EXPLANATORY STATEMENT ANNEXED TO THE NOTICE OF THE SIXTYSEVENTH ANNUAL GENERAL MEETINGOF THE COMPANY IN RESPECT OF ITEMS NO. 6 & 7 OF THE NOTICE DATED 20TH MAY 2013 &12TH AUGUST 2013.
Sri V.Manickam was a nominee Director appointed by Life Insurance Corporation of India,during 31st October 2008 to 14th September 2012 on the Board of the Company. He wasco-opted as an additional Director on the Company's Board with effect from 14th February2013. Under provisions of Article 103 of the Articles of Association of the Company readwith Section 260 of the Companies Act, 1956, Sri V.Manickam will hold the office up to thedate of sixtyseventh Annual General Meeting. Notice in writing under Section 257 of theCompanies Act, 1956 has been received along with necessary deposit from a membersignifying his intention to propose the appointment of Sri V.Manickam as a Director of theCompany, liable to retire by rotation, at the sixtyseventh Annual General Meeting. Thisordinary resolution is submitted to the members for approval.
Interest of Directors:
Sri V.Manickam is interested in the resolution as it concerns his appointment. No otherDirector is directly or indirectly concerned or interested in this resolution.
(i) The Company has availed financial assistance in the form of Rupee Term Loan ofRs.200 Crores from ICICI Bank Limited for the purpose of repayment of existing debts. Oneof the terms and conditions set out by ICICI Bank Limited in its sanction letterNo.CBG/2011/CMOG No.12/CBGCHN/ 34553 dated 27.07.2011 is that the financial assistance isrequired to be secured by a first mortgage and charge on the fixed assets of the Companyboth present and future.
(ii) The Company has availed financial assistance in the form of Rupee Term Loan ofRs.200 Crores from Axis Bank Limited for the purpose of part financing thermal powerproject at Company's Vishnupuram plant. One of the terms and conditions set out by AxisBank Limited in its sanction letter No.AXISB/ CO/RMG/KSH/2012-13/58 dated 24.09.2012 isthat the financial assistance is required to be secured by an exclusive mortgage / chargeon certain specified plant/assets of the Company as decided by the Board of Directors.
(iii) The Company has been sanctioned financial assistance in the form of Rupee TermLoan of Rs.100 Crores by HDFC Bank Limited for the purpose of meeting / refinancingcapital expenditure. One of the terms and conditions set out by HDFC Bank Limited in itssanction letter dated 27.06.2013 is that the financial assistance is required to besecured by first pari passu mortgage / charge on immovable fixed assets of the Company'sBoat Club Road property in Chennai.
(iv) The Company has been sanctioned financial assistance in the form of Rupee TermLoan of Rs.100 Crores by Karnataka Bank Limited for the purpose of meeting capitalexpenditure. One of the terms and conditions set out by Karnataka Bank Limited in itssanction letter no.BDR No.V-16 DT 31.07.2013 dated 06.08.2013 is that the financialassistance is required to be secured by first pari passu mortgage / charge on immovablefixed assets of the Company's Boat Club Road property in Chennai.
(v) The Company's bankers have revised their working capital facility to Rs.12959.50millions as set out in the resolution. The aforesaid revised working capital facility is,inter alia, required to be secured by second pari passu mortgage and charge on theimmovable and movable properties of the Company both present and future pertaining tocement business in favour of various Bankers as set out in the resolution.
Section 293(1)(a) of the Companies Act, 1956, provides, inter alia, that the Board ofDirectors of a public company shall not, without the consent of such public company ingeneral meeting, sell, lease or otherwise dispose of the whole or substantially the wholeof the undertaking of the Company, or where the Company owns more than one undertaking, ofthe whole or substantially the whole of any such undertaking. Since the mortgaging by theCompany of its immovable and movable properties as aforesaid may be regarded as disposalof the Company's properties/undertakings, it is necessary for the members to pass aresolution under Section 293(1)(a) of the Companies Act, 1956, for creation of the saidmortgage / charge. Hence the resolution.
Inspection of Documents:
Copies of Credit Arrangement letter No. CBG/2011/CMOG No.12/CBGCHN/34553 dated27.07.2011 and letter of amendment dated 07.09.2012 to master facility agreement dated27.07.2011 from ICICI Bank Limited, sanction letter No. AXISB/CO/RMG/KSH/2012-13/58 dated24.09.2012 from AXIS Bank Limited, sanction letter dated 27.06.2013 from HDFC BankLimited, sanction letter no.BDR No.V-16 DT 31.07.2013 dated 06.08.2013 from Karnataka BankLimited and Working Capital Consortium Agreement entered by the Company with Company'sBankers, are available for inspection of the shareholders at the Registered Office /Corporate Office of the Company between 11.00 A.M. and 1.00 P.M. on any working day priorto the date of the meeting and will also be available for inspection at the meeting.
Interest of Directors:
No Director of the Company except Sri K.P.Nair representing IDBI Bank Limited isdirectly or indirectly concerned or interested in this resolution.
| ||(By order of the Board) |
| ||for THE INDIA CEMENTS LIMITED |
|Place : Chennai ||G BALAKRISHNAN |
|Dates : 20th May, 2013 & 12th August, 2013 ||Senior President & Company Secretary |