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EXHIBIT 4
[TWENTY RUPEES]
CREDIT FACILITY AGREEMENT (TERM/DEMAND LOAN)
THIS AGREEMENT made this 20th day of May, 2000 between Caraco Pharmaceutical
Laboratories Limited a Company incorporated in Michigan and having its
Registered Office situated at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as the "Borrower", which expression shall, unless it
be repugnant to the subject or context thereof, include its successors and
assigns);
AND
ICICI BANK LIMITED, a company incorporated under the Companies ▇▇▇, ▇▇▇▇, and a
Scheduled Bank within the meaning of The Reserve Bank of India Act, 1934 (2 of
1934) and having its Registered Office at Landmark, Race Course Circle,
Baroda-390 007 and among others a Branch Office at Free ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mumbai 400 021 (hereinafter referred to as "the Bank", which
expression shall, unless it be repugnant to the subject or context thereof,
include its successors and assigns);
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DEFINITIONS: GENERAL CONDITIONS
I. DEFINITIONS:
1.1 The following terms shall have the following meanings:-
(a) "General Conditions" means the GENERAL CONDITIONS No. GC-II APPLICABLE TO
CREDIT FACILITIES PROVIDED BY THE BANK.
(b) 'Project' means the project to be financed described in Schedule-I hereto;
(c) 'Financing Plan' means the plan as described in Schedule II hereto.
1.2 GENERAL CONDITIONS:
The Loan hereby agreed to be granted by the Bank shall be subject to the
Borrower complying with the terms and conditions set out herein and also
in the General Conditions, a copy of which has been furnished to the
Borrower. The General Conditions shall be deemed to form part of this
Agreement and shall be read as if they are specifically incorporated
herein.
All monies payable by the Borrower to the Bank shall be paid to the Bank at
such Branch as may be specified by them by telegraphic, telex or mail transfer
to the account of such Branch by cheque or bank draft drawn in favour of the
Bank, and shall be so paid as to enable the Bank to realise, at par, the amount
on or before the relative due date.
Credit for all payments will be given on realisation of the instruments.
AGREEMENT AND TERMS OF LOAN
2.1 AMOUNT AND TERMS OF LOAN:
The Borrower agrees to avail from the Bank and the Bank agrees to provide to
the Borrower, on the terms and conditions contained herein as also in the
General conditions, sum up to an aggregate USD 5 million (equivalent to INR Rs
21,80,00,000/ - i.e. Rupees Twenty One Crores Eighty Lacs Only) under the
Bank's FCNR (B) loan scheme.
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2.2 INTEREST:
(i) The Borrower shall pay to the Bank interest on the principal amounts of the
loan outstanding from time to time, @ 140 basis points (bps) above six month
(US$) LIBOR (rounded off to the higher side in multiple of 0.05) prevailing on
the date of disbursement. The interest is payable on yearly basis, at the end of
each quarter i.e. on March 31, June 30, September 30 and December 31 every year.
(ii) ADDITIONAL INTEREST FOR INTERIM SECURITY:
Disbursement made pending final security as stipulated in Article III shall
carry further interest at the rate of 1% p.a. plus interest at the applicable
rate from time to time till creation of such security.
2.3 Cost and Charges:
The Borrower shall pay all taxes, duties, costs, charges and expenses in
connection with or relating to the Loan Transaction (in INR) (including
protection of Bank's interests). In the event of the Borrower failing to pay the
aforesaid monies, the Bank will be at liberty but shall not be obliged to pay
the same. All such sums shall be reimbursed by the Borrower to the Bank on
demand from the Bank and shall be debited to the Borrower's Loan Account and
shall carry the same interest as that of loan account.
2.4 COMMITMENT FEE:
0.25% p.a., from the date of execution of documents on the undrawn amount
payable on quarterly basis in arrears. The fee payable in equivalent INR
calculated at the TT selling rate prevailing on the date of payment.
2.5 REPAYMENT:
The Borrower shall repay the principal amounts of the Term Loan in accordance
with the Amortisation Schedule set forth in Schedule-III hereto.
SECURITY
3.1 SECURITY FOR THE LOAN
(A) The loan together with all interest, further interest, commission, service
charges, costs, expenses, liquidated and other monies whatsoever stipulated in
the Agreement shall be secured by-
a) Negative Lien over Caraco's Assets
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b) First charge over the moveable fixed assets of Sun Pharmaceutical Industries
Limited.
c) Demand Promissory Note(s);
(B) The Borrower shall make out a good and marketable title to its properties
to the satisfaction of the Bank and comply with all such formalities as may be
necessary or required for the said purpose.
3.2 CREATION OF ADDITIONAL SECURITY
If, at any time during the subsistence of this Agreement, the Bank is of the
opinion that the security provided by the Borrower has become inadequate to
cover the balance of the Credit Facilities then outstanding, then, on the Bank
advising the Borrower to that effect, the Borrower shall provide and furnish to
the Bank, to the satisfaction of the Bank such additional security as may be
acceptable to the Bank of cover such deficiency.
3.3 ACQUISITION OF ADDITIONAL IMMOVEABLE PROPERTIES
So long as any monies remain due and outstanding to the Bank, the Borrower
undertakes to notify the Bank in writing of all its acquisitions to make out a
marketable title to the satisfaction of the Bank and charge the same in favour
of the Bank by way of first charge in such form and manner as may be decided by
the Bank.
3.4 GUARANTEE
The Borrower shall procure irrevocable and unconditional corporate guarantee
from the following corporation:
Sun Pharmaceutical Industries Limited
The guarantee shall be in favour of the Bank for the due repayment of the Loan
and the payment of all interest and other monies payable by the Borrower in the
form prescribed by the Bank and to be delivered to the Bank before any part of
the Loan is advanced.
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SPECIAL CONDITIONS
The Loan hereby granted shall also be subject to the Borrower complying with
the special conditions set out in Schedule IV hereto.
THE LOAN HEREBY AGREED TO BE GRANTED BY THE BANK SHALL BE SUBJECT TO THE
BORROWER COMPLYING WITH THE TERMS AND CONDITIONS SET OUT HEREIN AND ALSO THE
GENERAL CONDITIONS, A COPY OF WHICH HAS BEEN FURNISHED TO THE BORROWER, SHALL
BE DEEMED TO FORM PART OF THIS AGREEMENT AND SHALL BE READ AS IF THEY ARE
SPECIFICALLY INCORPORATED HEREIN.
EFFECTIVE DATE OF AGREEMENT
This Agreement shall become binding on the Borrower and the Bank on and from
the date first above written. It shall be in force till all the monies due and
payable under this Agreement are fully paid off.
IN WITNESS WHEREOF the Borrower has caused its signature to be affixed hereto
and to a duplicate hereof on the day, month and year first hereinabove written
and the Bank has caused the same and the said duplicate to be executed by the
hand of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ and Shaekar ▇▇▇▇▇▇▇▇▇▇▇▇ authorised officials of
the Bank as hereinafter appearing.
For Caraco Pharmaceutical Laboratories Limited
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Chairman
SIGNED AND DELIVERED BY the
within named Bank by the hand of For ICICI Bank Ltd.
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ Singh and /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
/s/ Shaekar ▇▇▇▇▇▇▇▇▇▇▇▇ /s/ Shaekar ▇▇▇▇▇▇▇▇▇▇▇▇
authorised officials of the Bank Authorised Signatory
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SCHEDULE I
THE PROJECT
To carry out research and development activities, upgrading its manufacturing
facilities and restructuring of its existing debt portfolio.
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SCHEDULE II
FINANCING PLAN
Cost of the project:
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Requirement of Funds Rs. In cores
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Normal capital expenditure 2.20
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Net Losses 16.30
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Repayment of Term Loans 18.20
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Decrease in current liabilities 0.80
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Preference Dividend Payment 0.80
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TOTAL REQUIREMENTS OF FUNDS 38.30
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Means of Finance:
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SOURCES OF FUNDS RS. IN CRORES
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Foreign Currency Loan from ICICI
Bank Limited 21.80
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Internal Accruals 16.50
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TOTAL SOURCES 38.30
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SCHEDULE III
REPAYMENT
The loan will be repaid in eight equal quarterly installments of US$ 0.625
million (approximately Rs. 2.725 crores) commencing from December 31, 2003 and
ending on September 30, 2005.
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SCHEDULE IV
SPECIAL CONDITIONS
1. DISBURSEMENT/DRAWDOWN:
The amounts under the foreign currency denominated loans will be disbursed in
full or part within one month from the date of this agreement (utilisation
period) unless the borrower and the Bank have agreed otherwise.
The amounts disbursed under the foreign currency loans shall be utilised in
foreign currency or in Indian rupees.
2. NOTICE OF DRAWDOWN/DISBURSEMENT:
Disbursement/drawdown under the facility will be subject to a written
request/notice of 2 working days (excluding Saturdays) in advance in the
format enclosed.
3. CONVERSION AND HEDGING OF THE FOREIGN CURRENCY:
The amount of each drawdown may be converted into Indian rupees (INR) by an
outright transaction. The liability for repayment of principal may be hedged in
full or in part by forward contract/s for any period/s upto the maturity of
each disbursement/s.
4. INTEREST AND INTEREST PAYMENT:
The loan shall carry interest at the rate of 140 basis points (bps) over six
monthly (US$) LIBOR (rounded off to the higher side in multiples of 0.05)
prevailing on the date of each disbursement and corresponding to the period for
which the loan is disbursed. The rate of interest will be reset at six monthly
intervals.
The amount of interest due is payable in the currency of the loan on a
quarterly basis as on 31st March, 30th June, 30th September and 31st December
based on the actual number of days elapsed.
The amount of interest on the loans will be calculated on the basis of 360 days
a year and a month of 30 days.
The Borrower may remit the interest amount in US$ or submit export bills for
collection equivalent to interest amount.
In case the loan outstanding balance is converted into Indian Rupee on account
of non availability of foreign currency deposits / line of credit or for any
other reason except on account of default, the rate of interest will be charged
at the rate of 2% over ICICI Bank Advance rate.
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5. CONVERSION OF THE CURRENCY OF LOANS AND INTEREST ON ACCOUNT OF NON REPAYMENT:
In the event of any default in the payment of principal/interest on due date/s,
the Bank, may, at its sole discretion convert the amount due into INR, on the
due date/s or on any subsequent date, at the Bank's TT selling rate prevailing
as on the date of such conversion. The amount so converted would then be
reckoned as a loan denominated in INR. Interest on such overdue amounts will be
recovered as per Bank's applicable rate. The interest amount, if any, so
converted into INR will be debited to your operative account.
6. COMMITMENT FEE:
0.25%p.a., from the date of execution of documents on the undrawn amount
payable on quarterly basis in arrears. The fee is payable in equivalent INR
calculated at the TT selling rate prevailing on the date of payment.
7. PERIOD OF SANCTION: - One Time.
8. DOCUMENTATION: The facility is subject to executing/signing/furnishing all
such documents/deeds/ required by the Bank.
10. REPAYMENT/PREPAYMENT:
The loan amount will be repaid as detailed in Schedule - III.
The borrower shall be entitled to request the Bank for prepayment of any of the
amounts disbursed in full together with the interest accrued before the
stipulated due dates for each disbursement. The Bank, at its own discretion,
shall agree to any such prepayment requests subject to the borrower agreeing to
pay a prepayment fee of 1.25% p a, calculated on the amount proposed to be
prepaid for the period from the date of prepayment till the original due date
of the amount proposed to be prepaid.
The amount is payable in U.S. $ or in equivalent INR, at current T.T. selling
rate.
11. SUSPENSION OF DISBURSEMENT PAYMENT IMMEDIATELY DUE:
The bank is entitled to suspend disbursement of the loans in full or part and to
give notice of termination of the loan to the borrower and to demand immediate
repayment of loans outstanding as well as the payment of all interest and fees
accrued, any charges and other claims incidental thereto and also to convert
the foreign currency amounts due in all respects into Indian Rupees (INR) at
the Bank's TT selling rate applicable to the currency prevailing on the date
of such conversion, if there is any reason for doing so at the Bank's
discretion, in particular if:
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a) An obligation to effect payment under the loan agreement is not fulfilled
by the borrower when such payment falls due.
or
b) The borrower breaches or fails to fulfil on due date any other obligation
under this agreement.
or
c) The borrower or the guarantor admits its inability to meet its payment
obligations.
or
d) The borrower enters into insolvency or bankruptcy proceedings.
or
e) There has been a material deterioration in the financial situation of the
borrower or the guarantor or their assets have become substantially
endangered.
or
f) In the opinion of the Bank, other exceptional circumstances arise which
imperil, delay or preclude the fulfillment of the borrowers or guarantors
contractual obligations which make it unreasonable to adhere any longer to
the agreement the borrower has executed in Bank's favour.
or
g) A declaration, confirmation or information provided in connection with this
agreement proves to be incomplete or incorrect or would prove to be so if
provided at a later date.
or
h) Any of the loans granted to the borrower by the Bank including the loans
covered under this agreement is classified as a non performing asset (NPA)
as defined in terms of the directives of Reserve Bank of India (RBI).
12. GENERAL CONDITIONS:
a) All transactions involving conversion of foreign currency into INR or
conversion of INR into foreign currency for payment of interest/principal
and forward exchange contracts, swaps etc. relating to the loan/s should be
carried exclusively through ICICI Bank Limited.
b) All terms and conditions relating to the loan/s will be subject to
RBI/FEDAI regulations and will be subject to directives from RBI/FEDAI from
time to time.
c) The foreign currency amount would be the limiting factor and the borrowers
liability would accordingly be reckoned in the foreign currency in which the
loans are denominated.
d) The borrower is liable to pay interest and repay principal in the currency
in which the loans have been denominated. In the event of any default in the
payment of principal and or interest on due date of such loans, the Bank may at
its discretion, convert the amount into INR, on due date/s for such
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payment/s or on any subsequent date, at the Bank's TT selling rate prevailing on
the date of such conversion. The amount due thereafter, would be reckoned as
denominated in INR.
e) The INR equivalent of credit facilities have been reckoned for the purpose
of this agreement at the exchange rates as under:
1 USD :INR
f) In the event the INR value depreciates vis a vis the currency in which the
loans are denominated resulting in increased liability in terms of INR vis a
vis the currency of credit facilities, the borrower agrees and confirms that:
i) Such increased value in terms of INR shall also be covered by the
securities mentioned in this agreement.
ii) The borrower shall further execute, sign and furnish all such documents,
deeds required by the Bank for the aforesaid purpose.
g) In the event of any provisions of this agreement being or becoming wholly or
partially invalid or ineffective in law, the other provisions of this agreement
shall remain in force. Any insufficiency thus created shall be filled by a
corresponding provision consistent with the spirit and purpose of this
agreement.
h) In addition to the above, this agreement shall be subject to and interpreted
in accordance with the credit arrangement letter dated May 17, 2000 and May 19,
2000.
13. "We hereby agree as a pre-condition of the Credit Facility(ies) granted to
us by the Bank that in case we commit default in repayment of any or some or
all our dues as per the terms and conditions set out in the Credit Facility
Agreement/Credit Arrangement Letter and or other documents(s) on their
respective due dates as specified in the said documents, the Bank and or the
Reserve Bank of India will have an unqualified an unfettered right to disclose
or publish our names or the name of our company and its directors as a
defaulter in such a manner and through such medium as the Bank or Reserve Bank
or India in their absolute discretion may deem fit"
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GENERAL CONDITIONS - GC-II
APPLICABLE TO TERM / DEMAND LOAN
Caraco Pharmaceutical Laboratories Limited
DEFINITIONS The following terms have the following meanings in these
General Conditions and in the Loan Agreement:
- "Loan Agreement" means the particular Credit Facility
Agreement and includes these General Conditions GC-II as
applied thereto, and all schedules and amendments
supplemental to the Loan Agreement.
- "Loan(s)" means the Credit Facility agreed to be provided
under the Loan Agreement.
- "Lender(s)" means ICICI BANKING CORPORATION LIMITED
(hereinafter referred to as "the Bank") IDBI, IFCI,
ICICI, IRBI, LIC, GIC, NIC, NIA, OIC, UII, UTI Commercial
Banks or any one or more of them where the subject or
context so admits.
- "Lead Institution" means any one of the Lenders as may be
designated by them, from time to time, as their attorney
in a particular Loan transaction. In the event of any
Lender granting Loan(s) to the Borrower singly (and not
in participation with other Lenders), the expression
"Lead Institution" wherever it appears in these General
Conditions GC-II or in the Loan Agreement shall mean only
the "Lender".
- "Project" means the project for which the Loans are
agreed to be granted, as described in the Loan Agreement.
LEAD II. Unless otherwise agreed to by the Lead Institution, the
INSTITUTION Borrower shall approach the Lead Institution for obtaining
all consents and approvals required under the Loan
Agreement. All acts and deeds done, and all consents and
approvals given, by the Lead Institution shall be deemed to
have been done and given by every Lender individually.
TERMS OF III. The Loan will be disbursed by the Bank and/or by the
DISBURSEMENT Lenders through the Lead Institution, in one or more
instalment(s) as may be decided by the Bank / Lead
Institution subject to the Borrower complying with the
provisions of the Loan Agreement and the disbursement
procedure stipulated by the Bank / Lead Institution and the
expenditure incurred on the Project being in consonance
with the details mentioned in Loan Agreement. All
disbursements shall be by cheque(s)/authorisation(s) and
the collection/remittance/other charges will be borne by
the Borrower. The interest on the Loans will accrue as from
the date of the cheque(s)/authorisation(s) of the Bank /
Lead Institution.
- In the event of the Lender(s) agreeing to disburse any
amount of the Loans pending creation of final security as
stipulated in the Loan Agreement, the same may be
disbursed on such terms as may be decided by the Bank /
Lead Institution.
- The Lead Institution may deduct from sums to be lent to
the Borrower any monies then remaining due and payable by
the Borrower to the Lenders.
- All interest on the Loans and on all other monies
accruing due under the Loan Agreement shall, in case the
same be not paid on the respective due dates, carry
further interest at the applicable rate(s) under the Loan
Agreement, computed from the respective due dates and
shall become payable upon the footing of compound
interest with quarterly rests as provided in the Loan
Agreement.
- All interest or other monies which shall accrue under the
provisions of the Loan Agreement shall also be payable in
the manner and on the dates as mentioned in the Loan
Agreement for payment of interest on the principal
amounts of the Loans.
- Commitment charge shall be payable in the manner and on
the dates specified for payment of interest Under the
Loan Agreement.
- Arrears of commitment charge shall carry interest at the
applicable rate for Normal Loans
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on the date of the Loan Agreement.
- Commitment charge shall be payable even though the Loans are ultimately
cancelled or not availed of for any reason whatsoever.
- In the event of such cancellation, the commitment charge in respect of the
Loans or any part thereof which has been cancelled, shall cease to accrue from
the day on which the Borrower's request for cancellation is received by the
Bank / Lead Institution.
- The Lenders may charge interest and commitment charge on the Loans at the
weighted average rate, where applicable.
- For the purpose of this clause, "weighted average rate" means the weighted
mean of the rates of interest or commitment charge, as the case may be,
applicable to the Loans.
- Interest and all other charges shall accrue from day to day and shall be
computed on the basis of 365 days a year and the actual number of days
elapsed.
- The Lead Institution may, in suitable circumstances, revise, vary or postpone
the repayment of the principal amounts of the Loans or the balance outstanding
for the time being or any instalment(s) of the said principal amounts of the
Loans or any part thereof upon such terms and conditions as may be decided by
the Bank / Lead Institution.
- In the event of any default in the payment of instalments of principal, any
interest, commitment charge and liquidated damages, reschedulement, if any,
allowed by the Bank / Lead Institution shall be at the rate as may be
stipulated by the Bank / Lead Institution at the time of such reschedulement.
- If, for any reason, the amount finally disbursed by the Lenders out of the
Loans is less than the amount of the Loans, the instalment(s) of repayment of
the Loans shall stand reduced proportionately but shall be payable on the due
dates as specified in the Amortisation Schedule in the Loan Agreement.
- If the Bank / Lead Institution finds that the profitability of the Borrower,
the cash flow and other circumstances so warrant, the Bank / Lead Institution
may, on previous intimation to the Borrower, require the Borrower to prepay
the Loans on dates earlier than the dates specified in the Amortisation
Schedule in the Loan Agreement and also increase the amount of the instalments
of repayment fixed in that Schedule.
- The Borrower shall not prepay the outstanding principal amounts of the Loans
in full or in part, before the due dates except after the conversion right is
exercised in full, or has lapsed and after obtaining the prior approval of the
Bank / Lead Institution (which may be granted conditionally).
- If the due date in respect of any instalment of principal, interest,
commitment charge and liquidated damages and all other monies payable under
the Loan Agreement falls on a Sunday or a day which is a bank holiday at the
place where the payment is to be made, the immediately proceeding working day
shall be the due date for such payment.
- In case of default in payment of instalment of principal, interest, commitment
charge and all other monies (except liquidated damages) on their respective
due dates, the Borrower shall pay on the defaulted amounts, penal interest at
the rate of 2% per annum for the period of default. Penal interest shall be
payable in the manner and on the dates as specified in the Loan Agreement for
payment of interest. Arrears of penal interest shall carry interest at the
applicable rate for the loans on the date of the Loan Agreement.
- The Borrower shall reimburse all sums paid by the Bank / Lead Institution or
the Lenders within 30 days from the date of notice and demand from the Bank /
Lead Institution. All such sums shall be debited to the Borrower's Loan
Account and shall carry interest from the date of payment till such
reimbursement at the applicable rate for the Loans on the date of the Loan
Agreement.
- In case of default in making such reimbursement within 30 days from the date
of notice of demand, the Borrower shall also pay on the defaulted amounts,
penal interest at the
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rate of 2% per annum from the expiry of 30 days from the date of
notice of demand till reimbursement in accordance with the provisions
detailed in this document of General Conditions.
- Unless otherwise agreed to by the Bank / Lead Institution, any
payments due and payable under the Loan Agreement and made by the
Borrower shall be appropriated towards such dues in the following
order, viz.,
(i) Premium on prepayment;
(ii) Costs, charges, expenses and other monies;
(iii) Interest on costs, charges, expenses and other monies;
(iv) Commitment charge;
(v) Interest on arrears of commitment charges;
(vi) Interest, including additional interest, payable in terms of the
Loan Agreement;
(vii) Further interest and penal interest on defaulted amounts payable as
mentioned in this document.
(viii) Repayment of instalments of principal due and payable under the
Loan Agreement.
- Notwithstanding anything contained in the Clause hereinabove, the
Lenders may, at their discretion, appropriate such payments towards
the dues, if any, payable by the Borrower in respect of earlier
loan(s) availed of by the Borrower from the Lenders in the order
specified in the relative Loan Agreement(s).
- The Borrower shall pay and discharge all its liabilities to each of
the Lenders under the Loan Agreement without preferring one over the
other.
- If the Borrower makes any payment to any of the Lenders in preference
to other Lenders, the Lender receiving such payment shall,
notwithstanding anything to the contrary contained in the Loan
agreement, share the same with other(s) on pro-rata basis or in such
other manner as the Lenders may mutually agree and such sharing shall
be binding on the Borrower.
- All monies payable by the Borrower to the Lenders shall be paid to
the Bank / Lead Institution at such office(s) as may be specified by
the Bank / Lead Institution, by cash, telegraphic, telex or mail
transfer to the account of such office(s) or by cheque or bank draft
drawn in favour of the Bank / Lead Institution on a scheduled bank at
such place or to such other account as the Bank / Lead Institution
may notify to the Borrower and shall be so paid as to enable the
Bank / Lead Institution to realise, at par, the amount on or before
the relative due date. Credit for all payments by cheque/bank draft
will be given only on realisation or on the relative due date,
whichever is later.
BORROWER'S
WARRANTIES
IV Except to the extent already disclosed in writing by the Borrower
to the Lenders, the Borrower shall be deemed to have assured,
confirmed and undertaken as follows:
- The Borrower is not in arrears of any public demands such as
income-tax, corporation tax and all other taxes and revenues or any
other statutory dues payable to the Central or State Governments or
any local or other authority or to any small scale industrial units.
- The Borrower has entered into requisite selling and purchasing
arrangements to the satisfaction of the Bank / Lead Institution.
- The terms and conditions of appointment of Managing Director or any
other person holding substantial powers of management by whatever
name called; shall be subject to the approval of the Bank / Lead
Institution.
- Nothing in the Loan Agreement contravenes the Memorandum and Articles
of Association of the Borrower.
- The obligations of the Lenders to make disbursements under the
Loan Agreement shall be subject to the Borrower performing all
its obligations and undertakings under the Loan Agreement
besides compliance by the Borrower with the Disbursement
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Procedure stipulated by the Bank / Lead Institution, such as
submission of necessary information, documents, etc. to the
satisfaction of the Bank / Lead Institution. Before seeking
disbursement, the Borrower shall also comply with the following
conditions:
- The Borrowers shall raise share capital as stipulated in the
Loan Agreement and the promoters shall subscribe to such share
capital to the extent stipulated by the Bank / Lead Institution.
- The Borrower shall create security as stipulated in the Loan
Agreement in favour of the Lenders.
- The Borrower shall enter into effective agreements with other
institutions and banks in the form and substance satisfactory to
the Bank / Lead Institution for raising of funds as per the
financing plan.
- The Borrower shall satisfy the Bank / Lead Institution that no
event of default as defined in hereof and no event which, with
the lapse of time or notice and lapse of time as specified in
under item V hereof would become an event of default, has
happened and been continuing.
- The Borrower shall comply with such special conditions as may be
stipulated by the Bank / Lead Institution at the time of
communication of the sanction of the Loans or subsequently.
- The Bank / Lead Institution shall have the right to review the
cost of the project before final disbursement of the Loans.
- The Bank / Lead Institution may withhold disbursement of the
amount of the Loans equivalent to the provision against margin
money for working capital in the cost of the Project, till such
time as the Project is completed and build-up of working capital
commences.
- The Borrower shall procure undertaking(s) from such persons as
may be specified by the Bank / Lead Institution in the form
required by the Bank / Lead Institution, whereby the Borrower
shall take the responsibility for making arrangements
satisfactory to the Bank / Lead Institution for meeting the
shortfall, if any, in the resources of the Borrower for
completing the project and for working capital. The Borrower
shall join in such undertaking as a confirming party. The funds
brought in to meet the shortfall in the resources of the
Borrower for completing the Project and/or working capital shall
be in such form and manner and on such terms as may be required
by the Bank / Lead Institution.
- THE BORROWER SHALL COMPLY WITH THE FOLLOWING:
- Promptly notify in writing the Bank / Lead Institution of any
proposed change in the nature or scope of the Project and of any
event or condition which might materially and adversely affect
or delay completion of the project or result in substantial
overrun in the original estimate of costs. Any proposed change
in the nature or scope of the Project shall not be implemented
or funds committed therefor without the prior approval of the
Bank / Lead Institution.
- Obtain prior concurrence of the Bank / Lead Institution to any
material modification or cancellation of the Borrower's
agreements with its machinery supplies, collaborators, technical
consultants and suppliers of raw materials.
- Promptly inform the Bank / Lead Institution of the circumstances
and conditions which are likely to disable the Borrower from
implementing the Project or which are likely to delay its
completion or compel the Borrower to abandon the same.
- Furnish to the Bank / Lead Institution at the end of each month
following the month in which the Loan monies are disbursed, a
statement showing the manner in which the said monies have been
utilised.
- Keep such records as may be required by the Bank / Lead
Institution to facilitate
4
17
verification of the entries in respect of various payments made under the
Loan. The Borrower shall also furnish to the Bank / Lead Institution, as and
when required by it, certified true copy of the said records with details
for verification by the Bank / Lead Institution.
- Not to undertake any new project, diversification, modernisation or
substantial expansion of the Project described herein. The word 'substantial'
shall have the same meaning as under the Industries (Development and
Regulation) Act, 1951.
- Not to issued any debentures, raise any loans, accept deposits from public,
issue equity or preference capital, change its capital structure or create
any charge on its assets or give any guarantees without the prior approval of
the Bank / Lead Institution in writing. This provision shall not apply to
normal trade guarantees or temporary loans and advances granted to staff or
contractors or suppliers in the ordinary course of business or to raising of
unsecured loans, overdrafts, cash credit or other facilities from the Bank in
the ordinary course of business.
- Not to prepay any loan availed of by it from any other party without the
prior approval of the Bank / Lead Institution. If for any reason, the
Borrower is required to prepay any loan, it shall make proportionate
prepayment to the Lenders as well as comply with such conditions as may be
stipulated by the Lenders.
- Not to pay any commission to its promoters, directors, managers or other
persons for furnishing guarantees, counter guarantees or indemnities or for
undertaking any other liability in connection with any financial assistance
obtained for or by the Borrower or in connection with any other obligation
undertaken for or by the Borrower for the purpose of the Project.
- Promptly inform the Lenders 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 Companies Act, 1956, or any other notice under any other
Act or otherwise of any suit or other legal process intended to be filed or
initiated against the Borrower and affecting the title to the properties of
the Borrower or if a Receiver is appointed in respect of any of its
properties or business or undertaking.
- Promptly inform the Bank / Lead Institution of the happening of any labour
strikes, lockouts, shut-downs, fires or other similar happenings likely to
have an adverse effect on the Borrower's profits or business and of any
material changes in the rate of production or sales of the Borrower with an
explanation of the reasons therefor.
- Keep insured upto the replacement value thereof as approved by the Bank /
Lead Institution (including surveyor's and architect's fees) the properties
charged/to be charged to the Lenders and such of its other properties as are
of an insurable nature against fire, theft, lightning, explosion, earthquake,
riot, strike, civil commotion, ▇▇▇▇▇, ▇▇▇▇▇▇▇, flood marine risks, erection
risks, war risks, and such other risks as may be specified by the Bank / Lead
Institution and shall duly pay all premia and other sums payable for that
purpose. The insurance in respect of the properties charged/to be charged to
the Bank / Lenders and any other person or institution having an insurable
interest in the properties of the Borrower and acceptable to the Bank / Lead
Institution. The Borrower shall keep deposited with the Bank / Lead
Institution the insurance policies and renewals thereof.
- Take an appropriate cover under the Public Liability Insurance Act, 1991, in
case its activities involve the handling of hazardous substances as defined
in the Environment (Protection) Act, 1986.
- In the event of failure on the part of the Borrower to insure the properties
or to pay the insurance premia or other sums referred to above, the Lenders
may get the properties insured or pay the insurance premia and other sums
refered to above, as the case may be.
5
18
- Comply with all applicable laws relating to prevention of air and water
pollution and protection of environment.
- Promptly inform in writing, the Bank / Lead Institution of any loss or damage
which the Borrower may suffer due to any force majeure circumstances or act
of God, such as earthquake, flood, tempest or typhoon, etc. against which the
Borrower may not have insured its properties.
- Submit its duly audited annual accounts, within six months from the close of
its accounting year. In case statutory audit (if required) is not likely to
be completed during this period, the Borrower shall get its accounts audited
by an independent firm of Chartered Accountants and furnish the same to the
Bank / Lead Institution.
- Furnish to the Bank / Lead Institution such reports as may be required by the
Bank / Lead Institution.
- Maintain records showing expenditure incurred on the Project, utilisation of
the disbursements out of the Loans, progress of the Project and the
operations and financial conditions of the Borrower and such records shall
be open to examination by the Lenders and their authorised representatives.
- Permit the Lenders and their authorised representatives to carry out
technical, financial and legal inspections during the construction and
operation periods of the Project and to inspect all records, registers and
accounts of the Borrower. Any such representative of the Lenders shall have
free access at all reasonable times to any part of the Borrower's factory and
to its records, registers and accounts and to all reasonable times to any
part of the Borrower's factory and to its records, registers and accounts and
to all schedules, costs, estimates, plans and specifications relating to the
plant and shall receive full co-operation and assistance from the employees
of the Borrower. The cost of inspection, including travelling and all other
expenses shall be payable by the Borrower to the Lenders in this behalf.
- Not to declare or pay any dividend to its shareholders during any financial
year unless it has paid all the dues to the Lenders upto the date on which
the dividend is proposed to be declared or paid or has made satisfactory
provisions therefor. Further, the Borrower shall not declare dividend to the
equity shareholders in excess of 15% or the average of the dividend paid in
the three preceding years, whichever is higher, without prior approval of the
Bank / Lead Institution, which may be given conditionally.
- Not to create any subsidiary or permit any company to become its subsidiary.
- Carry out such alterations to its Memorandum and Articles of Association as
may be deemed necessary in the opinion of the Bank / Lead Institution to
safeguard the interests of the Lenders arising out of the Loan Agreement.
- Not to undertake or permit any merger, consolidation, reorganisation, scheme
or arrangement or compromise with its creditors or shareholders or effect any
scheme of amalgamation or reconstruction.
- Not to make any investments by way of deposits, loans, share capital, etc. in
any concern.
- Not to revalue its assets at any time during the currency of the Loans.
- Not to carry on any general trading activity other than the sale of its own
products.
- Not to enter into any arrangement for sale of its products and purchase of
raw materials inputs without the prior approval of the Bank / Lead
Institution. If so required by the Bank / Lead Institution, the Borrower
shall take steps to suitably modify or terminate the existing
selling/purchasing arrangements in such a manner as may be required by the
Bank / Lead Institution.
- Not to enter into any fresh agreement for the appointment of sole selling
agents/sole purchasing agents without the prior approval of the Bank / Lead
Institution. Any such
6
19
arrangement shall be subject to such terms and conditions as
may be stipulated by the Bank / Lead Institution.
NOMINEE - Each of the Lenders shall have the right to appoint and remove
DIRECTOR: from time to time, Director(s) on the Board of Directors of the
Borrower as set out in the Loan Agreement [such directors are
hereinafter referred to as "Nominee Director(s)'].
- The Nominee Director(s) shall not be required to hold
qualification shares and not be liable to retire by rotation.
- The Nominee Director(s) shall be entitled to all the rights
and privileges of other directors including the sitting fees and
expenses as payable to other Directors but if any other fees,
commission, monies or remuneration in any form is payable to the
Directors, the fees, commission, monies and remuneration in
relation to such Nominee Director(s) shall accrue to the Lenders
and the same shall accordingly be paid by the Borrower directly
to the Bank / Lead Institution for the account of the concerned
Lenders, provided that if any such Nominee Director is an
officer of the Lenders, the sitting fees in relation to such
Nominee Director(s) shall also accrue to the Lenders and the
same shall accordingly be paid by the Borrower directly to the
Bank / Lead Institution for the account of the concerned
Lenders.
- Any expenditure incurred by the Lenders or the Nominee
Director(s) in connection with his appointment or directorship
shall be borne by the Borrower.
- The Nominee Director(s) shall be appointed as a member of the
Management Committee or other committees of the Board, if so
desired by the Lenders.
- The Nominee Director(s) shall be entitled to receive all
notices, agenda and other related communications and to attend
all General Meetings and Board Meetings and Meetings of any
Committees of the Board of which he is a member.
- If, at any time, the Nominee Director is not able to attend a
meeting of the Board of Directors or any of its Committees of
which he is a member, the Lenders may depute an observer to
attend the meeting. The expenses incurred by the Lenders in this
connection shall be borne by the Borrower.
UNLESS THE LEAD INSTITUTION OTHERWISE AGREES:
- The Borrower shall not remove any person, by whatever name
called, exercising substantial powers of management of the
affairs of the Borrower at the time of execution of the Loan
Agreement and such persons shall not be paid any commission in
any year unless all the dues of the Lenders in that year have
been paid to the satisfaction of the Bank / Lead Institution.
- The Borrower shall not pay any compensation to any of such
persons in the event of loss of his / their office(s) for any
reason whatsoever if there is a default in repayment of dues to
the Lenders.
- The Borrower shall obtain suitable undertakings for giving
effect regarding remuneration, compensation from such persons.
The appointment / reappointment including terms of appointment
(or alteration in such terms) of the persons mentioned in (i)
above shall be subject to the prior approval of the Bank / Lead
Institution.
- The Borrower shall, as and when required by the Bank / Lead
Institution, appoint and change to the satisfaction of the Bank
/ Lead Institution, suitable technical, financial and executive
staff with proper qualifications and experience for the key
posts. The terms of such appointments including any changes
therein, shall be subject to prior approval of the Bank / Lead
Institution.
- In case of default in payment of any dues to the Lenders or if
in the opinion of the Bank / Lead Institution the business of
the Borrower is conducted in a manner opposed to the public
policy or in manner prejudicial to Lenders' interest, the Bank /
Lead Institution
7
20
shall have the right to review the management set up or
organisation of the Borrower and to require the Borrower to
restructure it as may be considered necessary by the Bank / Lead
Institution, including the formation of Management Committees
with such powers and functions as may be considered suitable by
the Bank / Lead Institution.
- The Bank / Lead Institution shall have the right to appoint,
whenever it considers necessary, any person, firm, company or
association of persons engaged in technical, management or any
other consultancy business to inspect and examine the working of
the Borrower and its factory and to report to the Bank / Lead
Institution. The Bank / Lead Institution shall have the right to
appoint, whenever it considers necessary, any Chartered
Accountants/Cost Accountants as auditors for carrying out any
specific assignment(s) or to examine the financial or cost
accounting system and procedures adopted by the Borrower for its
working or as concurrent or internal auditors, or for conducting
a special audit of the Borrower. The costs, charges and expenses
including professional fees and traveling and other expenses of
such consultants or auditors shall be payable by the Borrower.
- The Borrower shall constitute such Committees of the Board
with such composition and functions as may be required by the
Bank / Lead Institution for close monitoring of different
aspects of its working.
- The Borrower shall not recognise or register any transfer of
shares in the Borrower's capital made or to be made by
promoters, their friends or associates, as may be specified by
the Lenders.
EVENTS OF V. If one or more of the events specified in this Section
DEFAULT AND (hereinafter called 'events of defualt') happen(s), the Bank /
REMEDIES Lead Institution or the Lenders or any of them may, by a notice in
writing to the Borrower, declare the principal of and all accrued
interest on the Loans to be due and payable forthwith and the
security created in terms of the Loan Agreement shall become
enforceable and the Lenders shall have the following rights
(anything in the Loan Agreement to the contrary notwithstanding)
namely:
i. to enter upon and take possession of the assets of the
Borrower and
ii. to transfer the assets of the Borrower by way of lease or
leave and licence or sale.
EVENTS OF DEFAULT:
- Default has occurred in the payment of principal sums of the
Loans on the due dates.
- Default has been committed by the Borrower in payment of any
instalment of interest on the Loans and such default has
continued for a period of thirty days.
- Interest has been in arrears and remained unpaid for thirty
days after becoming due.
- Default has occurred in the performance of any other convenant,
condition or agreement on the part of the Borrower under the
Loan Agreement and any other agreement and such default has
continued for a period of thirty days after notice in writing
thereof has been given to the Borrower by the Lenders / Bank /
Lead Institution.
- Any information given by the Borrower in its application for
Loans, in the reports and other information
furnished by the Borrower in accordance with the Reporting
System and the warranties given/deemed to have been given by
the Borrower to the Bank / Lead Institution/Lenders is
misleading or incorrect in any material respect.
- If there is reasonable apprehension that the Borrower is unable
to pay its debts or proceedings for taking it into liquidation,
either voluntarily or compulsorily, may be or have been
commenced.
- If the properties and assets offered to the lenders as security
for the loans have not been kept insured by the Borrower or
depreciate in value to such an extent that, in the opinion of
the Bank / Lead Institution, further security to the
satisfaction of the Bank / Lead Institution should be given and
on advising the Borrower to that effect such security has
8
21
not been given to the Lenders.
- If, without the prior approval of the Bank / Lead Institution, any land,
buildings, structures or plant and machinery of the Borrower are sold,
disposed of, charged, encumbered or alienated or the said buildings,
structures, machinery, plant or other equipment are removed, pulled down or
demolished.
- If the other financial institution(s) or bank(s) with whom the Borrower has
entered into agreements for financial assistance have refused to disburse
it(s)/their loan(s) or any part thereof or have recalled its/their
loan(s)/their loan(s) or any part thereof or have recalled its/their loans(s)
under their respective loan agreements with the Borrower.
- The Borrower has voluntarily or involuntarily become the subject of
proceedings under any bankruptcy or insolvency law or the Borrower is
voluntarily or involuntarily dissolved.
- The Borrower is unable or has admitted in writing its inability to pay its
debts as they mature.
- The Borrower has taken or suffered any action for its reorganisation,
liquidation or dissolution.
- A receiver or liquidator has been appointed or allowed to be appointed of all
or any part of the undertaking of the Borrower.
- If an attachment or distraint has been levied on the mortgaged properties or
any part thereof or certificate proceedings have been taken or commenced for
recovery of any dues from the Borrower.
- If extraordinary circumstances have occurred which make improbable for the
Project to be carried out and for the Borrower to fulfill its obligations
under the Loan Agreement.
- On the happening of any of the events of default, in addition to the rights
specified in this document, each of the Lenders shall be entitled to appoint
and remove from time to time Whole-time Director(s) on the Board of Directors
of the Borrower [such Director(s) are hereinafter referred to as "the
Whole-time Nominee Director(s)"]. Such Whole-time Nominee Director(s) shall
exercise such powers and duties as may be approved by the Lenders and have
such rights as are usually exercised by or are available to a Whole- Time
Director, in the management of the affairs of the Borrower. Such Whole-time
Nominee Director(s) shall not be required to hold qualification shares nor be
liable to retire by rotation and shall be entitled to receive such
remuneration, fees, commission and monies as may be approved by the Bank /
Lead Institution. Such Whole-time Nominee Director(s) shall have the right to
receive notices of and attend all General Meetings and Board Meetings or any
committee(s) of the Borrower of which they are members.
- Any expense that may be incurred by the Lenders or such Whole-time Nominee
Director(s) in connection with their appointment or directorship shall be paid
or reimbursed by the Borrower to the Lenders, or as the case may be, to such
Whole-time Nominee Director(s).
- If any event of default or any event which, after the notice, or lapse of
time, or both, would constitute an event of default has happened, the Borrower
shall, forthwith give notice thereof to the Bank / Lead Institution in writing
specifying the nature of such event of default, or such event.
- All expenses incurred by the Lenders after an event of default has occurred in
connection with:
- Preservation of the Borrower's assets (whether then or thereafter existing);
and
- Collection of amounts due under the Loan Agreement shall be payable by the
Borrower.
- The Borrower may, by notice in writing to the Bank / Lead Institution, cancel
the Loans or any part thereof which the Borrower has not withdrawn prior to
the giving of such notice provided that such cancellation shall be pro-rata
for each Lender.
- Further access by the Borrower to the use of the Loans may be suspended or
terminated by the Bank / Lead Institution / Lenders:
9
22
- Upon failure by the Borrower to carry out all or any of the terms of
the Loan Agreement or on the happening of any event of default
referred to in item V hereof.
- If any extra ordinary situation makes it improbable that the
Borrower would be able to perform its obligations under the Loan
Agreement.
- If the Borrower takes or permits to be taken any action or
proceedings whereby any of its properties shall or may be assigned
or, in any manner, transferred or delivered to any receiver,
assignee, liquidator or other person whether appointed by the
Borrower or by any Court of Law whereby such property shall or may
be distributed among the creditors of the Borrower or the Borrower
suffers any charge to be created over its properties in any legal
proceedings.
- If any change in the Borrower's set-up has taken place which, in the
opinion of the Bank / Lead Institution (which shall be final and
binding on the Borrower), would adversely affect the conduct of the
borrower's business or the financial position or the efficiency of
the Borrower's management or personnel or the execution of the
Project.
- The right of the Borrower to make withdrawals from the Loans shall
continue to be suspended until the Bank / Lead Institution has
notified the Borrower that the right to make withdrawals has been
restored.
- If any of the events described above has been continuing or if the
Borrower has not withdrawn the Loans by the date referred to in the
Loan Agreement or such later date as may be agreed to by the Bank /
Lead Institution, then, in such event, the Bank / Lead Institution
may, by notice in writing to the Borrower, terminate the right of
the Borrower to make withdrawals. Upon such notice, the undrawn
amount of the Loans shall stand cancelled, notwithstanding any
cancellation, suspension or termination pursuant to the aforesaid
provisions, all the provisions of the Loan Agreement shall continue
to be in full force and effect as herein specifically provided.
- No delay in exercising or omission to exercise any right, power or
remedy accruing to the Bank / Lead Institution/Lenders upon any
WAIVER default under the Loan Agreement, security documents or any other
agreement or document shall impair any such right, power or remedy
or shall be construed to be a waiver thereof or any acquiescence in
such default, nor shall the action or inaction of the Bank / Lead
Institution/Lenders in respect of any default or any acquiescence by
it in any default, affect or impair any right, power or remedy of
the Bank / Lead Institution/Lenders in respect of any other default.
- Any notice required to be served by the Borrower or the Bank shall
MISCELLA be by Registered Post with Acknowledgement due to the address
NEOUS: mentioned in the Credit Facility Agreement and such despatch of the
notice shall be deemed to be a valid service of such notice.
- All intimation to be furnished by the Borrower shall be in writing.
- The entries in the account books of the Bank maintained in the usual
practice and in compliance with the statutory regulations shall be
final. Non receipt of account statements by the Borrower or the
correctness of any entry therein shall be brought to the notice of
the Bank within tenth day of every calender month.
- Any variation to the terms of the Credit Facility Agreement or to
the General Conditions shall be done only by mutual consent in
writing of the Borrower and the Bank.
For Caraco Pharmaceutical Laboratories Limited
Chairman
10
23
[SUN LOGO]
May 19, 2000
M/s ICICI Ltd
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
Ahmedabad - 380 006
SUB: LOAN TO CARACO PHARMACEUTICAL LABORATORIES LIMITED (CPLL)
Dear Sir,
We are pleased to inform you that ICICI Bank Limited has sanctioned a loan of
US $ 5 mill. to our US joint venture Caraco Pharmaceutical Laboratories Limited.
The copy of sanction letter is enclosed herewith for your ready reference.
As per the letter of sanction, the loan to Caraco Pharmaceutical Laboratories
Ltd will be secured by corporate guarantee of Sun Pharmaceutical Industries
Ltd, backed by a deed of hypothecation to be executed in favour of ICICI Bank
Ltd.
You are requested to send us a No Objection Certificate to this effect.
Thanking you,
Yours sincerely,
for Sun Pharmaceutical Industries Ltd
(Authorized Signatory)
Encl: as above
cc: ▇▇. ▇. ▇. ▇▇▇▇▇, Vice President (Credit), ICICI Bank Ltd, Mumbai.
24
[ICICI BANK LETTERHEAD]
CREDIT ARRANGEMENT LETTER
MUM/CR/L/2000-01/40
May 19, 2000
CARACO PHARMACEUTICAL LABORATORIES LIMITED
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
Dear Sirs,
We have pleasure in advising you that the Bank has sanctioned a one time
Foreign Currency Term Loan (FCNR (B) Loan) for USD 5 million (equivalent of Rs.
21.80 crores) to the Company, payable on demand but subject to periodical
review.
The limits will be available at Mumbai Branch of the Bank.
The aforesaid credit facilities are subject to the main terms and conditions
(subject to change as per RBI directives/Bank's policies from time to time) set
out in Annexure I hereto which is deemed to be a part of this Credit
Arrangement Letter. The credit assistance is also subject to the conditions
that are contained in the documents which the Company shall execute between and
in favour of ICICI Bank Limited (ICICI Bank). Drafts of the documents are sent
herewith as per Annexure II.
The bank will obtain detailed search report from the office of Registrar of
Companies. The charges for the same will be borne by the Company.
25
[ICICI BANK LETTERHEAD] 2
Please furnish within 30 days from the date of this letter two certified copies
of the resolutions duly passed by the Board of Directors of your Company
accepting the terms and conditions.
Meanwhile please return to us the duplicate copy of this letter duly signed by
the Director of the Company in token of acceptance of the terms and conditions
stipulated herein.
Yours faithfully,
Vice President [Credit]
Enclosures
FOR Caraco Pharmaceutical
Laboratories Limited
Director
26
[ICICI BANK LETTERHEAD] 3
ANNEXURE I
----------
CARACO PHARMACUETICAL LABORATORIES LIMITED
FOREIGN CURRENCY TERM LOAN [FCNR (B) LOAN]
1. LIMIT: USD 5 million (Equivalent to Rs. 21.80 crores)
2. SECURITY: The advance will be secured, interalia, by:
a) Negative Lien over Caraco's Assets
b) First charge over the movable fixed assets of Sun Pharmaceutical
Industries Limited.
c) Irrevocable and Unconditional Corporate Guarantee of Sun
Pharmaceutical Industries Limited.
The guarantor has to submit their latest Balance Sheet.
3. MARGINS: Nil
4. RATE OF INTEREST: Six month LIBOR (US$) + 140 bps (to be reset every six
months).
The Bank retains the right to recover interest which is due and remaining
unpaid, in equivalent INR, at the TT selling rate applicable on the day of
such recovery from your operative account.
The amount of interest due is payable in the currency of the loan on a
quarterly basis as on 31st March, 30th June, 30th September and 31st
December based on the actual number of days elapsed.
27
[ICICI BANK LETTERHEAD] 4
The amount of interest on the loans will be calculated on the basis of 360 days
a year and a month of 30 days.
5. PENAL RATE OF INTEREST: 2% above the rate applicable to the loan in case
there is any default in repayment of loan and/or interest on the defaulted
amount.
6. ADDITIONAL INTEREST FOR INTERIM SECURITY: Disbursement made pending creations
of final security shall carry further interest at the rate of 1% per annum
(excluding interest tax) on entire outstanding till creation of such security.
7. FRONT END FREE: 0.1% of the limit will be recovered upfront.
8. REPAYMENT: The loan to be repaid in eight equal quarterly instalments of US$
0.625 million (approximately Rs. 2.725 crores) commencing from December 31, 2003
and ending on September 30, 2005.
9. COMMITMENT FEE: 0.25%p.a., from the date of execution of documents on the
undrawn amount payable on quarterly basis in arrears. The fee is payable in
equivalent INR calculated at the TT selling rate prevailing on the date of
payment.
10. DISBURSEMENT/DRAWDOWN:
The amounts under the foreign currency denominated loans will be disbursed in
full or part within one month from the date of this agreement (utilisation
period) unless the borrower and the Bank have agreed otherwise.
11. NOTICE OF DRAWDOWN/DISBURSEMENT: Disbursement/drawdown under the facility
will be subject to a written request/notice of 2 working days (excluding
Saturdays) in advance in the format enclosed.
28
5
[ICICI BANK LETTERHEAD]
12. CONVERSION AND HEDGING OF THE FOREIGN CURRENCY:
The amount of each drawdown may be converted into Indian rupees (INR) by an
outright transaction. The liability for repayment of principal may be hedged in
full or in part by forward contract/s for any period/s up to the maturity of
each disbursement/s.
13. CONVERSION OF FOREIGN CURRENCY IN THE EVENT OF DEFAULT IN THE PAYMENT OF
PRINCIPAL/INTEREST:
In the event of any default in the payment of principal/interest on due date/s,
the Bank, may, at its sole discretion convert the amount due into INR, on the
due date/s or on any subsequent date, at the Bank's TT selling rate prevailing
as on the date of such conversion. The amount so converted would then be
reckoned as a loan denominated in INR. Interest on such overdue amounts will be
recovered as per Bank's applicable rate (at present 21.42% p.a.). The interest
amount, if any, so converted into INR will be debited to your operative account.
14. GENERAL CONDITIONS: All transactions involving conversion of foreign
currency into INR or conversion of INR into foreign currency for payment of
interest/principal, and forward exchange contracts, swaps, etc, relating to
the loan/s should be carried out exclusively through ICICI Bank Limited.
All terms and conditions relating to the loan/s will be subject to RBI/FEDAI
regulations and will be subject to directives from RBI/FEDAI, from time to time.
15. PERIOD OF SANCTION: One Time
29
6
[ICICI BANK LETTERHEAD]
ANNEXURE II
CARACO PHARMACEUTICAL LABORATORIES LIMITED
LIST OF DOCUMENTS
1. Credit Facility Agreement (Term/Demand Loan) along with General Conditions
II.
2. Deed of Hypothecation
3. Demand Promissory Note
4. Corporate Guarantee
5. Negative Lien
6. Letters for execution of security and other documents for the credit
facilities granted.
30
7
[ICICI BANK LETTERHEAD]
ANNEXURE III
NOTICE OF DRAWDOWN/REQUEST FOR DISBURSEMENT
The Branch Manager
ICICI Banking Corporation Limited
Mumbai Branch
Dear Sir,
Re: Multicurrency Corporate Credit (MCC) facility ______________
Request for disbursement
Please refer to the letter of sanction dated _______________.
We request you to disburse/release an amount of _______________.
We give below the particulars against which the drawing is required.
1. Value date of drawing
2. Period (months)
3. Purpose For payment of import ▇▇▇▇/to meet
domestic payments in INR.
4. Amount required for remittance of
import bills including currency of
remittance.
5. Amount to be converted into INR/
other currency/ies. (Please mention
the currency to which conversion
required).
6.a Whether forward exchange contract Yes/No
facility required to meet repayment
obligations.
6.b If yes, amount for which forward
contract required to be booked
including amount and delivery date.
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8
[ICICI BANK LETTERHEAD]
We confirm that this disbursement is subject to the terms and conditions
mentioned in the aforesaid letter of sanction and the credit facility agreement
executed by us. All charges, if any, relating to the aforesaid disbursement may
be debited to our current account/cash credit account with you.
Yours faithfully,
Authorised Signatory