other person. The Company's lien shall prevail notwithstanding that
it has received notice of any such claims.
FORFEITURE
If call or installment not paid notice must be given
47. (a) If any member or debenture holder fails
to pay the whole or any part of any call or installment or any money due in
respect of any share or debentures either by way of principal or interest on or
before the day appointed for the payment of the same or any such extension
thereof as aforesaid, the Directors may at any time thereafter, during such
time as the call or any installment or any part thereof or other moneys remain
unpaid or any such extension thereof as aforesaid, the Directors may at any
time thereafter, during such time as the call or any installment or any part
thereof or other moneys remain unpaid or a judgment or decree in respect
thereof remains unsatisfied in whole or in part, serve a notice on such member
or debenture holder or on the person (if any) entitled to the share by transmission
requiring him to pay such call or installment or such part thereof or other
moneys as remain unpaid together with any interest that may have accrued and
all expenses that may have been incurred by the Company by reason of such non
payment.
From of Notice
(b) The Notice shall
name a day not being less than One Month from the date of the notice and a
place or places, on and at which such call, or installment or such part or
other moneys as aforesaid and such interest and expenses as aforesaid are to be
paid. The notice shall also state that in the event of non payment of call
amount with interest at or before the
time and at the place appointed, the shares or debentures in respect of which
the call was made or installment or such part or other moneys is or are payable
will be liable to be forfeited.
In default of payment shares or debentures to be forfeited
48. If the requirements
of any such notice as aforesaid are not complied with any share/debenture in
respect of which such notice has been given, may at any time thereafter before
payment of all calls or installments, interest and expenses or other moneys due
in respect thereof, be forfeited by a resolution of the Directors to that
effect. Neither the receipt by the Company of a portion of any money which
shall from time to time be due from any member of the Company in respect of his
shares, either by way of principal or interest, nor any indulgence granted by
the Company, in respect of the payment of any such money, shall preclude the
Company from thereafter proceeding to enforce a forfeiture of such shares as
herein provided. Such forfeiture shall include all dividends declared or
interest paid or any other moneys payable in respect of the forfeited shares or
debentures and not actually paid before the forfeiture.
Entry of forfeiture in Register of members/debenture holders
49. When any
shares/debenture shall have been so forfeited, notice of the forfeiture shall
be given to the member or debenture holder in whose name it stood immediately
prior to the forfeiture and an entry of the forfeiture with the date thereof,
shall forthwith be made in the Register of members of debenture holders but no
forfeiture shall be invalidated by any omission or neglect or any failure to
give such notice or make such entry as aforesaid.
Forfeited share/debenture to be property of Company and may be
sold
50. Any share or
debenture so forfeited shall be deemed to be the property of the Company, and
may be sold, re-allotted or otherwise disposed of either to the original holder
or to any other person upon such terms and in such manner as the Directors
shall think fit.
Power to annul forfeiture
51. The Directors may,
at any time, before any share or debenture so forfeited shall have been sold,
re-allotted or otherwise disposed of, annul forfeiture thereof upon such
conditions as they think fit.
Shareholders or Debenture holders still liable to pay money owing
at time of forfeiture and interest
52. Any member or
debenture holder whose shares or debentures have been forfeited shall,
notwithstanding the forfeiture, be liable to pay and shall forthwith pay to the
Company, all calls, installments, interest expenses and other money owing upon
or in respect of such shares or debenture at the time of the forfeiture
together with interest thereon from the time of the forfeiture until payment at
such rate as the Directors may determine, and the Directors may enforce the
payment of the whole or a portion thereof, if they think fit, but shall not be
under any obligation to do so.
Effect of forfeiture
53. The forfeiture of a
share of debenture shall involve extinction at the time of forfeiture, of all
interest in and all claims and demands against the Company, in respect of the
share or debenture and all other rights incidental to the share or debenture,
except only such of those rights as by these Articles are expressly saved.
Certificate of forfeiture
54. A Certificate in
writing under the hand of one Director and counter signed by the Secretary or
any other officer authorised by the Directors for the purpose, that the call in
respect of a Share or debenture was made and notice thereof given and that
default in payment of the call was made and that the forfeiture of the share or
debenture was made by the resolution of Directors to that effect shall be
conclusive evidence of the facts stated therein as against all persons entitled
to such share or debenture.
Validity of sales under Articles 45 and 50
55. Upon any sale after
forfeiture or for enforcing a lien in purported exercise of the powers
hereinabove given, the Directors may, if necessary, appoint some person to
execute an instrument of transfer of the shares or debentures sold and cause
the purchaser's name to be entered in the Register of members or Register of debenture
holders in respect of the shares or debentures sold, and the purchaser shall
not be bound to see to the regularity of the proceedings, or to the application
of the purchase money and after his name has been entered in the Register of
members or debenture holders in respect of such shares or debenture the
validity of the sale shall not be impeached by any person, and the remedy of
any person aggrieved by the sale shall be for damages only and against the
Company exclusively.
Cancellation of Share/Debenture Certificate in respect of
forfeited Shares/Debentures
56. Upon any sale,
re-allotment or other disposal under the provisions of the preceding Articles,
the certificate/s originally issued in respect of the relative shares or
debentures shall (unless the same shall on demand by the Company has been
previously surrendered to it by the defaulting member or debenture holder)
stand cancelled and become null and void and be of no effect, and the directors
shall be entitled to issue a duplicate certificate/s in respect of the said
share or debentures to the person/s entitled thereto.
Title of Purchaser and allottee of forfeited shares/debentures
57. The Company may
receive the consideration, if any, given for the share or debenture on any
sale, re-allotment or other disposition thereof, and the person to whom such
share or debenture is sold, re-allotted or disposed of may be registered as the
holder of the share or debenture and shall not be bound to see to the
application of the consideration, if any, nor shall his title to the share or
debenture be affected by any irregularity or invalidity in the proceedings in
reference to the forfeiture, sale, re-allotment or other disposal of the share
of debenture.
Surrender of Shares or Debentures
58. The Directors may,
subject to the provisions of the Act, accept a surrender of any share or
debenture from or by any member or debenture holder desirous of surrendering
them on such term as they think fit.
TRANSFER AND TRANSMISSION OF SHARES AND DEBENTURES
Register of transfers
59. The Company shall
keep a book to be called the "Register of Transfers" and therein
shall be fairly and distinctly entered the particulars of every transfer or
transmission of any share.
Instrument of Transfer
60. The instrument of
transfer shall be in writing and all provisions of section 108 of the Companies
Act, 1956 and statutory modification thereof for the time being shall be duly
compiled with in respect of all transfer of shares and registration thereof.
Instrument of transfer to be executed by transferor and transferee
61. Every such
instrument of transfer shall be signed both by the transferor and transferee
and the transferor shall be deemed to remain the holder of such until the name
of the transferee is entered in the Register of members in respect thereof.
Directors may refuse to register transfer
62. (a) Subject to the provisions of Section 111
of the Act and Section 22A of the Securities Contracts (Regulation) Act, 1956,
the Directors may, at their own absolute and uncontrolled discretion and by
giving reasons, decline to register or acknowledge any transfer of shares
whether fully paid or not and the right of refusal, shall not be affected by
the circumstances that the proposed transferee is already a member of the
Company but in such cases, the Directors shall within one month from the date
on which the instrument of transfer was lodged with the Company, send to the
transferee and transferor notice of the refusal to register such transfer
provided that registration of transfer shall not be refused on the ground of
the transferor being either alone or jointly with any other person or persons
indebted to the Company on any account whatsoever except when the Company has a
lien on the shares. Transfer of shares/debentures in whatever to shall not be
refused.
(b) Nothing in
Sections 108, 109 and 110 of the Act shall prejudice this power to refuse to
register the transfer of, or the transmission on legal documents by operation
of law of the rights to, any shares or interest of a member in, any shares or
debentures of the Company.
Transfer of Shares
63. (a) An application of registration of the
transfer of shares may be made either by the transferor or the transferee
provided that where such application is made by the transferor, no registration
shall in the case of partly paid shares be effected unless the Company gives
notice of the application to the transferee and subject to the provisions of
Clause (d) of this Article, the Company shall unless objection is made by the
transferee within two weeks from the date of receipt of the notice, enter in
the Register of members the name of the transferee in the same manner and
subject to the same conditions as if the application for registration was made
by the transferee.
(b) For the purpose of
clause (a) above notice to the transferee shall be deemed to have been duly
given if sent by prepaid registered post to the transferee at the address given
in the instrument of transfer and shall be deemed to have been duly delivered
at the time at which if would have been delivered to him in the ordinary course
of post.
(c) It shall not be
lawful for the Company to register a transfer of any shares unless a proper
instrument of transfer duly stamped and executed by or on behalf of the
transferor and by or on behalf of the transferee and specifying the name,
address and occupation if any, of the transferee has been delivered to the
Company alongwith the Certificate relating to the shares and if no such
Certificate is in existence, alongwith the letter of allotment of shares. The
Directors may also call for such other evidence as may reasonably be required
to show the right of the transferor to make the transfer provided that where it
is proved to the satisfaction of the Directors of the Company that an
instrument of transfer register the transfer on such terms as to indemnity as
the Directors may think fit.
(d) Nothing in clause
(c) above shall prejudice any power of the Company to register as share holder
any person to whom the right to any share has been transmitted by operation of
law.
(e) The Company shall
accept all applications for transfer of shares/debentures, however, this
condition shall not apply to requests received by the Company;
(A) for splitting of a share or debenture
certificate into several scripts of very small denominations:
(B) Proposals of transfer of
shares/debentures comprised in a share/debenture certificate to several parties
involving, splitting of share/debenture certificate into small denominations
and that such split/transfer appears to be unreasonable or without any genuine
need.
(i) transfer of Equity shares/debentures
made in pursuance of any statutory provision or an order of a competent court
of law;
(ii) the transfer of the entire Equity
shares/debentures by an existing shareholder/debenture holder of the Company
holding under one folio less than 10 (ten) Equity Shares or 10 (ten) debentures
(all relating to the same series) less than in market lots by a single transfer
to a single or joint transferee.
(iii) the transfer of not less than 10 (ten)
Equity shares 10 (ten) debentures (all relating to the same series) in favour
of the same transferee (s) under two or more transfer deeds. out of which one
or more relate (s) to the transfer of less than 10 (ten) Equity Shares 10 (ten)
debentures.
(iv) the transfer of less than 10 (ten) Equity
shares or 10 (ten) debentures (all relating to the same series) to the existing
share holder/debenture holder subject to verification by the Company.
Provided
that the Board may in its absolute discretion waive the aforesaid conditions in
a fit and proper case(s) and the decision of the Board shall be final in such
case(s).
(f) Nothing in this
Article shall prejudice any power of the Company to refuse to register the
transfer of any shares.
Custody of Instrument of transfer
64. The instrument of
transfer shall after registration be retained by the Company and shall remain
in their custody. All instruments of transfer which the Directors may decline
to register, shall on demand be returned to the persons depositing the same.
The Directors may cause to be destroyed all transfer deeds lying with the
Company after such period as they may determine.
Transfer books and Register of members when closed
65. The Board shall
have power on giving not less than seven day's previous notice by advertisement
in some newspaper circulating in the district in which the office of the
Company is situate, to close the Transfer books, the Register of Members or
Register of debentures holders at such time or times and for such period or
periods, not exceeding thirty days at a time and not exceeding in the aggregate
forty five days in each year.
Transfer to Minors etc
66. Only fully paid
shares or debentures shall be transferred to a minor acting through his/her
legal or natural guardian. Under no circumstances, shares or debentures be
transferred to any insolvent or a person of unsound mind.
Title to shares of deceased holder
67. The executors or
administrators of a deceased member (not being one or two or more joint
holders) or the holder of a deceased member (not being one or two or more joint
holders) shall be the only persons whom the Company will be bound to recognise
as having any title to the shares registered in the name of such member, and
the Company shall not be bound to recognise such executors or administrators or
the legal representative unless they shall have first obtained probate or
letters of Administration or a Succession Certificate, as the case may be, from
a duly constituted competent court in India, provided that in any case where
the Directors in their absolute discretion think fit, the Directors may
dispense with the production of probate or Letters of Administration or a
Succession Certificate upon such terms as to indemnity or otherwise as the
Directors in their absolute discretion may think necessary and under Article 70
register the name of any person who claims to be absolutely entitled to the
shares standing in the name of a deceased member, as a member.
Registration of Persons entitled to share otherwise than by
transfer
68. (a) Subject to the provisions of Articles 67
and 77(d), any person becoming entitled to any share in consequence of the
death, lunacy, bankruptcy or insolvency of any member or by any lawful means
other than by a transfer in accordance with these presents, may with the
consent of the Directors (which they shall not be under any obligation to give)
upon producing such evidence that he sustains the character in respect of which
he proposes to act under this Article or of such titles as the Directors shall
think sufficient, either be registered himself as a member in respect of such
shares or elect to have some person nominated by him and approved by the
Directors registered as a member in respect of such shares. Provided
nevertheless that if such person shall elect to have his nominee registered he
shall testify his election by executing in favour of his nominee an instrument
of transfer in accordance with the provisions herein contained and until he
does so, he shall not be free from any liability in respect of such shares.
(b) A transfer of the shares or other
interest in the Company of a deceased member thereof made by his legal
representative shall, although the legal representative is not himself a member
be as valid as if he had been a member at the time of the execution of the
instrument of transfer.
Claimant to be entitled to same advantage
69. The person becoming
entitled to a share by reason of the death, lunacy, bankruptcy or insolvency of
the holder shall be entitled to the same dividends and other advantages to
which he would be entitled as if he were registered holder of the shares except
that he shall not before being registered as a member in respect of the share,
be entitled in respect of it, to exercise any right conferred by membership in
relation to the meeting of the Company provided that the Board may at any time
give notice requiring any such persons to elect either to be registered himself
or to transfer shares and if the notice is not complied within sixty days, the
Board may thereafter withhold payment of all dividends, interest, bonuses or
other moneys payable in respect of the share until the requirements of the
notice have been complied with.
Persons entitled may receive dividend without being registered as
member
70. A person entitled
to a share by transmission shall, subject to the right of the Directors to
retain such dividends, bonuses or moneys as hereafter provided be entitled to
receive, and may give a discharge for any dividends, bonuses or other moneys
payable in respect of the share/debenture.
71. Article 70 shall
not prejudice the provisions of Articles 44 and 55.
Refusal to register nominee
72. The Directors shall
have the same right to refuse on legal ground to register a person entitled by
transmission to any shares or his nominee as if he were the transferee named in
an ordinary transfer presented for registration.
Directors may require evidence of transmission
73. Every transmission
of a share shall be verified in such manner as the Directors may require, and
the Company may refuse to register any such transmission until the same be so
verified or until or unless an indemnity be given to the Company with regard to
such registration which the Directors at their discretion shall consider
sufficient, provided nevertheless that there shall not be any obligation on the
Company or the Directors to accept any indemnity.
No fee on Transfer or Transmission
74. No fee shall be
charged for registration of transfer, transmission, Probate, Succession
Certificate and Letters or administration, Certificate of Death or Marriage,
Power of Attorney or similar other document.
The Company not liable for disregard of a notice prohibiting
registration of transfer
75. The Company shall
incur no liability or responsibility whatsoever in consequence of its
registering or giving effect to any transfer of shares made or purporting to be
made by any apparent legal owner thereof (as shown or appearing in the Register
of members) to the prejudice of persons having or claiming any equitable right,
title or interest to or in the said shares, notwithstanding that the Company
may have had notice of such equitable right, title or interest or notice
prohibiting registration of such transfer and the Company shall not be bound or
required to regard or attend or give effect to any notice which may be given to
it of any equitable right, title or interest or be under any liability
whatsoever for refusing or neglecting so to do, though it may have been entered
or referred to in some book of the Company, but the Company shall nevertheless
be at liberty to regard and attend to any such notice and give effect thereto
if the Directors shall so think fit.
76. The provisions of
these Articles shall mutatis mutandis apply to the transfer or transmission by
operation of law, of debentures of the Company.
BORROWING POWERS
Restriction on powers of the Board
78. The Board of
Directors shall not, except with the consent of the Company in general meeting
and subject to Article 172 of the Articles of Association of the Company :
(a) sell, lease or
otherwise dispose of the whole or substantially the whole, of the undertaking
of the Company, or where the Company owns more than one undertaking of the
whole, or substantially the whole, of any such undertaking.
(b) remit, or give
time for the repayment of any debt due by a Director.
(c) invest, otherwise
than in trust securities the amount of compensation received by the Company in
respect of the compulsory acquisition alter the commencement of this Act, of
any such undertaking as is referred to inclause (a) or of any premises or
properties used for any such undertaking and without which it can not be
carried on or can be carried on only with difficulty or only after a
considerable time.
(d) borrow monies
where the moneys to be borrowed, together with the moneys already borrowed by
the Company (apart from temporary loans obtained from the Company's bankers in
the ordinary course of business) will exceed the aggregate of the paid-up
capital of the Company and its free reserves, that is to say, reserves not set
apart for any specific purpose.
(e) contribute, to
charitable and other funds not directly relating to the business of the Company
or the welfare of its employees, any amount the aggregate of which will, in any
financial year, exceed fifty thousand rupees or five percent, of its average
net profits as determined in accordance with the provision of Sections 349 and
350 of the Act during the three financial years immediately preceding,
whichever is greater.
Explanation : Every
resolution passed by the Company in general meeting in relation to the exercise
of the power referred to in clause (d) or in clause (e) shall specify the total
amount upto which money may be borrowed by the Board of Directors under
clause (d) or as the case may be, the
total amount which may be contributed to charitable and other funds in any
financial year under clause (e).
Conditions on which money may be borrowed
79. The Directors may
raise and secure the payment of such sum or sums in such manner and upon such
terms and conditions in all respects as they think fit, and in particular by
the issue of bonds, perpetual or redeemable, debenture or debenture stocks or
any mortgage or charge or other security on the undertaking of the whole or any
part of the property of the Company (both present and future including its
uncalled capital for the time being.
Bonds, debentures etc. to be subject to the control of directors
80. Any bonds,
debentures, debenture stocks or other securities issued or to be issued or to
be issued by the Company shall be under the control of the Directors who may
issue them upon such terms and conditions and in such manner and for such
consideration as they shall consider to be for the benefit of the Company.
Provided that bonds, debentures, debenture stock or other securities
so issued or to be issued by the Company with the right to allotment of or
conversion into shares shall not be issued except with the sanction of the
Company in general meeting by a special resolution.
Securities may be assignable free from equities
81. Debentures,
debenture stocks, or other securities may be issued, subject to the provisions
of the Act, at a discount premium or otherwise and with any special privileges
as to redemption, surrender, drawings, appointment of Directors and otherwise
and subject to the following :
Debentures with voting rights not to be issued
(a) The Company shall
not issued any debentures carrying voting rights at any meeting of the Company
whether generally or in respect of particular classes of business.
(b) The Company shall
have power to reissue redeemed debentures in certain cases in accordance with
Section 121 of the Act.
(c) Payments of
certain debts out of assets subject to floating charge in priority to claims
under the charge may be made in accordance with the provisions of Section 123
of the Act
(d) Certain charges
mentioned in Section 125 of the Act shall be void against the liquidators or
creditors unless registered as provided in section 125 of the Act.
(e) The term `charge'
shall include mortgage in these Articles.
(f) A contract with
the Company to take up and pay for any debentures of the Company may be
enforced by a decree for specific performance.
Limitation of time for issue of certificate
(g) The Company shall,
within three months after the allotment of any of its debentures or debenture
stock, and within one month after the application for the registration of the
transfer of any such debenture or debenture stocks have complete and have ready
for delivery the Certificate of all the debentures and the Certificates of all
debenture stocks allotted or transferred unless the conditions of issue of the
debentures or debenture stocks otherwise provide. The expression `transfer' for
the purpose of this clause means a transfer duly stamped and otherwise valid
and does not include any transfer which the Company is for any reason entitled
to refuse to register and does not register.
Right to obtain copies of and inspect Trust Deed
(h) (i) A copy of any Trust Deed for securing
any issue of debentures shall be forwarded to the holder of any such debentures
or any member of the Company at his request and within seven days of the making
thereof on payment.
(1) In the case of printed Trust Deed of the
sum of Rupee One and
(2) in the case of a Trust Deed which has
not been printed of thirty seven paise for every one hundred words or
fractional part thereof required to be copied.
(ii) The Trust Deed referred to in item (i)
above shall also be open to inspection by any member or debenture holder of the
Company in the same manner, to the same extent, and on payment of the same
fees, as if it were the Register of members of the Company.
Mortgage of uncalled capital
83. If any uncalled
capital of the Company is included in or charged by any mortgage or other
security the Directors shall, subject to the provisions of the Act and these
Articles, make calls on the members in respects of such uncalled capital in
trust for the person in whose favour such mortgage or security is executed.
Indemnity may be given
84. If the Directors or
any of them or any other person shall become personally liable for the payment
of any sum primarily due from the Company, the Directors may execute or cause
to be executed any mortgage charge or security over or affecting the whole or
any part of the assets of the Company by way of indemnity to secure the
Directors or person so becoming liable as aforesaid from any loss in respect of
such liability.
Registration of Charges
85. (a) The provisions of the Act relating to
registration of charges shall be complied with.
(b) In the case of a charge created out of
India and comprising solely property situated outside India, the provisions of
Section 125 of the Act shall also be complied with.
(c) Where a charge is created in India but
comprises property outside India, the instrument creating or purporting to
create the charge under Section 125 of the Act or a copy thereof verified in
the prescribed manner, may be filed for registration, notwithstanding that further
proceedings may be necessary to make the charge valid or effectual according to
the law of the country in which the property is situate, as provided by section
125 of the Act.
(d) Where any charge on any property of the
Company required to be registered under Section 125 of the Act has been so
registered any person acquiring such property or any part thereof or any share
or interest therein shall be deemed to have notice of the charge as from the
date of such registration.
(e) In respect of registration of charges on
properties acquired subject to charge, the provisions of Section 127 of the Act
shall be complied with.
(f) The Company shall comply with the
provisions of Section 128 of the Act relating to particulars in case of series
of debentures entitling holders pari passu.
(g) The Company shall comply with the
provisions of Section 129 of the Act in regard to registration of particulars
of commission, allowance or discount paid or made, directly or indirectly, in
connection with the debentures.
(h) The provisions of Section 133 of the Act
as to endorsement of Certificate of registration on debenture or Certificate of
debenture stock shall be complied with by the Company.
(i) The Company shall comply with the
provisions of Section 134 of the Act as regards registration of particulars of
every charge and a every series of debentures.
(j) As to modification of charges, the
Company shall comply with the provisions of Section 135 of the Act.
(k) The Company shall comply with the
provisions of Section 136 of the Act regarding keeping a copy of instrument
creating charge at the registered officer of the Company and comply with the
provisions of Section 137 of the Act in regard to entering in the register of
charges any appointment of Receiver or Manager as therein provided.
(l) The Company shall also comply with the
provisions of Section 138 of the Act as to reporting satisfaction of any charge
and procedure thereafter.
(m) The Company shall keep at its registered
office a Register of charges and enter therein all charges specifically
affecting any property of the Company and all floating charges on the
undertaking or on any property of the Company giving in each case :
(i) a short description of the property
charged;
(ii) the amount of the charge; and
(iii) except in the case of securities to
bearer, the names of persons entitled to the charge.
(n) Any creditor or member of the Company
and any other person shall have the right to inspect copies of instruments
creating charges and the Company's Register of charges in accordance with and
subject to the provisions of Section 144 of the Act.
Trust not recognised
86. No notice of any
trust, express or implied or constructive, shall be entered on the Register of
Debenture holders.
CONVERSION OF SHARES INTO STOCK AND RECOVERSION
Shares may be converted into stock
91. The Company in
general meeting may convert any paid up shares into stock and when any shares
shall have been converted into stock, the several holders of such stock may
thenceforth transfer their respective interest therein or part of such
interest, in the same manner and subject to the same regulations as, and
subject to which shares from which the stock arise might have been transferred,
if no such conversion had taken place, or as near thereto as circumstances will
admit. The Company may at any time reconvert any stock into paid up shares of
any denomination.
Rights of Stock holders
92. The holders of
stock shall, according to the amount of stock, held by them have the same
right, privileges and advantages as regards dividend, voting at meeting of the
Company and other matters, as if they held the share from which the stock
arose, but no such privilege or advantage (except participation in the
dividends and profits of the Company and the assets on winding up) shall be
conferred by an amount of stock which would not if existing in shares, have
conferred that privilege or advantage.
BOARD OF DIRECTORS
127. Unless otherwise
determined by the Company in General Meeting the number of Directors shall not
be less than three and not more than twelve.
The present Directors of the Company are :
1. Mr. Sanjaybhai T. Patel.
2. Mr. Pravinbhai P. Patel.
3. Mr. Bhikhabhai P. Patel.
4. Mrs. Hiraben P.
Patel.
5. Sheetal S. Patel.
Appointment of senior Executives as Wholetime Directors
128. (a) Subject to the provisions of the Act and
within the overall limit prescribed under these Articles for the number of
Directors on the Board, the Board may appoint any Senior executive of the
Company as a Wholetime Director of the Company for such period and upon such
terms and conditions as the Board may decide. The Senior Executive so appointed
shall be governed by the following provisions:
(i) He shall be liable to retire by
rotation as provided in the Act but shall be eligible for reappointment. His
reappointment as a Director shall not constitute a break in his appointment as
Wholetime Director.
(ii) He shall be reckoned as Director for the
purpose of determining and fixing the number of Directors to retire by
rotation.
(iii) He shall cease to be a Director of the
Company on the happening of any event specified in Sections 283 and 314(2C) of
the Act. He shall cease to be a Director of the Company, if for any reason
whatsoever, he cease to hold the position of Senior Executive in the Company or
cease to be in the employment of the Company.
(iv) Subject to what is stated hereinabove he
shall carry out and perform all such duties and responsibilities as may, from
time to time, be conferred upon or
entrusted to him by the Managing Director/s and/or the Board, shall exercise
such powers and authorities subject to such restrictions and conditions and/or
stipulations as the Managing Director/s and or/ the Board may, from time to
time determine.
(b) Nothing contained
in this Article shall be deemed to restrict or prevent the right of the Board
to revoke, withdraw, alter, vary or modify all or any of such powers,
authorities, duties and responsibilities
conferred upon or vested in or entrusted to such wholetime directors.
Debenture Director
129. Any Trust Deed for
securing debentures or debenture stocks, may, if so arranged, provide for the
appointment, from time to time by the trustees thereof or by the holders of
debentures or debenture stocks, of some person or persons to be a Director or
Directors of the Company and ma empower such Trustees or holders of debentures
or debenture stocks from time to time, to remove and reappoint any "
Debenture Director" and the term "Debenture Director" means the
Director for the time being in office under the Article. The Debenture
Director(s) shall not be bound to hold any qualification shares and shall not
be liable to retire by rotation or be removed by the Company. The Trust Deed
may contain such ancillary provisions as may be arranged between the Company
and the Trustees and all such provisions shall have effect notwithstanding any
of the other provisions herein contained.
Nominee Director
130. Notwithstanding
anything to the contrary contained in these Articles, so long as any moneys
remain owing by the Company to the Industrial Development Bank of India (IDBI), The Industrial credit
and Investment Corporation of India Ltd. (ICICI), Industrial Finance Corporation
of India (IFCI) and Life Insurance Corporation of India (LIC) or to any other
Finance Corporation or Credit Corporation or to any other Finance Company or
Body out of any loans granted by them to the company or so long as IDBI, IFCI,
ICICI, LIC and Unit Trust of India (UTI) or any other Financing Corporation or
credit Corporation or any other Financing Company or Body (each of which IDBI,
IFCI, ICICI, LIC and UTI or any other Finance Corporation or Credit Corporation
or any other Financing Company or Body is hereinafter in this Article referred
to as "the Corporation") continue to hold debentures in the Company
as a result of underwriting or by direct subscription or private placement, or
so long as the Corporation holds shares in the Company as a result of
underwriting or direct subscription or so long as any liability of the Company
arising out of any guarantee furnished by the Corporation on behalf of the
Company remains outstanding, the corporation shall have a right to appoint from
time to time any person or persons as a Director or Directors Wholetime or non-
wholetime (which Director or Directors is/ are hereinafter referred to as
" Nominal Director/s") on the Board of the Company and to remove from
such office any person or persons so appointed and to appoint any person or
persons in his or their place/s.
The Board of Directors of the Company shall have no power to
remove from the office the nominee Director/s. At the option of the Corporation
such Nominee Director/s shall not be required to hold any share qualification
in the Company. Also at the option of the Corporation such Nominee Director/s
shall not be liable to retirement by rotation of Directors. Subject as
aforesaid, the Nominee Director/s shall be entitled to the same rights,
privileges, and be subject to the same obligations as any other Director of the
Company.
The Nominee Director/s so appointed shall hold the said office
only so long as any money remain owing by the Company to the Corporation or so
long as the Corporation holds debentures in the Company as a result of direct
subscription or private placement or so long as the Corporation holds shares in
the Company as a result of underwriting or direct subscription or the liability
of the Company arising out of any guarantee is outstanding and the Nominee
Director/s so appointed in exercise of the said power shall ipso facto vacate
such office immediately the moneys owing by the Company to the corporation is
paid off or on the Corporation ceasing to hold debentures/ shares in the Company
or on the satisfaction of the liability of the Company arising out of any
guarantee furnished by the corporation.
The Nominee Director/s appointed under this Article shall be
entitled to receive all notices of and attend all General Meetings, Board
Meetings and of the Meetings of the Committee of which the Nominee Director's
is/are member/s as also the minutes of such meetings. The Corporation shall
also be entitled to receive all such notices and minutes. The Company shall pay
to the Nominee Director/s sitting fees and expenses which the other Directors
of the Company are entitled but if any other fees, commission, monies or
remuneration in any form is payable to the Directors of the Company, the fees,
commission, monies and remuneration in relation to such Nominee Director/s
shall accrue to the corporation and same shall accordingly be paid by the
Company directly to the Corporation. Any expenses that may be incurred by the
Corporation or by such Nominee Director/s in connection with their appointment
or Directorship, shall also be paid or reimbursed by the Company to the
corporation or as the case may be to such Nominee Director/s.
Provided that if any such Nominee Director/s is an officer of the
Corporation the sitting fee in relation to such Nominee Director/s shall also
accrue to the Corporation and the same shall accordingly be paid by the Company
directly to the Corporation.
Provided further that if such Nominee Director/s is an officer of
the Reserve Bank of India the sitting fees in relation to such Nominee
Director/s shall also accrue to IDBI and the same shall accordingly be paid by
the Company directly to IDBI.
Provided also that in the event of the Nominee Director/s being
appointed as Wholetime Director/s such Nominee Director/s shall exercise such
powers and duties as may be approved by the Lenders and have such rights as are
usually exercised or available to a wholetime Director, in the management of
the affairs of the Borrower. Such Nominee Director/s shall be entitled to
receive such remuneration, fees, commission and monies as may be approved by
the Lenders.
Special Director
131. (a) In connection with any collaboration
arrangement with any Company or corporation or firm or person for supply of
technical know-how and/or machinery or technical advice, the Directors may
authorise such Company, corporation, firm or person (hereinafter in this clause
referred to as "Collaborator") to appoint from time to time any
person or persons as Director or Directors of the Company (hereinafter referred
to as "Special Director") and may agree that such Special Director
shall not be liable to retire by rotation and need not possess any
qualification shares hold office so long as such collaboration arrangement
remains in force unless otherwise agreed upon between the Company and such
Collaborator under the collaboration arrangements or at any time thereafter.
(b) The collaborator
may at any time and from time to time remove any such Special Director appointed
by it and may at the time of such removal and also in the case of death or
resignation of the person so appointed, at any time, appoint any other person
as a Special Director in his place and such appointment or removal shall be
made in writing signed by such Company or corporation or any partner or such
person and shall be delivered to the Company at its registered office.
(c) It is clarified
that every collaborator entitled to appoint a Director under this Article may
appoint one or more such person or persons as a Director(s) and so that if more than one Collaborator is so entitled
there may at any time be as many Special Directors as the Collaborators
eligible to make the appointment.
132. Subject to the
provisions of Section 255 of the Act, the number of Directors appointed under
Articles 130 and 131 shall not exceed in the aggregate one-third of the total
number of Directors for the time being in office.
Appointment of Alternate Director
133. (a) The Board of Directors of the Company
may appoint an alternate Director to act for a Director (hereinafter in this
Article called "the Original Director") during his absence for a
period of not less than three months from the state in which meetings of the
Board are ordinarily held.
(b) An alternate
Director appointed under this Article shall not hold office as such for a
period longer than that permissible to the Original Director in whose place he
has been appointed and shall vacate office if and when the original Director
returns to the State in which meeting of the Board are ordinarily held.
(c) If the term of
office of the original director is determined before he returns to the state
aforesaid any provisions for the automatic reappointment of retiring Directors
in default of another appointment shall apply to the original and not to the
alternate director.
Appointment of additional Directors
134. Subject to the
provisions of Section 260 of the Act , the Board of Directors shall have power
at any time to appoint any person as an additional Director to the Board , but
so that the total number of Directors shall not exceed the maximum number fixed
by these Articles. Any Director so appointed shall hold the office only upto
the next annual general meeting of the Company and shall then be eligible for
re-election.
Appointment of Director to fill the casual vacancy
135. (a) Subject to the provisions of Section 262
of the Act, if the office of any Director appointed by the Company in general
meeting is vacated before his term of office expires in the normal course, the
resulting casual vacancy may in default of and subject to any regulation in the
Articles of the Company be filled by the Board of Directors at the meeting of
the Board and the Directors so appointed
shall be hold office only upto the date upto which the Director in whose
place he is appointed would have held office if it had not been vacated as
aforesaid but he shall then be eligible for re-election.
Individual Resolution for Directors appointment.
(b) At a general
meeting of the Company a motion shall not be made for the appointment of two or
more persons as Director of the Company by a single resolution unless a
resolution that it shall be so made has first been agreed to by the meeting
without any vote being given against it. Resolution moved in contravention of
this Article shall be void whether or not objection was taken at the time of
its being so moved. Provided that where a resolution so moved is passed no
provision for the automatic reappointment of retiring director by virtue of
these Articles and the Act in default of another appointment shall apply.
Appointment of Chairman
136. The directors may
from time to time elect among themselves a chairman of the board and determine
the period for which he is to hold office if at any meeting of the Board, the
chairman is not present within fifteen minutes after the time appointed for
holding the same, the directors present may choose one of their members to be
chairman of the meeting.
Qualification of Director
137. A Director need not
hold any shares in the Company to qualify him for the office of a Director of
the Company.
Remuneration of Directors
138. (a) Subject to the provisions of the Act, a
Managing Director or a Director who is in the wholetime employment of the
Company may be paid remuneration either by way of a monthly payment or at a
specified percentage of the net profits of the Company or partly by one way and
partly by the other.
(b) Subject to the provisions of the Act, a
Director, who is neither in the whole time employment nor a Managing Director
may be paid remuneration either :
(i) by way of monthly, quarterly or annual
payment with the approval of the Central Government, or
(ii) by way of commission if the Company by a
special resolution has authorised such payment.
(c) The fee payable to
Directors (other than Managing or Whole time Director, if any) for attending
each meeting of the Board or Committee thereof shall be such sum as may be
prescribed by the Act or the Central Government from time to time.
Travelling and other expenses
139. The board may allow
and pay to any Director for the purpose of attending a meeting such sum either
as fixed allowance and /or actual as the Board may consider fair compensation
for travelling, board and lodging and incidental and /or such actual out of pocket expenses incurred
by such Director in addition to his fees, for attending such meeting to and
from the place at which the meetings of the board or committees thereof or
general meetings of the Company are held from time to time or any other place
at which the Director executes his duties.
Remuneration for extra services
140. If any Director,
being willing shall be called upon to perform extra services or to take any
special exertions for any of the purposes of the Company and in the event the
Company may, subject to the provisions of the Act, remunerate such Director
either by a fixed sum or by a percentage of profit or otherwise, as may be
determined by the Directors but not exceeding that permitted under Section 309
of the Act and such remuneration may be either in addition to or in
substitution for his share in the remuneration above provided.
Increase in remuneration of Directors to require Government
sanction
141. (a) Any provision relating to the
remuneration of any director including a Managing or Joint Managing or
Wholetime Director or any amendment thereof, which purports to increase or has
the effect of increasing, whether directly or indirectly, the amount thereof, whether
that provision is contained in the company's Memorandum or there Articles, or
in an agreement entered into by it, or any resolution, passed by the Company in
general meeting or by the Board of Directors, shall not have any effect unless
approved by the Central Government and the amendment shall become void if, and
in so far as, it is disapproved by the Government.
Increase in remuneration of Managing Director on re-appointment or
appointment
(b) If the terms of
any re-appointment of a Managing or Joint Managing or Wholetime Director,
purport to increase or have the effect of increasing, whether directly or
indirectly, the remuneration which the Managing or Joint Managing or Wholetime
Director, as the case may be was receiving immediately before such re-appointment
or appointment shall not have any effect unless approved by the central
government, and shall become void if, and in so far as, it is disapproved by
the Government.
Directors not to act when number fall below minimum
142. When the number of Directors
in office falls below the minimum above fixed, the Directors, shall not act
except in emergencies or for the purpose of filling up vacancies or for
summoning a general meeting of the Company and so long as the number is below
the minimum they may so act
notwithstanding the absence of the necessary quorum.
Eligibility
143. A person shall not
be capable of being appointed a Director if he has the disqualifications
referred to in Section 274 of the Act.
Directors vacating office
144. (a) The office of a Director shall become
vacant if :
(i) he is found to be of unsound mind by a
Court of competent jurisdiction.
(ii) he applies to be adjudicated an
insolvent;
(iii) he is adjudged an insolvent;
(iv) he is convicted by a Court, of any offence
involving moral turpitude and sentenced in respect thereof to imprisonment for
not less than six months;
(v) he fails to pay any call in respect of
shares of the Company held by him, whether alone or jointly with others, within
six months from the last date fixed for the payment of the call unless the
central government by Notification in the Official Gazette removes the
disqualification incurred by such failure.
(vi) he absents himself from three consecutive
meetings of the Board of Directors, or from all meetings of the Board of
Directors for a continuous period of three months, whichever is longer, without
obtaining leave of absence from the board;
(vii) he, whether by himself or by any person
for his benefit or on his account or any firm in which he is a partner or any
private Company of which he is a director, accepts a loan or any guarantee or
security for a loan, from the Company in contravention of Section 295 of the
Act.
(viii) he acts in contravention of Section 299 of
the Act;
(ix) he becomes disqualified by an order of
court under Section 203 of the Act;
(x) he is removed in pursuance of Section
284 of the Act;
(xi) having been appointed a Director by
virtue of his holding any office or other employment in the Company , he ceases
to hold such office or other employment in the Company;
(xii) he resigns his office by notice in writing
given to the Company.
(b) Notwithstanding
anything in sub-clauses (iii), (iv) and (v) of clause (a) above, the
disqualifications referred to in these sub-clauses shall not take effect;
(i) for thirty days from the date of the
adjudication, sentence or order;
(ii) where any appeal or petition is
preferred within the thirty days aforesaid against the adjudication, sentence
or conviction resulting in the sentence or order until the expiry of seven days
from the date on which such appeal or petition is disposed off, or
(iii) where within the seven days aforesaid,
any further appeal, or petition is preferred in respect of the adjudication, sentence,
conviction or order and the appeal or petition, if allowed, would result in the
removal of the disqualification, until such further appeal or petition is
disposed off.
Removal of Directors
145. (a) The Company may (subject to the
provisions of Section 284 and other applicable provisions of the Act and these
Articles) remove any director other than ex-officio directors or special
directors or debenture directors or a nominee director or a director appointed
by the Central Government in pursuance of Section 408 of the Act, before the
expiry of his period of office.
(b) Special notice as provided by Section
190 of the Act shall be required of any resolution to remove a Director under
this Article or to appoint some other person in place of a Director so removed
at the meeting at which he is removed.
(c) On receipt of notice of a resolution to
remove a Director under this Article, the Company shall forthwith send a copy
thereof to the Director concerned and the Director (whether or not he is a member
of the Company) shall be entitled to be heard on the resolution at the meeting.
(d) Where notice is given of a resolution to
remove a Director under this Article and the Director concerned makes with
respect thereto representations in writing to the Company ( not exceeding a
reasonable length) and requests their notification to members of the Company,
the Company shall unless the representations are received by it too late for it
do so.
(i) in the notice of the resolution given
to Members of the Company state the fact of the representation having been
made, and
(ii) send a copy of the representation to
every member of the company to whom notice of the Meeting is sent (whether
before or after receipt of the representations by the Company) and if a copy of
the representations, is not sent as aforesaid because they were received too
late or because of the Company's default, the Director may (without prejudice
to his right to be heard orally) require that the representations need not be
sent or read out at the meeting if so directed by the Court.
(e) A vacancy created
by the removal of a Director under this Article may, if he had been appointed
in pursuance of Section 262 of the Act be filled by the appointment of another
Director in his stead by the Meeting at which he is removed, provided special
notice of the intended appointment has been given under Clause (b) hereof. A
Director so appointed shall hold office until the date upto which his
predecessor would have held office if he had not been removed as aforesaid.
(f) If the vacancy is
not filled under Clause (e), it may be filled as a casual vacancy in accordance
with the provisions, in so far as they may be applicable, of Section 262 of the
Act, and all the provisions of that Section shall apply accordingly.
Provided that the Director who was removed from office under this
Article shall not be re-appointed as a Director by the Board of Directors.
(g) Noting contained
in this Article shall be taken :
(i) as depriving a person removed
thereunder of any compensation or damages payable to him in respect of the
termination of his appointment as Director or of any appointment terminating
with that as Director; or
(ii) as derogating from any power to remove a
Director which may exist apart from this Article.
Directors may contract with Company
146. (a) Subject to the restrictions imposed by
these Articles and by Sections 292, 293, 294, 295, 297, 300, 311, 370 and 373
and any other provisions of the Act, no Director, Managing Director or other
Officer or Employee of the Company shall be disqualified from holding his
office by contracting with the Company either as vendor, purchaser, agent,
broker or otherwise, not shall any such contract or arrangement entered into by
or on behalf of the Company in which any Director, Managing Director, Joint
Managing Director, Executive Director, Other Officer or Employee shall be in
any way interested, be avoided, not shall the Director, Managing Director or
any Officer or Employee so contracting or being so interested be liable to
account to the Company for any profit realised by any such contract or
arrangement by reason only of such Director, Managing Director, Officer or
Employee holding that office or of the
fiduciary relation thereby established, but the nature of his or their interest
must be disclosed by him or them in accordance with the provisions of Section
299 of the Act where that section be applicable.
(b) In accordance with Section 300 of the
Act, no Director shall, as a Director, vote or take part in any discussion in
respect of any contract or arrangement in which he is interested and if he does
so vote, his vote shall be void nor shall his presence count for the purpose of
forming the quorum at the time of any such discussion or vote.
Provided that the above prohibition or restriction shall not apply
to the extent or under the circumstances mentioned in Sub-section (2) of
Section 300 of the Act.
(c) A General Notice such as is referred to
in Sub-section (3) of Section 299 of the Act shall be sufficient disclosure
under this Article as provided in that Section.
Directors may be directors of companies promoted by the Company
147. A Director, Managing
Director, Officer or Employee of the Company may be, or become a Director, of
any Company promoted by the Company or in which it may be interested as a
vendor, member or otherwise and no such Director shall be accountable for any
benefits received as Director or member of such Company except to the extent
and under the circumstances as may be provided in the Act.
Duty of Directors etc. to make disclosure
148. (a) Every Director (including a person
deemed to be a Director by virtue of the explanation to sub-section (1) of
Section 303 of the Act), Managing Director or Secretary of the Company, who is
appointed to or relinquishes the office of Director, Managing Director, Manager
or Secretary of any other body corporate shall, within twenty days of his
appointment or relinquishment of such office, as the case may be, disclose to
the Company aforesaid the particulars relating to the office in the other body
corporate which are required to be specified under sub-section (1) of Section
303 of the Act.
(b) Every Director of the Company and every
person deemed to be a Director of the Company by virtue of sub-section (10) of
Section 307 of the Act and every other person referred to in sub-section (11)
of Section 307 of the Act, shall give notice to the Company of such matters as
may be necessary for the purpose of enabling the Company to comply with the
provisions of that Section and Section 308 of the Act.
Directors etc. not to hold office or place of profit
149. The provisions of
Section 314 of the Act shall be complied with when applicable in regard to
holding of office or place of profit under the Company or under any subsidiary
of the Company by any person mentioned in the said section. The words office or
place of profit shall have the meaning assigned to them by Section 314 of the
Act.
Loans to Directors
150. The Company shall
observe the restrictions imposed on the Company in regard to granting of Loans
to Directors and other persons as provided in Section 295 and other applicable
provisions.
Appointment of Sole Selling Agents
151. (a) The appointment, re-appointment and
extension of the term of a Sole Selling Agent, shall be regulated in accordance
with the provisions of Section 294 of the Act and any rules or Notifications
issued by competent authority in accordance with the section and the Directors
and/or the Company in General Meeting may make the appointment, re-appointment
or extension of the term of office in accordance with and subject to the
provisions of the said Section and such Rules or Notification, if any as may be
applicable.
(b) The payment of any compensation to a
Sole Selling Agent shall be subject to the provisions under Section 294-A of
the Act.
Board resolution at a meeting necessary for certain contract
152. (a) Except with the consent of the Board of
Directors of the Company and with the previous approval of the Central
Government a Director of the Company of his relative, a firm in which such a
Director or relative is a partner, any other partner in such a firm, or a
private company of which the Director is a member or director, shall not enter
into any contract with the Company;
(i) for the sale, purchase or supply of any
goods, materials or service, or
(ii) for underwriting the subscription of any
shares in, or debentures of the Company.
(b) Nothing contained in the foregoing
sub-clause (a) shall affect :
(i) the purchase of goods and materials
from the Company of the sale of goods and materials to the Company, by any
Director, relative, firm, partner or private Company as aforesaid for cash at
prevailing market prices; or
(ii) any contract or contracts between the
Company on one side and any such Director, relative, firm, partner or private
Company on other side for sale, purchase, or supply of any goods, materials and
services in which either the Company or the Director, relative, firm, partner
or private Company as the case may be, regularly trades or does business.
Provided that such contract or contracts do not relate to goods
and materials the value of which, or service cost of which, exceeds five
thousand rupees in the aggregate in any year comprised in the period of the
contract or contracts.
(c) Notwithstanding
anything contained in the foregoing sub-clause(a) and (b) a Director, relative,
firm, partner of private Company as aforesaid, may in circumstances of urgent
necessity, enter, without obtaining the consent of the Board, into any contract
with the Company for the sale, purchase or supply of any goods, materials or
services even if the value of such goods, materials or services exceeds five
thousand rupees in the aggregate in any year comprised in the period of the
contract; but in such a case, the consent of the Board shall be obtained at a
meeting within three months of the date on which the contract was entered into.
(d) Every consent of
the Board required under this clause shall be accorded by a resolution passed
at a meeting of the Board and not otherwise; and the consent of the Board
required under sub-clause (a) above shall not be deemed to have been given
within the meaning of that sub-clause unless the consent is accorded before the
contract is entered into or within three months of the date on which it was
entered into.
(e) If consent is not
accorded to any contract under this clause, anything done in pursuance of the
contract shall be avoidable at the option of the Board.
(f) The directors, so
contracting or being so interested shall not be liable to the Company for any
profit realised by any such contract or fiduciary relation thereby established.
(g) The Company shall
also comply with such other provision of Section 297 of the Act, as may be
applicable.
POWERS OF DIRECTORS
Certain powers to be exercised by the Board only at meeting
170. (a) Without derogating form the powers
vested in the Board of Directors under these Articles, the Board shall exercise
the following powers on behalf of the Company and they shall do so only by
means of resolutions passed at meetings of the Board.
(i) The power to make calls on shareholders
in respect of money unpaid on their shares;
(ii) The power to
issue debenture;
(iii) The power to
borrow moneys otherwise than on debentures;
(iv) The power to
invest the funds of the Company, and
(v) The power to make loans.
Provided that the Board may be resolution passed at the meeting,
delegate to any Committee of Directors, the Managing Director, the Manager or
any other principal officer of the Company or in the case of a branch office,
the powers specified in sub-clauses (iii), (iv) and (v) to the extent specified
in clauses (b), (c) and (d) respectively on such condition as the Board may
prescribe.
(b) Every resolution
delegating the power referred to in sub-clause (iii) of clause (a) shall
specify the total amount outstanding at any one time upto which moneys may be
borrowed by the delegate.
(c ) Every resolution delegating
the power referred to in sub-clause (iv) of clause (a) shall specify the total
amount upto which the funds of the company may be invested and the nature of
the investments which may be made by the delegate.
(d) Every resolution
delegating the power referred to in sub-clause (v) of clause (a) shall specify
the total amount upto which loans may be made by the delegates, the purpose for
which the loans may be made and the maximum amount upto which loans may be made
for each such purpose in individual cases.
(e) Nothing in this
Article shall be deemed to affect the right of the Company in general meeting
to impose restrictions and conditions on the exercise by the Board of any of
the powers referred to in sub-clauses (i), (ii), (iii), (iv), and (v) of clause
(a) above.
Restriction of Power of Board
171. (a) The Board
of Directors of the Company shall not except with the consent of the Company in
general meeting :
(i) sell, lease or otherwise dispose of the
whole, or substantially the whole, of the undertaking of the Company, or where
the Company owns more than one undertaking of the whole or substantially the
whole of any such undertaking;
(ii) remit, or give time for the repayment of
any debt, due by a Director;
(iii) invest, otherwise than in trust
securities, the amount of compensation received by the Company in respect of
the compulsory acquisition of any such undertaking as is referred to in
sub-clause (i) above, or of any premises or properties used for any such
undertaking and without which is cannot be carried on or can be carried on only
with difficulty or only after a considerable time;
(iv) borrow moneys, where the money to be
borrowed, together with the moneys already borrowed by the Company (apart from
the temporary loans obtained from the Company's bankers in the ordinary course
of business) will exceed the aggregate of the paid-up capital of the Company
and its free reserves that is to say, reserves not set apart for any specific
purpose; or
(v) contribute
to charitable and other funds not directly relating to the business of the
Company or the welfare of its employees any amounts the aggregate of which will
in any financial year, exceed fifty thousand rupees or five percent of its
average net profits as determined in accordance with the provisions of Sections
349 and 350 of the Act during the three financial years, immediately
proceeding, whichever is greater.
(b) Nothing contained
in sub-clause (a) above shall affect :
(i) the title of a buyer
or other person who buys or takes a lease of any such undertaking as is
referred to in that sub-clause in good faith and after exercising due care and
caution, or
(ii) the selling or
leasing of any property of the Company where the ordinary business of the
Company consists of, or comprises such selling or leasing.
(c) Any resolution
passed by the Company permitting any transaction such as is referred to in
sub-clause (a) (i) above, may attach such conditions to the permission as may
be specified in the resolution, including conditions regarding the use,
disposal or investment of the sale proceeds which may result form the
transaction. Provided that this clause shall not be deemed to authorize the
Company to effect any reduction in its capital except in accordance with the
provisions contained in that behalf in the Act.
(d) No debt incurred
by the Company in excess of the limit imposed by sub-clause (iv) of clause (a)
above, shall be valid or effectual, unless the lender proves that he advanced
the loan in good faith and without knowledge that the limit imposed by that
clause had been exceeded.
Prohibition regarding making of political contributions
A. Due regard and compliance shall be observed in regard to
matters dealt with by or in the Explanation contained in sub-section (1) of
Section 293 of the Act and in regard to the limitations on the power of the
Company contained in Section 293A of the Act.
General powers of the Company vested in Directors
172. Subject to the
provisions of the Act, the management of the business of the Company shall be
vested in the Directors and the Directors may exercise all such powers and do
all such acts and things as the Company is by the Memorandum of Association or
otherwise authorized to exercised and do and not hereby or by the statute or
otherwise directed or required to be exercised or done by the Company in
General Meeting, but subject nevertheless to the provisions of the Act, and
other Act, and of the Memorandum of
Articles and to any regulations, not being inconsistent with the Memorandum of
Association and these Articles or the Act, from time to time made by the
company in general meeting provided that no such regulation shall invalidate
any prior act of the Directors which would have been valid if such regulation
had not been made.
Specific powers given to Directors
173. Without prejudice to
the general powers conferred by Article 172 and the other powers conferred by
these presents and so as not in any way to limit any or all of those powers, if
is hereby expressly declared that the Directors shall have the following
powers:
To pay registration expenses
I. to pay the costs, charges and expenses preliminary and
incidental to the promotion, formation, establishment and registration of the
Company;
II. to pay and charge to the capital account of the Company any
interest lawfully payable thereon under the provisions of Sections 76 and 208
of the Act,
To acquire property
(iii) Subject to the
provisions of the Act and these Articles to purchase or otherwise acquire any
lands, buildings, machinery, premises, hereditaments, property effects, assets,
rights, credits, royalties, bounties and goodwill of any person, firm or
Company carrying on the business which this Company is authorized to carry on,
at or for such price or consideration and generally on such terms and
conditions as they may think fit; and in any such purchase or acquisition to
accept such title as the Board may believe or may be advised to be reasonably
satisfactory;
To purchase lands, buildings etc.
(iv) Subject to the
provisions of the Act to purchase, or take on lease for any term or terms of
years, or otherwise acquire any mills of factories or any land or lands, with
or without buildings and thereon, situate in any part of India, at such price
or rent and under and subject to such terms and conditions as the Directors may
think fit; and in any such purchase, lease or other acquisition to accept such
title as the Directors may believe or may be advised to be reasonably satisfactory;
To Construct buildings
(v) To erect,
construct, enlarge, improve, alter, maintain, pull down rebuild or reconstruct
any buildings, factories, offices, workshops or other structures, necessary or
convenient for the purposes of the Company and to acquire lands for the
purposes of the Company;
To mortgage, charge property
(iv) To let, mortgage, charge, sell or
otherwise dispose of subject to the provisions of Section 293 of the Act, any
property of the Company either absolutely or conditionally and in such manner
and upon such terms and conditions in all respects as they think fit and to
accept payment or satisfaction for the same in cash or otherwise, as they may
think fit,
To pay for property etc.
(vii) At their
discretion to pay for any property, rights of privileges acquired by or
services rendered to the Company, either wholly or partially, in cash or in
shares, bonds, debentures, debenture stock or other securities of the Company,
and any such shares may be issued either as fully paid up or with such amount
credited as paid up thereon as may be agreed upon; and any such bonds,
debentures, debenture stock or other securities may be either specifically
charged upon all or any part of the property of the Company and its uncalled
capital or not so charged;
To Insure
(viii) To insure and
keep insured against loss or damage by fire or otherwise, for such period and
to such extent as they may think proper, all or any part of the building,
machinery, goods, stores, produce and other moveable property of the Company
either separately or co-jointly, also to insure all or any portion of the
goods, produce, machinery and other articles imported or exported by the
Company and to sell, assign, surrender or discontinue any polices of assurance
effected in pursuance of this power;
To open accounts
(ix) subject to section
292 of the Act, to open accounts with any bank or bankers or with any Company,
firm, or individual and to pay money into and draw money from any account form
time to time as the Directors may think fit;
To secure contracts
(x) To secure the
fulfillment of any contracts or engagements entered into by the Company by
mortgage or charge of all or any of the properties of the Company and its
unpaid capital for the time being or in such other manner as they may think
fit;
To attach to Shares such conditions
(xi) To attach to any
shares to be issued as the consideration for any contract with or property
acquired by the Company, or in payment for service rendered to the Company,
such conditions, subject to the provisions of the Act, as to the transfer
thereof as they think fit;
To accept surrender, of shares
(xii) To accept from any
member on such terms and condition as shall be agreed, a surrender of his
shares or stock or any part thereof subject to the provisions of the Act;
To appoint trustees
(xiii) To appoint any
person or persons (whether incorporated or not) to accept and hold in trust for
the Company any property belonging to the Company or in which it is interested
or for any other purposes and to execute and do all such deeds and things as
may be requisite in relation to any such trusts and to provide for the
remuneration of such trustee or trustees;
To bring and defend actions
(xiv) To institute,
conduct, defend, compound or abandon any legal proceedings by or against the
company or its Officers or otherwise
concerning the affairs of the company and also subject to the provisions
of Section 293 of the Act to compound and allow time for payment or
satisfaction of any debts due, or of any claims or demands by or against the
company.
To refer to arbitration
I. To refer, subject to the provisions of section 293 of the Act,
any claims or demands by or against the company to arbitration and observe and
perform the awards;
To act on insolvency matters
II. To act on behalf of the company in all matters relating to
bankrupts and insolvents;
To give receipts
III. To make and give receipts, releases and other discharges for
moneys payable to the company and for the claims and demands of the company
subject to the provisions of section 293 of the Act.
To authorise acceptance
IV. To determine from time to time as to who shall be entitled to
sign bills, notes, receipts, acceptances, endorsements, cheques, dividend
warrants, releases, contracts and documents on the company's behalf;
To invest moneys
V. Subject to the provisions of sections 292, 293, 370, 372 of the
Act, invest and deal with any of the moneys of the company, not immediately
required for the purpose thereof, upon such shares, securities, or investments
not being shares in this company) and in such manner as they may think fit, and
form time to time to vary or realize such investments;
To provide for personal liabilities
VI. To execute in the name and on behalf of the company in favour
of any Director or other person who may incur or be about to incur any personal
liability for the benefit of the company, such mortgages of the company's
property (present and future) as they may think fit and any such mortgage may
contain a power of sale and such other powers, covenants and provisions as
shall be agreed upon;
To give to Directors etc. an interest in business
VII. Subject to such sanction as may be necessary under the Act or
these Articles, to give to any Director, Officer, or other person employed by
the company, an interest in any particular business or transaction either by
way of commission on the gross expenditure thereon or otherwise or a share in
the general profits of the company, and such interest, commission or share of
profits shall be treated as part of the working expenses of the company.
To provide for welfare of employees
VIII. To provide for the welfare of employees or ex-employees of
the company and their wives widows, families, dependents or connections of such
persons by building or contributing to the building of houses, dwelling, or
chawls or by grants of money, pensions, allowances, gratuities, bonus or
payments by creating and from time to time subscribing or contributing to
provident and other funds, institutions, or trusts and by providing or
subscribing or contributing towards places of instruction and recreation,
hospitals and dispensaries, medical and other attendances and other assistance
as the Directors shall think fit;
To subscribe to charitable and other funds
IX. To subscribe, or contribute or otherwise to assist or to
guarantee money to charitable, benevolent, religious, scientific, national
public or any other useful institutions, object or purposes for any exhibition;
To maintain pension funds
(xxiv) To establish and
maintain or procure the establishment and maintenance of any contributory or
non-contributory pension or super-annuation funds for the benefit of, and to
give or produce the giving of donations, gratuities, pensions, allowances or
emoluments, to any persons who are or were at any time in the employment or
services of the Company, or for any Company which is a subsidiary of the
Company or is allied to or associated with the Company or with any such
subsidiary Company, or who are or were at any time Directors or Officers of
Company of any such other company as aforesaid, and the wives, widows, families
and dependants of any such persons and also to establish and subsidise and
subscribe to any institutions, associations, clubs or funds collected to be for
the benefit of or to advance the interests and well being of the Company or of
any such other Company as aforesaid, and make payments to or towards the
insurance of any such person as aforesaid and do any of the matters aforesaid,
either alone or in conjunction with any such other Company as aforesaid.
(xxv) To decide and
allocate the expenditure on capital and revenue account either for the year or
period or spread over the hears.
To create Reserve Fund
(xxvi) Before recommending
any dividend, to set a side out of profits of the Company such sums as they may
think proper for depreciation or to Depreciation Fund or Reserve Fund or
Sinking Fund or any other special fund to meet contingencies or to repay
redeemable preference shares, debentures, or debenture stock or for special
dividends or for equalising dividend or for repairing, improving, extending and
maintaining any part of the property of the Company, and for such other
purposes as the Directors may, in their absolute discretion, think conducive to
the interest of the Company and to invest the several sums so set aside or so
much thereof as required to be invested upon such investments (subject to the
restrictions imposed by Sections 292 and 293 and other provisions of the Act) as
the Directors may think fit, and from time to time, to deal with and vary such
investments and dispose of and apply and expend all or any part thereof for the
benefit of the Company in such manner and for such purposes as the Directors
(subject to such restrictions as aforesaid) in their absolute discretion think
conducive to the interests of the Company notwithstanding that the matters to
which the Directors apply or upon which they may expend the same or any part
thereof may be matters to or upon which the Capital moneys of the Company might
rightly be applied or expended; and to divide the Reserve Fund into such
special funds as the Directors think fit, and to emply the assets constituting
all or any of the above funds, including the Depreciation Fund in the business
of the Company or in repayment or redemption or redeemable preference shares,
debentures or debenture stock and that without being bound to keep the same
separate from other assets or to pay interest on the same, with power, however
to the Directors at their discretion, to pay or allow to the credit of such
fund interest at such rate as the Directors may think proper.
To appoint Managers etc.
(xxvii) To appoint and at
their discretion to remove or suspend such Managers, Secretaries, Officers,
Clerks, Agents and Servants for permanent, temporary or special service as they
may from time to time think fit, and to determine, their powers and duties, and
fix their salaries or emolument s and require security in such instances and to
such amounts as they may think fit, and from time to time provide for the
management and transactions of the affairs of the Company in any special
locality in India in such manner as they may think fit. The provisions
contained in the clause following shall be without prejudice to the general
powers conferred by this clause.
To authorise by power of attorney
(xxviii) At any time and
from time to time by power of attorney to appoint any person or persons to be
the Attorney or Attorneys of the Company for such purpose and with such powers,
authorities and discretions (not exceeding those vested in or exercisable by
the Directors under these presents) and for such period and subject to such
conditions as the Directors may from time to time think fit and any such
appointment (if the Directors may think fit) be made in favour of any Company
or the Members, Directors, Nominees or Managers of any Company or Firm or
otherwise in favour of any fluctuating body or person whether nominated,
directly or indirectly by the Directors and any such power of attorney may
contain any such powers for the protection or convenience of persons dealing
with such Attorneys as the Directors may think fit; and may contain powers
enabling any such delegates or Attorneys as aforesaid to sub-delegate all or
any of the powers, authorities, and discretions for the time being vested in
them.
To authorise, delegate
(xxix) Subject to the
provisions of the Act, generally and from time to time and at any time to
authorise, empower or delegate to (with or without powers of sub-delegation)
any Director, Officer or Officers or Employee for the time being of the company
and/or any other person, firm or Company all or any of the powers, authorities
and discretions for the time being vested in the Directors by these presents,
subject to such restrictions and conditions, if any as the Directors may think
proper.
To Negotiate
(xxx) To enter into all
such negotiations, contracts and rescind and/or vary all such contracts and to
execute and do all such acts, deeds, and things in the name of on behalf of the
Company as they may consider expedient for or in relation to any of the matters
aforesaid or otherwise for the purposes of the Company.
MANAGING DIRECTORS
Power to appoint Managing or Wholetime Directors
174. (a) Subject to the provisions of the Act and
of these Articles, the Board shall have power to appoint from time to time any
of its Members as Managing Director or Managing Directors and/or Wholetime
Director and/or Special Director like Technical Director, Financial Director,
etc. of the Company for a fixed term not exceeding five years at a time and
upon such terms and conditions as the Board thinks fit, and the Board may by
resolution vest in such Managing Director or Managing Directors, Wholetime
Director(s), Technical Director(s), Financial Director(s) and Special
Director(s) such of the powers hereby vested in the Board generally as it
thinks fit, and such powers may be made exercisable for such period or periods,
and upon such conditions and subject to such restrictions as it may determine.
The remuneration of such Directors may be by way of monthly remuneration and/or
fee for each meeting and/or participation in profits, or by any or all of those
modes, or of any other mode not expressly prohibited by the Act.
(b) The Directors may
whenever they appoint more than one Managing Director, designate one or more of
them as "Joint Managing Director" or "Joint Managing
Directors" or "Deputy Managing Directors" as the case may be.
Appointment and payment of remuneration to Managing or Wholetime
Director
(c) Subject to the
provisions of Sections 198, 269, 310 and 311 of the Act, the appointment and
payment of remuneration to the above Director shall be subject to approval of
the Members in General Meeting and of the Central Government.
DIVIDENDS
Division of Profits
178. The Profits of the
Company subject to any special rights relating thereto created or authorised to
be created by these presents shall be divisible among the members in proportion
to the amount of capital paid up or credit as paid-up on the shares held by
them, respectively.
Dividend payable to registered holder
179. No dividend shall be
paid by the Company in respect of any share except to the registered holder of
such share or to his order or to his banker.
Time for payment of dividend
180. Where a dividend has
been declared by the Company, it shall be paid within the period provided in
Section 207 of the Act.
Capital paid up in advance and interest not to earn dividend
181. Where the capital is
paid-up in advance of calls upon the footing that the same shall carry
interest, such capital shall not, whilst carrying interest confer a right to
dividend or to participate in profits.
Dividends in proportion to amount paid-up
182. (a) The Company shall pay dividends in
proportion to the amounts paid up or credited as paid up on each share, when a
larger amount is paid up or credited as paid up on some shares than on others.
Nothing in this Article shall be deemed to affect in any manner the operation
of Section 208 of the Act.
(b) Provided always
that any Capital paid-up on a share during the period in respect of which a
dividend is declared, shall unless the terms of issue otherwise provide, only
entitle the holder of such share to an apportioned amount of such dividend
proportionate to the capital from time to time paid during such period on such
share.
Company in Annual General Meeting may declare dividends
183. The Company in
Annual General Meeting may declare a dividend to be paid to the Members
according to their respective rights and interests in the profits and may fix
the time for payment.
Power of Directors to limit dividends
184. No larger dividend
shall be declared than is recommended by the Directors but the Company in
General Meeting may declare a smaller dividend.
Dividends only to be paid out of profits
185. No dividend shall be
declared or paid by the Company otherwise than out of profits of the financial
year arrived at after providing for depreciation in accordance with the
provisions of sub-section (2) of Section 205 of the Act or out of the profits
of the Company for any previous financial year or years arrived at after
providing for depreciation in accordance with these provisions and remaining
undistributed or out of both or out of moneys provided by the Central
Government or a State Government for the payment of dividend in pursuance of
the guarantee given by that Government provided that :
(a) If the Company has
not provided for depreciation for any previous financial year or years, it
shall before declaring or paying a dividend for any financial year, provide for
such depreciation out of the profits of that financial year or out of the
profits of any other previous financial year or years;
(b) If the Company has
incurred any loss in any previous financial year or years the amount of the
loss or any amount which is equal to the amount provided for depreciation for
that year or those years whichever is less, shall be set off against the
profits of the Company for the year for which the dividend is proposed to be
declared or paid or against the profits of the Company for any previous
financial year or years arrived at in both cases after providing for depreciation
in accordance with the provisions of sub-section (2) of Section 205 of the Act
or against both.
Provided further that, no dividend shall be declared or paid for
any financial year out of the profits of the Company for that year arrived at
after providing for depreciation as above, except after the transfer to the
reserves of the Company of such percentage of its profit s for that year as may
be prescribed in accordance with Section 205 of the Act or such higher
percentage of its profits as may be allowed in accordance with that Section.
Nothing contained in this Article shall be deemed to affect in any
manner the operation of Section 208 of the Act.
Directors' declaration as to net profits conclusive
186. The declaration of
the Directors as to the amount of the net profits of the Company shall be
conclusive.
Interim Dividends
187. The Directors may,
from time to time, pay to the Members such Interim Dividends as in their
judgement the position of the Company justifies.
Retention of Dividend until completion of transfer under Article
188. The Directors may
retain the Dividends payable upon shares in respect of which any person is
under the Transmission Clause of these Articles entitled to become a member or
which any person under that clause is entitled to transfer until such person
shall become a member in respect of such shares or shall duly transfer the
same.
No member to receive Dividend whilst indebted to the Company and
Company's right to reimbursement therefrom
189. Subject to the
provisions of the Act, no member shall be entitled to receive payment of any
interest or dividend in respect of his share(s) whilst any money may be due or
owing from him to the Company in respect of such share(s) or debenture(s) or
otherwise however either alone or jointly with any other person or persons and
the Directors may deduct from the interest or dividend payable to any member,
all sums of moneys so due from him to the Company.
Transferred Shares must be registered
190. A transfer of shares
shall not pass the right to any dividend declared thereon before the
registration of the transfer.
Dividend how remitted
191. Unless otherwise
directed any dividend may be paid by cheque or warrant or a pay-slip or receipt
having the force of a cheque or warrant sent through ordinary post to the
registered address of the member or person entitled or in the case of joint
holders to that one of them first named in the Register of Members in respect
of the joint holding. Every such cheque or warrant so sent shall be made
payable to the registered holder of shares or to his order or to his bankers.
The Company shall not be liable or responsible for any cheque or warrant lost
in transmission or for any dividend lost, to the member or person entitled
thereto by the forged endorsement of any cheque or warrant or the fraudulent or
improper recovery thereof by any other means.
Unpaid Dividend or Dividend Warrant posted
192. (a) Where the Company has declared a
dividend but which has not been paid or the dividend warrant in respect thereof
has not been posted within 42 days from the date of declaration to any
shareholder entitled to the payment of the dividend, the Company shall within 7
days from the date of expiry of the said period of 42 days, open a special account
in that behalf in any scheduled bank, as per Section 205-A of the Act, and
transfer to the said account, the total amount of dividend which remains unpaid
or in relation to which no dividend warrant has been posted.
(b) Any money
transferred to the unpaid dividend account of the Company which remains unpaid
or unclaimed for a period of three years from the date of such transfer, shall
be transferred by the Company to the general revenue account of the Central
Government. A claim to any money so transferred to the general revenue account
may be preferred to the Central Government by the shareholders to whom the
money is due.
(c) No unpaid or
unclaimed dividend shall be forfeited by the Board.
Dividend and call together
193. Any General Meeting
declaring a dividend may on the recommendation of the Directors make a call on
the Members for such amount as the meeting fixes, but so that the call on each
member shall not exceed the dividend payable to him so that the call be made
payable at the same time as the dividend and the dividend may, if so arranged
between the Company and the members be set off against the calls.
Dividend to be payable in cash
194. No dividend shall be
payable except in cash. Provided that nothing in this Article shall be deemed
to prohibit the capitalisation of profit of reserves of the Company for the
purpose of issuing fully paid up bonus shares or paying up any amount for the
time being unpaid on any shares held by the members of the Company.
CAPITALISATION
Capitalisation
195. (a) Any General Meeting may resolve that any
amount standing to the credit of the Share Premium Account or the Capital
Redemption Reserve Account or any moneys' investments or other assets forming
part of the undivided profits (including profits or surplus moneys arising from
the realisation and where permitted by law, from the appreciation in value of
any capital assets of the Company) standing to the credit of the General
Reserve, Reserve or any Reserve Fund or any other fund of the Company or in the
hands of the Company and available for dividend may be capitalised. Any such
amount (excepting the amount standing to the credit of the Share Premium
Account and/or the Capital Redemption Reserve Account) may be capitalised :
i) by the issue and
distribution as fully paid shares, debentures, debenture stock, bonds or
obligations of the Company or
ii) by crediting the
Shares of the Company which may have been issued and are not fully paid-up,
with the whole or any part of the sum remaining unpaid thereon.
Provided that any amounts standing to the credit of the Share
Premium Account may be applied in;
(1) paying up
un-issued shares of the Company to be issued to members of the Company as fully
paid bonus shares;
(2) in writing off the
preliminary expenses of the Company;
(3) in writing off the
expenses of, or the commission paid or discount allowed on any issue of shares
or debentures of the Company; or
(4) in providing for
the premium payable on the redemption of any redeemable preference shares or of
any debentures of the Company. Provided further that any amount standing to the
credit of the Capital Redemption Reserve Account shall be applied only in
paying up unissued shares of the Company to be issued to the Members of the
Company as fully paid bonus shares.
(b) Such issue and
distribution under sub-clause (a)(i) above and such payment to the credit or
unpaid share capital under sub-clause (a)(ii) above shall be made to, among and
in favour of the members of any class of them or any of them entitled thereto
and in accordance with their respective rights and interests and in proportion
to the amount of capital paid-up on the shares held by them respectively in
respect of which such distribution under sub-clause (a)(i) or payment under sub
clause (a)(ii) above shall be made on the footing that such members become
entitled thereto as capital.
(c) The Directors
shall give effect to any such resolution and apply portion of the profits,
General Reserve Fund or any other fund or account as aforesaid as may be required
for the purpose of making payment in full for the shares, debentures or
debenture stock, bonds or other obligations of the Company so distributed under
sub-clause (a)(i) above or (as the case may be) for the purpose of paying, in
whole or in part, the amount remaining unpaid on the shares which may have been
issued and are not fully paid up under sub-clause (a)(ii) above provided that
no such distribution or payment shall be made unless recommended by Directors
and if so recommended such distribution and payment shall be accepted by such
members as aforesaid in full satisfaction of their interest in the said
capitalised sum.
(d) For the purpose of
giving effect to any such resolution, the Directors may settle any difficulty,
which may arise in regard to the distribution or payment as aforesaid as they
think expedient and in particular they may issue fractional certificates or
coupons and fix the value for distribution of any specific assets and may
determine that such payments be made to any members on the footing of the value
so fixed may vest any such cash, shares, fractional certificates or coupons,
debentures, debenture stock, bonds, or other obligations in trustees upon such
trusts for the persons entitled thereto as may seem expedient to the Directors
and generally may make such arrangement for the acceptance, allotment and sale
of such shares, debentures, debenture stock, bonds or other obligations and
fractional certificates or coupons or otherwise as they may think fit.
(e) Subject to the
provisions of the Act and these Articles in cases where some of the Shares of
the Company are full paid and others are partly paid only, such capitalisation
may be effected by the distribution of further shares in respect of the fully
paid shares, and by crediting the partly paid shares with the whole or part of
the unpaid liability thereon but so that as between the holders of fully paid
shares, and the partly paid shares the sums so applied in the payment of such
further shares and in the extinguishments or diminution of the liability on the
partly paid shares shall be so applied pro-rata in proportion to the amount
then already paid or credited as paid on the existing fully paid and partly
paid shares, respectively.
196. When deemed
requisite a proper contract shall be filed with the Registrar of Companies in
accordance with the Act and the Board may appoint any person to sing such
contract on behalf of the Members entitled as aforesaid and such appointment
shall be effective.
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION
The following contracts and agreements referred to in paragraph
`A' below (not being entered into the
ordinary course of business carried on or intended to be carried on by the
Company or contracts entered into more than two years before the date of this
prospectus) which are or may be deemed to be material have been entered into by
or on behalf of the Company. Copies of these contracts together with copies of
the documents referred to in para (B) below have been attached with the
prospectus and delivered to the Registrar of Companies, Mumbai for registration
and may be inspected at registered office of the Company between 10 a.m. and 1
p.m. on any working day until the closing date of the subscription list.
The following Contracts mentioned in Para A below (not being
Contracts entered into in the ordinary course of business carried on by BMTSL)
are or may be deemed to be Material Contracts. Copies of these Contracts along
with documents referred to in Para (B) below have been attached to the copy of
this Prospectus delivered to the Registrar of Companies, ------ for
registration and may be inspected at the Registered Office of WCIL between
11.00 a.m. to 1.00 p.m. on any working day until the closing of the Issue.
(A) MATERIAL CONTRACTS
1) Memorandum of Understanding dated November 25, 2000 entered
into between the Company and Lead Manager to the Issue, M/s. Aryaman Financial
Services Private Limited.
2) Memorandum of Understanding dated November 27, 2000 entered
into between the Company and Registrars to the Issue, M/s. Intime Spectrum
Registry Private Limited.
3) Lease Agreement for the head office of the companyat Borivli,
Mumbai
4) Sale deeds (three) for purchase of land at Karjan, Navi Jitradi,
Baroda
5)
(B) DOCUMENTS FOR
INSPECTION
1) Memorandum & Articles of Association of WCIL.
2) Certificate of Incorporation dated July 15, 1996 and Fresh
Certificates of Incorporation dated May 9, 2000 (for conversion into public
limited company) and July 12, 2000 (for change of name).
3) Quotations for the plant and machinery and misc. fixed assets
4) Purchase Order copies given by the company for plant and
machineries and construction of building.
5) Consent from Book Running Lead Manager to the issue, Registrars
to the issue, Bankers to the issue, Bankers to the Company, Auditors to the
company, Compliance Officer and as referred elsewhere in this prospectus.
6) Auditors' Report dated November 25, 2000 referred to in the
Prospectus.
7) Certificate of Auditors on Tax Benefits dated November 20, 2000
and their consent for inclusion of the same in the prospectus.
8) Auditors Certificate for Deployment of funds dated November 25,
2000
9) Copies of Annual Reports for accounting years ending 31st
March, 1997, 31st March, 1998, 31st March, 1999, and 31st March, 2000 and for
the period from April 1, 00 to November 25, 2000.
10) Copies of Resolutions passed by the shareholders of the
Company at its meeting held on
November 15, 2000 under section 81 (1A).
11) Copy of initial listing application made to Mumbai, Vadodara,
Ahemdabad Stock Exchanges for listing of Equity Shares of the Company.
12) Copy of Resolution dated
-------, 2000 authorizing the Registrar to the issue for realisation of
Stockinvest on behalf of the Company.
13) Copies of Resolutions passed by the shareholders of the
Company at its meeting held on
November 15, 2000 under section 293 (1) (a) & 293 (1) (d).
14) Acknowledgement
Card No. ___________________ dated
________ received from SEBI.
PART - III
DECLARATION
We the Directors declare that all the relevant provisions of the
Companies Act, 1956, and the guidelines issued from time to time by the
Government of India / Securities and Exchange Board of India have been complied
with and no statement made in this Prospectus is contrary to the provisions of
the Companies Act and the rules made there under and the SEBI guidelines.
SIGNED BY DIRECTORS :
Mr. Pravinbhai P. Patel
Mr. Sanjay T. Patel
Mrs. Hiraben P. Patel
Mr. Bhikhubhai P. Patel
Mr. Mansukhlal Patel
Ms. Sheetal Sanjay Patel
Dated :
Place :
119
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