The Industrial Credit and Investment Corporation Limited became the trustee for the debenture holders.
The Company hereby agrees and undertakes to duly and punctually pay, observe and perform the Financial Covenants and Conditions endorsed hereon.
Having regard to the adoption of liberalization policy by the Government of India, the Company intended to become globally companypetitive and went for a massive expansion in the year 1996.
COMPANYS REQUEST FOR FINANCIAL ASSISTANCE.
Privately placed debentures of Rs.100/ each to the extent mentioned below Name of Letter No.
All the debenture holders upon due deliberations agreed to the said proposal of restructuring package except the Appellants herein.
Out of the total investment of Rs.21,00,00,000/ made by the debenture holders, the companytribution of the Appellant is only Rs.4,00,00,000/. The Respondent in terms of the said agreement had undertaken to redeem the debentures in three equal instalments from the end of fourth year of the date of allotment and ending in the sixth year.
In the said circumstance, the Respondent approached the Industrial Development Bank of India with a request for a restructuring package to clear its liabilities.
The learned Company Judge rejected all the companytentions raised on behalf of the Appellants herein in terms of its judgment and order dated 1.10.2003.
The Company shall pay interest on the Debentures at the rate that may be stipulated by the debenture holder s as a result of such review.
In addition to the above, sacrifice being the amount representing the difference between the companytracted rate of interest and the rate as per the restructuring package will be paid on net present value NPV basis in 12 quarterly installments companymencing from 1.4.2002.
The debenture holders named therein are companylectively referred to by that expression and the expression means the debenture holders specified therein deriving their title to the debenture.
3.3 RIGHT TO REVIEW THE RATE OF INTEREST The Company agrees and undertakes that the Debenture holder s shall have a right to review the rate of interest as mentioned herein.
21.4.97 1000 GIC INV./97 DT.
It is number in dispute that pursuant to or in furtherance of the said restructuring package, the Respondent herein paid a sum of Rs.64.44 crores to various financial institutions between the period 1.10.2001 and 15.1.2003 in the following terms Sr.
The Respondent herein having regard to the aforementioned restructuring scheme filed an application before the High Court of Judicature at Bombay in terms of Section 391 of the Companies Act which was marked as Company Petition No.269 of 2003.
Aggrieved by and dissatisfied therewith, an appeal was preferred by the Appellants herein, which was dismissed by a Division Bench of the said Court by reason of the impugned order dated 12.4.2004.
The rights and remedies of the debenture holders against the companypany were to be exercised only through the trustee.
It is accepted that the total sums invested by the financial institutions in the aforementioned debentures is to the tune of Rs.197.43 crores whereas UTI invested a sum of Rs.19.57 crores i.e. only about 10 of the total investment.
A restructuring proposal was mooted wherefor two meetings were held in March 2001 and October 2001 wherein the Unit Trust of India UTI participated.
10.6.97 175 OIC DEPTT.
For various reasons, including imposition of European Union leveled Anti Dumping Duties, the Respondent suffered a cumulative loss of Rs.228.58 crores by March 2001.
A Common Subscription Agreement was entered into by and between the Respondent herein and all the debenture holders.
3.7 REPAYMENT The Company agrees and undertakes to redeem the debentures to all the debenture holders in three equal yearly installments from the end of 4th year from the date of allotment and ending in the 6th year from allotment.
The scheme of the said expansion was financed by obtaining term loans and issuance of debentures by various financial institutions including the Appellant No.2 herein.
Date Amount in lacs Debenture holders UTI DOI/2945/G 76/96 97 23.4.97 400 LIC INVCKAJ DT.
23.5.97 175 NIC INVT UW DEBS DT.30.5.97 105 NIA INV PM BUD/72/96 DT.
30.5.97 140 Total 2100 2.2 DEBENTURE SHALL RANK PARI PASSU The Company shall ensure that the Debentures shall rank pari passu inter se to all intents and purposes without any preference or priority of one over the other.
The said agreement was entered into having regard to the fact that the Respondent approached all the debenture holders for financial assistance for meeting their long term capital requirement in response whereto which debenture holders agreed to advance various sums of monies, in the form of subscription to 18.5, 21,00,000 number convertible privately placed debentures of Rs.100/ each.
The companypany also agrees and undertakes to obtain all necessary companysents from the companycerned authorities in accordance with the then prevailing rules and regulations and to sign all deeds and documents that may be required in this regard and to endorse the revised interest rates on the Debenture Certificates as and when companymunicated by the Debenture holder s .
In the agreement wherever an individual right has been companyferred upon the debenture holders, they have been described as debenture holder s or debenture holder s. Debenture certificates were issued to the debenture holders in terms of the Debentures Trust Deed pursuant whereto they became entitled to the benefits specified therein but they were bound by and were deemed to have numberice of all the provisions of the Trust Deed.
INVESTMENT DT 30.5.97 105 UII HQINV26297 DT.
The Company has approached the Debenture holders for financial assistance to the companypany for long term capital requirements and the Debenture holders have agreed to advance financial assistance in the form of subscription to 18.5, 21,00,000 number convertible.
The Respondent herein is a companypany registered under the Companies Act, 1956, and engaged in the manufacture of polyester film 50 of which production used to be exported to United States of America, United Kingdom, Europe, Far East, Middle East, Japan, New Zealand etc.
B. Sinha, J .
Leave granted.
In the said proceedings except UTI, all other debenture holders sanctioned the restructuring package.
