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Confidential

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RELIGARE FINVEST LIMITED

RELIGARE FINVEST LIMITED INFORMATION MEMORANDUM

FOR

ISSUE OF SECURED REDEEMABLE NON CONVERTIBLE DEBENTURES

ON A PRIVATE PLACEMENT BASIS

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DISCLOSURES UNDER SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE

AND LISTING OF DEBT SECURITIES) REGULATIONS, 2008

(i) Name and registered office address of the Issuer

Religare Finvest Limited. (Hereinafter referred to as “the Issuer” or “the Company” or

“RFL”)

Registered & Corporate Office:

Religare Finvest Limited 19, Nehru Place, New Delhi – 110019

Tel. No. + 91-11- 3081 5100

Corporate Office:

A-3 to A-5, Plot No. 11,

GYS Global,

Sector – 125, Noida – 201 301

Tel.No. + 91 -120 -3391000

Website : www.religarefinvest.com

Compliance Officer

Punit Arora

Company Secretary

Email: [email protected]

Debenture Issue

The Company proposes to issue 2000 (Two Thousand only) Redeemable, secured, non

convertible debentures of face value of Rs. 10,00,000/- (Rupees Ten Lakhs Only ) each,

aggregating to Rs. 200,00,00,000/- (Rupees Two Hundred Crores only) on private

placement basis (“the Issue” or “ the Debentures”).

General Risk

For taking an investment decision, investors must rely on their own examination and make

their own assessment as to the suitability of investing in the Debentures of the issue of the

Debentures as per the information provided in this disclosure document as required under

Securities and Exchange Board of India (Issue and Listing of Debt Securities)

Regulations, 2008 (“Disclosure Document/Information Memorandum”). The

Debentures have not been recommended or approved by the Securities and Exchange

Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of this

Disclosure Document. This Disclosure Document has not been submitted, cleared or

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approved by SEBI. It should be clearly understood that the Company is solely responsible

for the correctness, adequacy and disclosure of all relevant information herein.

Other risks

Prospective investors should consult their own legal, regulatory, tax, financial and/or

accounting advisors about risks associated with an investment in the Debentures and the

suitability of investing in such Debentures in light of their particular circumstances.

Issuer’s absolute responsibility

The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms

that this Disclosure Document contains all information with regard to the Issuer and the

Issue, which is material in the context of the Issue, that the information contained in this

Disclosure Document is true and correct in all material respects and is not misleading in

any material

respect, that the opinions and intentions expressed herein are honestly held and that there

are no other facts, the omission of which makes this Disclosure Document as a whole or

any of such information or the expression of any such opinions or intentions misleading in

any material respect.

Stock Exchange Disclaimer Clause

It is to be distinctly understood that filing of this Disclosure Document with the Bombay

Stock Exchange Ltd (“Stock Exchange”) should not, in any way, be deemed or construed

that the same has been cleared or approved by the Stock Exchange. The Stock Exchange

does not take any responsibility either for the financial soundness of any scheme or the

project for which the Issue is proposed to be made, or for the correctness of the statements

made or opinions expressed in this Disclosure Document.

Credit rating

ICRA has assigned the Issuer rating of “LA+” (pronounced as LA plus) for Rs. 500

Crores Long Term Debt to be raised by the Company.

Listing

The secured, redeemable, Non-Convertible Debentures are proposed to be listed on

Bombay Stock Exchange Limited (“BSE”).

Trustees for the Debenture holders/Debenture Trustees

AXIS TRUSTEE SERVICES LIMITED

Registered office at Maker Towers-"F", 13th Floor, Cuffe Parade, Colaba

Mumbai-400005

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Corporate Office at Maker Towers-"F", 6th Floor, Cuffe Parade, Colaba

Mumbai-400005

Registrar to the Issue

Link Intime India Private Ltd.

A-40, 2nd

floor, Naraina Industrial Area, Phase-II

Near Batra Banquet Hall, New Delhi-110028

Sole Book Runner & Lead Arranger

Standard Chartered Bank

90, Mahatma Gandhi Road, Fort,

Mumbai – 400 001

Disclaimer of the Lead Arranger

“The Arranger does not in any manner warrant, certify or endorse the correctness,

accuracy or completeness of any of the contents of this Information Memorandum. The

Arranger has neither scrutinized nor vetted or conducted any due-diligence for

verification of the contents of this Information Memorandum. The Arranger shall use this

Information Memorandum for the purpose of soliciting subscription(s) for the NCDs to

be issued by the Company on private placement basis. It is to be distinctly understood

that the use of this Information Memorandum by the Arranger should not in any way be

deemed or construed to mean that the Information Memorandum has been prepared,

cleared, approved or vetted by the Arranger.”

This Information Memorandum under Securities and Exchange Board of India (Issue and

Listing of Debt Securities) Regulation, 2008 for private placement is neither a prospectus

nor a statement in lieu of prospectus and does not constitute an offer to the public

generally to subscribe for or otherwise acquire the Debentures issued or to be issued by

the Issuer.

Apart from this Disclosure Document, no disclosure document or prospectus has been

prepared in connection with this Issue or in relation to the Company nor is such a

prospectus required to be registered under the applicable laws. Accordingly, this

Disclosure Document has neither been delivered for registration nor is it intended to be

registered.

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This Disclosure Document has been prepared to provide information about the pricing

and other terms and conditions including the nature of the Debentures, exclusively to

potential investors to whom it is addressed and who are willing and eligible to subscribe

to the Debentures. This Disclosure Document does not purport to contain all the

information that any potential investor may require. Neither this Disclosure Document

nor any other information supplied in connection with the Debentures is intended to

provide the basis of any credit or other evaluation and any recipient of this Disclosure

Document should not consider such receipt a recommendation to purchase any

Debentures. It is the responsibility of potential investors to also ensure that they will sell

these Debentures in strict accordance with applicable laws including restrictions on who

may acquire the Debentures and so that the sale does not constitute an offer to the public

within the meaning of the Act.

None of the intermediaries or their agents or advisors associated with this Issue undertake

to review the financial condition or affairs of the Company or the factors affecting the

Debentures during the life of the arrangements contemplated by this Disclosure

Document or have any responsibility to advise any investor or potential investor in the

Debentures of any information available with or subsequently coming to the attention of

the intermediaries, agents or advisors. No person has been authorized to give any

information or to make any representation not contained or incorporated by reference in

this Disclosure Document or in any material made available by the Company to any

potential investor pursuant hereto and, if given or made, such information or

representation must not be relied upon as having been authorized by the Company. The

intermediaries and their agents or advisors associated with this Issue have not separately

verified the information contained herein. Accordingly, no representation, warranty or

undertaking, express or implied, is made and no responsibility is accepted by any such

intermediary, agent or advisor as to the accuracy or completeness of the information

contained in this Disclosure Document or any other information provided by the

Company. Accordingly, all such intermediaries, agents or advisors associated with this

Issue shall have no liability in relation to the information contained in this Disclosure

Document or any other information provided by the Company in connection with the

Debentures.

The contents of this Disclosure Document are intended to be used exclusively by those

investors to whom it is distributed. It is not intended for distribution to any other person

and should not be reproduced by the recipient, in any manner whatsoever.

The person to whom a copy of this Disclosure Document is sent is alone entitled to apply

for the Debentures. No invitation is being made to any persons other than those to whom

application forms along with this Disclosure Document have been sent. Any application

by a person to whom the Disclosure Document and the application form has not been sent

by the Company shall be summarily rejected without assigning any reason therefore. The

person who is in receipt of this Information Memorandum shall maintain utmost

confidentiality regarding the contents hereof and shall not reproduce or distribute in

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whole or part or make any announcement in public or to a third party regarding its

contents, without the prior written consent of the Company.

Each person receiving this Disclosure Document acknowledges that such person has been

afforded an opportunity to:

a) request and to review and has received all additional information considered by an

individual to be necessary;

b) to verify the accuracy of the Disclosure Document; and

c) to understand the nature of the Debentures and the risks involved in investing in them

including for any reason having to sell them or be made to redeem them before final

redemption date.

Further, such person acknowledges that he has not relied on any intermediary or agent or

advisor or underwriter that may be associated with issuance of the Debentures in connection

with its investigation of the accuracy of such information or its investment decision.

The Company does not undertake to update the Disclosure Document to reflect subsequent

events after the date of the Information Memorandum and thus it should not be relied upon

with respect to such subsequent events without first confirming its accuracy with the

Company. Neither the delivery of this Disclosure Document nor any sale of Debentures made

hereunder shall, under any circumstances, constitute a representation or create any

implication that there has been no change in the affairs of the Company since the date hereof.

The Disclosure Document is made available to potential investors on the strict understanding

that it is confidential and is provided exclusively for their use.

Disclaimer statement from the Company

The Company accepts no responsibility for statements made other than in this Information

Memorandum and/or any other material expressly stated to be issued by or at the instance of the

Company in connection with the issue of these Debentures and that anyone placing reliance on

any other source of information would be doing so at their/ its own risk.

(ii) Name and Address of the Directors of the Issuer

Sr. No. Name Designation Address

1.

Sunil

Godhwani

Director

A-2, Inayat Farm, Asola,

Fatehpur Beri, P.O. Mehrauli,

NewDelhi - 110030

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2.

Atul Gupta Whole Time

Director

Flat No-42, Prayag Appartments,

Plot No-B-1, Vasundhara Enclave,

New Delhi - 110096

3.

J.S.Grewal Whole Time

Director

F-07 Mittal Park, 44 J.R. Mhatre

Road, Opp. Godrej Bungalow,

Juhu, Mumbai- 400049

4.

Sunil Kumar

Garg

Director C-90 Ramprastha, Gaziabad,

201011, Uttar Pradesh,

5.

Padam

Narain Behl

Director D-70, Ranjit Avenue,

Amritsar - 143001

6.

J.W. Balani Director Compas De La Victoria 3, 29012

Spain-29012

7.

R.K.Shetty Alternate to

J.W.Balani

D-2, 166, Chartered Cottage

Langford Road, Bangalore

560025, Karnataka

(iii) A brief summary of the business/ activities of the Issuer and its line of business

Religare Finvest Limited

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RFL was incorporated as an investment company on January 6, 1995 as “Skylark

Securities Private Limited” under the Companies Act, 1956 (“Act”). Its CIN is

U74999DL1995PLC064132. Subsequently, on September 23, 2004 it changed its name

to “Fortis Finvest Private Limited” and on October 7, 2004 it changed its name to “Fortis

Finvest Limited”. On April 4, 2006 it changed its name to its present name.

The registered office of RFL is situated at 19, Nehru Place, New Delhi- 110 019, India.

RFL is a Non Banking Financial Company (“NBFC”) not accepting public deposits and

is registered with the Reserve Bank of India (“RBI”). RFL is currently engaged in the

business of extending personal/corporate credit, corporate finance advisory, IPO

distribution, mutual fund distribution services and DP services.

The shares of RFL are not listed on any stock exchange.

Operational coverage and expansion

RFL is registered with the RBI as a NBFC and is presently engaged in providing

personal/corporate credit such as LAS, personal loans, loan against property and loan for

commercial vehicles, PFS and IPO financing. RFL has obtained post facto permission

from the RBI for distribution of mutual fund products and has applied to the SEBI for

registration as a custodian of securities under the provisions of the Securities and

Exchange Board of India (Custodian of Securities) Regulations, 1996, as amended, to

provide custodian services to its clients. RFL believes that its pan-India coverage through

the Religare brand will allow it to continue to grow its consumer loan portfolio. RFL’s

ability to appraise credit with a quality in-house team is key to providing efficient credit

decisions, a factor that will further enhance RFL’s ability to penetrate the consumer credit

market. ICRA, one of the leading rating agencies in India, has recently rated RFL with its

rating ‘LA+’ for the long term debt for Rs. 500 crores.

RFL has ramped up its distribution business and its advisor team is 350 as on August 31,

2009 and it has increased collection of third party assets.

Operations

Religare Finvest Limited undertakes the following operations:

Lending Operations - Capital Markets Financing

LAS: RFL’s LAS business involves offering loans secured by shares held by its retail

customers. RFL’s LAS book size as on August 31, 2009 amounted to Rs. 8,156.56

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million with approximately 2,319 clients. During fiscal 2007, RFL’s LAS book size

amounted to Rs. 4,410.09 million and as of fiscal 2008, the total book size had increased

to Rs. 8,678.38 million. RFL’s LAS had a base of approximately 1,611 clients as on

March 31, 2007 which grew to approximately 2,675 as on March 31, 2008.

IPO Financing: IPO financing is focused on the retail finance market in India and is

engaged in offering secured loans to retail customers who subscribe to shares of

companies in domestic public offerings (“IPO Financing”). IPO Financing helps

customers overcome the liquidity concerns by providing leverage to make large size

applications. RFL undertakes IPO Financing with minimal incremental costs due to its

existing infrastructure and client base.

Lending Operations - Consumer Financing

Personal Loans: RFL offers unsecured personal loans at fixed rates to specific customer

segments, with focus on creditworthy individuals with low access to credit, such as

salaried employees from the lower middle class. The average maturity for such loans is

36 (thirty six) months. For the 5 (five) months period ended August 31, 2009, RFL

disbursed personal loans amounting Rs. 980.64 million. During fiscal 2007, RFL

disbursed personal loans amounting Rs. 309.37 million and in fiscal 2008, the total

disbursement increased to Rs. 1,840.93 million. During fiscal 2009 RFL disbursed

personal loans amounting Rs. 1,828.53 million. RFL’s personal loan business has been

rolled out in seven locations and has credit and sales managers across these locations.

RFL had a customer base of approximately 844 clients as on March 31, 2007 which grew

to approximately 6,221 and 10,294 as on March 31, 2008 and August 31, 2009,

respectively.

Loan for Commercial Vehicles: RFL also recently began offering loans for commercial

vehicles and is in the process of entering into certain arrangements for financing

commercial vehicles.

Loan against Property: RFL also provides loans against property and total disbursal as

on August 31, 2009 was Rs. 5,760.94 million.

Distribution Business – Personal Financial Services

Financial planning services are geared toward individuals seeking advice on how best to

manage their financial resources. This may include a debt and asset analysis, as well as

college, retirement, estate and tax planning. Customers utilizing the financial planning

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services receive periodic checks to monitor how well the plan is being followed and

performing over time.

Much of the planning revolves around developing an income and expense budget, with

advice on the types of financial investments suitable for a particular client. With a view to

leverage the strength of its branch network during the course of fiscal 2007, RFL started

distribution of mutual funds and, in fiscal 2008, it converted this segment to ‘Personal

Financial Services (“PFS”), which provides financial planning services where a single

team can advise clients across various product and service offerings.

As of August 31, 2009, RFL had approximately 83,590 PFS folios for its retail

customers, with total funds of Rs. 7,769.83 million invested in equity-related funds and

Rs. 15,47,347.57 million in debt-related funds. RFL’s PFS team now offers a diversified

spectrum of financial planning to customers, which includes insurance, IPOs and mutual

funds. RFL had about 350 dedicated PFS advisors as of August 31, 2009.

(iv) A brief history of the Issuer since its incorporation giving details of its activities

including any reorganization, reconstruction or amalgamation, changes in its capital

structure, (Authorized, Issued and Subscribed) and borrowings, if any

History

RFL was incorporated as an investment company on January 6, 1995 as “Skylark

Securities Private Limited” under the Act. Its CIN is U74999DL1995PLC064132.

Subsequently, on September 23, 2004 it changed its name to “Fortis Finvest

Private Limited” and on October 7, 2004 it changed its name to “Fortis Finvest Limited”.

On April 4, 2006 it changed its name to its present name.

The Business

An extract of one of the main objects of the Memorandum of Association of the

Company is reproduced below:

“To lend money on any terms that may be thought fit to any persons or companies or

customers having dealings with the Company.”

Changes in the capital structure

The following changes have been made to the Capital Structure of the Company:

(i) Authorized Share Capital of the Company

Date Particulars

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15/09/2004 From Rs. 25,00,000 divided into 2,50,000 equity shares of Rs. 10 each

to Rs. 2,00,00,000 divided into 20,00,000 equity shares of Rs. 10 each

23/09/2005 From Rs. 2,00,00,000 divided into 20,00,000 equity shares of Rs. 10

each to Rs. 5,00,00,000 divided into 50,00,000 equity shares of Rs. 10

each

2/2/2006 From Rs. 5,00,00,000 divided into 50,00,000 equity shares of Rs. 10

each to Rs. 55,00,00,000 divided into 50,00,000 equity shares of Rs. 10

each and 5,00,00,000 cumulative redeemable preference shares of Rs. 10

each

22/03/2006 Alteration of Authorised Share Capital from Rs. 55,00,00,000 divided

into 5,00,00,000 Cumulative Shares of Rs. 10 each and 50,00,000

Equity Shares of Rs. 10 each, to Rs. 55,00,00,000 divided into

2,50,00,000 Equity Shares of Rs. 10 each and 3,00,00,000 Cumulative

Redeemable Preference Shares of Rs. 10 each by cancellation of un-

issued 2,00,00,000 cumulative redeemable preference shares of Rs. 10

each and in lieu thereof by creation of 2,00,00,000 equity shares of Rs.

10 each.

2/12/2006 From Rs. 55,00,00,000 divided into 2,50,00,000 equity shares of Rs. 10

and 3,00,00,000 Cumulative Redeemable Preference Shares of Rs. 10

each to Rs. 90,00,00,000 divided into 6,00,00,000 equity shares of Rs.

10 each and 3,00,00,000 Cumulative Redeemable Preference Shares of

Rs. 10each.

30/12/2006 Alteration of Authorised Share Capital from Rs. 90,00,00,000 divided

into 3,00,00,000 Redeemable Preference Shares of Rs. 10 each and

6,00,00,000 Equity Shares of Rs. 10 each, to Rs. 90,00,00,000 divided

into 9,00,00,000 Equity Shares of Rs. 10 each by cancellation of un-

issued 3,00,00,000 cumulative redeemable preference shares of Rs. 10

each in lieu thereof by creation of 3,00,00,000 equity shares of Rs. 10

each

22-10-2007 From Rs. 90,00,00,000 divided into 9,00,00,000 equity shares of Rs. 10

each to Rs. 1,500,000,000 divided into 1,50,000,000 equity shares of Rs.

10 each

01-12- 2008 From Rs. 1,500,000,000 divided into 150,000,000 equity shares of Rs.

10 each to Rs. 2,500,000,000 divided into 250,000,000 equity shares of

Rs. 10 each.

(ii) Issued and Subscribed and Paid Up Capital of the Company

Date Of Allotment Particulars (No. of Shares)

17-10-1997 1,50,000 equity shares of Rs. 10/- each

25-11-1997 50,000 equity shares of Rs. 10/- each

5-11-1999 49,980 equity shares of Rs. 10/- each



28-03-2006 2,00,00,000 equity shares of Rs. 10/- each and

25000000, 6% Cumulative Redeemable Preference

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Shares of Rs.10/- each *

12-12-2006 1,25,00,000 equity shares of Rs. 10/- each







* The preference shares have been redeemed as on 12.12.2006

(v.) Details of debt securities issued and sought to be listed including face value, nature of

debt securities mode of issue i.e. public issue or private placement.

Instrument/Facility Redeemable non-convertible secured Debentures ("Debentures")

Mode of

Placement

On private placement basis to all eligible investors

Issue Price Face

Value of

Debenture

Rs 10,00,000.00 (Rupees Ten Lakhs only) each at par

Issue Amount INR 200 crores (Indian Rupees Two Hundred crores only) split

between Tranche 1, Tranche 2 and Tranche 3 as under :

Tranche 1 : ~ Rs.66 Crore



Redemption Bullet

Redemption and

Maturity Date

Tranche 1: 1 year from the Deemed Date of Allotment. i.e. *******

Tranche 2: 2 years from the Deemed Date of Allotment. i.e.

*******


*******

(vi.) Issue Size

Issue Size Rs. 200 Crores

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(vii.) Details of utilization of the Issue proceeds

The proceeds of the Issue will be utilized for general corporate purposes.

Details of the bank account where the Issue proceeds have to be deposited

Beneficiary Name Religare Finvest Limited

Credit Account No. 22505682326

Centre (Location) 23-25 M.G Road Branch, Mumbai

Bank Standard Chartered Bank

Branch 23-25 M.G Road, Fort, Mumbai-400001

Account Type Savings / Current / Over Draft

IFSC Code SCBL0036046

(viii.) A Statement containing particulars of the dates of, and parties to all material

contracts, agreements involving financial obligation of the Issuer.

1. Memorandum and Articles of Association of the Company, as amended from time to time.

2. Certificate of Incorporation of the Company dated 6th January, 1995

3. NBFC Registration Certificate issued by Reserve Bank of India dated 10th November, 2006.

4. Board resolutions approving the private placement of Debentures dated 28.08.2009

5. Tripartite Agreement between the Company, the Depository and the Registrar for the issue of

the Debentures in demat form 27.04.2005.

6. Consent letters from the trustees to the Debenture holders dated 01.10.2009.

7. Annual reports of the Company for the last five years.

8. Credit ratings assigned to the Company by ICRA dated 1st September, 2009.

9. Financial arrangements with various banks, mutual funds and corporates (As per the table

provided below).

( ix.) Details of other Borrowings including any other issue of debt securities in past.

Statement of secured loans/ unsecured loans & instruments as on 31st August 2009

S.N.

Name of the

Banks/Lenders

Date of the

sanctioned/

agreement

Type of

Instrument

Sanctioned

Amount (Amt.

in Rs. Crores)

Outstanding

amount (Amt.

in Rs. Crores)

1

Breakup of Secured

Loans:-

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HDFC BANK April,2009 8.61 1.80

Sub Total (1)

1.80

2.

Break up of unsecured

Loans:-

(i) Various Mutual Funds

Commercial

Papers 819.00

(ii) Various Mutual Funds Non Convertible

Debentures

955.00

(iii) Corporates

Inter-corporate

Deposits 17.64

(iv)

Standard Chartered

Bank (Mauritius) Limited

Compulsorily

convertible

Debentures

60.00

Interest on above 0.31

Sub Total (2)

1851.95

Grand Total (1)+(2)

1853.75

(x.) Any material event / development or change at the time of issue or subsequent to the

issue which may affect the issue or investors decision to invest / continue to invest in the

debt securities.

In the opinion of the Directors of the Company, there have been no material developments after

the date of the last financial statements as disclosed in the Disclosure Document, which would

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materially and adversely affect, or would be likely to affect, the trading or profitability of the

Company or the value of its assets or its ability to pay its liabilities.

(xi.) Particulars of the debt securities issued for consideration other than cash, whether in

whole or part, at a premium or discount or in pursuance of an option.

The Company has not issued any debt securities for consideration other than cash, whether in

whole or part, at a premium or discount or in pursuance of an option.

(xii.) A list of highest ten holders of each class or kind of securities of the Issuer as on the

date of the application along with particulars to the number of shares or debt securities

held by them and the address of each such holder.

List and address of shareholders of Religare Finvest Limited as on 31/8/2009

S. No. Name of Shareholder Number of equity shares

of Rs. 10 each

% of Issued Capital

1. Religare Enterprise Limited (REL)

19, Nehru Place, New Delhi -

110019

169,071,537

99.99

2. Mr. Malvinder Mohan Singh* 100 Negligible

3. Mr. Shivinder Mohan Singh* 100 Negligible

4. Ms. Japna Malvinder Singh* 100 Negligible

5. Ms. Aditi Shivinder Singh* 100 Negligible

6. Mr. Gurpreet Singh Dhillon* 100 Negligible

7. Mr. Gurkirat Singh Dhillon* 100 Negligible

Total 169,072,137

100.00

*Nominee of REL

(xiii.) An undertaking that the Issuer shall use a common form of transfer.

The normal procedure for the transfer of securities held in dematerialized form shall be

followed for transfer of these Debentures held in electronic form. The seller should give

delivery instructions containing details of the buyer’s Depository participant’s account to

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his Depository participant. The Issuer undertakes that there will be a common transfer

form / procedure for transfer of Debentures.

(xiv.) Redemption amount, period of maturity, coupon rate.

Redemption and

Maturity Date Tranche 1: 1 year from the Deemed Date of Allotment. i.e.

*******


*******


*******

Coupon _____% p.a., payable _______on each of the Tranches.

(xv.) Information relating to the terms of offer or purchase.

The Issuer is placing 2000 (Two Thousand only) secured, redeemable, non convertible

Debentures of face value of Rs. 10,00,000/- (Rupees Ten Lakhs Only ) each, aggregating to

Rs. 200,00,00,000 /- (Rupees Two Hundred Crores only).

Issuer Religare Finvest Ltd. (“RFL” or the “Issuer” or the “Company”)

Sole Book Runner

and Lead Arranger

Standard Chartered Bank (“Arranger/SCB”)

Instrument/ Facility Secured Redeemable Non Convertible Debentures (“Debentures”)






Mode of Placement


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Purpose For general corporate purposes

Face Value Rs.10,00,000 (Rupees Ten Lakhs only) per Debenture

Issue Price At par

Security - First & Exclusive Charge over specific receivables to the extent of

1.5x of the Principal Amount Outstanding. All Receivables provided

as security shall be current at all times. The above cover will be

subject to a charge on receivables from secured assets to the extent of

at least 1.25x of the Principal Amount Outstanding.

- RFL to provide monthly statement showing the specific receivables

provided under first & exclusive charge to investor(s). Receivables

provided under first & exclusive charge shall not include any retail

capital market related loans and dues from associate or affiliates of

RFL, unless agreed by investor(s).

- Unconditional and irrevocable Corporate Guarantee covering

Principal and Interest from Religare Enterprises Ltd.(“REL” or

“Holding Company”)

Security should be created within 30 calendar days of the Deemed

Date of Allotment.

Rating “LA+/Stable” from ICRA

Maturity Date Tranche 1: 1 year from the Deemed Date of Allotment. i.e. *******

Tranche 2: 2 years from the Deemed Date of Allotment. i.e. *******


Redemption Bullet

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Put & Call Option

None

Arranger Fees **************

Interest on

Application Money

Interest on application money will be paid to investors at Coupon

from the date of realization of subscription money up-to one day prior

to the Deemed Date of Allotment. Such interest shall be payable

within seven business days from the Deemed Date of Allotment.

Indicative Timing Issue Opening Date: *********

Issue Closing Date: *********

Pay in Date: *********

Deemed Date of Allotment: *********

All documentation including, but not limited to, the Information

Memorandum, Board Resolution, Rating Letter, Appointment of

Trustees, In-principle listing approval from the Stock Exchange etc.,

to be completed and made available to the Arranger 1 day prior to

subscription.

Business Day

Convention

If any payment date is not a Business Day in Mumbai, payment shall

be made on the next Business Day in Mumbai.

Business Day means a day which is not a Saturday or Sunday or a

public holiday and on which high value clearing facility is available in

Mumbai.

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Day Count Basis Actual / Actual

Stamp duty payable

in case of transfer of

Debentures

Stamp Duty on secondary market transfer as applicable under the

Bombay Stamp Act. (Presently, no stamp duty is payable on transfer

of Debentures in dematerialised form).

Security Trustee Any SEBI registered Bank/ Institution mutually acceptable to the

Issuer & Arranger

Issue of Debentures

The Issuer will issue the Debentures / Letters of Allotment in

dematerialized form within one business day from the Deemed Date

of Allotment.

Documentation Customary documentation for the Issue as required by SCB.

Conditions

precedent:

SCB’s arrangership will be subject to the following conditions and

compliance of the said conditions by the Issuer wherever applicable:

(i) the accuracy and completeness of the representations

made /to be made by the Issuer to SCB and the

information that the Issuer has furnished /would furnish to

SCB till the closure of the Issue; and compliance by the

Issuer of the terms and conditions of this Agreement;

(ii) SCB having satisfied in a form and substance acceptable

to SCB and having obtained from the Issue (a) all

applicable internal and external approvals for the Issue

have been obtained by the Issuer applicable approvals

and resolutions passed by the board of directors of the

Issuer; (b) documentation for the Transaction being

prepared as specified in (iv) below and appropriate

business description disclosure in the offering circular

(prepared by the Issuer’s counsel);

(iii) the documentation in respect of the Issue is in full

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compliance with the statutory and Arranger’s

requirements and completed to the satisfaction of the

Arranger;

(iv) the Issuer obtaining in-principle approval from the

relevant stock exchange(s) for listing of Debentures;

(v) the absence of any default or cross default in respect of

other liabilities of the Issuer.

Covenants

*************

Optional

Prepayment

************

Resolutions required The Issuer should ensure that all the consents and resolutions required

to issue Debentures are in place prior to the issue.

The Issuer should also ensure that any and all applicable regulations

pertaining to this Issue are complied with, including but not limited to

RBI’s Prudential Guidelines on banks’ investment in non-SLR

securities dated 12th November 2003, SEBI Circular on Secondary

Market for Corporate Debt Securities dated 30th September 2003 and

22nd December 2003 and SEBI Issue & Listing of Debt Instrument

guidelines dated June 6, 2008

Expenses All expenses related to the issue including but not limited to costs

relating to stamp duty, legal fee, listing fee, credit rating charges and

other expenses will be to the account of the Issuer.

Material Adverse

Circumstances

The Agreement of SCB are subject to there being no material adverse

change (or an event which is likely to result in a material adverse

change) in:

i. the business activities, financial condition and credit standing

of the Issuer (or any of its shareholders, or subsidiaries) since

the date of their respective latest published financial

statements;

ii. the international or domestic money, bank, foreign exchange

and capital markets, or in the debt syndication market,

iii. the socio-political and economic situation of India (including

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as a result of hostilities along the borders of the Republic of

India ) or any event, whether domestic or international;

which in SCB’s sole opinion/judgement, would adversely impact the

successful syndication of the Issue /materially impair subscription to

the Debentures, from the date of acceptance of this offer till the

closure of the Issue.

In such an event, SCB shall have the option to renegotiate the terms of

the Issue or terminate the Agreement.

Investor Profile Banks, Mutual Funds, Financial Institutions, Insurance Corporations,

Provident & Pension Funds, Corporate Investors, FIIs. There shall be

no negative list of investors.

Clear Market

Provision

The Issuer undertakes that it will not announce or raise from the

market, either on bilateral or syndication basis, any Debentures from

the date of acceptance of this offer till the date of closure of the Issue.

Further, the Issuer also undertakes that it shall not announce or bring

to the market any other issuance of similar tenor Debentures on terms

better than those offered under the present issue for a period of 2

weeks from the Deemed Date of Allotment of these Debentures.

Derivative

Transactions

The Issuer confirms that it will offer SCB the first right of refusal to

SCB if it transacts derivatives / swaps for the purpose of risk

management on these debentures.

Listing On the WDM segment of The Stock Exchange, Mumbai. The Issuer

shall make an application for listing on the day of the deemed date of

allotment of Debentures, and ensure listing within two working days.

Publicity &

Communication

On successful conclusion of the Issue, the Arranger reserves the right

to issue publicity material such as tombstones, advertisements etc.

after discussion with the Issuer.

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Governing Law and

Jurisdiction

The Governing law will be the Indian Law and the parties submit to

the non-exclusive jurisdiction of the courts in Mumbai.

Validity of the

Indicative Terms

These indicative terms and conditions are open for

discussion*****************on October ******2009 after which

time these outline terms and conditions shall lapse if the Issuer has not

signed these terms and conditions by that time.

Over and above such terms and conditions, the Debentures shall also be subject to the

applicable provisions of the Depositories Act, 1996 and the laws as applicable,

guidelines, notifications and regulations relating to the allotment and issue of capital and

listing of securities issued from time to time by the Government of India ( “GoI”),

Reserve Bank of India , Securities & Exchange Board of India (“SEBI”), concerned

Stock Exchanges(s), or any other authorities and other documents that may be executed

in respect of the Debentures.

The terms of the Issue are as given below.

Nature and status of Debentures

1) The Company shall issue redeemable, secured, and non convertible Debentures. The

Debentures will constitute direct obligations of the Company and covered by pari passu

Mortgage over the Company’s Immovable property situated at plot no. 37, survey no. 35

of Mouje Irana of Kadi Taluka, Distt. Mehasana, Gujarat, and pari passu charge on

business receivables by way of hypothecation.

Deemed Date of Allotment

All the benefits under the Debentures, including the payment of interest/coupon, will

accrue to the investor(s) from the Deemed Date of Allotment. The Company shall ensure

that the demat accounts of the investors who have been allotted the Debentures are

credited within 1 (one) working day from the Deemed Date of Allotment.

Listing

The Debentures are proposed to be listed on the BSE within 2 (two) working days from

the Deemed Date of Allotment.

Issue in demat form

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The Company shall issue Debentures in dematerialized form only and has made

necessary arrangements with National Securities Depository Limited (“NSDL”) for the

same. Investors shall hold the Debentures in de-mat form and deal with the same as per

provisions of Depositories Act, 1996 / rules as notified by NSDL from time to time.

Investors should, therefore mention their Depository participant’s name, DP-ID and

Beneficiary Account Number in the appropriate place in the application form. The

Company shall take necessary steps to credit the Depository Account of the investor with

the number of Debentures allotted.

Mode of transfer / transmission of Debentures

The Debenture(s) shall be transferred and / or transmitted in accordance with the

applicable provisions of the Act. The provisions relating to transfer and transmission and

other related matters in respect of shares of the Company contained in the Articles of

Association of the Company and the Act shall apply, mutatis mutandis ( to the extent

applicable to Debentures) to the Debentures as well. The Debentures held in

dematerialized form shall be transferred subject to and in accordance with the rules /

procedures as prescribed by Depository participant of the transferor/transferee and any

other applicable laws and rules notified in respect thereof. The transferee(s) should

ensure that the transfer formalities are completed prior to the record date. In absence of

the same, principal and coupon will be paid/redemption will be made to the person,

whose name appears in the register of Debenture holders/record of the Depository. In

such cases, claims, if any, by the transferee(s) would need to be settled with the

transferor(s) and not with the Company.

Interest on application money

Interest on application money, if any, will be payable at the specified coupons (subject to

deduction of tax at source at the rates prevailing from time to time under the provisions of

Income Tax Act, 1961 or any statutory modification or re-enactment thereof), on the

entire application money on all valid applications. The same will be released within 7

(seven) business days from the Deemed Date of Allotment.

Such interest shall be paid for the period commencing from the date of realization of

cheque (s) / draft(s) up to one day prior to the Deemed Date of Allotment. The Interest

Warrants will be dispatched by registered post, courier or by way of bank transfer /

RTGS instruction at the sole risk of the applicant, to the sole / first applicant. No interest

on application money would be payable in cases of invalid applications.

Effect of holidays

Should any of dates defined above or elsewhere in the Disclosure Document, excepting

the Deemed Date of Allotment, fall on a Sunday or a Public Holiday, or a day in which

banks are closed for clearing, for the general public, the preceding working day shall be

considered as the effective date. However the payment of coupon shall be computed and

paid as per coupon rate.

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In case the principal redemption date falls on a Sunday or a Public Holiday, or a day in

which banks are closed for clearing for the general public, the payment due shall be made

on the preceding working date ( the effective date as mentioned above).

For the purposes of this clause, a Public Holiday or a day on which banks are closed for

clearing for the general public will be with reference to Mumbai, India.

Tax Deduction at Source

Income tax will be deducted at source from interest on application money/Debentures as

per applicable provisions of the Income Tax Act, 1961 and as applicable from time to

time. In respect of interest on application money, the relevant document (Form

15AA/15H) should be submitted along with the application form.

Where any deduction of income tax is made at source, the Company shall send to the

Debenture holder a Certificate of Tax Deduction at Source at the end of the Financial

Year.

Tax benefits.

The Debenture holder is advised to consider in his own case the tax implications in

respect of subscription to the Debentures after consulting his tax advisor.

Letter of allotments & Debenture certificate

The Company will allot to the investors, the Debentures in due course after verification

of the application form(s), the accompanying documents and on realization of application

money.

The de-mat account of the investors with NSDL/CDSL will be credited on completion of

all statutory formalities and such credit will be substituted for the number of Debentures

allotted.

There shall be first & exclusive charge over specific receivables to the extent of 1.5x of

the Principal Amount Outstanding. All Receivables provided as security shall be current

at all times. The above cover will be subject to a charge on receivables from secured

assets to the extent of at least 1.25x of the Principal Amount Outstanding.

RFL to provide monthly statement showing the specific receivables provided under first

& exclusive charge to investor(s). Receivables provided under first & exclusive charge

shall not include any retail capital market related loans and dues from associate or

affiliates of RFL, unless agreed by investor(s).

Unconditional and irrevocable Corporate Guarantee covering Principal and Interest from

Religare Enterprises Ltd.(“REL” or “Holding Company”)

Security should be created within 30 calendar days of the Deemed Date of Allotment.

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Execution of Trust Deed and other security documents

The Company shall execute a deed of hypothecation in favour of the Debenture Trustees

creating a pari passu charge on business receivables by way of hypothecation within 30

(thirty) days from the Deemed Date of Allotment of Debentures to secure the Debentures

for the benefit of the Debenture holders.

Stamp Duty

The Company will pay all stamp duties in relation to the Debentures and all documents

executed in relation to the Debentures including any security documents.

Redemption

There shall be bullet redemption of Debentures.

Procedure for redemption

In case of the Debentures held in de-mat form, no action is required on the part of the

Debenture holder(s) at the time of redemption of the Debentures and on the

redemption date the redemption proceeds would be paid by cheque or by way of

RTGS instruction to the Depositories by the Company. The name(s) would be as per

the Depositories’ records on the Record Date fixed for the purpose of redemption. All

such Debentures will be simultaneously redeemed through appropriate debit

corporate action. Interest and/or principal repayment shall be made to the person

whose name appears as sole or first holder in the register of Debenture

holders/beneficiaries on the Record Date.

In case of cheque issued towards redemption proceeds, the same will be dispatched

by courier or hand delivery or registered post at the address provided in the

application or at the address as notified by Debenture holder(s) or at the address as

per the Depositories’ records. Once the cheque for redemption proceeds is

dispatched to the Debenture holder(s) at the addresses provided or available from the

Depositories’ records, the Company’s liability to redeem the Debentures on the date

of redemption shall stand extinguished and the Company will not be liable to pay any

interest/coupon, income or compensation of any kind from the date of redemption of

the Debenture(s).

The Debentures will not carry any obligation for interest, or otherwise, after the

Maturity Date.

Succession

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Where Debentures are held in joint names and one of the joint holders dies, the

survivor(s) will be recognized as the holders(s) of the said Debentures. It would be

sufficient for the Company to delete the name of the deceased Debenture holders after

obtaining satisfactory evidence of his death.

In the event of demise of the sole /first holder of the Debentures(s), the Company will

recognize the executors or administrator of the deceased Debenture holder, or the

holder of the succession certificate or other legal representative as having title to the

Debentures only if such executor or administrator obtains and produces probate of a

will or letter of administration or is the holder of the succession certificate or other

legal representation, as the case may be, from an appropriate Court in India. The

Directors of the Company in their absolute discretion may, in any case, dispense with

production of probate of the will or letter of administration or succession certificate or

other legal representation.

Record Date

The Record Date shall be 10 (ten) calendar days before the redemption or interest

payment date of Debentures. The Company shall request the Depository (ies) to

provide a list of Beneficial Owners as at the end of the Record Date. This shall be the

list, which shall be considered for payment of coupon or repayment of principal

amount, as the case may be.

REPRESENTATIONS AND WARRANTIES

The Company declares represents and warrants as of the date hereof that:

1. Consent/approval required for the issue of Debentures

All corporate and other action necessary for the issuance of the Debentures have

been obtained by the Company and the Company will at all times keep all such

approvals /consents valid and subsisting during the term of the Debentures. The

company has obtained consent from Debenture Trustee holding prior charge for

creation of security for the Debentures.

2. Absence of defaults with Memorandum/ Articles of Association or any

other agreements in respect of transaction/ transaction document

The Disclosure Document and other documents executed in pursuance hereof,

including towards creation of the security, when executed and delivered, will

constitute valid and binging obligations of the Company and will not contravene

any applicable laws, statutes or regulations and will not be in conflict with the

Memorandum of Association/ Articles of Association of the Company or result

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in the breach of, any of the terms, covenants, conditions and stipulations under

any existing agreement to which the Company is a party.

3. Filings and registration

The Company shall duly and in a timely manner complete all filings and

registrations as may be required under law from time to time for the purposes of

the issue and maintenance of the Debentures and the creation of security.

4. No immunity under laws

Neither the Company nor its assets has any immunity (sovereign or otherwise)

from any suit or any legal proceeding under the laws of India.

5. Solvency

The Company is currently solvent and the Company has not taken any corporate

or other action, nor have any steps been taken or legal proceedings of any manner

been initiated/ threatened against the Company for its winding up, dissolution,

insolvency, bankruptcy or for appointment of receiver on its assets or its business.

6. No debt/contingent liability other than as disclosed in the annual audited

accounts

The Company has no debts or contingent liabilities outstanding except as

disclosed in its annual audited financial statement dated March 31, 2009. Debts as

on 31st August 2009 is given in point (ix) of this Disclosure Document.

7. Indebtedness

The Company is not in default with respect to any loans or deposits or advances

or other financial facilities availed by the Company in the capacity of the

Borrower.

COMPANY’S COVENANTS

(A) Affirmative covenants:

The Company shall:

(i) Disclosure Documents to conform to the Debenture Trust Deed

Ensure that the debenture trust deed executed in favour of the Debenture Trustees

(“Debenture Trust Deed”) and other security documents when executed shall be

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to the satisfaction of the Debenture Trustees and Debenture holders at all times ,

and will be in accordance with the terms and conditions as contained herein.

(ii) Validity of transaction documents

Ensure that the Disclosure Document, the Debenture Trust Deed and other

documents creating the security shall be validly executed and delivered, will

continue in full force and effect and will constitute valid and binding obligations

of the Company.

(iii) Notice of winding up or other legal process

Promptly inform the Debenture Trustees if it has notice of any application for

winding up having been made or any statutory notice of winding up under the

provisions of the Act, or any other notice under any other act or otherwise of any

suit or other legal processes intended to be filed or initiated against the

Company and affecting the title of the Company to its assets or if a Receiver is

appointed over any of the properties or businesses or undertakings of the

Company.

(iv) Annual Accounts

Submit to the Debenture Trustees it’s duly audited Annual Accounts, within 6

(six) months from the close of its accounting year. In case statutory audit is not

likely to be completed during this period, the Company shall get its accounts

audited by an independent firm of chartered accountants and furnish the same to

the Debenture Trustees.

(v) Memorandum and Articles of Association

Carry out such alterations to its Memorandum of Association and Articles of

Association as may be deemed necessary in the opinion of Debenture

holders/Debenture Trustees to safeguard the interests of the Debenture holders.

(vi) Preserve corporate status

Diligently preserve its corporate existence and status and its license to conduct

business as a non banking financial institution.

(vii) Furnish information to Debenture Trustees

Give to the Debenture Trustees or their nominee(s) such information as they shall

require as to all matters relating to the business, property and affairs of the

Company and at the time of the issue thereof to the shareholders of the Company

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furnish to the Debenture Trustees copies of every report, balance sheet, profit and

loss account, circulars or notices issued to the shareholders and the Debenture

Trustees shall be entitled if they deem fit, from time to time to nominate an

accountant or agent to examine the books of account, documents and property of

the Company or any part thereof and to investigate the affairs thereof and the

Company shall allow any such accountant or agent to make such examination and

investigation and shall furnish him with all such information as he may require

and shall pay all costs, charges and expenses incidental to such examination and

investigation.

(viii) Shall furnish quarterly report to the Debenture Trustees containing the

following particulars –

1) Updated list of the names and addresses of the Debenture holders.

2) Details of the interest due, but unpaid and reasons thereof.

3) The number and nature of grievances received from the Debenture holders and

resolved by the Company.

4) A statement that those assets of the Company which are available by way of

security are sufficient to discharge the claims of the Debenture holders as and

when they become due.

(ix) Promptly and expeditiously attend to and redress the grievances, if any, of the

Debenture holders. The Company further undertakes that it shall promptly

comply with the suggestions and directions that may be given in this regard, from

time to time, by the Debenture Trustees and shall advise the Debenture Trustees

periodically of the compliance.

(x) Corporate Governance

Confirm to all mandatory recommendations and make all disclosures as contained

in the listing agreement for privately placed Debentures or under the Act.

(xi) Due payment of public and other demands

Confirm that the Company is not, and will continue not to be, in arrears of any

undisputed public demands such as income-tax, corporation tax and all other taxes

and revenues or any other statutory dues payable to Central or State Governments

or any local or other authority.

(xii) Maintain listing

Confirm that the Company shall take all necessary steps and comply with the

listing agreement to ensure that the Debentures remain listed at all times during

the term of the Debentures.

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(xiii) Maintenance of rating

Confirm that the Company will comply with any agreement with the rating

agency and provide any necessary information to the rating agency so as to

continue to maintain a credit rating.

(xiv) Comply with provisions of Section 205C of the Companies Act, 1956

Comply with the provisions of Section 205C of the Act relating to transfer of

unclaimed / unpaid amounts of interest/coupon on Debentures and redemption of

Debentures to Investor Education and Protection Fund (“IEPF”), if applicable to

it.

EVENTS OF DEFAULT

The occurrence of any of the following events, or events similar thereto, shall each

constitute an Event of Default (“EOD”):

(i) Default in payment of principal sums of the Debentures Default has occurred in the payment of principal sums and/or coupon of the

Debentures on the due dates.

(ii) Default in performance of covenants and conditions Except for the events contained in paragraph (i) above, default has occurred in

the performance of any other covenants, conditions or agreement on the part

of the Company under these presents and such default has not been remedied

within 30 (thirty) days from the date of receipt of such notice.

(iii)Supply of misleading information Any information given by the Company in the Disclosure Document, reports

and other information furnished by the Company in accordance with the

reporting system and the warranties given/deemed to have been given by the

Company to the Debenture holders / Debenture Trustees is misleading or

incorrect in any material respect.

(iv) Proceedings against company The Company has voluntarily or involuntarily become the subject of

proceedings under any bankruptcy or insolvency law and such proceedings

have been admitted by a competent court or the Company is voluntarily or

involuntarily dissolved.

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(v) Appointment of receiver A receiver or a liquidator has been appointed or allowed to be appointed over

all or any part of the properties of the Company.

(vi) Inability to pay debts on maturity The Company has admitted in writing that the Company is unable to pay its

debts as they fall due.

(vii) Attachment or restraint on company’s properties If there is an attachment or restraint on assets of the Company, of value in

excess of Rs. 50,00,00,000/- (Rupees Fifty Crores).

(viii) Failure to create Security The Company fails to create the security as mentioned herein within 90

(ninety) days of the issue of the Debentures.

(ix) Breach of covenants The Company breaches any of the covenants as provided herein in relation to

the listing of the Debentures.

(x) Litigation against the transaction documents If the Company, for any reason whatsoever, initiates proceedings before any

court, challenging the validity of any of the documents in relation to the

Debentures.

(xi) Effectiveness of transaction documents If any of the documents in relation to the Debentures are found to be invalid

or unenforceable under the laws of India.

(xii) Illegality It is found to be, or becomes illegal under the laws of India, either wholly or

in part, for any reason whatsoever, for the Company to maintain the

Debentures, or the Company becomes obligated, under Indian laws, to

withdraw the Debentures, in any manner.

(xiii) Material adverse effect If there is an event of material adverse change which has or is likely to have,

in the reasonable view of the Debenture holder(s) / Debenture Trustees, a

material adverse effect on the Company’s business and financial operations.

Consequences of an EOD

In the event of the happening of an EOD, the Debenture Trustees will have a right to

accelerate the repayment of the Debentures along with all applicable outstanding dues

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including coupon and demand immediate repayment of the principal. The Debenture

Trustees will also have the right to enforce the security for such repayment.

Amendment of the terms of the Debentures

The rights, privileges, terms and conditions attached to the Debentures may be varied,

modified or abrogated with the consent, in writing, of those holders of the Debentures

who hold at least three fourths of the outstanding amount of the Debentures or with the

sanction accorded pursuant to a special resolution passed at a meeting of the Debenture

holder(s), provided that nothing in such consent or resolution which modifies or varies

the terms and conditions of the Debentures shall be operative against the Company, if the

same are not accepted by the Company.

Trustees for the Debentures holders

The Company has appointed Axis Trustee Services Limited to act as trustees for the

Debenture holders (“Debenture Trustees”). The Company and the Debenture Trustees

will enter into a Debenture Trust Deed, inter alia, specifying the powers, authorities and

obligations of the Debenture Trustees and the Company. The Debenture holder(s) shall,

without further act or deed, be deemed to have irrevocably given their consent to the

Debenture Trustees or any of their agents or authorized officials to do all such acts,

deeds, matters and things in respect of or relating to the Debentures as the Debenture

Trustees may in their absolute discretion deem necessary or require to be done in the

interest of the Debenture holder(s), except as expressly provided herein.

The Debenture Trustees will protect the interest of the Debenture holder(s) in the event of

default by the Company with regard to timely payment of coupon and repayment of

principal and they will take necessary action at the cost of the Company.

The investors can refer to the Debenture Trust Deed to be entered into with the Debenture

Trustees in order to know the powers, liabilities, rights, retirement, and removal etc. of


Rights of Debenture holder(s)

The Debenture holder(s) will not be entitled to any rights and privileges of shareholders

other than those available to them under statutory requirements. The Debentures shall

not confer upon the holders the right to receive notice, or to attend and vote at the general

meetings of the Company. The Debentures shall be subject to other usual terms and

conditions as incorporated in the application form (Annexure I).

Future Borrowings

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The Company shall be free to borrow / raise loans or avail financial assistance in

whatever form, and also issue promissory notes / debentures or other securities in any

manner having such ranking, pari passu or otherwise and change the capital structure

including the creation of any security over any assets including the assets forming part of

the security for the Debentures, or issue of shares of any class, on such terms and

conditions as the Company may deem appropriate, without the consent of, or intimation

to the Debenture holder(s) / Debenture Trustees in this connection. Provided that at the

time of raising such further issue of debentures and/or further term loans and/or availing

deferred payment credit/guarantee facilities the Company maintains the security cover as

stipulated herein in respect of the Debentures.

Governing Law

The Debentures are governed by and shall be construed in accordance with the existing

Indian laws. Any dispute arising thereof will be subject to the jurisdiction of the courts

of Mumbai.

Debenture redemption reserve

As per the circular of the Department of Company Affairs (N0.6/3/2001-CL.V) dated 18th

April, 2002, debenture redemption reserve is not required to be created for issue of

privately placed debentures by Non-Banking Financial Companies registered with the

Reserve Bank of India under Section 45 (1) A of the RBI (Amendment) Act, 1997.

Who Can Apply

The following categories of investors, when specifically approached, are eligible to apply

for this private placement of Debentures.

• Banks

• Financial Institutions

• Insurance Corporations

• Mutual Funds

• Foreign Institutions

• FIIs

• Provident & Pension Funds

• Corporate Investors

There shall no negative list of investors.

Documents to be provided by investors

• Memorandum and articles of association/constitutional documents

• PAN

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• Resolution/authority authorizing the investment

• Certified true copy of power of attorney (if applicable)

• Form 15AA for investors seeking exemption from tax deduction at source

• Specimen signature of authorized signatories

Submission of Completed application form

All applications duly completed and accompanied with all necessary documents shall

be submitted to the Company at its registered office.

Rights to accept / reject applications

The Issuer is entitled at its sole and absolute discretion to accept or reject any

application, in part or in full, without assigning any reason. Application forms which

are incomplete or which do not fulfill the terms and conditions indicated on the back

of the application form are liable to be rejected.

Compliance Officer

In case of any pre-Issue / post-Issue related problems such as non-receipt of letters of

allotment / refund orders etc., the investors are requested to contact the Compliance

Officer whose details are given below:

Mr. Punit Arora

Company Secretary

Email: [email protected]

Telephone +91 -120 - 3391000

Depository arrangement

The Company has appointed Link Intime India Private Ltd. as registrar and transfer

agents (“Registrar”) for the Issue. The Company has entered into depository

arrangement with National Securities Depository Limited.

Purchase / Re-Issue of Debentures / Cancellation of Debentures

The Company may, at any time and from time to time, purchase Debentures at a

discount, at par, or at a premium, in the open market or otherwise in accordance with

the applicable laws. Such Debentures may, at the option of the Company be

cancelled, held or reissued at such a price and on such terms and conditions as the

Company may deem fit and as permitted by law.

Where the Company has redeemed any such Debenture, subject to the provisions of

the Act and other applicable provisions, the Company shall have and shall be deemed

always to have and the right to keep such Debentures alive for the purpose of re-issue

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and in exercising such right, the Company shall have and shall be deemed always to

have had the power to re-issue such Debentures either by re-issuing the same

Debentures or by issuing other debentures in their place.

Register of Debenture holders

The Company shall maintain a register of Debenture holders containing necessary

particulars at its registered office.

Notices

All the notices, communications and writings to the Debentures holder(s) required to

be given by the Issuer shall be deemed to have been given if sent by registered post /

courier / hand delivery to the address of the Debenture holder(s) registered with the

Company.

All notices, communications and writings to be given by the Debenture holder(s)

shall be sent by registered post / courier / hand delivery to the Registrars to the Issue

or to the Compliance Officer of the Issuer at the registered office and/or corporate

office of the Company or to such persons at such address as may be notified by the

Issuer, from time to time and shall be deemed to have been received on actual receipt.

(xvi) The discount at which such offer is made and the effective price for the

investor as a result for such discount

The Offer for issue of Debentures is being made at the face value and not at discount

to offer price.

(xvii) The Debt Equity Ratio Prior to and after Issue of the debt security

Amount in Rs. Crores

Particulars Debt Equity Ratio as per latest Un-Audited Balance

Sheet as on 31st August, 2009

Share Capital:-

- Paid up Share

Capital* 229.07

- Reserves and Surplus 1253.66

Total Equity Funds 1482.73

Loan funds:-

- Secured Loans 1.80

- Unsecured Loans 1791.96

Total Debt Funds 1793.76

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Debt Equity Ratio 1.21 : 1

*Including Compulsorily Convertible Debentures of Rs. 60 Crores

Amount in Rs. Crores

Particulars Debt Equity Ratio as per latest Audited Balance Sheet as

on 31th

March, 2009

Share Capital

- Paid up Share

Capital* 1163.21

- Reserves and Surplus 279.48

Total Equity Funds 1442.69

Loan Funds:-

- Secured Loans 39.50

- Unsecured Loans 606.13

Total Debt Funds

645.63

Debt Equity Ratio 0.45 : 1

* including

(a) Share Application Money of Rs. 943.30 Crores; and

(b) Compulsorily Convertible Debentures of Rs. 100 Crores

Debt Equity ratio will vary as and when the Company issues the proposed secured non-

convertible redeemable Debentures. The same shall be intimated to the BSE accordingly.

(xviii) Servicing behavior on the existing debt securities, payment of due interest on

due dates on term loans and debt securities

The Company has been discharging all its liabilities in time including the payment of interest

due on loan facility(s) availed and on debt securities of the Company, principal repayments

and payments on redemption, including repayments to banks, mutual funds and financial

institutions. The Company also undertakes to fulfill its future obligations whenever it arises.

(xix) Permission /consent from prior creditors for the charge being created in favour of


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The company has obtained consent from Debenture Trustee holding prior charge for creation

of security for the Debentures.

(xx) The names of the Debenture Trustees shall be mentioned with the statement to the

effect that Debentures Trustees has given his consent to the Issuer for his appointment

under Regulation 4 (4) and also in all the subsequent periodical communications sent to

the holder(s) of the debt securities.

Axis Trustee Services Limited has given its consent for its appointment as the Debenture

Trustees to the present issue under Regulation 4 (4) and also in all the subsequent periodical

communications to be sent to the holders of the Debentures.

(xxi) The rating rationale

ICRA has assigned the Issuer rating of “LA+” (pronounced as LA plus) for the long term

debt issue of 500 Crores to be raised by the company. The rating indicates adequate-credit-

quality.

(xxii) Names of all the recognized Stock Exchanges where the securities are proposed to

be listed clearly indicating the designated stock exchange and also whether in-principle

approval from the recognized stock exchange has been obtained

The Debentures are proposed to be listed on the Bombay Stock Exchange Limited . The

Company has obtained in-principle approval from BSE for listing of the Debentures vide its

letter dated [*].

(xxiii) A summary term sheet shall be provided which shall include brief information

pertaining to the secured non convertible debt securities (or a series thereof) as follows

(where relevant

Issuer Religare Finvest Ltd. (“RFL” or the “Issuer” or the “Company”)

Sole Book Runner

and Lead Arranger

Standard Chartered Bank (“Arranger/SCB”)

Instrument/ Facility Secured Redeemable Non Convertible Debentures (“Debentures”)



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Mode of Placement


Purpose For general corporate purposes

Face Value Rs.10,00,000 (Rupees Ten Lakhs only) per Debenture

Issue Price At par

Security - First & Exclusive Charge over specific receivables to the extent of

1.5x of the Principal Amount Outstanding. All Receivables provided

as security shall be current at all times. The above cover will be

subject to a charge on receivables from secured assets to the extent of

at least 1.25x of the Principal Amount Outstanding.

- RFL to provide monthly statement showing the specific receivables

provided under first & exclusive charge to investor(s). Receivables

provided under first & exclusive charge shall not include any retail

capital market related loans and dues from associate or affiliates of

RFL, unless agreed by investor(s).

- Unconditional and irrevocable Corporate Guarantee covering

Principal and Interest from Religare Enterprises Ltd.(“REL” or

“Holding Company”)

Security should be created within 30 calendar days of the Deemed

Date of Allotment.

Rating “LA+/Stable” from ICRA

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Maturity Date Tranche 1: 1 year from the Deemed Date of Allotment. i.e. *******



Redemption

Bullet


Put & Call Option

None

Arranger Fees **************

Interest on

Application Money

Interest on application money will be paid to investors at Coupon

from the date of realization of subscription money up-to one day prior

to the Deemed Date of Allotment. Such interest shall be payable

within seven business days from the Deemed Date of Allotment.

Indicative Timing Issue Opening Date: *********

Issue Closing Date: *********

Pay in Date: *********

Deemed Date of Allotment: *********

All documentation including, but not limited to, the Information

Memorandum, Board Resolution, Rating Letter, Appointment of

Trustees, In-principle listing approval from the Stock Exchange etc.,

to be completed and made available to the Arranger 1 day prior to

subscription.

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Business Day

Convention

If any payment date is not a Business Day in Mumbai, payment shall

be made on the next Business Day in Mumbai.

Business Day means a day which is not a Saturday or Sunday or a

public holiday and on which high value clearing facility is available in

Mumbai.

Day Count Basis Actual / Actual

Stamp duty payable

in case of transfer of

Debentures

Stamp Duty on secondary market transfer as applicable under the

Bombay Stamp Act. (Presently, no stamp duty is payable on transfer

of Debentures in dematerialised form).

Security Trustee Any SEBI registered Bank/ Institution mutually acceptable to the

Issuer & Arranger

Issue of Debentures

The Issuer will issue the Debentures / Letters of Allotment in

dematerialized form within one business day from the Deemed Date

of Allotment.

Documentation Customary documentation for the Issue as required by SCB.

Conditions

precedent:

SCB’s arrangership will be subject to the following conditions and

compliance of the said conditions by the Issuer wherever applicable:

(i) the accuracy and completeness of the representations

made /to be made by the Issuer to SCB and the

information that the Issuer has furnished /would furnish to

SCB till the closure of the Issue; and compliance by the

Issuer of the terms and conditions of this Agreement;

(ii) SCB having satisfied in a form and substance acceptable

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to SCB and having obtained from the Issue (a) all

applicable internal and external approvals for the Issue

have been obtained by the Issuer applicable approvals

and resolutions passed by the board of directors of the

Issuer; (b) documentation for the Transaction being

prepared as specified in (iv) below and appropriate

business description disclosure in the offering circular

(prepared by the Issuer’s counsel);

(iii) the documentation in respect of the Issue is in full

compliance with the statutory and Arranger’s

requirements and completed to the satisfaction of the

Arranger;

(iv) the Issuer obtaining in-principle approval from the

relevant stock exchange(s) for listing of Debentures;

(v) the absence of any default or cross default in respect of

other liabilities of the Issuer.

Covenants

*************

Optional

Prepayment

************

Resolutions required The Issuer should ensure that all the consents and resolutions required

to issue Debentures are in place prior to the issue.

The Issuer should also ensure that any and all applicable regulations

pertaining to this Issue are complied with, including but not limited to

RBI’s Prudential Guidelines on banks’ investment in non-SLR

securities dated 12th November 2003, SEBI Circular on Secondary

Market for Corporate Debt Securities dated 30th September 2003 and

22nd December 2003 and SEBI Issue & Listing of Debt Instrument

guidelines dated June 6, 2008

Expenses All expenses related to the issue including but not limited to costs

relating to stamp duty, legal fee, listing fee, credit rating charges and

other expenses will be to the account of the Issuer.

Material Adverse The Agreement of SCB are subject to there being no material adverse

change (or an event which is likely to result in a material adverse

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Circumstances change) in:

i. the business activities, financial condition and credit standing

of the Issuer (or any of its shareholders, or subsidiaries) since

the date of their respective latest published financial

statements;

ii. the international or domestic money, bank, foreign exchange

and capital markets, or in the debt syndication market,

iii. the socio-political and economic situation of India (including

as a result of hostilities along the borders of the Republic of

India ) or any event, whether domestic or international;

which in SCB’s sole opinion/judgement, would adversely impact the

successful syndication of the Issue /materially impair subscription to

the Debentures, from the date of acceptance of this offer till the

closure of the Issue.

In such an event, SCB shall have the option to renegotiate the terms of

the Issue or terminate the Agreement.

Investor Profile Banks, Mutual Funds, Financial Institutions, Insurance Corporations,

Provident & Pension Funds, Corporate Investors, FIIs. There shall be

no negative list of investors.

Clear Market

Provision

The Issuer undertakes that it will not announce or raise from the

market, either on bilateral or syndication basis, any Debentures from

the date of acceptance of this offer till the date of closure of the Issue.

Further, the Issuer also undertakes that it shall not announce or bring

to the market any other issuance of similar tenor Debentures on terms

better than those offered under the present issue for a period of 2

weeks from the Deemed Date of Allotment of these Debentures.

Derivative

Transactions

The Issuer confirms that it will offer SCB the first right of refusal to

SCB if it transacts derivatives / swaps for the purpose of risk

management on these debentures.

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Listing On the WDM segment of The Stock Exchange, Mumbai. The Issuer

shall make an application for listing on the day of the deemed date of

allotment of Debentures, and ensure listing within two working days.

Publicity &

Communication

On successful conclusion of the Issue, the Arranger reserves the right

to issue publicity material such as tombstones, advertisements etc.

after discussion with the Issuer.

Governing Law and

Jurisdiction

The Governing law will be the Indian Law and the parties submit to

the non-exclusive jurisdiction of the courts in Mumbai.

Validity of the

Indicative Terms

These indicative terms and conditions are open for

discussion*****************on October ******2009 after which

time these outline terms and conditions shall lapse if the Issuer has not

signed these terms and conditions by that time.

For Religare Finvest Limited

Sd/-

Sunil Kumar Garg

Director

Date: October 13, 2009

Place :New Delhi

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Annexure I

APPLICATION FORM


(Incorporated under the Companies Act, 1956)

Regd. Office: 19, Nehru Place, New Delhi – 110019

Tel. No. + 91-11- 3081 5100

Website: www.religarefinvest.com

Dear Sirs,

Having read and understood the contents of the Information Memorandum, we apply for

allotment to us of the secured, redeemable, and Debentures being privately placed. The

amount payable on application as shown below is remitted herewith. On allotment, please

place our name on the register of Debenture holders. We bind ourselves to the terms and

conditions as contained in the Information Memorandum. We note that the Company is entitled

in its absolute discretion to accept or reject this application whole or in part without assigning

any reason whatsoever.

(PLEASE READ THE INSTRUCTIONS CAREFULLY BEFORE FILLING THIS FORM)

Form in which certificate is to be issued

We understand that in case of allotment of Debentures to us, our Beneficiary Account as

mentioned above would be credited to the extent of Debentures allotted. We also understand

that Debentures will be issued to us and will have to be held by us in dematerialized form only

and no physical certificates will ever be issued by the Company.

The application shall be for a minimum of 1(One) Debenture and in Multiples of 1 (One)

Debenture thereafter (Each Debenture of Rs. 10,00,000/- (Ten Lakhs rupees only))

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Remittance through Cheque/Draft

Remittance through STEPS/RTGS

We are applying as Tick(√) whichever is applicable

1 Company 2 Commercial Bank

3

Eligible Financial

Institution 4 Insurance Companies

5 NBFC & Residuary NBFC 6 Mutual Fund

7 FII 8 Provident & Pension Fund

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Details of Bank Account of the First Applicant:

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ACKNOWLEDGEMENT SLIP


(Incorporated under the Companies Act, 1956)

Regd. Office: 19, Nehru Place, New Delhi – 110019

Tel. No. + 91-11- 3081 5100

Website: www.religarefinvest.com

Application Form Sr. No:

Received from ______________________________________________________

Address ________________________________ __________________________

an application for _____ Debentures along with Cheque/Demand Draft No.

__________ Dated _________ Drawn on _____________ for Rs. __________

(Rupees_________________________ _____________________________ only)

(Note: Cheques and Drafts are subject to realization)

STEPS/RTGS Remittance Particulars

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