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IBBI invites Suggestions and Comments on Draft Specimen:Information Memorandum, Evaluation Matrix, Request for Resolution Plans, and Resolution Plan
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....BBI invites Suggestions and Comments on Draft Specimen:Information Memorandum, Evaluation Matrix, Request for Resolution Plans, and Resolution Plan <br>News and Press Release<br>Dated:- 28-11-2018<br><BR>Insolvency and Bankruptcy Board of India No. IBBI/PR/2018/33 26thNovember, 2018 PRESS RELEASE IBBI invites Suggestions and Comments on Draft Specimen: a. Information Memorandum b. Evaluation Matrix c. Request for Resolution Plans, and d. Resolution Plan. The Insolvency and Bankruptcy Code, 2016 (Code) read with the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (Regulations) envisage inter alia preparation and issue / submission of (a) Information Memorandum, (b) Evaluation Matrix, (c) Request for Resolution Plans, and (d) Resolution Plan. These documents form the basis for various decisions by the stakeholders and hence the outcome of a corporate insolvency resolution process depends on quality of these documents. 2. The Code read with the Regulations indicate the content and purpose of the aforesaid documents. Market has developed best practices about detailed content of these documents from the perspective of adequacy and relevance for sta....
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....keholders. It, however, requires considerable skill and expertise and due diligence to prepare these documents which are complete, correct, relevant and user friendly, while confirming to the requirements of the Code and Regulations and meeting the need and expectations of the stakeholders. 3. A few stakeholders have prepared draft specimen of the aforesaid documents (placed as Annexures). The IBBI intends to refine these documents, with inputs from stakeholders, and release them as specimen for guidance of the stakeholders. It invites suggestions and comments from stakeholders as under: Sl. No. Document Annexures Suggestions and Comments may be mailed to: 1 2 3 4 1. Draft Specimen of Information Memorandum along with a. Draft Specimen of Information Memorandum for a Corporate Debtor in Manufacturing Sector, and b. Draft Specimen of Information Memorandum for a Corporate Debtor in Power Sector. A A1 A2 [email protected] 2. Draft Specimen of Evaluation Matrix B 3. Draft Specimen of Request for Resolution Plans C 4. Draft Specimen of Resolution Plan D 4. The suggestions and comments may be mailed at the email address as indicated in colum....
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....n 4 of the above table, latest by15th December, 2018. In the subject line of the email, please state: "Comments on Information Memorandum (A, A1 and A2)/ Comments on Evaluation Matrix(B) / Comments on Request for Resolution Plans (C) / Comments on Resolution Plan (D). Sd/- (Methil Unnikrishnan) General Manager DOWNLOAD PDF ============= Document 1Page 1 Annexure-A Specimen Information Memorandum Table of Contents Abbreviations ACQ B.Tech ВОРBPTA Annual Contracted Quantity Bachelor of Technology Balance of Plant Bulk Power Transmission Agreement Mn Million MOC Ministry of Coal MOD Merit order dispatch MTPA Million Tons Per Annum BTG CAGR Boiler Turbine Generator MW Compound Annual Growth Rate O&M CEA CERC Central Electricity Authority PLF Central Electricity Regulatory Commission PPA CoD Commercial Operation Date REC Cr Crores ROM Mega Watt Operation and Maintenance Plant Load Factor Power Purchase Agreement Rural Electrification Corporation Limited Run of Mine EPC Engineering, procurement and construction Rs Rupees (Indian) FDI Foreign direct investment SERC SHR State Electricity Regulatory Commission Station Heat Rate FSA Fuel Supply Agreement St. Station G....
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....CV Gross Calorific Value tn Tonne INR Indian National Rupee TN Tamil Nadu IPP Independent Power Producer TPP Thermal Power Plant KCal Kilo Calories UP Kg kilogram WPI Uttar Pradesh Wholesale Price Index Kms kv kWh Kilometers Kilovolt Kilowatt-hour M.S. M.Tech Page 2 Masters of Science Master of Technology Disclaimer This information memorandum is formulated by ABC (Name of Resolution Professional) in consultation with XYZ Ltd (Name of Professional Advisor, if any) which has been appointed as a professional advisor to the Resolution Professional (RP). The purpose of this document is to assist the recipient in deciding whether they wish to proceed with a further investigation of the Company, and in putting forward resolution plan for the Company in accordance with the Insolvency and Bankruptcy Code, 2016 (hereinafter as "IBC" or "Code") and the Regulations made thereunder, as amended from time to time. This Information memorandum has been prepared in furtherance of Section 29 of the Code. The information memorandum contains specific information of the corporate debtor including but not limited to the details as prescribed under sub-regulation 2 of Regulation 36 of the Insolvency and ....
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....Bankruptcy Board of I India (Resolution process for Corporate Persons) Regulations, 2016 (hereinafter as "CIRP Regulations"). This information memorandum and the information contained herein is not intended to form the basis of any investment decision by a prospective resolution applicants. Interested parties should carry out their own investigations and analysis of the Corporate Debtor and of the data referred to in this Information Memorandum and should consult their own advisers before submitting a resolution plan. Neither this document, nor anything contained herein, should form the basis of, or be relied upon in connection with any contract, agreement, undertaking, understanding or any commitment or investment decision whatsoever. The information contained/disclosed in the information memorandum is as provided by the Corporate Debtor and the creditors of the Corporate Debtor. No representation or warranty, express or implied, is given by the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) as to the accuracy, authenticity or completeness of the contents of this Memorandum or any other documen....
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....t or â– information supplied, or which may be supplied at any time or any opinions or projections expressed herein or therein, nor is any such party under any obligation to update the Memorandum or correct any inaccuracies or omissions in it which may exist or become apparent. This Memorandum should not be considered as a recommendation by the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) to invest in the Corporate Debtor and each prospective applicant must make its own independent assessment of the merits or otherwise of investing in the corporate debtor. This information memorandum contains the forecasts, projected financial information and other predictive statements that represent the Resolution | Professionals and its Professional Advisors assumptions in light of information available in public domain, about circumstances and events that have not yet taken place. The said forecasts, projected financial information and other predictive statements are based on market/industry trends/predictions/estimates and other factors. Accordingly, there can be no assurance or guarantee that the pro....
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....jected results will be attained. The projected results are not definitive and are subject to change without notice. The future projections enclosed in this information memorandum involve risks and uncertainties, based on various factors and variables, which may cause actual performance to differ materially from any projections of future performance The Resolution Professional and its Professional Advisors at no time guarantees the accuracy/authenticity of the future projections. In particular, but without prejudice to the generality of I the foregoing, no representation or warranty whatsoever is given in relation to the reasonableness or achievability of the projections contained in this Information Memorandum or in relation to the bases and assumptions underlying such projections and you must satisfy yourself in relation to the reasonableness, achievability and accuracy thereof. The recipient acknowledges that it will be solely responsible for its own assessment of the market projections and future prospects/performance of the corporate debtor Page 3 Disclaimer Cont. Memorandum and the information contained therein is confidential and subject to the undertaking executed between th....
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....e corporate debtor and the â– recipient in pursuance of Section 29 (2) of the Code. The recipient by way of the undertaking, unconditionally acknowledges to undertake to (a) comply with the provisions of the law for the time being in force relating to confidentiality and insider trading (b) protect the intellectual property of the corporate debtor it may have access to and (c) is statutorily obligated not to share the information memorandum or its contents with third parties unless (a) and (b) above have been complied with. The recipient further also acknowledges that the information contained in the information memorandum shall not be used ito cause undue gain or undue loss to itself or to any other persons and that the recipient shall comply with the requirements under Section 29(2) of the â– Code. I i No responsibility or liability is accepted for any loss or damage arising whatsoever that you may suffer as a result of this Information memorandum or the information contained herein and any and all responsibility and liability is expressly disclaimed by the Resolution Professional and its Professional Advisor and its respective partners, directors, officers, affiliates,....
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.... employees, advisors or agents. Should this Information memorandum (through the act or default of the recipient) reach other persons without the resolution professional's written consent, the recipient shall indemnify the resolution professional and its professional advisor including its respective partners, directors, officers, affiliates, employees, advisors or agents against any loss or damage or other liabilities (including all costs), which they may suffer as a result. By accepting a copy of this information memorandum, the recipient is deemed to have acknowledged and accepted that the terms and conditions of the disclaimer notice and that it formed an integral/material part of this information memorandum. The recipient further is deemed to have unconditionally acknowledged that the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) do not accept any liability for any and all information contained in this information memorandum. The recipient is deemed to have acknowledged that the information contained in the information memorandum shall not be utilised/used for any other purpose other than fo....
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....r the preparation of the Resolution Plan as defined in the Code. The information memorandum and the information contained herein may not be inclusive or contain all information which the recipient considers material. While the Resolution Professional shall endeavour to furnish further relevant information/details/ clarifications, the resolution professional is under no â– obligation to provide the recipient with any further relevant information/details/clarifications. In the event any additional information/clarifications are so provided they shall be unconditionally subject to this disclaimer notice irrespective of whether it has been specifically provided for or not. This information memorandum and the information contained herein should not be printed, reproduced, transmitted, sold, distributed, or published by the recipient without prior written approval of the Resolution Professional. The recipient further acknowledges to return and /or destroy this information memorandum at the written request of the resolution professional. The resolution professional shall act as the primary point of contact for the recipients and any and all correspondences/clarifications should only ....
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....be addressed to the resolution professional. This Information memorandum is issued by the â– resolution professional of the corporate debtor without incurring any liability/commitment on the part of itself or the professional advisor (including but not limited to the professional advisors respective partners, directors, officers, affiliates, employees, advisors or agents) or the corporate debtor or any of its officers, employees or its agents Page 4 Contact Details: For any further enquiries, please contact: [Name] Resolution Professional Name of Corporate Debtors Tel: Mobile Email Page 5 Contents Part A Part B Statutory Information Memorandum under IBC Business Transaction Information Memorandum Page 6 Model Information Memorandum Table of Contents Part A: Statutory Information Memorandum 1. Related Sections and Regulations 2. Contents as given in Regulation 36 3. Description of Assets & Liabilities and Financial Statements (Regulation 36(2)(a),(b) & (c)) 4. 5. 6. List of Creditors (Financial, Operational, Employees and Others) including the names of creditors, the amounts claimed by them, the amount of their claims admitted and the security interest, if any, in respect of su....
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....ch claims (Regulation 36(2)(d)) Dues to/from Related parties (Regulation 36(2)(e)) Guarantor Details (Regulation36(2)(f)) 7. Members or partners having- 1% or more stake (Regulation36(2)(g)) 8. Details of all material litigation and an ongoing investigation (Regulation36(2)(h)) 9. No. of Workers & Employees and their dues (Regulation36(2)(i)) Part B: Transaction Information Memorandum 10. Executive Summary, Key Investment Highlights and Indicative Project Timelines 11. Company Overview Page 7 2.1 Corporate Debtor Profile 2.2 Business Evolution (Timeline) 2.3 Project Details 2.4 Current Scenario, Snapshot of Financial Performance and Interim Finance 2.5 Capital Structure of Corporate Debtor 2.6 Shareholding Pattern of Corporate Debtor Model Information Memorandum Table of Contents 2.7 Financial & Operational Claims 2.8 Details of Preferential/Undervalued/Extortionate/Fraudulent Transactions 2.9 Facilities and Capability 2.10 Division Overview, Customer Overview and Summary of Contracts/Orders 2.11 Capex Requirement 2.12 Organisation Structure 2.13 Board of Directors & Key Management 2.14 Details of Statutory Approvals and Compliances 2.15 Investment Overview 3. Industry Overview 3.1....
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.... Snapshot 3.2 Sector Fundamentals 3.3 Key Growth Drivers 3.4 Competitor Analysis 3.5 Key Trends & Outlook 4. Projected Business Plan Page 8 4.1 Future Growth Strategy 4.2 Assumptions 4.3 Profit & Loss for the Forecast Period 4.4 Company level EBITDA analysis over the Forecast Period Model Information Memorandum Table of Contents Annexures to Business Transaction IM ➤ List of Annexures to be given ➤ Process Overview Page 9 Page 1 Annexure-A1 Specimen of Information Memorandum For a Corporate Debtor in Manufacturing Sector Abbreviations Abbreviation Full Form Abbreviation Full Form IRP Interim Resolution Professional XXX XXX Ð¾Ñ Operational Creditor XXX XXX FC Financial Creditor XXX XXX CAGR Compounded Annual Growth Rate XXX XXX NCLT National Company Law Tribunal XXX XXX RA Resolution Applicant XXX XXX IM Information Memorandum XXX XXX CFO Chief Finance Officer XXX XXX Cr Crores XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX....
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.... XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Page 2 Disclaimer This information memorandum is formulated by ABC (Name of Resolution Professional) in consultation with XYZ Ltd (Name of Professional Advisor, if any) which has been appointed as a professional advisor to the Resolution Professional (RP). The purpose of this document is to assist the recipient in deciding whether they wish to proceed with a further investigation of the Company, and in putting forward resolution plan for the Company in accordance with the Insolvency and Bankruptcy Code, 2016 (hereinafter as "IBC" or "Code") and the Regulations made thereunder, as amended from time to time. This Information memorandum has been prepared in furtherance of Section 29 of the Code. The information memorandum contains specific information of the corporate debtor including but not limited to the details as prescribed under sub-regulation 2 of Regulation 36 of the Insolvency and Bankruptcy Board of I India (Resolution process for Corporate Persons) Regulations, 2016 (hereinafter as "CIRP Regulations"). This information memorandum and the information contained her....
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....ein is not intended to form the basis of any investment decision by a prospective resolution applicants. Interested parties should carry out their own investigations and analysis of the Corporate Debtor and of the data referred to in this Information Memorandum and should consult their own advisers before submitting a resolution plan. Neither this document, nor anything contained herein, should form the basis of, or be relied upon in connection with any contract, agreement, undertaking, understanding or any commitment or investment decision whatsoever. The information contained/disclosed in the information memorandum is as provided by the Corporate Debtor and the creditors of the Corporate Debtor. No representation or warranty, express or implied, is given by the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) as to the accuracy, authenticity or completeness of the contents of this Memorandum or any other document or â– information supplied, or which may be supplied at any time or any opinions or projections expressed herein or therein, nor is any such party under any obligation to update th....
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....e Memorandum or correct any inaccuracies or omissions in it which may exist or become apparent. This Memorandum should not be considered as a recommendation by the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) to invest in the Corporate Debtor and each prospective applicant must make its own independent assessment of the merits or otherwise of investing in the corporate debtor. This information memorandum contains the forecasts, projected financial information and other predictive statements that represent the Resolution | Professionals and its Professional Advisors assumptions in light of information available in public domain, about circumstances and events that have not yet taken place. The said forecasts, projected financial information and other predictive statements are based on market/industry trends/predictions/estimates and other factors. Accordingly, there can be no assurance or guarantee that the projected results will be attained. The projected results are not definitive and are subject to change without notice. The future projections enclosed in this information memorandum involve ....
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....risks and uncertainties, based on various factors and variables, which may cause actual performance to differ materially from any projections of future performance The Resolution Professional and its Professional Advisors at no time guarantees the accuracy/authenticity of the future projections. In particular, but without prejudice to the generality of I the foregoing, no representation or warranty whatsoever is given in relation to the reasonableness or achievability of the projections contained in this Information Memorandum or in relation to the bases and assumptions underlying such projections and you must satisfy yourself in relation to the reasonableness, achievability and accuracy thereof. The recipient acknowledges that it will be solely responsible for its own assessment of the market projections and future prospects/performance of the corporate debtor Page 3 Disclaimer Cont. Memorandum and the information contained therein is confidential and subject to the undertaking executed between the corporate debtor and the â– recipient in pursuance of Section 29 (2) of the Code. The recipient by way of the undertaking, unconditionally acknowledges to undertake to (a) comply w....
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....ith the provisions of the law for the time being in force relating to confidentiality and insider trading (b) protect the intellectual property of the corporate debtor it may have access to and (c) is statutorily obligated not to share the information memorandum or its contents with third parties unless (a) and (b) above have been complied with. The recipient further also acknowledges that the information contained in the information memorandum shall not be used ito cause undue gain or undue loss to itself or to any other persons and that the recipient shall comply with the requirements under Section 29(2) of the â– Code. I i No responsibility or liability is accepted for any loss or damage arising whatsoever that you may suffer as a result of this Information memorandum or the information contained herein and any and all responsibility and liability is expressly disclaimed by the Resolution Professional and its Professional Advisor and its respective partners, directors, officers, affiliates, employees, advisors or agents. Should this Information memorandum (through the act or default of the recipient) reach other persons without the resolution professional's written consent,....
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.... the recipient shall indemnify the resolution professional and its professional advisor including its respective partners, directors, officers, affiliates, employees, advisors or agents against any loss or damage or other liabilities (including all costs), which they may suffer as a result. By accepting a copy of this information memorandum, the recipient is deemed to have acknowledged and accepted that the terms and conditions of the disclaimer notice and that it formed an integral/material part of this information memorandum. The recipient further is deemed to have unconditionally acknowledged that the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) do not accept any liability for any and all information contained in this information memorandum. The recipient is deemed to have acknowledged that the information contained in the information memorandum shall not be utilised/used for any other purpose other than for the preparation of the Resolution Plan as defined in the Code. The information memorandum and the information contained herein may not be inclusive or contain all information which the ....
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....recipient considers material. While the Resolution Professional shall endeavour to furnish further relevant information/details/ clarifications, the resolution professional is under no â– obligation to provide the recipient with any further relevant information/details/clarifications. In the event any additional information/clarifications are so provided they shall be unconditionally subject to this disclaimer notice irrespective of whether it has been specifically provided for or not. This information memorandum and the information contained herein should not be printed, reproduced, transmitted, sold, distributed, or published by the recipient without prior written approval of the Resolution Professional. The recipient further acknowledges to return and /or destroy this information memorandum at the written request of the resolution professional. The resolution professional shall act as the primary point of contact for the recipients and any and all correspondences/clarifications should only be addressed to the resolution professional. This Information memorandum is issued by the â– resolution professional of the corporate debtor without incurring any liability/commitmen....
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....t on the part of itself or the professional advisor (including but not limited to the professional advisors respective partners, directors, officers, affiliates, employees, advisors or agents) or the corporate debtor or any of its officers, employees or its agents Page 4 Contact Details: For any further enquiries, please contact: [Name] Resolution Professional Name of Corporate Debtors Tel: Mobile Email Page 5 Contents Part A Part B Statutory Information Memorandum under IBC Business Transaction Information Memorandum Page 6 Page 7 Part A Statutory Information Memorandum (Statutory IM) Model Information Memorandum Table of Contents 1. Related Sections and Regulations 2. Contents as given in Regulation 36 Statutory Information Memorandum 3. Description of Assets & Liabilities and Financial Statements (Regulation 36(2)(a),(b) & (c)) 4. List of Creditors (Financial, Operational, Employees & Others) (Regulation 36(2)(d)) 5. Dues to/from Related parties (Regulation 36(2)(e)) 6. Guarantor Details (Regulation36(2)(f)) 7. Members or partners having- 1% or more stake (Regulation36(2)(g)) | 8. Details of all material litigation and an ongoing investigation (Regulation36(2)(h)) 9. No of Work....
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....ers & Employees and their dues (Regulation36(2)(i)) Page 8 Index of Tables Page 9 Table 1 Assets & Liabilities Table 2: List of Creditors... Table 3: Dues to/from Related Parties....... Table 4 Guarantor Details.. Table 5: Details of members / partners holding at least one per cent stake.. Table 6: Material Litigation.............. Table 7: Workers & Employees and their dues... .8 .9 .10 .11 .12 .13 .14 1. Relevant Sections and Regulations Section 5(10) Section 29(1) ¡ Section 29(2) I Regulation 36 of IBBI (IRP for Corporate Persons) I Regulations, 2016 Information Memorandum (Statutory IM) is a memorandum prepared by resolution professional under sub-section (1) of section 29. Provides that the resolution professional shall prepare an information memorandum in such form and manner containing such relevant information as may be specified by the Board for formulating a resolution plan. ■The resolution professional shall provide to the resolution applicant access to all relevant information in physical and electronic form, provided such resolution applicant undertakes- (a) to comply with provisions of law for the time being in force relating to confidentiality and insider t....
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....rading; (b) to protect any intellectual property of the corporate debtor it may have access to; and (c) not to share relevant information with third parties unless clauses (a) and (b) of this sub-section are complied with. ■Explanation.—For the purposes of this section, "relevant information" means the information required by the resolution applicant to make the resolution plan for the I corporate debtor, which shall include the financial position of the corporate debtor, all information related to disputes by or against the corporate debtor and any other matter ! pertaining to the corporate debtor as may be specified. Provides for the contents of the Statutory IM and the manner in which it will be submitted to each member of the CoC and any potential resolution applicant. Page 10 2. Contents of Statutory IM Regulation 36 of IBBI (IRP for Corporate Persons) Regulations, 2016 S.No. Regulation 1 36(2)(a) 2 36(2)(b) & 36(2)(c) 3 36(2)(d) 4 36(2)(e) 5 36(2)(f) 6 36(2)(g) 7 36(2)(h) 8 36(2)(i) Page 11 Particulars Assets and Liabilities with such description, as on the insolvency commencement date, as are generally necessary for ascertaining their values. The latest annual ....
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....financial statements and audited financial statements of the corporate debtor for the last two financial years and provisional financial statements for the current financial year made up to a date not earlier than fourteen days from the date of the application A list of Creditors containing the names of creditors, the amounts claimed by them, the amount of their claims admitted and the security interest, if any, in respect of such claims Particulars of a debt due from or to the corporate debtor with respect to related parties Details of guarantees that have been given in relation to the debts of the corporate debtor by other persons, specifying which of the guarantors is a related party The names and addresses of the members or partners holding at least one per cent stake in the corporate debtor along with the size of stake. Details of all material litigation and an ongoing investigation or proceeding initiated by Government and statutory authorities. The number of workers and employees and liabilities of the corporate debtor towards them. 2. Contents of Statutory IM Regulation 36 of IBBI (IRP for Corporate Persons) Regulations, 2016 A member of the committee may request the resolu....
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....tion professional for further information of the nature described in this Regulation and the resolution professional shall provide such information to all members within reasonable time if such information has a bearing on the resolution plan. The interim resolution professional or the resolution professional, as the case may be, shall share the information memorandum after receiving an undertaking from a member of the committee or a potential resolution applicant to the effect that such member or resolution applicant shall maintain confidentiality of the information and shall not use such information to cause an undue gain or undue loss to itself or any other person and comply with the requirements under section 29(2). Page 12 3. Assets & Liabilities and Financial Statements 1. Assets and Liabilities with such description, as on the insolvency commencement date, as are generally necessary for ascertaining their values. 2. 'Description' includes the details such as date of acquisition, cost of acquisition, remaining useful life, identification number, depreciation charged, book value, and any other relevant details. 3. The latest annual financial statements and audited financial st....
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....atements of the corporate debtor for the last two financial years. 4. Provisional financial statements for the current financial year made up to a date not earlier than fourteen days from the date of the application. Generally, provisional financials are made on the date of commencement of the Corporate Insolvency Resolution Process (CIRP). Table-1 Amount Particulars Assets Fixed Assets XXX CWIP XXX Investments (net of provisions) XXX Loans and Advances XXX XXX XXX XXX XXX Investment in Mutual Funds XXX XXX Tax Assets Inventory Debtors Cash and Bank balances Total Assets Liabilities Financial creditors Operational Creditors Provisions Net Worth Total Liabilities Source: Financials of corporate debtor as on CIRP date XXX XXX XXX XXX XXX Page 13 4. List of Creditors- names of creditors, the amounts claimed by them, the amount of their claims admitted and the security interest Financial, Operational, Employees & Others Financial Creditors: All financial creditors have to file their claims in Form C in the prescribed format, after which the Resolution Professional will verify and admit the claims to the extent they have been verified, form the CoC and include the claims of the I financ....
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....ial creditors in the IM. All financial creditors have voting rights which is based on the proportion of the financial debt owed to such financial creditor in relation to the financial debt owed by the corporate debtor. â– Operational Creditors: All operational creditors have to file their claims in Form B in the prescribed format, after which the Resolution Professional will verify and admit the claims of the operational creditors to the extent they have been verified i Operational creditors have no voting rights. Employee Claims & Other Claims are filed in Form D & Form E respectively, then they are verified and admitted. Table-2 Creditor names Facility Amount of claims submitted Amount admitted Voting right Financial creditors XXX XXX 100% A Secured Term Loan XXX XXX 50% B Working Capital Loan XXX XXX 20% C Term Loan XXX XXX 30% Amount of claims Creditor names Facility Amount admitted Voting right submitted Operational Creditors XXX XXX ÎΑ X ÎΑ XXX XXX ÎΑ Y ÎΑ XXX XXX ÎΑ Z ÎΑ XXX XXX ÎΑ Source: Data from Corporate Debtor/Management Discussion/Financials Page 14 5. Dues to/from Related Party Definition of related party in relat....
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....ion to a Corporate Debtor is much wider in scope as compared to the Companies Act, 2013. It has been defined in section 5(24) of IBC, 2016. As per Regulation 36(2)(e), particulars of a debt due from or to the corporate debtor with respect to related parties are to be stated in the Statutory IM. Debt payable to/due from related parties Name of the party To/due from related parties: XXX XXX Total Table-3 Sample Format Any other Trade receivables Trade payables Loans/Advances arrangements Net receivable/ (payable) XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Source: Data from Corporate Debtor/Management Discussion/Financials Page 15 6. Guarantor Details ! As per Regulation 36(2)(f), details of guarantees that have been given in relation to the debts of the corporate debtor by other persons, specifying which of the guarantors is a related party. Example: Corporate Guarantee or Personal Guarantee given in relation to the debts by any related party of the corporate debtor Guarantees given Personal guarantees of: XXX Corporate guarantees of: XXX Table-4 Sample Format Designation XXX Source: Security Creation documents along with sanction letter/Register of Charges created P....
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....age 16 Facility XXX XXX XXX 7. Details of Members/Partners Holding at least 1% Stake As per Regulation 36(2)(g), the names and addresses of the members or partners holding at least one per cent stake in the corporate I debtor along with the size of stake have to be provided in the Statutory IM --- Name of the shareholder Promoter Group XXX XXX Table-5 Sample Format Address Nature of Shareholder No. of fully paid up equity shares held Shareholding as a % of total no. of shares Promoter XXX XXX Non Promoter Group XXX XXX Non Promoter XXX XXX Source: Annual Report or Financials/ Register of Members Page 17 8. Material Litigations ! As per Regulation 36(2)(h), Details of all material litigation and an ongoing investigation or proceeding initiated by Government and statutory authorities have to be provided. Table-6 Sample Format Notice received for Contingent Proceedings initiated by Court Authority Related Law/ Regulation Parties to the litigation Particulars of case amount Liability Lawyer Involved Labour Related cases XXX XXX XXX XXX XXX XXX XXX XXX Direct & Indirect Taxes Related cases XXX XXX XXX XXX XXX XXX XXX XXX Other cases XXX XXX XXX XXX XXX XXX XXX XXX Source: Annual Report ....
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....or Financials/ Management discussions Page 18 9. Number of Workers and Employees and their Dues ¡As per Regulation 36(2)(i), the number of workers and employees and liabilities of the corporate debtor towards them have to be I provided. Table-7 Sample Format Number of Employees and amount due to employees as on CIRP Commencement date Particulars Number of Employees Number of Workers - Regular No. of Employees XXX XXX XXX Number of Workers - Casual Wages & Salary including provision LTA and Medical Payable Reimbursements Provident Fund ESI Staff expenses unpaid Full and Final Settlement payable Any other Total Source: Management Discussions/ Data from Corporate Debtor Page 19 Balance outstanding as at CIRP Commencement Date XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Page 20 PART-B Business Transaction- For a Corporate Debtor in Manufacturing Sector Model Information Memorandum Table of Contents Transaction Information Memorandum 1. Executive Summary, Key Investment Highlights and Indicative Project Timelines 2. Company Overview 3. 2.1 Corporate Debtor Profile 2.2 Business Evolution 2.3 Current Scenario, Snapshot of Financial Performance and Interim Finance 2.4 Capital Structure of C....
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....orporate Debtor 2.5 Shareholding Pattern of Corporate Debtor 2.6 Financial and Operational Claims 2.7 Division and Customer Overview and Key Contracts 2.8 Supply Chain Infrastructure 2.9 Facilities and Capability 2.10 Details of Manufacturing Facilities & Additional Capex Requirement 2.11 Organisation Structure 2.12 Board of Director and Key Management 2.13 Details of Statutory Approvals and Compliances 2.14 Investment Overview Industry Overview Page 21 3.1 Snapshot 3.2 Sector Fundamentals 3.3 Key Growth Drivers 3.4 Competitor Analysis Model Information Memorandum Table of Contents Transaction Information Memorandum Projected Business Plan 4.1 Future Growth Strategy 4.2 Assumptions 4.3 Profit & Loss for the Forecast Period 4.4 Company level EBITDA analysis over the Forecast Period Annexures to Business Transaction IM List of Annexures Process Overview ➤ Indicative Reference List Page 22 Index of Tables Table 1 : Financial Summary.... Table 2 Balance Sheet and Income Statement Capital Structure.... .15 .17 Table 3 Table 4 Table 5 : Shareholding Pattern.... Financial Claims.... Table 6 Operational Claims.. Table 7 Manufacturing Facilities.. Table 8 Projected P&L Page 23 .18 .18....
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.... .19 .18 .23 .40 Index of Charts Chart 1 Sales by Geography.... Chart 2 Sales by Segment... Chart 3 Division Wise Share. Chart 4 Supplier Dependence....... Chart 5 Turnover Breakup Chart 6: Trend Analysis... Chart 7 Key Sectors.... Chart 8 Investment Perks... Chart 9: Competitor Analysis... Chart 10 Production Capacity... 15 15 20 21 32 33 33 33 35 36 Page 24 1. Executive Summary ABC Ltd. ("the Companyâ€) is a leading [] Company Overview What ABC Ltd offers? Has a comprehensive product portfolio of [] â–º Recently commenced providing turnkey services such as [] â–º Operates X state of art Manufacturing facilities in ABC/DEF/GHI â–¸ Equipped with XXXXXXX â–º Has deep-rooted and long-standing customer relationships with one of the market leaders in the Indian industry and other prominent domestic and international brands â–¸ Owned and run by professional management â–¸ CIRP background â–º Opportunity to increase the production capacity â–º Operational state-of-the-art manufacturing plant equipped with backward integrated facilities Established platform for a strategic partner to enter/ expand its operations in the high growth Indian [relevant indu....
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....stry] market, resulting in an immediate top-line boost ► [mention opportunity here] The Transaction Page 25 1. Key Investment Highlights Page 26 Comprehensive product portfolio State-of-the-art manufacturing facilities with end-to-end backward integrated operations Professional management team and corporate governance standards benchmarked to best industry practices Operating in high growth industry Diverse Mix of Customers 1. Indicative Project Timelines ✓ Communication strategy ✓ Day O plan ✓ Risk identifications & mitigation ✓ Application formalities ✓ Public Announcement Take control of the assets ✓ Roll out new org. chart Prepare an IM Meetings with key suppliers & customers ✓ Constitute Committee of all Creditors ✓ Agree a plan with customers ✓ Funding requirement and identify potential investor Optimize cash and cut cost ✓ Negotiate with different creditors ✓ Sale of any non core assets ✓ Update list of claims from creditors ✓ Diligence / Meeting with potential resolution applicant ✓ Review all Approval of the resolution plan by CoC & NCLT resolution plan received before presenting to C....
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....oC File application to NCLT Planning 0-30 days 31-60 days 61-120 days 121-150 days 151-180 days Project & crisis management Compliance with IBC rules Cash flow management Collect and validate claims Stakeholder management Negotiate plan with creditors Page 27 Page 28 Company Overview 2. Company Overview 2.1 Corporate Debtor Profile Overview of the Corporate Debtor Brief overview of the Company along with particulars such as: â–¡ Overview of operations, Key Management and board, â–¡ Overview of facilities, Key Customers â–¡ Registered Address, date of Incorporation, CIN number, etc. Number of employees Financial Summary Revenue Revenue from operations Particulars Year-I Year-II Year-III Other Income Total Revenue XXX XXX XXX XXX XXX XXX XXX XXX XXX Expenses: Cost of Materials Consumed XXX XXX XXX Changes in inventories of finished goods, work-in-| progress and Stock-in-Trade XXX XXX XXX Employee benefit expense XXX XXX XXX Other Expenses XXX XXX XXX EBITDA XXX XXX XXX EBITDA Margin XXX XXX XXX Depreciation and Amortization of Expenses XXX XXX XXX Finance costs XXX XXX XXX Segment overview PBT XXX XXX XXX Tax XXX XXX XXX Sales by Geography Sales by Segment PAT XXX XXX XXX....
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.... PAT Margin XXX XXX XXX Table 1 Chart 1 Chart 2 Source: Company Annual Report/ Company Website/ Management Discussions Page 29 Source: Company Annual Report/ Historical Financials A brief observation on a key trend or outlook can be highlighted here • Additionally, Financial data can also be summarised in the form of charts and Revenue-EBITDA relation, Revenue-PAT Relation and other important data can also be presented. 2.2 Business Evolution ► [] 2000- 05 2008-11 2005-08 ► 0 Going forward, the Company has opportunity to higher 2011-present [ ] and aim at 1975-2000 ►Inception- XXX was Incorporated in June, 1975 Evolved over the last 4 decades to become one of the frontline players in the [xxxx] industry in India Page 30 2.3 Current Scenario Technical Issues Lack of maintenance of machines leading to higher cost in the form of internal rejections, breakdown! cost, idle labour, etc. Poor controls over quality check or lack of a proper quality check policy which leads to increased cost in the form of higher external rejections and freight cost. Loss in share of business because of not delivering orders in time and poor quality of finished products. XXX XXX + Fi....
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....nancial Issues Lower EBITDA and negative free cash due to under utilisation of capacity. Hence, company is not able to currently service its full interest and debt obligations. Loss of sales and share of business due to I apprehension amongst the customers caused due to failure to perform and CIRP rumours. Lack of orders resulting in non recovery of Fixed cost. Hence, negative cash flows. XXX XXX XXX Macroeconomic Factors Manufacturing plants are sitting idle due to higher cost of manufacturing per unit as compared to competitors utilising the I economies of scale. Implementation of a government policy or regulation which is unfavourable for the industry. Liquidation or Hostile Takeovers by capital rich companies to create synergy benefits and capture market share. Slow growth in the economy/industry due to recession due to which companies are facing liquidity issues. XXX Page 31 2.3 Snapshot of Financial Performance Financial Summary ance sheet as on XX/XX/XXXX Particulars Equity Net Worth Non-Current Liability Long term loan Others Current Liability Sundry creditors Others Total Equity and Liability Assets Non-Current Assets Investments Others Current assets Debtors Cash Total As....
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....sets FY 1 FY -1 FY-2 Income Statement Summary Particulars Revenue from Operations Other Income Total Expenses EBITDA Depreciation EBIT Interest expense EBT PAT Table 2 Source: Company Annual Report/ Historical Financials Page 32 FY 1 FY-1 FY -2 1. The consistent increase in revenue in the last 2 years is in line with the increasing trend as seen in the industry. 2. Low EBITDA margin along with calculated Interest Coverage Ratio and Debt Service Coverage Ratio shows the difficulty in servicing the finance cost and principal instalments. 3. Increasing inventory and trade receivables highlights working capital being blocked and hence, the liquidity problems faced by ABC Ltd. 4. XXXXXX 5. XXXXXX 6. XXXXXX 2.3 Interim Finance • Current Status Advances received from key customers to keep the business afloat and maintain continuity of supplies; to be repaid on offset against sales basis Delay in salaries & wages resulting in low morale across the company; inability to retain/deploy level impacting workers at the required production and sales At current levels of production, cash gap projected to hit INR 10 Cr by April, resulting in total shutdown of, unless Interim Finance is raised....
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.... Challenges without Interim Finance • Accumulation of month on month operating losses on account of operating below break even levels could lead to closure Low probability of achieving good bids/ resolution plans on account of sub-optimal operations and absence of confidence from customers XXXX XXXX Projected Cash-flow Particulars Mar Apr May Jun Projected inflows Projected outflows 38 39 34 34 43 47* 43 43 Net Cash after opening adjustments (2) (8) (10) (10) Cumulative cash gap (2) (10) (20) (30) Estimated Interim Finance Required: INR XX Cr Indicative Term Sheet • Amount of Interim Finance: INR XXCr. • Period: CIR period • • • Upfront fee: 2% on the disbursed amount Rate of Interest :XX6% P.A (Interest payable monthly) Repayment: No repayment during CIR period Page 33 2.4 & 2.5 Capital Structure and Shareholding Capital Structure and Shareholding Pattern Page 34 I Capital Structure: ¡ Capital Structure of the Corporate Debtor as on the date of commencement of CIRP is provided below (Sample only): ■Shareholding Pattern: Shareholding Pattern of the Corporate Debtor is provided ! by bifurcating the shareholding into 2 parts- ■A. P....
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....romoter & promoter group B. Public shareholding, which is further divided into institutions and non-institutions. Particulars No of shares Amount (INR Crore) Particulars Authorized share capital Equity shares of Rs.10/- each XXX XXX I Promoter and Preference shares of Rs.10/- each XXX XXX Promoter Group Issued, subscribed and paid up capital Public Equity shares of Rs.10/- each XXX XXX Institutions Preference shares of Rs.10/- each XXX XXX Non-Institutions Grand Total Table 3 Total Debt Source: Company Annual Report/ Financials/ NSE or BSE filings No. of Shares % XXX 40.86% XXX 59.14% 2.05% 57.09% XXX 100.00% XXX Table 4 Source: Company Annual Report/Financials/ NSE or BSE filings Details of Financial and Operational Claims Page 35 2.6 Financial and Operational Claims S. No Name of the financial creditors Facility arrangement Amount as per claims filed Amount Admitted (A) Difference Voting Right 1 XXX XXX XXX XXX XXX XXX 234569 XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX 8 XXX XXX XXX XXX XXX XXX 9 XXX XXX XXX XXX XXX XXX Total Table 5 S. No Name of the Operational creditors Amount A....
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....s per claims filed Amount Admitted (A) Difference 1 XXX XXX XXX XXX 2 XXX XXX XXX XXX 34567% XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX 8 XXX XXX XXX XXX 9 XXX XXX XXX XXX Total Table 6 2.7 Division & Customer Overview Customer Analysis Page 36 Products ABC Ltd. (Corporate Debtor) Division 1 Division 2 Division 3 Division 4 Product 1 Product 2 Product 3 Product 4 Key Customers Customer 1 Customer 1 Customer 1 Customer 1 Customer 2 Customer 2 Customer 2 Customer 2 Customer 3 Customer 3 Customer 3 Customer 3 Share of Key Customers Percentage share Percentage share 25 % 25 % Percentage of Total Sale (By division) 75 % 75 % Percentage share 15 52 % 35 % 65 % Chart 3 Source: Company Annual Report/ Company Website/ Management Discussions Percentage share 85 % 2.7 Summary of Key Orders Customer XX Order Details Particulars Buyer Location XXX Plant Name Name of Parts XXX Location Plant Details INR Crore XXX XXX Volume per month XXX Value per month XXX Revenue per unit XXX VA % XXX Cost per unit XXX XXX state Customer XX Plant Details Long Term PPA Particulars Buyer Location XXX Plant Name Name of Parts XXX Location INR Crore XXX XXX Volume per month XX....
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....X Value per month XXX Revenue per unit XXX VA % XXX Cost per unit XXX XXX state A summary of all contracts / orders with key customers to be listed here and other details such as estimated Revenue and EBITDA in the coming financial years can be added Page 37 Supplier Analysis 2.8 Supply Chain Infrastructure ABC Ltd. (Corporate Debtor) Divisions Division 1 Division 2 Division 3 Division 4 Products Product 1 Product 2 Product 3 Product 4 Key Raw material Supplier 1 Supplier 1 Supplier 1 Supplier 1 Supplier 2 Supplier 2 Supplier 2 Supplier 2 Supplier 3 Supplier 3 Supplier 3 Supplier 3 Share of Key Supplier Percentage share Percentage share Percentage share Percentage share Percentage of Supplier Dependance (By division) Source: Company Annual Report/ Company Website/ Management Discussions Page 38 Supplier 1 Supplier 2 Supplier 3 Chart 4 Supplier 4 2.9 Facilities and Capability Location 2 • Land area - XXX • Head Count - XXX Rajasthan Himachal Pradesh Location 1 • Land area -XXX • Head Count - XXX Haryana Location 3 • Land area - XXX • Head Count - XXX Source: Company Annual Report/ Company Website Value Proposition Some value proposition points and....
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.... other key observations noted in the study of the facilities, which will benefit the investors and other stakeholders to be I highlighted here. Page 39 2.10 Details of Manufacturing Facilities Particulars Unit 1 Unit 2 Unit 3 Total Ownership Owned/leased Owned/leased Owned/leased Year Established 2005 2008 2008 Total Land Area (sq. m) Xxxx XXXX XXXX Xxxx Leased Area (sq. m) Xxxx Xxxx Xxxx Xxxx Covered Area (sq. m) Xxxx Xxxx Xxxx Xxxx Ground Covered Area Xxxx Xxxx Xxxx Ground Coverage Area Limit Xxxx Xxxx Xxxx Table 7 Source: Company Annual Report/ Company Website/ Management Discussions Unit 1 Plant picture â–¸ Highlight Unit 2 Highlight Unit 3 â–¸ Highlight State-of-the-art manufacturing facilities â–¸ Equipped with the best-in-line machinery and equipment sourced from leading equipment manufacturers across the globe such as [xxxxx] â–º The manufacturing plants are ISO 9001:2008 certified â–º Suitably supported by the modern ERP software â–º Mix of automated and manual processes leads to cost effective solutions Adequate scope for expansion â–¸ Details Industry leading quality standards â–º Negligible customer rejection rate of 0.5% on sales â–º....
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.... Process rejection rate of 0.3% ►Insignificant customer returns till date Facilities and Capability: Details to be provided in the following manner- Location wise details of each facility Land area at each facility ☠Head count at each facility □ Nature of facility such as machining, assembly, etc Page 40 2.10 Capex Requirement Fund infusion required for completion of Plant 1/2/3... Plant Capacity XXX (X plants with XXX units Capacity) Location CoD Project Cost Funding means Percentage of Completion Plant Capacity Location CoD Project Cost Funding means Percentage of Completion Enter Location Enter commencement of operations date of all units after fund infusion from XXX date Enter Total cost and Cost/unit Debt: INR XXX Equity: INR XXX XX % XXX (X plants with XXX units Capacity) Enter Location Enter commencement of operations date of all units after fund infusion from XXX date Enter Total cost and Cost/unit Debt: INR XXX Equity: INR XXX XX % Details of funds required for the remaining part/incomplete part of the project. Funds infused into the plant till date. Plant specification (Assembly, machining, forging, etc.) and i details of the areas/machinery where funds ....
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....are to be employed for completion of the plant. Purpose of the new plant- Manufacturing a new product, expansion of capacity of existing products, new customer, etc. Additional revenue and EBITDA which will be generated after completion and will be sufficient to service the interest and debt obligations relating to the project. Details of funds required for the remaining part/incomplete part of the project. Funds infused into the plant till date. Plant specification (Assembly, machining, forging, etc.) and details of the areas/machinery where funds are to be employed for completion of the plant. Purpose of the new plant- Manufacturing a new product, expansion of capacity of existing products, new customer, etc. Additional revenue and EBITDA which will be generated after completion and will be sufficient to service the interest and debt obligations relating to the project. Page 41 2.11 Organisation Structure Operations Vice President Turnkey Division Vice President Commercial Head Performance Review Senior Manager Board of Directors SAMPLE Accounts DGM Supply Chain DGM HR and Admin Senior Manager Design/ R&D Head Costing and MIS Senior Manager Internal Audit Senior Manager Sales and....
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.... Marketing Senior Manager Quality Head Company Secretary Source: Company Annual Report/ Company Website/ Management Discussions Page 42 2.12 Board of Directors Director Brief profile Person 1 â–º Brief Profile Director Person 2 Director Person 3 Director Person 4 Director Brief Profile Brief Profile Brief Profile Person 5 Brief Profile Whole-Time Director Source: Company Annual Report/ Company Website/ Company Secretarial Records Page 43 2.12 Key Management Management VP - Operations DGM-Manufacturing Brief profile â–º Brief Profile â–º Brief Profile Head - Quality Design Head DGM-Supply Chain DGM - Finance and Accounts Senior Manager - Performance Review Senior Manager - HRD Company Secretary â–º Brief Profile â–º Brief Profile â–¸ Brief Profile Brief Profile â–¸ Brief Profile â–¸ Brief Profile â–¸ Brief Profile Page 44 2.13 Details of Statutory Approvals and Compliances ➤ Details of all relevant statutory approvals/compliances/licences etc to be furnished including but not limited to: ➤ Environmental Clearances ➤ Fire and Safety Clearance ➤ Pollution Control > Certificate to Operate ➤ Statutory Licences/Clearances âž....
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.... Registration Certificates ➤ Registration under Tax Authorities ➤ Details to be furnished to include current status, last renewed date, next renewal date, costs involved, relevant authority involved priority of approvals etc Page 45 2.14 Investment Overview Key Investments held ין ¡A snapshot of the Key Investments held by the corporate debtors can be given as shown below: Parent Co. 51% Promoter Shareholding A Ltd. 49% 6% ABC Ltd. (Corporate Debtor) E ltd. 35.88% B Ltd. 41.1% F Ltd. 41.34% C Pvt Ltd. 41.17% G Pvt. Ltd. 15.02% D Pvt Ltd. 41.19% Gs Pvt Ltd. 41.28% Source: Company Annual Report/ Company Website/ Company Secretarial Records Page 46 Public 43% Foreign Subsidiaries 100% 2.14 Investment 1/2/3... Description of each Investment of the corporate debtor can be given highlighting the following aspects of each investment: Business Description: Give a brief description of the business of the entity with details such as nature of business, plants or office location, financial details or a snapshot of the financials of the entity, date of investment in the entity, status of operations, etc. Key Customers: ■A list of the key customers of the entity, pro....
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....duct wise and location of plant wise, if applicable. For Example: Logos of the customer Products: A list of the key products of the entity, category and sub category of products. Sample format given: Manufacturing plant details Plant 1- XXX, XXX Category Manufacturing Engine Product names Products Transmission Product name Applications Page 47 . Final Application Headcount (as of 31st March, 2018)- XXX Land Area (in acres)- XXX Brief description of the unit and the capacity and overall level of capacity utilization in the past Components of Plant's Core shop includes equipments like: List of equipments at the core shop Page 48 Industry Overview 3. Industry Overview Detailed Industry analysis to be furnished and the following points can be considered for the same: Nature of industry Concise overview of the industry should include its competitors and their operations. â–¡ Industry growth trend in the past and future outlook of the industry Macroeconomic factors affecting the industry â–¡ Change in laws and regulations governing the industry (Favourable or not) L L Highlight factors like geographical growth, consumer base, price fluctuations, past performances and income proje....
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....ctions. Sector wise break up of customers into Private/State Government/Central Government, etc. Key Investment perks in the industry ☠Seasonality/Business Cycle of the Industry. Page 49 3.1 Industry Overview - Snapshot Turnover- Exports Contribution to GDP- Share in India's Exports Domestic Aftermarket Number of players, Organized vs Unorganized Turnover breakup Organized vs Unorganized 10000 Unorganized 15% 700 Unorganized Organized 85% Organized Chart -5 Source: CRISIL/ICRA report or Specific industry reports from SIAM, NHAI, S&P, Capital IQ, etc Organized sector-------- Unorganized sector- Page 50 Brief gist pertaining to the charts XYZ Industry Key highlights regarding industry Marquee deals in recent years 3.2 Strong Sector Fundamentals Trend Analysis (%) Chart -6 Key Sectors Chart -7 16.6 13.8 11.2 11.7 12.3 12.2 10.6 9.8 9 13.3 12 11.7 State 33% 11 4.7 4.5 9.6 9.9 Private 43% Key remarks on segment wise break 8.4 8.7 8.8 8.8 8.8 up... 3.2 7.1 7.3 1.6 4.2 3.6 2.1 FOX FY 2 FY 3 FY 4 FY 5 FY 6 FY 7 FY 8 FY 9 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 Central 24% ―% Peak Deficit % Energy Deficit Source: CRISIL/ICRA report or Specific industry reports from SIAM, NHAI, S&P,....
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.... Capital IQ, etc Matured Regulatory Environment Source: CRISIL/ICRA report or Specific industry reports from SIAM, NHAI, S&P, Capital IQ, etc Investment Perks Chart -8 Ministry of XYZ sector/Govt body Transparent and well evolved bidding mechanism Appellate tribunal for relevant sector for quick resolution of disputes Page 51 100% FDI Allowed Tax benefits Industry Specific incentives.. Source: CRISIL/ICRA report or Specific industry reports from SIAM, NHAI, S&P, Capital IQ, etc 3.3 Key Growth Drivers in the XYZ Sector 1 DEMAND 2 POLICY SUPPORT SUPPLY Page 52 3 3.4 Competitor Analysis I Competitor Analysis for a particular Financial Year to be given (Sample given below) Chart -9 1600 1469 15% 11.5% 8.1% 2% 3% 20% 1400 10% 0% 1200 6% 878 -10% 1000 1127 716 -20% Sales (In Rs 800 579 -30% Crore) -40% 600 281 298 -50% EBITDA 400 -71% -60% 16% 11% 19% 12% 12% 25% Margin 200 -70% 0 -80% Net Margin Castex Kirloskar Ferrous India... Rico Auto Industires... Ramkrishna Forge Alicon Castallo Nelcast Munjal Kiriu Industries... Production capacity of all competitors to be given (Sample given below) Chart -10 0 50000 100000 150000 200000 250000 217786 Page 53 40000 Observations/Comments: Top 3 p....
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....layers Account for ~XX% of the Total Industries' Revenue The Industry Leader is ABC with a top line of XX Cr and EBITDA margin of XX% Key emerging players are - XYZ, MNO, etc. XXXX Source: CRISIL/ICRA report or Specific industry reports from SIAM, NHAI, S&P, Capital IQ, etc 30000 48000 ■Capacity (MTPA) 150000 150000 150000 Source: CRISIL/ICRA report or Specific industry reports from SIAM, NHAI, S&P, Capital IQ, etc Apart from this analysis, we have to look at a product wise analysis of each competitor Mention the latest deals, mergers or acquisitions that have taken place amongst the competitors Page 54 Projected Business Plan - Aspirational 4.1 Future Growth Strategy Capacity expansion/utilization ABC Ltd. Is currently operating at XX% of its capacity, which is XX% less than its breakeven point. Hence, with XXX amount of funds, capacity can be increased to XX% i.e. more than the breakeven point and ABC Ltd can start generating positive cash flows. Other points for expansion... XXX XXX Future growth strategy ས Diversifying customer base and product segments A very diverse customer base existing already with potential for expansion/diversification even further. List of to....
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....p 5 existing customers and their percentage share in total sales. List of top 3 potential customers who can be roped in or ongoing discussions taking place. Impact on EBITDA after expansion of customer base. Page 55 Holistic approach for overall growth of the company. Expansion of Customer base/ New product line/ entering new market segment or new geographical segment. Measures to increase top line/ control bottom line. XXX New product development Long term plan to cover the "high volume" and the “high margin" slices of the [xxxxx] industry 4.2 Assumptions Key assumption taken for the forecast: Fund infusion (Working capital/Term loan/Equity) for achieving the operational level projected including capex ➤ Factors considered while projecting- Market share growth, Average selling price, Existing order book, Average cost of the product. Assumption for demand in the forecast period - how it will increase/decrease, based on historical trend or industry reports. Assumptions used for other expenses: Manufacturing Overheads Bifurcation into fixed, variable and semi variable Employee benefit expenses Indirect Costs Other expenses Assumptions for Management Expertise and Adequate ....
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....Capitalisation. Listing reports which are relied on for the following: • Industry growth rate assumptions; Average Selling Price in the forecast period; Average Cost Price in the forecast period; Market Share, Inflation, etc Working capital assumptions Page 56 4.3 Profit & Loss for the Forecast Period Particulars Year 1 Year 2 Year 3 Year 4 Year 5 Revenue from Operations XXX XXX XXX XXX XXX Other Operating Income XXX XXX XXX XXX XXX Aggregate Revenue XXX XXX XXX XXX XXX Total cost of materials consumed XXX XXX XXX XXX XXX Employee benefits expense XXX XXX XXX XXX XXX Other Mfg. expenses XXX XXX XXX XXX XXX Power and Fuel XXX XXX XXX XXX XXX Transportation charges XXX XXX XXX XXX XXX Plant overheads XXX XXX XXX XXX XXX Other SG&A XXX XXX XXX XXX XXX Total Expenses EBITDA XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Net Profit XXX XXX XXX XXX XXX Table 8 Source: Company Industry Report/ Company Website/ Management Discussions Observations/Commentary: (Commentary on Key Observations should be given as follows) The above projections have been made assuming the utilisation of idle capacity. Hence, we can see growth in revenue and EBITDA levels. ➤ Overheads are decreasing constantl....
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....y basis our understanding of the efficiency in the production processes and economies of scale. Sufficient demand for the product line is present. XXXXXX XXXXXX XXXXXX Page 57 4.4 Company level EBITDA Analysis over the Forecast Period Year 1 Year 2 Year 3 Year 4 Year 5 53.0% Raw Material Cost as a % of revenue 52.0% 51.0% 50.0% 50.0% 48.0% Manufacturing expenses as a % of revenue Administrative expenses as % of revenue Selling & distribution expenses as % of revenue EBITDA 13.2% 13.0% 13.1% 13.0% 12.8% 12.8% 3.8% 3.8% 3.6% 3.3% 3.0% 2.8% 1.6% 1.6% 1.5% 1.4% 1.3% 1.3% 21.0% 21.6% 21.9% 20.2% 20.3% 20.4% Source: Company Industry Report/Company Website/ Management Discussions Page 58 Chart -11 [COMMENTARY] This type of EBITDA analysis can be shown with commentary on the right Annexures Serial Number Annexure 1 Annexure 2 Annexure 3 Annexure 4 Annexure 5 Annexure 6 Annexure 7 Details Process Overview Bid Evaluation Criteria Public Announcement Expression of Interest Claims of Various Creditors Details of Key Investments Process Note Page 59 Page 60 Process Overview Process Overview Background and Initiation of CIRP Proceedings under NCLT: ☠Date of admission in NCLT . Name of Inte....
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....rim Resolution Professional ☠Name of Process Advisors & Legal Counsel Name of Valuers Appointed Summary of claims Filed & Admitted Brief summary of Flow of events post initiation of CIRP ☠Brief profile of Insolvency Resolution Professional (IRP): ☠Professional background of the IRP - Highlight the current occupation and designation in the industry or professional firm. Educational Qualification and number of years of experience in different organisations or in practice. Select Experience of the IRP Highlight the ongoing engagements and engagements done in ! the past to show how that experience will help. EOI Invitation under NCLT: Page 61 . Date on which EOIs were invited EOIS received under the NCLT process U EOIs accepted after the last date of submission of EOIs ã… â˜ â˜ Tabular summary of EOIs received, their status as eligible to bid or not and whether they are strategic investors or financial investors. Binding Financial Bid/Binding Resolution Plan: ☠Last Date of submission of Binding Financial Bid Summary of Binding Financial Bids received Last Date of submission of Binding Resolution Plan Date of discussion of plans with the COC. Details....
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.... of Negotiations with highest evaluated ! bidder Name of the applicant selected as successful resolution applicant Indicative Reference List Financial snapshot and historical numbers to be used for analysis can be obtained from company annual reports and/or audited financials of the corporate debtor Discussions with management / KMPs of the corporate debtor to get data of current market share, major customers, major suppliers of raw material, alternate sourcing arrangements etc Sector/Industry reports can be sourced from secondary database providers (Example: For the automotive sector report issued by SIAM or ACMA) Institutional / Government Publications to be referenced for policy updates and key statistics Industry reports from various credit rating agencies can be referenced especially when the agency is initiating coverage on a particular Industry/Company News in the media to be referenced for recent developments in the company/industry Page 62 Page 1 Annexure-A2 Specimen of Information Memorandum For a Corporate Debtor in Power Sector Abbreviations ACQ B.Tech ВОРBPTA BTG Annual Contracted Quantity Bachelor of Technology Balance of Plant Bulk Power Transmission Agree....
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....ment Mn Million MOC Ministry of Coal MOD MTPA Boiler Turbine Generator MW CAGR Compound Annual Growth Rate O&M CEA CERC Central Electricity Authority PLF Central Electricity Regulatory Commission PPA CoD Commercial Operation Date REC Cr Crores ROM Merit order dispatch Million Tons Per Annum Mega Watt Operation and Maintenance Plant Load Factor Power Purchase Agreement Rural Electrification Corporation Limited Run of Mine EPC Engineering, procurement and construction Rs Rupees (Indian) FDI Foreign direct investment SERC SHR State Electricity Regulatory Commission Station Heat Rate FSA Fuel Supply Agreement St. Station GCV Gross Calorific Value tn Tonne INR Indian National Rupee TN Tamil Nadu IPP Independent Power Producer TPP Thermal Power Plant KCal Kilo Calories UP Kg kilogram WPI Uttar Pradesh Wholesale Price Index Kms kv kWh Kilometers Kilovolt Kilowatt-hour M.S. M.Tech Page 2 Masters of Science Master of Technology Disclaimer This information memorandum is formulated by ABC (Name of Resolution Professional) in consultation with XYZ Ltd (Name of Professional Advisor, if any) which has been appointed as a professional advisor to the Resolution Professional (RP). The purpose of th....
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....is document is to assist the recipient in deciding whether they wish to proceed with a further investigation of the Company, and in putting forward resolution plan for the Company in accordance with the Insolvency and Bankruptcy Code, 2016 (hereinafter as "IBC" or "Code") and the Regulations made thereunder, as amended from time to time. This Information memorandum has been prepared in furtherance of Section 29 of the Code. The information memorandum contains specific information of the corporate debtor including but not limited to the details as prescribed under sub-regulation 2 of Regulation 36 of the Insolvency and Bankruptcy Board of I India (Resolution process for Corporate Persons) Regulations, 2016 (hereinafter as "CIRP Regulations"). This information memorandum and the information contained herein is not intended to form the basis of any investment decision by a prospective resolution applicants. Interested parties should carry out their own investigations and analysis of the Corporate Debtor and of the data referred to in this Information Memorandum and should consult their own advisers before submitting a resolution plan. Neither this document, nor anything contained here....
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....in, should form the basis of, or be relied upon in connection with any contract, agreement, undertaking, understanding or any commitment or investment decision whatsoever. The information contained/disclosed in the information memorandum is as provided by the Corporate Debtor and the creditors of the Corporate Debtor. No representation or warranty, express or implied, is given by the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) as to the accuracy, authenticity or completeness of the contents of this Memorandum or any other document or â– information supplied, or which may be supplied at any time or any opinions or projections expressed herein or therein, nor is any such party under any obligation to update the Memorandum or correct any inaccuracies or omissions in it which may exist or become apparent. This Memorandum should not be considered as a recommendation by the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) to invest in the Corporate Debtor and each prospective applicant must make its own indep....
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....endent assessment of the merits or otherwise of investing in the corporate debtor. This information memorandum contains the forecasts, projected financial information and other predictive statements that represent the Resolution | Professionals and its Professional Advisors assumptions in light of information available in public domain, about circumstances and events that have not yet taken place. The said forecasts, projected financial information and other predictive statements are based on market/industry trends/predictions/estimates and other factors. Accordingly, there can be no assurance or guarantee that the projected results will be attained. The projected results are not definitive and are subject to change without notice. The future projections enclosed in this information memorandum involve risks and uncertainties, based on various factors and variables, which may cause actual performance to differ materially from any projections of future performance The Resolution Professional and its Professional Advisors at no time guarantees the accuracy/authenticity of the future projections. In particular, but without prejudice to the generality of I the foregoing, no representati....
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....on or warranty whatsoever is given in relation to the reasonableness or achievability of the projections contained in this Information Memorandum or in relation to the bases and assumptions underlying such projections and you must satisfy yourself in relation to the reasonableness, achievability and accuracy thereof. The recipient acknowledges that it will be solely responsible for its own assessment of the market projections and future prospects/performance of the corporate debtor Page 3 Disclaimer Cont. Memorandum and the information contained therein is confidential and subject to the undertaking executed between the corporate debtor and the â– recipient in pursuance of Section 29 (2) of the Code. The recipient by way of the undertaking, unconditionally acknowledges to undertake to (a) comply with the provisions of the law for the time being in force relating to confidentiality and insider trading (b) protect the intellectual property of the corporate debtor it may have access to and (c) is statutorily obligated not to share the information memorandum or its contents with third parties unless (a) and (b) above have been complied with. The recipient further also acknowledges....
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.... that the information contained in the information memorandum shall not be used ito cause undue gain or undue loss to itself or to any other persons and that the recipient shall comply with the requirements under Section 29(2) of the â– Code. I i No responsibility or liability is accepted for any loss or damage arising whatsoever that you may suffer as a result of this Information memorandum or the information contained herein and any and all responsibility and liability is expressly disclaimed by the Resolution Professional and its Professional Advisor and its respective partners, directors, officers, affiliates, employees, advisors or agents. Should this Information memorandum (through the act or default of the recipient) reach other persons without the resolution professional's written consent, the recipient shall indemnify the resolution professional and its professional advisor including its respective partners, directors, officers, affiliates, employees, advisors or agents against any loss or damage or other liabilities (including all costs), which they may suffer as a result. By accepting a copy of this information memorandum, the recipient is deemed to have acknowledge....
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....d and accepted that the terms and conditions of the disclaimer notice and that it formed an integral/material part of this information memorandum. The recipient further is deemed to have unconditionally acknowledged that the Corporate Debtor, any of its officers, employees or its agents, the Resolution Professional or XYZ Ltd. (Name of Professional Advisor) do not accept any liability for any and all information contained in this information memorandum. The recipient is deemed to have acknowledged that the information contained in the information memorandum shall not be utilised/used for any other purpose other than for the preparation of the Resolution Plan as defined in the Code. The information memorandum and the information contained herein may not be inclusive or contain all information which the recipient considers material. While the Resolution Professional shall endeavour to furnish further relevant information/details/ clarifications, the resolution professional is under no â– obligation to provide the recipient with any further relevant information/details/clarifications. In the event any additional information/clarifications are so provided they shall be uncondition....
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....ally subject to this disclaimer notice irrespective of whether it has been specifically provided for or not. This information memorandum and the information contained herein should not be printed, reproduced, transmitted, sold, distributed, or published by the recipient without prior written approval of the Resolution Professional. The recipient further acknowledges to return and /or destroy this information memorandum at the written request of the resolution professional. The resolution professional shall act as the primary point of contact for the recipients and any and all correspondences/clarifications should only be addressed to the resolution professional. This Information memorandum is issued by the â– resolution professional of the corporate debtor without incurring any liability/commitment on the part of itself or the professional advisor (including but not limited to the professional advisors respective partners, directors, officers, affiliates, employees, advisors or agents) or the corporate debtor or any of its officers, employees or its agents Page 4 Contact Details: For any further enquiries, please contact: [Name] Resolution Professional Name of Corporate Debto....
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....rs Tel: Mobile Email Page 5 Contents Part A Part B Statutory Information Memorandum under IBC Business Transaction Information Memorandum Page 6 Page 7 Part A Statutory Information Memorandum (Statutory IM) Model Information Memorandum Table of Contents 1. Related Sections and Regulations 2. Contents as given in Regulation 36 Statutory Information Memorandum 3. Description of Assets & Liabilities and Financial Statements (Regulation 36(2)(a),(b) & (c)) 4. List of Creditors (Financial, Operational, Employees & Others) (Regulation 36(2)(d)) 5. Dues to/from Related parties (Regulation 36(2)(e)) 6. Guarantor Details (Regulation36(2)(f)) 7. Members or partners having- 1% or more stake (Regulation36(2)(g)) | 8. Details of all material litigation and an ongoing investigation (Regulation36(2)(h)) 9. No of Workers & Employees and their dues (Regulation36(2)(i)) Page 8 Index of Tables Page 9 Table 1 Assets & Liabilities Table 2: List of Creditors... Table 3: Dues to/from Related Parties....... Table 4 Guarantor Details.. Table 5: Details of members / partners holding at least one per cent stake.. Table 6: Material Litigation.............. Table 7: Workers & Employees and their dues... .8 .9 ....
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.....10 .11 .12 .13 .14 1. Relevant Sections and Regulations Section 5(10) Section 29(1) ¡ Section 29(2) I Regulation 36 of IBBI (IRP for Corporate Persons) I Regulations, 2016 Information Memorandum (Statutory IM) is a memorandum prepared by resolution professional under sub-section (1) of section 29. Provides that the resolution professional shall prepare an information memorandum in such form and manner containing such relevant information as may be specified by the Board for formulating a resolution plan. ■The resolution professional shall provide to the resolution applicant access to all relevant information in physical and electronic form, provided such resolution applicant undertakes- (a) to comply with provisions of law for the time being in force relating to confidentiality and insider trading; (b) to protect any intellectual property of the corporate debtor it may have access to; and (c) not to share relevant information with third parties unless clauses (a) and (b) of this sub-section are complied with. ■Explanation.—For the purposes of this section, "relevant information" means the information required by the resolution applicant to make the resoluti....
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....on plan for the I corporate debtor, which shall include the financial position of the corporate debtor, all information related to disputes by or against the corporate debtor and any other matter ! pertaining to the corporate debtor as may be specified. Provides for the contents of the Statutory IM and the manner in which it will be submitted to each member of the CoC and any potential resolution applicant. Page 10 2. Contents of Statutory IM Regulation 36 of IBBI (IRP for Corporate Persons) Regulations, 2016 S.No. Regulation 1 36(2)(a) 2 36(2)(b) & 36(2)(c) 3 36(2)(d) 4 36(2)(e) 5 36(2)(f) 6 36(2)(g) 7 36(2)(h) 8 36(2)(i) Page 11 Particulars Assets and Liabilities with such description, as on the insolvency commencement date, as are generally necessary for ascertaining their values. The latest annual financial statements and audited financial statements of the corporate debtor for the last two financial years and provisional financial statements for the current financial year made up to a date not earlier than fourteen days from the date of the application A list of Creditors containing the names of creditors, the amounts claimed by them, the amount of their claims admitted and th....
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....e security interest, if any, in respect of such claims Particulars of a debt due from or to the corporate debtor with respect to related parties Details of guarantees that have been given in relation to the debts of the corporate debtor by other persons, specifying which of the guarantors is a related party The names and addresses of the members or partners holding at least one per cent stake in the corporate debtor along with the size of stake. Details of all material litigation and an ongoing investigation or proceeding initiated by Government and statutory authorities. The number of workers and employees and liabilities of the corporate debtor towards them. 2. Contents of Statutory IM Regulation 36 of IBBI (IRP for Corporate Persons) Regulations, 2016 A member of the committee may request the resolution professional for further information of the nature described in this Regulation and the resolution professional shall provide such information to all members within reasonable time if such information has a bearing on the resolution plan. The interim resolution professional or the resolution professional, as the case may be, shall share the information memorandum after receiving ....
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....an undertaking from a member of the committee or a potential resolution applicant to the effect that such member or resolution applicant shall maintain confidentiality of the information and shall not use such information to cause an undue gain or undue loss to itself or any other person and comply with the requirements under section 29(2). Page 12 3. Assets & Liabilities and Financial Statements 1. Assets and Liabilities with such description, as on the insolvency commencement date, as are generally necessary for ascertaining their values. 2. 'Description' includes the details such as date of acquisition, cost of acquisition, remaining useful life, identification number, depreciation charged, book value, and any other relevant details. 3. The latest annual financial statements and audited financial statements of the corporate debtor for the last two financial years. 4. Provisional financial statements for the current financial year made up to a date not earlier than fourteen days from the date of the application. Generally, provisional financials are made on the date of commencement of the Corporate Insolvency Resolution Process (CIRP). Table-1 Amount Particulars Assets Fixed Asse....
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....ts XXX CWIP XXX Investments (net of provisions) XXX Loans and Advances XXX XXX XXX XXX XXX Investment in Mutual Funds XXX XXX Tax Assets Inventory Debtors Cash and Bank balances Total Assets Liabilities Financial creditors Operational Creditors Provisions Net Worth Total Liabilities Source: Financials of corporate debtor as on CIRP date XXX XXX XXX XXX XXX Page 13 4. List of Creditors- names of creditors, the amounts claimed by them, the amount of their claims admitted and the security interest Financial, Operational, Employees & Others Financial Creditors: All financial creditors have to file their claims in Form C in the prescribed format, after which the Resolution Professional will verify and admit the claims to the extent they have been verified, form the CoC and include the claims of the I financial creditors in the IM. All financial creditors have voting rights which is based on the proportion of the financial debt owed to such financial creditor in relation to the financial debt owed by the corporate debtor. â– Operational Creditors: All operational creditors have to file their claims in Form B in the prescribed format, after which the Resolution Professional will veri....
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....fy and admit the claims of the operational creditors to the extent they have been verified i Operational creditors have no voting rights. Employee Claims & Other Claims are filed in Form D & Form E respectively, then they are verified and admitted. Table-2 Creditor names Facility Amount of claims submitted Amount admitted Voting right Financial creditors XXX XXX 100% A Secured Term Loan XXX XXX 50% B Working Capital Loan XXX XXX 20% C Term Loan XXX XXX 30% Amount of claims Creditor names Facility Amount admitted Voting right submitted Operational Creditors XXX XXX ÎΑ X ÎΑ XXX XXX ÎΑ Y ÎΑ XXX XXX ÎΑ Z ÎΑ XXX XXX ÎΑ Source: Data from Corporate Debtor/Management Discussion/Financials Page 14 5. Dues to/from Related Party Definition of related party in relation to a Corporate Debtor is much wider in scope as compared to the Companies Act, 2013. It has been defined in section 5(24) of IBC, 2016. As per Regulation 36(2)(e), particulars of a debt due from or to the corporate debtor with respect to related parties are to be stated in the Statutory IM. Debt payable to/due from related parties Name of the party To/due from related parties: XXX....
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.... XXX Total Table-3 Sample Format Any other Trade receivables Trade payables Loans/Advances arrangements Net receivable/ (payable) XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Source: Data from Corporate Debtor/Management Discussion/Financials Page 15 6. Guarantor Details ! As per Regulation 36(2)(f), details of guarantees that have been given in relation to the debts of the corporate debtor by other persons, specifying which of the guarantors is a related party. Example: Corporate Guarantee or Personal Guarantee given in relation to the debts by any related party of the corporate debtor Guarantees given Personal guarantees of: XXX Corporate guarantees of: XXX Table-4 Sample Format Designation XXX Source: Security Creation documents along with sanction letter/Register of Charges created Page 16 Facility XXX XXX XXX 7. Details of Members/Partners Holding at least 1% Stake As per Regulation 36(2)(g), the names and addresses of the members or partners holding at least one per cent stake in the corporate I debtor along with the size of stake have to be provided in the Statutory IM --- Name of the shareholder Promoter Group XXX XXX Table-5 Sample Format Address Nature of S....
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....hareholder No. of fully paid up equity shares held Shareholding as a % of total no. of shares Promoter XXX XXX Non Promoter Group XXX XXX Non Promoter XXX XXX Source: Annual Report or Financials/ Register of Members Page 17 8. Material Litigations ! As per Regulation 36(2)(h), Details of all material litigation and an ongoing investigation or proceeding initiated by Government and statutory authorities have to be provided. Table-6 Sample Format Notice received for Contingent Proceedings initiated by Court Authority Related Law/ Regulation Parties to the litigation Particulars of case amount Liability Lawyer Involved Labour Related cases XXX XXX XXX XXX XXX XXX XXX XXX Direct & Indirect Taxes Related cases XXX XXX XXX XXX XXX XXX XXX XXX Other cases XXX XXX XXX XXX XXX XXX XXX XXX Source: Annual Report or Financials/ Management discussions Page 18 9. Number of Workers and Employees and their Dues ¡As per Regulation 36(2)(i), the number of workers and employees and liabilities of the corporate debtor towards them have to be I provided. Table-7 Sample Format Number of Employees and amount due to employees as on CIRP Commencement date Particulars Number of Employees Number of Worker....
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....s - Regular No. of Employees XXX XXX XXX Number of Workers - Casual Wages & Salary including provision LTA and Medical Payable Reimbursements Provident Fund ESI Staff expenses unpaid Full and Final Settlement payable Any other Total Source: Management Discussions/ Data from Corporate Debtor Page 19 Balance outstanding as at CIRP Commencement Date XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Page 20 PART-B Business Transaction- For a Corporate Debtor in Power Sector Model Information Memorandums Table of Contents Transaction Information Memorandum 1. Executive Summary, Key Investment Highlights and Indicative Project Timelines 2. Company Overview 3. 2.1 Corporate Debtor Profile 2.2 Business Evolution 2.3 Project Details 2.4 Current Scenario, Snapshot of Financial Performance and Interim Finance 2.5 Capital Structure of Corporate Debtor 2.6 Shareholding Pattern of Corporate Debtor 2.7 Financial & Operational Claims 2.8 Facilities and Capability 2.9 Summary of Contracts, Fully Tied-up Fuel Sourcing Arrangement & Adequate Coal Sourcing 2.10 Capex Requirement 2.11 Organisation Structure 2.12 Board of Directors & Key Management 2.13 Details of Statutory Approvals and Compliances 2.14 Investm....
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....ent Overview Industry Overview Page 21 3.1 Snapshot 3.2 Sector Fundamentals 3.3 Key Growth Drivers 3.4 Competitor Analysis 3.5 Key trends & outlook Model Information Memorandums Table of Contents Transaction Information Memorandum 4. Projected Business Plan 4.1 Future Growth Strategy 4.2 Assumptions 4.3 Profit & Loss for the Forecast Period 4.4 Company level EBITDA analysis over the Forecast Period Annexures to Business Transaction IM List of Annexures to be given Process Overview Indicative Reference List Page 22 Index of Tables Table 1 : Financial Summary.... Table 2 Balance Sheet and Income Statement Table 3 Capital Structure.... Shareholding Pattern.... Table 4 : Table 5 Financial Claims.... Table 6 Operational Claims.. Table 7 Manufacturing Facilities.. Table 8 Projected P&L .15 .17 .18 .18 .19 .18 .23 .40 Page 23 Index of Charts Chart 1 Sales by Geography.... Chart 2 Sales by Segment... Chart 3 Division Wise Share. Chart 4 Supplier Dependence....... Chart 5 Turnover Breakup Chart 6: Trend Analysis... Chart 7 Key Sectors.... Chart 8 Investment Perks... Chart 9: Competitor Analysis... Chart 10 Production Capacity... 15 15 20 21 32 33 33 33 35 36 Page 24 1. Executive Summary Com....
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....pany Overview A Ltd. ("the Company") is a major player in the power sector operating in renewable/non renewable segment. â–º Has a total installed capacity of XXX MW â–º Recently approvals obtained for 2 additional hydro/wind/solar units of XX XMW each â–º Operates X state of art Manufacturing facilities in ABC/DEF/GHI â–º Has deep-rooted and long-standing contracts/PPAs with XXX for X years at INR X per unit â–¸ Owned and run by professional management â–¸ CIRP background What ABC Ltd offers? â–º Opportunity to increase the power generation capacity â–º Lower cost of generation due to operational efficiencies, optimisation of logistics cost w.r.t. coal procurement Platform for a strategic partner to enter/expand its operations in various segments (Hydro/coal/wind) PLF of thermal power plant > 80% â–º [mention opportunity here] The Transaction Page 25 1. Key Investment Highlights 1 Diverse portfolio across Thermal, wind and solar plants. 2 State-of-the-art power plants with latest technology machines 3 Professional management team and corporate governance standards benchmarked to best industry practices 4 Page 26 Operating in highly government re....
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....gulated sector, with various programmes in pipeline to accelerate industry growth 1. Indicative Project Timelines ✓ Communication strategy ✓ Day O plan ✓ Risk identifications & mitigation ✓ Application formalities ✓ Public Announcement Take control of the assets ✓ Roll out new org. chart Prepare an IM Meetings with key suppliers & customers ✓ Constitute Committee of all Creditors ✓ Agree a plan with customers ✓ Funding requirement and identify potential investor Optimize cash and cut cost ✓ Negotiate with different creditors ✓ Sale of any non core assets ✓ Update list of claims from creditors ✓ Diligence / Meeting with potential resolution applicant ✓ Review all Approval of the resolution plan by CoC & NCLT resolution plan received before presenting to CoC File application to NCLT Planning 0-30 days 31-60 days 61-120 days 121-150 days 151-180 days Project & crisis management Compliance with IBC rules Cash flow management Collect and validate claims Stakeholder management Negotiate plan with creditors Page 27 Page 28 Company Overview 2. Company Overview 2.1 Corporate Debtor Profile POWER & UTILITIES ....
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....COMPANY A generates, transmits, and distributes electric power and operates through fuel & power, power grid, and customer service segments Sales (20XX) XXX Net Income (20XX) XXX Number of employees XXX (31 March 20XX) Credit Rating Ba3 (Moody's, 20XX) Fortune 500 Ranking (20XX) # (If applicable) In April 20XX, POWER & UTILITIES COMPANY A transitioned to a Holding Company System, spinning off its three business segments: Generation POWER & UTILITIES COMPANY A Transmission and Distribution POWER & UTILITIES COMPANY A Retail POWER & UTILITIES COMPANY A Generation Mix The company has a portfolio of thermal, hydroelectric, and nuclear, as well as renewable energy power plants, including solar, wind, and hydro. It also engages in the design of power generation and distribution facilities Thermal constitute the highest in energy mix with more than 65% contribution. Renewable capacity grew by XX% in 20XX but still lowest in contribution 1 66.3% 2 65.9% 18.9% 19.1% ã… â˜ Thermal Hydro Solar Total: 66.8 GW Total: XX GW Sources: POWER & UTILITIES COMPANY A's annual reports and company website Page 29 Geographic Reach, Strategic and Expansion Plans â–º Currently, it supplies elec....
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....tricity only in XXX, especially in CITY metropolitan area. â–¸ With plans to increase in presence geographically, it collaborated with XX in July 2016, to form a JV - ABCD. Customer Base -35% customers serviced across XXX (as of March 2016) â–¸ The company aimed to complete installation of smart meters in every household by 2020 â–¸ POWER & UTILITIES COMPANY A introduced new service amid liberalization, such as new rate plans, web service to enhance electricity usage, as well as alliances with 40 companies in other sectors 2.2 Business Evolution â–º [] 2000- 05 2008-11 2005-08 â–º 0 Going forward, the Company has opportunity to and aim at 2011-present [] higher 1975-2000 â–ºInception- XXX was Incorporated in June, XXXX Evolved over the last 4 decades to become one of the frontline players in the [xxxx] industry in India Page 30 2.3 Project Details XXX MW operational plant in XXX (Location) Project Size Location CoD Project Cost Funding means XXX MW (X plants with XXX MW Capacity) Enter Location Enter commercial operation date of all units Enter Total Project cost and Project Cost/MW Debt: INR XXX Equity: INR XXX Coal linkage Source of Coal (For thermal power....
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.... plants) and FSAS Page 31 Approvals obtained for 2 additional units of XX XMW each → Total potential of XXX MW installed capacity at the site 1 USD = INR 65 2.4 Current Scenario Technical Issues Lack of availability of Natural gas and inadequate gas pipeline infrastructure resulting in the project operating at low/no PLF. PPA with XXX state board has expired in XX i Month, 20XX. Project is currently pursuing renewal of PPA for additional term of 10 years, however there is uncertainty over the same due to low demand and higher variable cost of the same. No definitive PPA for Power Offtake of Project II & Project III. Due to low power demand and High variable cost of generation, power sale could not be tied up. + Financial Issues Lower EBITDA and negative free cash due to lower power generation and under utilisation of capacity. Hence, company is not able to currently service its full interest and debt obligations. Removal of subsidies by the Government resulting in increase in variable cost of generation per unit. Lack of PPAs resulting in non recovery of Fixed cost. Hence, negative cash flows. XXX XXX XXX Macroeconomic Factors Thermal power plants are sitting idle due to hig....
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....her cost of generation per unit as compared to wind and solar energy. Threat of new rivals as new players are coming in the renewable energy sector. Liquidation or Hostile Takeovers by capital rich companies to create synergy benefits and capture market share. XXX XXX Page 32 2.4 Snapshot of Financial Performance Financial Summary Balance sheet as on XX/XX/XXXX FY 1 FY-1 FY -2 Particulars Equity Net Worth Non-Current Liability Long term loan Others Current Liability Sundry creditors Others Total Equity and Liability Assets Non-Current Assets Investments Others Current assets Debtors Cash Total Assets Income Statement Summary Particulars FY 1 FY-1 FY -2 Revenue from Operations Other Income Operating Expenses EBITDA Depreciation EBIT Interest expense EBT PAT Source: Company Annual Report/ Historical Financials Page 33 1. The consistent increase in revenue in the last 2 years is in line with the increasing trend as seen in the industry. 2. Low EBITDA margin along with calculated Interest Coverage Ratio and Debt Service Coverage Ratio shows the difficulty in servicing the finance cost and principal instalments. 3. Increasing inventory and trade receivables highlights working capital be....
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....ing blocked and hence, the liquidity problems faced by A Ltd. 4. XXXXXX 5. XXXXXX 6. XXXXXX 2.4 Interim Finance • Current Status Advances received from key customers to keep the business afloat and maintain continuity of supplies; to be repaid on offset against sales basis Delay in salaries & wages resulting in low morale across the company; inability to retain/deploy level impacting workers at the required production and sales At current levels of production, cash gap projected to hit INR 10 Cr by April, resulting in total shutdown of, unless Interim Finance is raised Challenges without Interim Finance • Accumulation of month on month operating losses on account of operating below break even levels could lead to closure Low probability of achieving good bids/ resolution plans on account of sub-optimal operations and absence of confidence from customers XXXX XXXX Projected Cash-flow Particulars Mar Apr May Jun Projected inflows Projected outflows 38 39 34 34 43 47* 43 43 Net Cash after opening adjustments (2) (8) (10) (10) Cumulative cash gap (2) (10) (20) (30) Estimated Interim Finance Required: INR XX Cr Indicative Term Sheet • Amount of Interim Finance: INR XXC....
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....r. • Period: CIR period • • • Upfront fee: 2% on the disbursed amount Rate of Interest :XX6% P.A (Interest payable monthly) Repayment: No repayment during CIR period Page 34 2.5 & 2.6 Capital Structure and Shareholding Capital Structure and Shareholding Pattern Page 35 I Capital Structure: ¡ Capital Structure of the Corporate Debtor as on the date of commencement of CIRP is provided below (Sample only): ■Shareholding Pattern: | Shareholding Pattern of the Corporate Debtor is provided ! by bifurcating the shareholding into 2 parts- ■A. Promoter & promoter group B. Public shareholding, which is further divided into institutions and non-institutions. Particulars Authorized share capital No of shares Amount (INR Crore) Particulars Equity shares of Rs.10/- each Promoter and XXX XXX Preference shares of Rs.10/- each Promoter Group XXX XXX Public Issued, subscribed and paid up capital Equity shares of Rs.10/- each Institutions XXX XXX Non-Institutions Preference shares of Rs.10/- each XXX XXX Grand Total Total Debt Source: Company Annual Report/Financials/ NSE or BSE filings No. of % Shares XXX 40.86% XXX 59.14% 2.05% 57.09% XXX 100.00% XXX Source....
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....: Company Annual Report/Financials/ NSE or BSE filings Page 36 Details of Financial and Operational Claims 2.7 Financial and Operational Claims S. No Name of the financial creditors Facility arrangement Amount as per claims filed Amount Admitted (A) Difference Voting Right 1 XXX XXX XXX XXX XXX XXX 234569 XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX 8 XXX XXX XXX XXX XXX XXX 9 XXX XXX XXX XXX XXX XXX Total S. No Name of the Operational creditors Amount As per claims Amount Admitted (A) Difference filed 1 XXX XXX XXX XXX 2 XXX XXX XXX XXX 34567% XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX 8 XXX XXX XXX XXX 9 XXX XXX XXX XXX Total 2.8 Facilities and Capability Plant 1 • Land area - XXX • Head Count - XXX . Type-Thermal/ Hydro/ Wind/Solar Plant 3 • Land area - XXX • Head Count - XXX • Type-Thermal/ Hydro/ Wind/Solar Rajasthan Plant 2 Himachal Pradesh . Land area -XXX • Head Count - XXX Haryana Type-Thermal/ Hydro/ Wind/Solar Location 1 Location Details (For each location) ■Located in XXX village in XXX district....
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.... of XXX. XX Kms away from the nearest coal mine Location 2 â– Located in XXX village in XXX district of XXX. â– XX Kms away from the nearest coal mine Location 3 Located in XXX village in XXX district of XXX. â– XX Kms away from the nearest coal mine Water Source (For each location) XXX water reservoir, ~24 kms from the XXX Dam Source: Company Annual Report/ Company Website Features of Land (For each location) ~XXX acres of land in possession Plain terrain, no rehabilitation or resettlement involved Page 37 2.9 Summary of PPAs/Key contracts Contract 1 - Power Purchase Agreement: 1 Long Term PPA Project/Plant Particulars INR Crore Buyer XXX Project Cost XXX Net Capacity 150 MW Debt (77.49) XXX PPA start date 27th May, 20XX Equity (22.51) XXX PPA end Date 31th May, 20XX Levellized Tariff (INR) 4.47 Cost per MW 4.32 XXX state Contract 2 - Power Purchase Agreement: 2 Project/Plant Long Term PPA Particulars INR Crore Buyer XXX Project Cost XXX Net Capacity 200 MW Debt (77.49) XXX PPA start date 27th December, 20XX Equity (22.51) XXX PPA end Date Levellized Tariff (INR) 31th December 20XX 5.02 Cost per MW 5.67 XXX state A summary of all key contracts / PPAs to be listed here ....
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....along-with the details of tenor of the contract, Levellized tariff etc Page 38 2.9 Fully Tied-up Fuel Sourcing Arrangement 35% of the Resolution Debt - 20.0 marks 5 years up to 10 years: 10% • >10 years up to 15 years: 15% . > 15 years: 30% LO 5 S. No. Section A.2 NPV of all payments made to all creditors other than FCs Marks Marks for this category to be allocated in proportion to the Claims %age subject to a minimum of 5 marks and maximum of 10 marks 35 - Marks allocated for A.2 above Description This shall be computed by discounting the future cash flows to be paid to all creditors (other than FCs) by following a tiered discounting rate. The discounting rate shall vary depending on the age bucket in which the cash flow falls. The age buckets that shall be considered are as follows: 0-5 years: 8% >5 years up to 10 years: 10% >10 years up to 15 years: 15% • > 15 years: 30% This shall be computed by discounting all the future cash flows to be paid to financial creditors by following a tiered discounting rate. The discounting rate shall vary depending on the age bucket in which the cash flow falls. The age buckets that shall be considered are as follows: 0-5 years: 8% . ....
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....>5 years up to 10 years: 10% Scoring Methodology The scoring shall be linked to the Resolution Debt of the Corporate Debtor: о For the RA giving highest %age of the Resolution Debt as NPV - full marks о For all other RAs, the score shall be proportionately reduced The scoring shall be linked to the Resolution Debt of the Corporate Debtor: 0 For the RA giving highest %age of the Resolution Debt as NPV - full marks For all other RAs, the score shall be proportionately reduced A.3 NPV of all payments to be made to FCs A.4 Equity Upside for the 5 financial creditors • >10 years up to 15 years: 15% • > 15 years: 30% This shall be computed based upon the Fair Value of Corporate Debtor computed by the valuer appointed by the RP and factoring the extent of shareholding proposed to be offered to financial creditors The scoring shall be linked to the Resolution Debt of the Corporate Debtor: ○ For the RA giving highest %age of the Resolution Debt as NPV - full marks 60 S. No. Section Marks Description A.5 Equity/Quasi-equity infusion for improvement of business operations For the parameter to be considered in scoring, the RA has to clearly provide all the details rela....
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....ting to the sources of available funds being used for the proposed equity /quasi-equity infusion In case of a One Time Settlement ("OTS"), the RA's score shall be rescaled to 70 marks, basis the marks obtained in parameters from A.1 to A.4 10 This shall be computed as the actual cash proposed to be infused by the RA in the Corporate Debtor for improvement of business operations in the form of Equity or Quasi-Equity within first 6 months from the NCLT Approval date plus discounted cash flows for infusion beyond 6 months, but up to 3 years, at a discount rate of 8% p.a. If the infusion is beyond 3 years, it will not be considered for scoring purposes. Equity shall be defined as investment by way of Common Shares. Quasi equity shall mean fund infusion by RA in the form of instruments, other than common shares, which meet the following criteria: • Sub-ordinate to the secured • loans Interest shall be cumulative but not paid before secured lenders are repaid fully • No redemption without the consent of secured lenders Total marks 70 7 Scoring Methodology о For all other RAs, the score shall be proportionately reduced PART-B - Qualitative Parameters (Total 30 marks) ....
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....• • • The evaluation of Resolution Plan under this category will be with the objective of ascertaining the qualitative aspects of the Resolution Plan / Resolution Applicant. For the parameters pertaining to the Resolution Applicant, we shall consider the entity that is designated as the Resolution Applicant or in case the Resolution Applicant is a Special Purpose Vehicle ("SPV") we shall consider the parameters pertaining to the largest shareholder in the SPV The key qualitative parameters that shall be considered for the purpose of evaluation are as follows: S. Section No. B.1 Marks Reasonableness of financial projections/ Eventuality of honoring proposed commitment 10 Description This shall refer to reasonableness of assumptions in the business plan submitted by the RA and assessment of risks and mitigations related to implementation of the Resolution Plan The analysis shall be made of assumptions with respect to, but not limited to, revenue growth rate, gross margin, asset turnover ratio and net working capital. Scoring Methodology • CoC advisor/Process Advisor shall present analysis of reasonableness of financial projections on items such as revenue grow....
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....th, profitability, market share, per unit pricing etc., by using benchmarks available in the public domain or financial projections used by valuer to arrive at fair value, if available • A key parameter related to "eventuality of honouring proposed commitment" is the conditions precedent (CPS) submitted as a part of the plan. The fewer the number and higher the simplicity of the CPs, the higher the likelihood of the plan reaching successful closure. 8 S. Section Marks Description No. B.2 B.2a Scoring Methodology • Each CoC member shall award marks on this criterion for this post presentation of our analysis. The weighted average as per vote share shall yield the final score for this parameter. Ability to turnaround distressed companies Managerial competence and technical capabilities, key managerial personnel, track record in implementing turnaround of stressed assets Track record/Experience of the Resolution Applicant 10 5 This shall refer to the years of operating experience that the RA has in the sector In case of a RA who is financial investor, the assessment shall be made based on the entities in which RA has a management control Marks will be given on a scale of 5....
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.... marks based upon experience of the RA and the scale of the operations of the RA 9 S. Section No. B.2b Track record in M&A/ 5 taking over and turning B.3 around distressed assets Marks Description This shall refer to evaluating RA's track record in undertaking corporate M&A and acquiring and turning around distressed assets Scoring Methodology Marks will be given on a scale of 2.5 based upon M&A/ turnaround track record of the RA. Successful turnaround could be evaluated based on RoI, improvement in key metrics, ratio of repayment of debt etc. post acquisition. Standing of Bidder / External Rating/ adherence to financial Discipline/record of regulatory compliance [the score will be o, if the RA, including any Group Company is NPA 1. In consideration of ..[Insert name of the Successful Resolution Applicant(s) with address] (hereinafter called the “Successful Resolution Applicant(s)") agreeing to undertake the obligations under the RFRP dated [â—], issued by the Resolution Professional, in consultation with the CoC and pursuant to the approval of the CoC vide voting dated [date of voting results] pursuant to meeting dated [date of CoC meeting], (hereinafter called "RFRP")....
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.... and any other required documents, issued by the Resolution Professional, in consultation with the CoC and pursuant to the approval of the CoC in respect of the Resolution Plan for (Name of the Corporate Debtor) (hereinafter called the “Corporate Debtor") the [Insert name and address of the bank issuing the guarantee and address of the head office] (hereinafter called the “Guarantor Bank") hereby agrees unequivocally, irrevocably and unconditionally to pay to Bank, having its office at (hereinafter referred to as "the Bank") forthwith on demand in writing from any officer authorised by it in this behalf without any protest or demur, any amount up to and not exceeding Rs. (Rupees only) on behalf of. [Insert name of the Successful Resolution Applicant(s)] (hereinafter called “Performance Guarantee") against any and all loss and/or damage caused to or suffered by or would be caused to or suffered by the Company by reasons of any breach by the said Resolution Applicant(s) of any of the terms and conditions contained in the RFRP. 2. We, [Insert name of bank] do hereby undertake to pay the amounts due and payable under this Performance Guarantee without any demur, merel....
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....y on a demand from the Bank including from any officer authorised by it in this behalf. Any such demand made on us, shall be conclusive as regards the amount due and payable by us under this Performance Guarantee. However, our liability under this Bank Guarantee shall be restricted to an amount not exceeding Rs. . only). (Rupees 3. We undertake to pay to the Bank, any money so demanded notwithstanding any dispute or disputes raised by the Successful Resolution Applicant(s) in any suit or proceeding pending before any Court or Tribunal relating thereto our liability under this present being absolute and unequivocal. 4. The Guarantor Bank shall make payment hereunder on first demand without restriction or conditions and notwithstanding any objection by,. [Insert name of the Successful Resolution Applicant(s)] and/or any other person. The Guarantor Bank shall not require the Bank to justify the invocation of this Bank Guarantee, nor shall the Guarantor Bank have any recourse against M/s. name of RA] in respect of any payment made hereunder. [Insert the 5. The payment so made by us under this bond shall be a valid discharge of our liability for payment thereunder and the Successful Res....
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....olution Applicant(s) shall have no claim against us for making such payment. 41 6. We, the Guarantor Bank further agree that the guarantee herein contained shall remain in full force and effect for a period of [….. (……...)] months from the date hereof and that it shall continue to be enforceable till all the dues of the Successful Resolution Applicant(s) in relation to the Resolution Plan and /or under or by virtue of the RFRP have been fully paid and its claim satisfied or discharged or till the Bank certifies that the Resolution Plan has been effected and that the terms and conditions of the RFRP have been fully and properly carried out by the said Successful Resolution Applicant(s). The Bank shall be entitled to invoke this Performance Guarantee up to [….. (…....)] days from the last date of the validity of this Performance Guarantee by issuance of a written demand to invoke this Performance Guarantee. 7. We, the Guarantor Bank, further agree that the Bank and/or the CoC shall have the fullest liberty without our consent to vary any of the terms and conditions of the RFRP or to extend time of performance by the said Successful Resolution Applicant(s....
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....) from time to time or to postpone for any time or from time to time any of the powers exercisable by the Bank against the said Successful Resolution Applicant(s) and to forbear or enforce any of the terms and conditions relating to the RFRP. We shall not be relieved from our liability by any reason of any such variation or extension being granted to the said Successful Resolution Applicant(s) or by any such matter or thing whatsoever which under the law relating to sureties would but for this provision have effect of so relieving us. 8. This Performance Guarantee shall be valid and binding on the Guarantor Bank and shall in no event be terminable by notice or any change in the constitution of the Guarantor Bank or by any other reasons whatsoever and our liability hereunder shall not be impaired or discharged by any extension of time or variations or alternations made, given, or agreed with or without our knowledge or consent, by or between the parties. This Performance Guarantee shall not be affected in any manner by reason of merger, amalgamation, restructuring, liquidation, winding up, dissolution or any other change in the constitution of the Guarantor Bank. 9. This Performance....
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.... Guarantee shall be interpreted in accordance with the laws of India and the courts at [State] shall have exclusive jurisdiction. The Performance Guarantor Bank represents that this Performance Guarantee has been established in such form and with such content that it is fully enforceable in accordance with its terms as against the Performance Guarantor Bank in the manner provided herein. 10. This Performance Guarantee shall be a primary obligation of the Guarantor Bank and accordingly the Bank shall not be obliged before enforcing this Performance Guarantee to take any action in any court or arbitral proceedings against the Successful Resolution Applicant(s), to make any claim against or any demand on the Successful Resolution Applicant(s) or to give any notice to the Successful Resolution Applicant(s) or to exercise, levy or enforce any distress, diligence or other process against the Successful Resolution Applicant(s). 11. We, [â—], lastly undertake not to revoke this Performance Guarantee during its currency. 42 NOTWITHSTANDING anything contained herein: 1. This Bank Guarantee shall be valid till...... as per the RFRP].; and [Insert the date of validity of the Performance G....
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....uarantee 2. We are liable to pay the guaranteed amount or any part thereof under this Bank Guarantee only and only if you serve upon us a written claim or demand on or before the.......... 3. This Performance Guarantee shall be extended from time to time for such period, as may be desired by the Bank. We are liable to pay the guaranteed amount or any part thereof under this Bank Guarantee only if Bank serves upon us a written claim or demand. All claims under this Performance Guarantee shall be payable at […………………..]. This Performance Guarantee will be returned to us as soon as the purpose for which it is issued is fulfilled. In witness whereof the Guarantor Bank, through its authorised officer, has set its hand and stamp on this day of..... at Witness: 1. Name and Address. 2. Name and Address For: Banker's Stamp and Full Address: Dated this Signature Name: Designation with Bank Stamp [Insert Name of the Bank] day of 20..... Notes: *The Stamp paper should be in the name of the Guarantor Bank. 43 33 APPENDIX 5 UNDERTAKING BY RESOLUTION APPLICANT(S) [On the letter head of the Resolution Applicant(s) or Lead member in case of consortium] Resol....
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....ution Applicant(s) Undertaking To, Name of the RP, Resolution Professional (Name of the Corporate Debtor) Dear Sir, Sub: Resolution Applicant(s)' undertaking in relation to the Binding Resolution Plan in response to RFRP dated [•], issued by the Resolution Professional, in consultation with the CoC and pursuant to the approval of the CoC vide voting dated [Date of voting results] pursuant to meeting dated [Date of the CoC meeting] ("RFRPâ€) 1. We, [Insert name of the Resolution Applicant(s)] (“Resolution Applicant(s)â€), refer to the RFRP and provide our unconditional acceptance of the terms and conditions of the RFRP as amended from time to time in accordance with the procedure set out under the RFRP, including but not limited to the Disclaimer contained in the RFRP. Further and in relation to the said RFRP and the Resolution Plan Process set out there under, the Resolution Applicant(s) undertakes, agrees and acknowledges that the Resolution Applicant(s) (collectively, the "Undertaking"): a) shall execute all such deeds and documents as may be required to be so executed pursuant to the completion of the Resolution Plan Process; b) has submitted the Binding Re....
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....solution Plan and other requisite documents strictly as per forms prescribed in the RFRP, without any deviations or conditions and without setting out any assumptions or notes qualifying the Resolution Plan; c) the Binding Resolution Plan shall be valid up to the end of the period set out under the RFRP; d) the Resolution Plan has been duly signed by a director of the Resolution Applicant(s) as a Representative or Power of Attorney holder, as applicable e) f) has obtained all the corporate authorizations required or expedient under Applicable Law for the submission of the Resolution Plan; shall, except as otherwise required under the RFRP, upon being notified as the Successful Resolution Applicant(s), pay such amounts and consideration as set out in the Resolution Plan in the manner agreed to between the Resolution Applicant(s) and the CoC at terms mutually agreeable to CoC and the Resolution Applicant(s) strictly in accordance with the procedure set out under the RFRP; shall execute such agreement(s) as may be required, to the satisfaction of the Resolution Professional in accordance with the RFRP; 44 h) i) has provided all information and data during this Resolution Plan Process,....
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.... in a manner that is true, correct, accurate and complete and no such information, data or statement provided by the Resolution Applicant(s) is inaccurate or misleading in any manner; and has submitted a Binding Resolution Plan that conforms to the requirements of the RFRP as on the date of this Undertaking. 2. We further undertake and confirm that the Proposal submitted as part of the Binding Resolution Plan is unconditional and acknowledge and agree that the CoC reserves the right to negotiate terms with the Selected Resolution Applicant(s) and any decision taken by the CoC in relation to the Resolution Plan and the Resolution Plan Process shall be final and binding on the Resolution Applicant(s). Further, in addition to the undertaking set out under clause 1 (h) above, the Resolution Applicant(s) confirms that all the confirmations, declarations and representations made in the Binding Resolution Plan are valid as on the date of this Undertaking and acknowledge that the CoC may at their sole discretion be free to cancel our Binding Resolution Plan and encash the Earnest Money Deposit where such confirmations, declarations and representations are found to be incorrect or misleadin....
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....g. 3. Capitalised terms used herein but not defined shall have the meaning assigned to such term in the RFRP. Thank you. Yours sincerely, [Signature and name of Attorney] Rubber stamp/seal of the Resolution Applicant(s) 45 55 APPENDIX 6 FORMAT FOR POWER OF ATTORNEY (To be on non-judicial stamp paper of appropriate value as per the stamp act relevant to the place of execution. Foreign companies submitting Binding resolution plans are required to follow the applicable law in their country.) POWER OF ATTORNEY Know all men by these presents, We, [Insert name and address of the registered office of the Resolution Applicant(s)] ("Resolution Applicant(s)") do hereby constitute, appoint and authorize Mr./Ms. [Insert name and residential address of the attorney] who is presently holding the position of [â—] as our true and lawful attorney ("Attorneyâ€), to do in the name of the Resolution Applicant(s) and on the behalf of the Resolution Applicant(s), all such acts, deeds and things necessary in connection with or incidental to the submission of the Binding Resolution Plan or any other document as may be required under or pursuant to as per the provisions of the RFRP dated [â—....
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....], issued by the Resolution Professional, in consultation with the CoC and pursuant to the approval of the CoC vide voting dated [Date of voting results] pursuant to meeting dated [Date of the CoC meeting] (“RFRP"), including the signing and submission of Binding Resolution Plan and all other documents related to the Binding Resolution Plan, including but not limited to undertakings, letters, certificates, acceptances, clarifications, guarantees or any other deeds or document that the Resolution Professional may require the Resolution Applicant(s) to submit. The aforesaid Attorney is further authorised to provide representations, information or responses to the Resolution Professional, and represent the Resolution Applicant(s) and generally deal with the Resolution Professional and CoC with respect to the Binding Resolution Plan and the Binding Resolution Plan Submission Process, in accordance with the terms of the RFRP. We hereby ratify all acts, deeds and things done by the said Attorney pursuant to this power of attorney and that all acts, deeds and things done by the aforesaid Attorney shall be binding on the Resolution Applicant(s) and shall always be deemed to have been....
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.... done by the Resolution Applicant(s). All the terms used herein but not defined shall have the meaning ascribed to such terms under the RFRP. Signed by the within named [Insert the name of the Resolution Applicant(s)] Through the hand of Mr. (Name, designation and address of the executant) Duly authorised by the Board to issue such Power of Attorney Dated this day of......... Accepted Signature of Attorney 46 46 (Name, designation and address of the Attorney) Attested (Signature of the executant) (Name, designation and address of the executant) WITNESS 1. Name Designation......... 2. Name Designation.......... (Signature) (Signature) Signature and stamp of Notary of the place of execution Common seal of Resolution dated...... has been affixed in my / our presence pursuant to Board of Director's Notes: (1) The mode of execution of the power of attorney should be in accordance with the procedure, if any, laid down by the Applicable Law and the charter documents of the Resolution Applicant(s) and the same should be under common seal of the Resolution Applicant(s) affixed in accordance with applicable procedure. Further, the person whose signatures are to be provided on the Power of At....
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....torney shall be duly authorised by the Resolution Applicant(s) in this regard. (2) The person authorised under this Power of Attorney, in the case of the Resolution Applicant(s) being a public Company, or a private Company which is a subsidiary of a public Company, in terms of the Companies Act, 2013, with a paid up share capital of more than Rs. 5,00,00,000 (Rupees Five Crores only), should be the managing director / whole time director / manager appointed under section 203 of the Companies Act, 2013. In all other cases, the person authorised should be a director duly authorised by a board resolution duly passed by the Company. (3) In case of the Resolution Applicant(s) being a foreign Company, the same shall be signed by a person of equivalent position and the requisite legalization and consularisation process shall be duly completed. (4) In the event, the power of attorney has been executed outside India, the same shall be required to be duly notarized by a notary public of the jurisdiction where it is executed. 47 (5) Also, wherever required, the Resolution Applicant(s) should submit for verification the extract of the charter documents and documents such as a board resolution/....
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....power of attorney, in favour of the person executing this power of attorney for delegation of power hereunder on behalf of the Resolution Applicant(s). (6) The Resolution Applicant(s) shall submit a power of attorney or such other equivalent authorisation as may be deemed to be adequate in the jurisdiction of incorporation of the Resolution Applicant(s). 48 APPENDIX 6(A) FORMAT FOR POWER OF ATTORNEY FOR LEAD MEMBER (In case of Consortium) (To be on non-judicial stamp paper of appropriate value as per the stamp act relevant to the place of execution. Foreign companies submitting Binding resolution plans are required to follow the applicable law in their country.) Whereas, and (collectively the “Consortiumâ€) being Members of the Consortium are interested in submitting Binding Resolution Plans under or pursuant to as per the provisions of the RFRP dated [â—], issued by the Resolution Professional, in consultation with the CoC and pursuant to the approval of the CoC vide voting dated [Date of voting results] pursuant to meeting dated [Date of the CoC meeting], hereinafter called "RFRP") and any other required documents, issued on behalf of the Committee of Creditors i....
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....n respect of the Binding Resolution Plan for (Name of the Corporate Debtor) (hereinafter called the "Corporate Debtorâ€), and Whereas, it is necessary for the Members of the Consortium to designate one of them as the Lead Member with all necessary power and authority to do for and on behalf of the Consortium, all acts, deeds and things as may be necessary in connection with the Consortium's submission for Binding Resolution Plans. NOW THEREFORE KNOW ALL MEN BY THESE PRESENTS We, M/s having our registered office at and M/s. M/s. having our registered office at , ' having our [the registered office at respective names and addresses of the registered office] (hereinafter collectively referred to as the "Principals") do hereby irrevocably designate, nominate, constitute, appoint and authorise M/s having its registered office at , being one of the Members of the Consortium, as the Lead Member and true and lawful attorney of the Consortium (hereinafter referred to as the "Attorneyâ€) and hereby irrevocably authorise the Attorney (with power to sub-delegate) to conduct all business for and on behalf of the Consortium and any one of us during the Resolution Plan Process and, in t....
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....he event the Consortium is selected as the Successful Resolution Applicant(s), during the execution of the Resolution Plan, and in this regard, to do on our behalf and on behalf of the Consortium, all or any of such acts, deeds or things as are necessary or required or incidental to the signing and submission of Binding Resolution Plan and all other documents related to the Binding Resolution Plan, including but not limited to undertakings, letters, certificates, acceptances, clarifications, guarantees or any other deeds or document that the Resolution Professional may require the Resolution Applicant(s) to submit. AND hereby agree to ratify and confirm and do hereby ratify and confirm all acts, deeds and things lawfully done or caused to be done by our said Attorney pursuant to and in exercise of the powers conferred by this Power of Attorney and that all acts, deeds and things done by our said Attorney in exercise of the powers hereby conferred shall and shall always be deemed to have been done by us/ Consortium. IN WITNESS WHEREOF WE THE PRINCIPALS ABOVE NAMED HAVE EXECUTED THIS POWER OF ATTORNEY ON THIS DAY OF 20**. For (Name & Title) 49 For (Name & Title) For (Name & Title) Wi....
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....tnesses: 1 2 (Executants) (To be executed by all the Members of the Consortium) has been affixed in my / our presence pursuant to Board of Director's Signature and stamp of Notary of the place of execution Common seal of Resolution dated...... Notes: (1) The mode of execution of the Power of Attorney should be in accordance with the procedure, if any, laid down by the applicable law and the charter documents of the executant(s) and when it is so required, the same should be under common seal affixed in accordance with the required procedure. (2) Also, wherever required, the consortium members should submit for verification the extract of the charter documents and documents such as a resolution/ power of attorney in favour of the person executing this Power of Attorney for the delegation of power hereunder on behalf of the consortium member. (3) In the event, the power of attorney has been executed outside India, the same shall be required to be duly notarized by a notary public of the jurisdiction where it is executed. 50 50 APPENDIX 6(B) FORMAT FOR BOARD RESOLUTION (On the letter head of the Resolution Applicant(s)) CERTIFIED TRUE COPY OF RESOLUTION PASSED BY THE BOARD OF DIRECTOR....
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....S (“BOARD") OF [Insert name of the Resolution Applicant(s)] ("COMPANY") IN THE MEETING HELD ON [Insert Date], AT [Insert Time] AT [Insert Place] WHEREAS pursuant to the expressions of interest dated [â—] ("EOIâ€), and the subsequent RFRP dated [â—], issued by the Resolution Professional, in consultation with the CoC and pursuant to the approval of the CoC vide voting dated [Date of voting results] pursuant to meeting dated [Date of the CoC meeting] (hereinafter called "RFRP") and any other required documents, issued on behalf of the Committee of Creditors in respect of inviting the Binding Resolution Plan for (Name of the Corporate Debtor), the Company has been shortlisted by the Resolution Professional (acting on the instructions of the Committee of Creditors), for the purpose of submission of the Binding Resolution Plan. In view of the above, the Board has resolved as follows: "RESOLVED THAT any of the directors of the Company, be and is hereby authorised to take all the steps required to be taken by the Company for the submission of the Binding Resolution Plan in accordance with the terms of the RFRP, including the following: a) b) c) d) e) submit the Bindin....
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....g Resolution Plan and other requisite documents, in accordance with the terms of the RFRP; execute all other agreements, deeds, writings and power of attorney as may be required in relation to the RFRP, including any amendments or modifications as may be suggested by the Resolution Professional (on the instructions of the Committee of Creditors) and/or the Committee of Creditors to any of such executed agreements, documents or other writings and in general to do all such acts, deeds and all things as may be required or considered necessary under or in respect of the RFRP; negotiate the terms and conditions for the acquisition of [Management Control or Asset Acquisition of the Corporate Debtor], with the members of the CoC; pay such amounts and consideration, in the manner as may be agreed with the CoC, in accordance with the procedure set out under the RFRP, for the purpose of acquisition of [Management Control or Asset Acquisition] of the Corporate Debtor; and to generally do or cause to be done all such acts, matters, deeds and things as may be necessary or desirable in connection with or incidental or for the purpose of implementation and giving effect to the above resolutions f....
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....or and on behalf of the Company, and to comply with all other requirements in this regard.†"RESOLVED FURTHER THAT a certified copy of the foregoing resolution be furnished as may be required, under the signature of [the Company Secretary / any two of the Directors of the Company]." Certified to be true For the Company 51 Director(s)/Company Secretary Notes: (1) The contents of the format may be suitably re-worded indicating the identity of the entity passing the resolution. (2) In case of the Board Resolution being provided by a Company incorporated in India, the Board Resolution shall to be notarized by a notified notary. In the event the Board resolution is from a Company incorporated outside India, the same shall be duly notarized in the jurisdiction of incorporation of the Company. (3) This format may be modified only to the limited extent required to comply with the local regulations and laws applicable to a foreign entity submitting this resolution. For example, reference to Companies Act 2013 may be suitably modified to refer to the law applicable to the entity submitting the resolution. However, in such case, the foreign entity shall submit an opinion issued by the l....
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....egal counsel of such foreign entity, stating that the board resolutions are in compliance with the applicable laws of the respective jurisdictions of the issuing Company and the authorizations granted therein are true and valid. (4) The Board Resolution is to be certified by the Company Secretary / Directors, in accordance with applicable law and the constitutional documents of the Company. 62 52 THE STAMP PAPER SHOULD BE IN THE NAME OF THE GUARANTOR BANK. APPENDIX-7 EARNEST MONEY DEPOSIT AMOUNT PAYMENT BY PARENT COMPANY To, [Name of the RP], Resolution Professional [Address of Resolution Professional] [Copy to:] [Insert name of the Resolution Applicant(s) with address] Dear Sir, Sub: Payment of the amounts of Earnest Money on behalf of the Resolution Applicant(s) in relation to the Resolution Plan of (Name of the Corporate Debtor) In light of the Resolution Plan for (Name of the Corporate Debtor) submitted by [Insert name of the Resolution Applicant(s) with address] in accordance with and subject to the provisions of the RFRP dated [ ] in relation to the captioned transaction (“RFRP"), issued by the Resolution Professional, in consultation with the CoC and pursuant to the ap....
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....proval of the CoC vide voting dated [Date of voting results] pursuant to meeting dated [Date of the CoC meeting] and any other relevant documents, [Insert name and address of the Parent Company and address of the head office] hereby declares and confirms it is [an / the] [Insert relationship of the Parent Company with the Resolution Applicant(s)] of the Resolution Applicant(s) (“Parent Companyâ€), and the payment of the Earnest Money amount vide [Insert mode of payment] ("Paymentâ€) is on behalf of the Resolution Applicant(s). The Parent Company acknowledges that such amounts paid as Earnest Money shall be subject to the terms of the RFRP and hereby waives any right to claim any refund or adjustment of the amounts of such Payment except in accordance with the terms of the RFRP. The Parent Company hereby represents and warrants that payment of amounts on behalf of the Resolution Applicant(s) is in compliance with Applicable Law. Capitalized terms used but not defined in this letter shall have the meanings ascribed to such terms in the RFRP. Thank you. Yours sincerely, 53 [Signature and name of the Authorized Officer of the Parent Company] Rubber stamp/seal of the Par....
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....ent Company ACKNOWLEDGMENT We hereby acknowledge and confirm the statements set out above by the Parent Company. Yours sincerely, [Signature and name of the Authorized Officer of the Resolution Applicant(s)] Rubber stamp/seal of the Resolution Applicant(s) 54 APPENDIX 8 PERFORMANCE GUARANTEE AMOUNT PAYMENT BY PARENT COMPANY To, [Name of the RP], Resolution Professional [Address of Resolution Professional] [Copy to:] [Insert name of the Resolution Applicant(s) with address] Dear Sir, Sub: Payment of the amounts of the Performance Guarantee on behalf of the Resolution Applicant(s) in relation to the Resolution Plan of (Name of the Corporate Debtor) In light of the Resolution Plan for (Name of the Corporate Debtor) submitted by ..[Insert name of the Successful Resolution Applicant(s) with address] in accordance with and subject to the provisions of the RFRP dated ( ) in relation to the captioned transaction ("RFRP"), issued by the Resolution Professional, in consultation with the CoC and pursuant to the approval of the CoC vide voting dated [Date of voting results] pursuant to meeting dated [Date of the CoC meeting], and any other relevant documents, [Insert name and address of the Pa....
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....rent Company and address of the head office] hereby declares and confirms it is [an / the] [Insert relationship of the Parent Company with the Successful Resolution Applicant(s)] of the Successful Resolution Applicant(s) ("Parent Company"), and the payment of the Performance Guarantee amount vide [Insert mode of payment] ("Paymentâ€) is on behalf of the Successful Resolution Applicant(s). The Parent Company acknowledges that such amounts paid as Performance Guarantee shall be subject to the terms of the RFRP and hereby waives any right to claim any refund or adjustment of the amounts of such payment except in accordance with the terms of the RFRP. The Parent Company hereby represents and warrants that payment of amounts on behalf of the Successful Resolution Applicant(s) is in compliance with Applicable Law. Capitalized terms used but not defined in this letter shall have the meanings ascribed to such terms in the RFRP. Thank you. Yours sincerely, [Signature and name of the Authorized Officer of the Parent Company] 55 Rubber stamp/seal of the Parent Company ACKNOWLEDGMENT We hereby acknowledge and confirm the statements set out above by the Parent Company. Yours sincerely, [Si....
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....gnature and name of the Authorized Officer of the Successful Resolution Applicant(s)] Rubber stamp/seal of the Successful Resolution Applicant(s) 56 56 APPENDIX 9 COMPOSITION AND OWNERSHIP STRUCTURE OF THE RESOLUTION APPLICANT(S) [In case of consortium, for each member of the consortium] (On the letter head of the Resolution Applicant(s) duly stamped) a. Corporate Details: Please provide the following information for the Resolution Applicant(s): i. Company's Name, Address, Nationality details: Name Registered Office Website Address Corporate Identification Number, if any: Country of Origin: Address for Correspondence: Year and Date of Incorporation Company's Business Activities: Name of the Representatives Name and details of all Connected Persons Telephone Number Email Address Fax No In case of a consortium, following details of the members of consortium shall be provided: Members of consortium Member 1 (Lead Partner) Member 2 [Please add extra rows if there are more than two members] Equity Interest (%) held or to be held in the consortium Nature establishment of the member of ii. Please provide the following documents: a) Copy of the memorandum and articles of association and ce....
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....rtificate of incorporation or other equivalent organizational document (as applicable in the case of the jurisdiction of incorporation of the Resolution Applicant(s) and all Connected Persons), including amendments, if any, certified by the company secretary, or equivalent or a director of the Resolution Applicant(s) (as an annexure to this Format) 57 b) d) Authority letter in favor of the Resolution Professional from the Resolution Applicant(s) authorizing CoC or the Resolution Professional or Resolution Process Advisor to seek reference from their respective bankers, Financial Creditor, financing institutions of the Resolution Applicant(s) and any other person. Annual report or audited financials of the Resolution Applicant(s) and its group companies for the preceding 3 (three) years whose revenue and net worth numbers have been submitted as part of the Expression of Interest. In case of a financial investor / fund, in addition to the above, statutory auditor's certificate for Assets under Management as of immediately preceding financial year shall be provided. If the Resolution Applicant(s) is a consortium, then copy of the Memorandum and Articles of Association and certificate ....
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....of incorporation or other equivalent organizational document (as applicable in the case of a foreign company), including their amendments of each of the consortium member (certified by the company secretary or a director) (as attachment to this document). Copy of permanent account number card of the Company (or equivalent identification for an overseas entity); f) Credit opinion report from the principal bank of the Resolution Applicant and its Parent company; g) h) i) External rating report if available, for the Resolution Applicant(s) and the Parent Company; Names and Details of the directors of the Resolution Applicant(s), all Connected Persons and the Parent Company as per format below: Name Designation Identification Nos. Full Other DIN PAN Passport Address directorships The Resolution Applicant(s) shall submit photocopy of the passport for each of the Directors; Details of Ownership Structure of the Resolution Applicant(s) and its relationship with all Connected Persons: Details of persons owning 10% (ten percent) or more of the total paid up equity of the Resolution Applicant(s). Name of the Resolution Applicant(s) equity holding as on Status of Type and Number % of Equity E....
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....xtent of Voting Control (%) Name of Equity of Shares owned Holder Holding 58 j) 1. 2. 3. Details of transactions, if any, of the Resolution Applicant(s) and/or any Connected Persons with the Company in the preceding two years; iii. Please clarify if the Resolution Applicant(s) and/or any Connected Person has been convicted of any offence in the preceding five years, and if so, please share all relevant details of the same. iv. V. vi. vii. etc. Please clarify of there are any criminal proceedings, investigations, enquiries commenced or pending against the Resolution Applicant(s) and/or any Connected Person, and if so, please share all relevant details of the same. Please clarify if any of the promoters, shareholders, directors and/or key managerial personnel of the Resolution Applicant(s) and/or any Connected Person have been disqualified to act as a director under the provisions of the Companies Act, 2013, and if so, please share all relevant details of the same Please clarify if the Resolution Applicant(s) and/or any Connected Person has been identified as a willful defaulter by any bank or financial institution or consortium thereof in accordance with the guidelines of the RBI, a....
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....nd if so, please share all relevant information and details in relation to the same; and Please clarify if the Resolution Applicant(s) and/or any Connected Person has been disqualified or debarred from accessing to or trading in the securities markets under any order of the Securities and Exchange Board of India and/or any other such judicial authority. For and Behalf of M/s, {Signature and Name of Attorney as Power of Attorney} Rubber Seal of Resolution Applicant(s) Status of equity holding should be provided not earlier than [number of days] days prior to Binding Plan Due Date. Details of the Parent Company, Ultimate Parent and / or the Group Companies, affiliates of the Resolution 59 Applicant(s), and corporate guarantor (if any corporate guarantee constitutes part of the Resolution Plan), and their respective business activity shall be provided. The determination of the relationship of the Parent Company, Ultimate Parent and / or the Group Companies and affiliates of the Resolution Applicant shall not be [number of days] days prior to the Resolution Plan Submission Date. Documentary evidence in form of a certificate from CS or Statutory Auditor to submitted along with the Resol....
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....ution Plan. 60 60 I, S/o Shri APPENDIX 10 AFFIDAVIT ON RS 100 STAMP PAPER aged years, residing at registered office at 1. 2. 3. (i) (ii) (iii) (iv) (v) (vi) designated as [ ] of [ ] (Resolution Applicant) having its do solemnly affirm and declare on oath as under: - I state that an insolvency resolution process has been initiated against (Name of the Corporate Debtor) (Corporate Debtor) vide order dated [Order date] (Admission Order) passed by National Company Law Tribunal,(State) Bench (Adjudicating Authority) in an application filed by operational creditor against the Corporate Debtor under Section 7 of the Insolvency and Bankruptcy Code, 2016 (amended up to date) (IBC). I state that the present affidavit is sworn by me on behalf of the Resolution Applicant in compliance of section 29A of the IBC. I on behalf of the Resolution Applicant and any other person acting jointly or in concert with the Resolution Applicant hereby confirm that: The Resolution Applicant and any connected person as per the Explanation I provided under section 29A of the IBC is not an undischarged insolvent; or The Resolution Applicant and any connected person as per Explanation I provided under section 29A ....
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....of the IBC, is not identified as a willful defaulter in accordance with the guidelines of the Reserve Bank of India issued under the Banking Regulation Act, 1949; or At the time of submission of the Resolution Plan, the account of the Resolution Applicant and any connected person as per Explanation I provided under section 29A of the IBC or an account of the corporate debtor under the management or control of such person of whom such person is a promoter, IBC is not classified as non-performing asset in accordance with the guidelines of the Reserve Bank of India issued under the Banking Regulation Act, 1949 or guidelines of a financial sector regulator issued under any other law at the time being in force and at least a period of one year or more has lapsed from the date of such classification till the date of commencement of corporate insolvency resolution process of the corporate debtor and that I have not failed to make the payment of all overdue amounts with interest thereon and charges relating to non-performing asset before submission of Resolution Plan; or The Resolution Applicant and any connected person as per Explanation I provided under section 29A of the IBC have not be....
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....en convicted for any offence punishable with imprisonment for 2 years or more under any Act specified in the Twelfth Schedule or for seven years or more under any law for the time being in force or a period of two years has expired from the date of release of such imprisonment; or The Resolution Applicant and any connected person as per Explanation I provided under section 29A of the IBC have not been disqualified to act as a director under the Companies Act 2013; or The Resolution Applicant and any connected person as per Explanation I provided under section 29A of the IBC have not been prohibited by the Securities and Exchange Board of India from trading in securities or assessing the securities markets; or 61 (vii) The Resolution Applicant and any connected person as per Explanation I provided under section 29A of the IBC have not indulged in preferential transaction or undervalued transaction or fraudulent transaction in respect of which an order has been made by the Adjudicating Authority under the IBC; or (viii) The Resolution Applicant and any connected person as per Explanation I provided under section 29A of the IBC have not executed a guarantee in favor of a creditor, in ....
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....respect of a corporate debtor against which an application for insolvency resolution made by such creditor has been admitted under the IBC and no such guarantee has been invoked by the creditor or remains unpaid in full or part; or (ix) (i) (ii) (111) (iv) (v) (vi) The Resolution Applicant and any connected person a per Explanation I provided under section 29A of the IBC are not subject to any disability, corresponding to clauses mentioned above under any law in a jurisdiction outside India. That the Resolution Applicant unconditionally and irrevocably agrees and undertakes that it shall make full disclosure in respect of itself and all its connected persons as required under Regulation 38(3) of the CIRP Regulations. That the Resolution Applicant unconditionally and irrevocably agrees and undertakes that it shall make full disclosure in respect of itself and all its connected persons as per the provisions of the CIRP and the rules and regulations framed thereunder to submit a resolution plan and that it shall provide all documents, representations and information as may be required by the RP or the CoC to substantiate to the satisfaction of the RP and the CoC that the Resolution Ap....
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....plicant is eligible under the IBC and the rules and regulations thereunder to submit a resolution plan in respect of Corporate Debtor. That the Resolution Applicant unconditionally and irrevocably undertakes that it shall provide all data, documents and information as may be required to verify the statements made under this affidavit. That the Resolution Applicant understands that the CoC and the RP may evaluate the resolution plan to be submitted by the Resolution Applicant or any other person acting jointly with it and such evaluation shall be on the basis of the confirmations, representations and warranties provided by the Resolution Applicant under this affidavit. That the Resolution Applicant agrees that each member of the CoC and the RP are entitled to rely on the statements and affirmations made in this affidavit for the purposes of determining the eligibility and assessing, agreeing and approving the resolution plan submitted by the Resolution Applicant. That in the event any of the above statements are found to be untrue or incorrect, then the Resolution Applicant unconditionally agrees to indemnify and hold harmless the RP and each member of the CoC against any losses, cl....
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....aims or damages incurred by the RP and / or the members of the CoC on account of such ineligibility of the Resolution Applicant. 62 62 (Deponent) 63 69 (Deponent) Verified at on this VERIFICATION (day, month & year), that the above contents of this affidavit are true & correct to the best of my knowledge and belief and nothing has been concealed there from. Annexure-D SPECIMEN OF RESOLUTION PLAN UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 DATED: SUBMITTED BY [RESOLUTION APPLICANT / CONSORTIUM OF RESOLUTION APPLICANTS] A [public/private] limited company under the (Indian) Companies Act, 1956, and existing under the ((Indian) Companies Act, 2013, having its registered office at [ ] IN THE MATTER OF CORPORATE INSOLVENCY RESOLUTION PROCESS OF [Corporate Debtor] CIN - A [public/private] limited company incorporated under the (Indian) Companies Act, 1956, and existing under the ((Indian) Companies Act, 2013, having its registered office at [TBI] NCLT Bench, Case No: Submitted By: [insert name of authorized signatory] Authorized Signatory [insert email of authorized signatory] [Resolution Applicant] 1 Submitted To: [Resolution Professional] Table of Contents I. DEFINITIONS. EXECUTIVE ....
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....SUMMARY OF THE RESOLUTION PLAN. 3 II. III. PROFILE OF THE RESOLUTION APPLICANT 6 IV. OVERVIEW OF THE CORPORATE DEBTOR 7 V. KEY CHALLENGES AND TRENDS IN INDUSTRY 8 VI. SUMMARY PROPOSAL OF THE RESOLUTION APPLICANT 9 VII. VIII. DETAILS OF THE PROPOSED RESOLUTION / TRANSACTION STRUCTURE BUSINESS PLAN.. 12 13 IX. X. TERM, IMPLEMENTATION SCHEDULE AND MONITORING OF THE RESOLUTION PLAN.......... 14 TREATMENT OF VARIOUS STAKEHOLDERS. 15 XI. MANDATORY CONTENTS OF THE RESOLUTION PLAN 16 XII. SOURCE OF FUNDS.. .17 XIII. TERMS OF RESOLUTION PLAN 18 XIV. SCHEDULES 19 2 I. DEFINITIONS As used in the resolution plan, the following capitalized terms shall have the following meanings: [Definitions of terms used in the resolution plan to be inserted in this section, as applicable] The words not defined herein shall be as defined under the IBC Code and IBC Regulations. Abbreviation/ Full form/reference Definition Adjudicating Authority Applicable Laws CIRP The bench of the National Company Law Tribunal, [State] All applicable laws, regulations, rules, guidelines, circular, re-enactments, revisions, applications and adaptions thereto made from time to time and in force and effect, judgments, decrees, i....
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....njunctions, writs and orders of any court, arbitrator or governmental agency or authority, court or statutory or other body applicable for such transaction including but not limited to the IBC, CIRP Regulations, Companies Act, 1956 / 2013 (as applicable), and Foreign Exchange Management Act, 1999, each as amended from time to time Corporate Insolvency Resolution Process CIRP Regulations the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, as amended CoC or COC Effective Date Governmental Authority IBC or Code RA RP Committee of Creditors The date on which Resolution Plan is approved by the Adjudicating Authority i.e. NCLT Any nation or government or any province, state or any other political subdivision thereof; any entity, authority or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including any government authority, agency, department, board, commission or instrumentality of India as applicable, or any political subdivision thereof or any other applicable jurisdiction; any court, tribunal or arbitrator or other adjudicatory authority, and any ....
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....securities exchange or body or authority regulating such securities exchange Insolvency and Bankruptcy Code, 2016 Resolution Applicant Resolution Plan 3 II. EXECUTIVE SUMMARY OF THE RESOLUTION PLAN [Placeholder for presenting an executive summary of the resolution plan, which may include identified synergies, value addition and other benefits from the proposed resolution plan.] Illustration: The Resolution Applicant believes that its unique combination of financial strength, management depth, significant turnaround experience and broad technological expertise would enable it to successfully implement its Resolution Plan for the Corporate Debtor. [Summary may include proposed financial proposal, transaction structure, term and implementation schedule, desired reliefs and concessions, etc.] In case of a consortium plan: we agree and declare that we being members of the consortium will be jointly and severally liable for performance of the terms of this resolution plan submitted to the resolution professional for submitting the resolution plan. [An indicative format for summary is as below: S.NO. 1 Particulars Amount of upfront payment to Creditors (Upfront cash recovery) Proposed ins....
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....truments for repayment Interest rate/coupon and frequency of payment 2 Balance repayment obligation to creditors (other than 1 above) 3 4 5 6 7 8 Repayment schedule Security Conversion terms for quasi equity instruments, if any Terms of equity being offered to lenders, if any Amount of fresh equity proposed to be infused for improving operations of the Company 10 Corporate Guarantee 11 12 1333 or additional collateral/security being offered by the Resolution Applicant Details of key management personnel of the Resolution Applicant with a brief description of experience in the relevant industry/business Details of prior experience of the Resolution Applicant in managing similar business Brief description of successful turnaround case studies in India or abroad 4 Key terms/Amounts 14 15 Credit Rating of the Resolution Applicant Brief of proposed business plan for the Company including the following: Proposed improvement in capacity utilization Proposed improvement in sales realization Proposed improvement in EBITDA margin and absolute EBITDA Technology adapted Any synergies with existing business/operations of the Resolution Applicant Plan for addressing interests of all stakeholders....
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.... 5 a) b) III. PROFILE OF THE RESOLUTION APPLICANT [Brief profile of the Resolution Applicant ("RAâ€), including the following illustrative points: Business and background of the RA, its history, geography of operations, financial overview etc. Details of RA's group companies and corporate structure, composition and shareholding etc. c) RA's experience in the relevant industry/sector d) Brief overview of the management personnel of the RA Summary of competitive advantages of the RA f) Business rationale of the proposed resolution plan g) Any other point, as applicable] 00 6 IV. OVERVIEW OF THE CORPORATE DEBTOR [Brief description of the Corporate Debtor, including the following illustrative points: 1. Brief overview of the business and history of the Corporate Debtor 2. Details of the group companies and the corporate structure, shareholding etc. 3. Understanding of reasons for the current financial distress of the Corporate Debtor 4. Any other point as applicable] 7 V. KEY CHALLENGES AND TRENDS IN INDUSTRY [Brief write up on the trends and challenges of the industry (in which the Corporate Debtor operates or is dependent on) that may have led to the ongoing distress faced by th....
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....e Corporate Debtor. Brief rationale of the proposed resolution plan/ transaction structure and how it is expected to resolve the distress faced by the Corporate Debtor.] 8 VI. SUMMARY PROPOSAL OF THE RESOLUTION APPLICANT [Placeholder for summarizing the financial proposal of the resolution plan] Illustration: An overview of the amounts proposed to be paid towards the corporate insolvency resolution of the Corporate Debtor pursuant to the implementation of the proposed resolution plan is set out below: a) Payment towards CIRP costs - [ ] b) Operational creditors settlement amount - [ ] c) Upfront cash recovery to financial creditors - [] d) Upfront payment towards outstanding employee dues – [] Equity upside to financial creditors – [] f) Fresh capital infusion - [ ] Details of settlement plan to various creditors: SI. No. Parameters Amounts Source of Funds Payable Description of Proposal (INR Crore) Upfront Cash Recovery 1 [ ] for Financial Creditors [ ] = NPV based on 2 evaluation matrix, as [ ] [ ] provided in the RFP [Reference to relevant section wherein details of the payout including timing, breakup / basis of payout to various financial creditors are provided] ....
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....[Reference to relevant section wherein details of the deferred payout including timing, quantum are provided] [Reference to relevant section wherein details of Equity allotment to 3 [ ] [ ] the equity Financial Creditors 4 Treatment of other stakeholders (other than Financial Creditors) allotment, as applicable, are provided] 9 SI. Parameters Amounts Source of Funds No. Payable (INR Crore) Operational creditors, 4(a) excluding employees and workmen [] [] 4(b) Employees and workmen [] [] 4(c) Other creditors [] [] Details of fresh capital infusion: SI. No. Parameters Upfront fresh capital infusion for improving operations and 1 enhancing revival prospects of the Corporate Debtor Description of Proposal [Reference to relevant section wherein details of the payout including timing, breakup / basis of payout to various creditors are provided] [Reference to relevant section wherein details of the payout including timing, breakup/basis of payout to various creditors are provided] [Reference to relevant section wherein details of the payout including timing, breakup / basis of payout to various creditors are provided] Amounts Payable Source of Funds Description of Proposal (INR Crore) [ ]....
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.... [ ] 10 10 [Reference to relevant section wherein details of fresh capital infusion, including quantum and timing are provided] Other relevant details for the purpose of evaluation, as per the RFP document provided by RP/COC of the Corporate Debtor: SI. No. Parameters Description of Proposal 1 Reasonableness of Financial Projections [Reference to relevant sections of the resolution plan] 2 Ability to turnaround distressed companies [Reference to relevant sections of the resolution plan] 3 Assessment of credibility of applicant and connected persons (to the extent that connected persons are proposed to be participants in the implementation of the Resolution Plan) [Reference to relevant sections of the resolution plan] [Relevant inputs providing details / basis of the payout / infusion (including timing, quantum etc.) to various stakeholders to be laid out - as referred in the aforementioned tables] 11 VII. DETAILS OF THE PROPOSED RESOLUTION / TRANSACTION STRUCTURE [This section should provide details of the proposed resolution plan as per regulation 37, which may include: Proposed settlement/ resolution of debts of the Corporate Debtor ] 12 VIII. BUSINESS PLAN [A write up on the bus....
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....iness plan including assumptions and financial projections basis which the financial proposal has been drafted. The business plan may provide details of proposed management team, fund infusion and its sources to meet capital expenditure/ working capital requirement, operational and marketing plan, etc.] 13 IX. TERM, IMPLEMENTATION RESOLUTION PLAN SCHEDULE AND MONITORING OF THE [Steps envisaged for implementation of the proposed resolution plan to be elaborated, along with corresponding timelines (illustration provided below) a) Step by step approach with timelines for implementing the proposed resolution plan b) Required approvals and timelines for obtaining the same : These may include: O RBI approval â—‹ SEBI approval â—‹ â—‹ Ministry of Corporate Affairs / RoC approvals Competition Commission of India approval Infusion of capital, as envisaged in the proposed resolution plan d) Settlement of creditors, as per details of the financial proposal e) Other relevant steps and timelines, as applicable Further, the mechanism for monitoring, reporting, along with provision for associated costs, for the implementation of the resolution plan is required to be elaborated. Com....
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....monly proposed mechanisms include formation of a monitoring agency, comprising of members of the CoC, RP, RA etc., with defined roles and responsibilities.] Illustrative implementation plan: Step KEY STEPS 1. 2. 3. Approval of the Committee of Creditors and Adjudicating Authority • The Resolution Plan will have to be approved by the CoC. • Post receipt of the approval of the CoC, the Resolution Plan will have to be filed with the Adjudicating Authority for its approval. Reconstitution of Board and constitution of Monitoring Committee Upon approval of plan by Adjudicating Authority, the following actions to be taken: • Monitoring Committee: [Constitution, roles and responsibilities of members to be elaborated] • Board: [Reconstitution (if proposed) of Board of Directors of Corporate Debtors to be elaborated] Repayment of priority dues Within [ ] days from approval of plan by Adjudicating Authority, the following amounts shall be paid: [ ] • 4. 6. Seeking approvals and implementation of the transaction structure [ ] Other actions, as applicable [ ] 14 X. TREATMENT OF VARIOUS STAKEHOLDERS [A write up on the treatment of various stakeholders, as proposed i....
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....n the resolution plan. An illustration is provided below, for reference: Illustration: The Resolution Applicant has, to the extent possible, taken into account the interests of all Stakeholders of the Corporate Debtor. A synopsis of how the Resolution Applicant proposes to deal with the interest of Stakeholders is stated below. Insolvency Resolution Process Costs Insolvency Resolution Process Costs will be paid in priority over payments to all Creditors. The Insolvency Resolution Process Costs, to the extent that it remains outstanding, shall be first duly paid by the Corporate Debtor from its accruals and distributable cash. [Additional details may be added, as relevant] Workmen and Employees The Resolution Applicant is desirous of paying []% of the Workmen and Employees' Claims. [Additional details such as retention of employees etc. may be added, as relevant] Financial Creditors The Resolution Applicant is proposing to pay the Financial Creditors the amounts stated under Section [ ], which is higher than the recoveries that the Financial Creditors are likely to make in case of liquidation. [Basis of distribution may be elaborated] Operational Creditors (other than Workmen, Emplo....
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....yees) The Resolution Applicant is proposing to pay the Operational Creditors the amounts stated under Section []. [Basis of distribution may be elaborated] Shareholders As a part of the Resolution Plan, the Resolution Applicant is desirous of [proposed treatment of shares may be elaborated] Other Creditors The Resolution Applicant is proposing to pay the Other Creditors the amounts stated under Section [ ]. [Basis of distribution may be elaborated] [Proposal for any other / specific stakeholder, as desired by the RA, may be included] 15 XI. MANDATORY CONTENTS OF THE RESOLUTION PLAN [References to sections covering the mandatory contents of the resolution plan, as per the provisions of the Code, the CIRP Regulations and the RFP (if any issued by RP/COC) to be provided. Any pending content not covered in the resolution plan elsewhere may be laid out here. Illustration (as per the provisions of the Code and CIRP regulations amended up to October 5, 2018) 1. The amount due to Operational Creditors – to be given priority in payment over financial creditors (Regulation 38(1)(b)) 2. Term of Plan and its implementation schedule (Regulation 38(2)(a)) 3. Management and control of the....
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.... affairs of Corporate Debtor after approval of the Resolution Plan (section 30(2)(c) / Regulation 38(2)(b)) 4. Adequate means for supervision of implementation (Regulation 38(2)(c)) 5. Compliance with the provisions of law for the time being in force (Section 30(2)(e)) 6. Statement as to how the applicant has dealt with interest of all Stakeholders in Resolution Plan (Regulation 38(1A)) 7. Disclosure under Regulation 38(3): Certain details of Resolution Applicants Eligibility declaration by Resolution Applicant under section 29A Declaration that the plan is not in contravention of the provisions of any applicable laws.] 16 XII. SOURCE OF FUNDS [The source of funds, as proposed to be settled in the financial proposal to be detailed.] Illustration: Description of Source of Funds Insolvency Resolution Process Costs [ ] Workmen and Employee settlement amount [ ] Upfront recovery to Financial Creditors and claims being paid to operational creditors [ ] 17 XIII. TERMS OF RESOLUTION PLAN [Proposed treatment of any unclaimed / unpaid / pending / contingent / statutory dues may be elaborated including but not limited to the following: • Treatment of all other liabilities not received ....
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..../ admitted by the RP Treatment of contingent liabilities Extinguishment and Waiver of other claims and liabilities • • Novation of debt • Treatment of debts barred by limitation Treatment of employees Treatment of subsidiaries • • • • • • • Desired reliefs and concessions Treatment of specific contracts Treatment of auditors, corporate governance implementation in corporate debtor post acquisition Treatment of personal guarantees of existing promoters Listing delisting of shares Merger / demerger of corporate debtor Change in company secretary/KMPs Condition of delays in stock exchange filing /AGM /finalization of audited balance sheet / other compliances Completion of formalities for registration of title deeds / lease deeds Taking control of assets of Corporate Debtor not in its possession Releasing assets owned by operational / other creditors Release of amounts/assets/documents held by financial creditors in escrow / Trust 18 XIV. SCHEDULES [Relevant schedules required as part of the RFP document (if any issued by RP/COC), or referred elsewhere in the resolution plan may be provided.] 19<BR> News - Press release - PIB....
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........