SUBSCRIPTION AGREEMENT
 
 THIS AGREEMENT made at Mumbai on this the ……..day of …….. 	two thousand one between, ABC Power Corporation Ltd. a company registered under the Companies Act, 1956 and having its	registered office at Mumbai in the State of Maharashtra (hereinafter referred to as "the Company", which expression shall, unless it be repugnant to the subject or context thereof, include its successors and assigns);
	
AND
 
THE XYZ FINANCE COMPANY LTD., a company incorporated under the Companies Act, 1956 and having its registered office at  ……..Mumbai 400001 (hereinafter referred to as "Subscriber", which expression shall include its successors and assigns as the subject or context may require).
 
Capitalised terms used herein shall have the meanings assigned in Schedule II hereto.
 
ARTICLE 1: ISSUE OF NCDs
 
The Company shall issue 54,00,000 Secured Redeemable Non-Convertible Debentures (hereinafter called NCDs) of the face value of Rs. 100 each aggregating to Rs. 54.00 Crores (Rupees fifty-four crores only) to the Subscriber.
 
The proceeds of the issue of the said NCDs shall be utilised for implementing the Project as defined in Schedule II. In case the Company fails, for any reason, to utilise the proceeds of the issue for the said purpose or utilises the same for any purpose other than the approved Scheme, the Subscriber would be entitled to rescind/avoid the contract on that ground and to call back the money, if any, paid towards subscription of the said NCDs.
 
ARTICLE II : AGREEMENT AND TERMS OF SUBSCRIPTION
 
2.1 Amount and terms of subscription
 
The Subscriber agrees to subscribe to and the Company agrees to allot to the Subscriber on the terms and conditions contained herein, 54,00,000 NCDs of Rs. 100 each aggregating Rs. 54.00 crores on private placement basis as set out against their name in Schedule I hereto.
 
2.2 Issue of Debenture Certificates
 
The Company shall issue the debenture certificates in such manner and form as will be required by the Subscriber. The Company shall amend its Articles of Association for such purpose where necessary.
 
2.3 Front-end fee
 
The Company shall pay front-end fee at the rate of 1%, plus interest tax, upfront, on the agreed amount of Subscription, i.e. on Rs. 54.00 crores.
 
2.4 Rate of interest/Coupon rate
 
The NCDs shall carry interest on the principal amount of NCDs outstanding from time to time at the prime lending rate ("PLR") of the Subscriber plus 3.5% per annum plus interest tax as prevailing on the date of each subscription, payable quarterly or at such oftler higher rate as may be applicable in terms of section 2.5 below. The first instalment of interest shall accrue for the broken period from the date of subscription upto the date immediately following 15th June and 15th December as the case may be and subsequently be payable on the said dates 15th March, 15th June, 15th September and 15th December. The interest for the broken period shall be payable together with the last instalment of the redemption of the said NCDs.
 
The applicable rate of interest would be fixed at the end of the total Subscription (for NCDs of Rs. 54.00 Crores) period on the basis of the weighted average of the interest rates at which the subscriptions were made.
 
In the event of any default in the payment of interest on the NCDs on the dates as stated above, compound interest at half-yearly rests at the said rates will become due and payable for the moneys due for the period of default.
 
2.5 Review of rate of interest
 
Subscriber would have the right to reset the rate of interest at the end of seven years from the date of first disbursement provided that the company will have the right to redeem the NCDs if the reset is adverse to the Company.
 
2.6 Further interest
 
All interest which shall become due during the currency of the NCDs or any part thereof and for the time being remaining unpaid and all other moneys which have become payable by Company to Subscriber, in case the same be not paid on the dates on which they accrue due, carry further interest at the maximum lending rate of the Subscriber (top of the Interest Rate Band), as applicable on the date of default or at the applicable rate under the Subscription agreement, whichever is higher, computed from the respective date(s) of such interest of moneys accruing due and all such interest and further interest which have become payable but not paid, shall become payable upon the footing of compound interest with rests taken or made quarterly as herein before provided.
 
2.7 Liquidated damages
 
An additional charge of 2% per annum plus interest tax by way of Liquidated Damages will be levied for defaults in the payment of interest, redemption of NCDs and other moneys payable to the Subscriber. The arrears of Liquidated damages shall carry interest at the maximum lending rate of the Subscriber (i.e., top of the interest rate band) or at the applicable under the Subscription Agreement, which ever is higher.
 
2.8 Repayment Schedule
 
The NCDs shall be redeemed in 34 quarterly equal instalments, commencing from 15th December, 2001. Such instalments shall be payable quarterly, each year, on 15th day of December, March, June and September.
 
2.9 Validity period
 
The validity period of the commitment to subscribe NCDs by the Subscriber will be upto February 15, 2003, unless extended by a letter in writing addressed by the Subscriber to the Company.
 
2.10 Additional Interest
 
Disbursements made pending creation of final security as stipulated in Article VII hereof, in case of non-creation of final security within 3 months from the date of first disbursement, shall carry further interest at the rate of 1% plus interest tax from the date of first disbursement till creation of such security.
 
ARTICLE III: COMPANY'S WARRANTIES
 
3.1 Except to the extent already disclosed in writing to the Lead Institution, the Company shall be deemed to have assured, confirmed and undertaken as follows:
 
(a) Information.-That the information furnished by the Company in its application to the Subscriber for sanction of Subscription as also that furnished from time to time is true and correct and is not misleading in any respect.
 
(b) Due payment of public and other demands.-The Company is not in arrears on 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 Government(s) or any local or other authority except which have been disputed and/or contested by the Borrower or taken up by way of appeal/review/revision, etc. with the appropriate authority unless the Company has made provision for adequate reserves in respect of such demands.
 
(c) Selling and purchasing arrangements. -The Company has entered into requisite selling and purchasing arrangements to the satisfaction of the Lead Institution.
 
(d) Management agreement.-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 Lead Institution.
 
(e) Conflict with Memorandum and Articles of Association.-Nothing in the Subscription Agreement conflicts with the Memorandum and Articles Association of the Company.
 
(f) Import licence.-The Company or its contractors have obtained import licence(s) (if required) with list of equipment/necessary information about eligibility, scope and validity of imports under Open General Licence for equipment to be imported for the project. The Company further undertakes to obtain information regarding changes in import policy, eligibility and scope of import and shall advise the Subscriber in this regard from time to time.
 
3.2 The Company has full power, capacity and authority to execute, deliver and perform this Agreement and has taken necessary action (corporate, statutory or otherwise) to allot the NCDs on private placement basis to the Subscriber on the terms and conditions contained in this Agreement and to authorise execution, delivery and performance of this Agreement
 
3.3 The Company shall revise the terms and conditions relating to the monetary benefits available to the Subscriber in the event of the Central Government announcing, in future, any modification/amendment/restriction in the guidelines for the purpose of Issue of Debentures by Public Limited Companies.
 
ARTICLE IV: PRE-SUBSCRIPTION CONDITIONS
 
4. Conditions precedent to subscription
 
4.1 The obligations of the Subscriber to subscribe to the NCDs shall be subject to the Company performing all its obligations and undertaking to observe the subscription procedure stipulated by the Subscriber such as submission of necessary information, documents, etc., to the satisfaction of the Subscriber as also compliance with the following conditions:
 
(a) Recovering calls in arrears.-The Company shall make arrangement for recovering calls in arrears of its shareholding in a time bound manner and to the said effect it shall furnish an undertaking to the Subscriber in such form and manner as may be prescribed by the Lead Institution.
 
(b) Legal and Other charges.-All legal/other charges, costs and/or other expenses incurred by the Subscriber relating to the NCDs shall be borne/paid by the Company.
 
(c) Pre-commitment Conditions.- Before the Subscription to NCD becomes effective, the Company shall to the satisfaction of the Lead Institution comply with the following conditions:
 
(i)	obtain in-principle sanction from MSEB's banker(s) for opening of irrevocable and revolving letter of credit for prompt payment of dues by MSEB.
(ii)	enter into an escrow account arrangement with MSEB to cover payment of electricity dues from MSEB.
(iii)	amend the Operations & Maintenance (O&M) agreement so as to provide for guarantee on heat rate, liquidated damages for increase in heat rate or decrease in availability of plant.
(iv)	furnish an undertaking from Promoters i.e., Santex Constructions Limited (SCL), Santex Industries Limited (SIL), Santex Investment Limited (SIL) UVW Power Generation Limited to the effect that cost overrun, if any, shall be made good by Promoters without recourse to Fl’s/Banks and in a manner satisfactory to the Subscriber.
(v)	arrange for ECA loans to the extent of US$ 80 million from ADB on terms satisfactory to the Subscriber. In the event of any savings compared to provisions in the project cost on account of lower insurance cover charges, management fee on deferred payment guarantee, etc. the Rupee Loan shall be reduced to that extent.
(vi)	furnish an undertaking from Promoters to bridge the gap, if any, in raising equity capital by way of private placement with CDC (Rs. 100 crores).
(vii)	tie-up entire means of financing on the terms satisfactory to the Subscriber.
(viii)	obtain all necessary approvals from the Government of India (FIPB)/Reserve Bank of India, etc. for the proposed foreign equity investment in the equity share capital of the Company.
(ix)	appoint, in consultation with the Subscriber, a reputed firm of Engineering Consultants during the implementation period as well as during operation period with direct reporting to the Subscriber, all costs and expenses in this regard will be borne by the Company.
(x)	undertake to comply with all the statutory requirements for preferential allotment of SCL's shares to NRI's/OCB's.
(xi)	get amended all approvals obtained earlier in the name of Santex Power to the name of the Company.
(xii)	get amended the Government of Maharashtra Guarantee to the effect that it continues to be valid irrespective of Maharashtra Government's shareholding in MSEB.
(xiii)	amend the Shareholders Agreement (SA) to provide for
 
-	disinvestment/dilution of shareholding Santex Group and UVW Power Generation Limited/WEB Energy Limited shall be in consultation with and prior approval of the Subscriber.
-	SA shall not be terminated without the prior approval of the Subscriber.
(xiv)	finalise the insurance package including Advance Loss of Profit to the satisfaction of the Subscriber.
(xv)	appoint insurance Advisor and Legal Advisor to Lenders. The necessary fees and other expenses for the same shall be borne by the Company.
(xvi)	The Project agreements/contracts shall be to the satisfaction of the Lender.
(xvii)	Modify the Memorandum & Articles of Association of the Borrower to enhance the borrowing powers as per the envisaged means of financing.
(xviii)	Ensure that the promoters shall meet the liquidated damages payable to the APSEB from their own resources without recourse to the Lender.
(xix)	Ensure that the envisaged promoters contribution is subscribed to in full and paid up in cash to the extent of 100% in respect of Santex Group aggregating Rs.212.00 crores.
(xx)	Obtain MSEB approval for extension of the date of financial closure as per PPA.
(xxi)	Obtain all statutory/non-statutory clearances and approvals required for the project including Pollution Control/Environ mental Clearance and ensure that the equipment proposed to be installed is adequate and appropriate to the Pollution Control requirement.
 
4.2 Before seeking Subscription of the NCDs by the Subscriber, the Company shall to the satisfaction of the Subscriber comply with the following conditions:
 
(i)	modify the Memorandum and Articles of Association to enhance the authorised capital and borrowing powers as per the envisaged means of financing.
(ii)	bring in 50% of the proposed equity contribution of UVW Power Generation 	Limited/MNC Energy Limited, and CDC aggregating Rs ........Crores i.e ........Crores.
(iii)	shall agree to open a Trust and Retention Account in a bank and shall deposit all the cash inflows in the said account and the proceeds shall be utilised in a manner and priority to the satisfaction of the Subscriber.
(iv)	acquire and obtain possession of the entire land with provision for mortgage of land in favour of institutions and obtain all necessary approvals for usage of the land for the purpose of the power plant.
(v)	constitute a Project Management Committee of its Directors for the purpose of supervising and monitoring the progress in the implementation of the project. The Committee shall be responsible for the management of the project during construction period including civil tendering, placement of orders for supply of plant and machinery and other assets and monitoring the implementation of the Project.
(vi)	agree and undertake to furnish to the Subscriber such information and data as might be required by the Subscriber to ensure that the physical progress as well as expenditure incurred on the Project are as per the schedule.
(vii)	agree that the Subscriber shall have the right to review the cost of the Project any time during the implementation of the Project as also before the final disbursement of the loan amount. Pending completion of the review, the Company shall obtain prior approval of the Subscriber for utilising the amount of the loans equivalent to the contingency provision in the cost of Project.
(viii)	agree that the Subscriber shall be entitled to appoint one or more nominee(s) on the Board of Directors of the Company during the currency of financial assistance.
 
4.3 Other conditions
 
The Company shall
 
(i)	constitute an audit sub-committee of its Directors (other than the Directors representing the Promoters) for monitoring/guidance.
(ii)	arrange for carrying out safety/audit in connection with storage, handling and transportation of petroleum products and shall comply with the recommendations set out in the audit report.
(iii)	make satisfactory arrangement with its bankers for meeting its working capital requirements and shall furnish a letter from its bankers in this regard.
(iv)	agree that the Subscriber may at its discretion withhold disbursement of the amount of the NCDs equivalent to the provision against margin money for working capital in the cost of the Project till such time as the Project is completed or the build up of working capital commences.
(v)	shall not undertake any new project or expansion of the existing projects or make any investment or take assets on lease without prior approval of the Subscriber during the currency of the NCDs from the Subscriber.
(vi)	The Subscriber shall have the right to review and reset the rate of interest (including the spread on LIBOR) after seven years from the date of first disbursement, provided that the Borrower shall have the right to prepay the NCDs without any penalty or premium if the rate of interest is adversely reset after seven years from the date of first disbursement.
(vii)	broadbase its Board of Directors by induction of experienced outside professionals to the satisfaction of the Subscriber.
(viii)	obtain all other statutory and non-statutory clearances for the Project.
(ix)	shall ensure the release of funds from K-EXIM in line with the disbursement of foreign currency loans from the Financial Institutions/Banks.
(x)	all other terms and conditions stipulated by other financial institution and banks over and above the conditions stipulated herein shall apply mutatis mutandis for the assistance sanctioned by the Lender (XYZ Finance Company Ltd.).
 
ARTICLE V: CONDITIONS APPLICABLE DURING CURRENCY OF THIS AGREEMENT 
 
5.1 Project
 
The Company shall
 
(i) Project Implementation.-Carry out and operate the Project with due diligence and efficiency and in accordance with sound engineering, technical, administrative, financial and managerial and industrial standards and business practices with qualified and experienced management and personnel in accordance with the Financing Plan and cause the financing specified in the Financing Plan to be applied exclusively to the Project.
 
(ii) Project Changes.-Promptly notify the Subscriber of any proposed changes 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 subscribing to 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 thereof without the prior approval of the Lead Institution.
 
(iii) Contract changes.-Obtain prior concurrence of the Subscriber to any material modification or cancellation of the Company's agreements with its contractors, machinery suppliers, collaborators and technical consultants and suppliers of raw materials.
 
(iv) Delay in Completing the Project.-Promptly inform the Subscriber of the circumstances and conditions which are likely to disable the Company from implementing the Project or which are likely to delay its completion or compel the Company to abandon the same.
 
5.2 Utillisation of subscription amount
 
The Company shall
 
(i)	use the Subscription amount solely for the purpose of which it has subscribed to be used i.e., exclusively in the carrying out of the Project.
(ii)	furnish to the Subscriber at the end of each quarter a statement showing the manner in which the said monies have been utilised.
(iii)	Trust and Retention Agreement
 
(a) keep the Subscription amount in special account in the name of the Company in accordance with the Trust and Retention Agreement; and
(b) not transfer the subscription amount or any portion thereof from the said special account for being kept 	in call or in deposit except for investment in Authorised Investments without obtaining the prior approval of the 	Subscriber,
 
5.3 General covenants
 
(A) Without the prior approval of the Subscriber the Company shall not:
 
(i) New Project.-Undertake any new project, diversification, modernization 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.
(ii) Loans and Debentures.-Except as provided for in the Financing Plan annexed to this Agreement, issue 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. 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 Banks in the ordinary course of business.
(iii) Premature Repayment.-Prepay any loan availed of by it from any other party, unless a proportionate repayment is offered to the Subscriber, with prepayment premium as may be determined by the Subscriber.
(iv) Commission.-Except as provided for in the Financing Plan annexed to this Agreement, 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 other obligation undertaken for or by the Company for the purpose of the Project.
(v) Dividend.-Declare or pay any dividend to its shareholders during any financial year unless it has paid all the dues to the Subscriber up to the date on which the dividend is proposed to be declared or paid or has made satisfactory provisions therefore, provided that approval of the Subscriber shall not be necessary if:
 
(a)	the ADSCR is equal to or greater than 1:4;
(b)	the Required Balances in the Debt Service Reserve Account and the Current Debt Service Reserve (as defined in the Trust and Retention Agreement) are maintained; and
(c)	no Event of Default or potential Event of Default is then in existence (or would be in existence after such dividend payment).
 
For the purposes of this clause,
 
"ADSCR" or "Average Debt Service Coverage Ratio" shall mean the ratio of (i) below to (ii) for the twenty-four month period comprising the twelve months ending on the Calculation Date and the twelve months immediately following the Calculation Date:
 
(i)	the aggregate of profit after tax; plus aggregate fees and interest charges; plus non-cash items, if any debited from the Borrower's Profit & Loss Account; minus non-cash items, if any credited from the Borrower's Profit & Loss Account; plus the balances standing to the credit of Borrower's bank accounts and the Overhaul and Reserve Accounts; plus the principal amount of the Authorised Investments made by the Borrower;
(ii)	the aggregate of the financing costs, which among others, include the installments of principal paid during the twelve month period ending on the Calculation Date; plus projected over the twelve month period immediately after the Calculation Date.
 
"Calculation Date" means the four quarterly debt repayment dates.
 
"Overhaul Costs" means those costs projected to be incurred during scheduled major overhaul outages and excluding costs to be incurred for routine annual overhaul and more frequent maintenance outages as envisaged in the Trust and Retention Agreement.
 
"Overhaul Reserve Account" means the account so named and established and maintained by the Borrower to accumulate the amount projected to be required to fund Overhaul Costs for the ensuing twelve months as envisaged in the Trust and Retention Agreement.
 
(vi) Subsidiaries.-Create any subsidiary or permit any company to become its subsidiary.
 
(vii) Merger, Consolidation, etc..-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.
 
(viii) Investments by Company.-Without the prior approval of the Subscriber, the Company shall not make any investments except hereinafter appearing ("Authorised Investments").
 
"Authorised Investments" shall mean:
 
(a) 	In relation to investment of Rupee funds:
(1) Indian Government Securities, Treasury Bills; or
(2) Bonds, Certifications of Deposit of Financial Institutions, or
(3) Fixed Deposits with Scheduled Commercial Banks;
 
The instruments floated by the FIs/Banks should at least be rated as AAA/P1 by ICRA or equivalent ratings by other recognised rating agencies like CARE/CRISIL and should have maturity of not more than 365 days.
 
(b) 	In relation to investments of Dollar funds:
 
(1)Securities issued to directly and fully guaranteed or insured by the United States or any agency of instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than six months from the date of acquisition; or
 
(2)Time deposits and certificate of deposit, with maturities of not more than six months from the date of acquisition; of any international commercial bank of recognised standing having capital and surplus in excess of US$ 500,000,000 and having the highest rating on its commercial paper by MMM International Corporation or the equivalent thereof by MMM Investors Service, Inc.
 
(c) 	Any other investment as may be approved in writing by the Lead Institution.
 
(ix) Revaluation of Assets.-Revalue its assets at any time during the currency of the NCDs except as required by law.
 
(x) Trading Activity.-Carry on any general trading activity other than the sale of its own products.
(B) Unless otherwise agreed to by the Subscriber, the Company shall,
 
(i) Accounting and Cost Control Systems.-Promptly and diligently install and thereafter maintain an accounting and cost control system satisfactory to the Subscriber and maintain books of accounts and other records adequate to reflect truly and fairly the financial position of the Company and the results of its operations (including the progress of the Project) in conformity with sound accounting principles consistently applied. Such records and books shall be open to examination by the Subscriber.
 
(ii) Information on Goods, Services, etc.-Provide to the Subscriber all such information relating to the goods and services financed out of the Subscription amount, the Project and its operations and other related matters as the lead institution shall, from time to time, at their discretion request, including information relating to the administration, management and financial condition of the Company.
 
(iii) Notice of Winding up or Other Legal Process.-Promptly inform the Subscriber 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 Company or if a receiver is appointed of any of its properties or business or undertaking.
 
(iv) Adverse Changes in Profits and Production.-Promptly inform the Subscriber of the happening of any labour strikes, lockouts, shutdowns, fires or any event likely to have a substantial effect on the Company's profits or business and of any material changes in the rate of production or sales of the Company with an explanation of the reasons thereof.
 
(V) Insurance
 
(a) Insure and keep insured against such risks as may be determined in the insurance plan approved by the Lead Institution, all the goods to be imported for the purpose of the Project whether financed out of the proceeds of the loan or not and in particular the goods to be financed out of the proceeds of the loan as are of an insurable nature against all marine, transit and other hazards incident to the acquisition, transportation and delivery of the goods to the place of use of installation, and for such insurance any indemnity shall be payable in any currency freely usable by the Company to replace or repair such goods.
 
(b) Keep insured up to the replacement value thereof as approved by the Lead Institution (including surveyor's and architect's fee) the properties charged or to be charged in favour of the Subscriber and other Subscriber and such of its other properties and risks as are of an insurable nature against fire, theft, lightning explosion, earthquake, riot, strike, civil commotion, storm, tempest, flood, marine risks including war risks, erection risks, and such other risks as may be specified in the insurance plan approved by the Subscriber.
 
(c) Duly pay all premia and other sums payable for that purpose. The insurance in respect of properties charged or to be charged to the Subscriber and other Lenders and Commitment Charge Lenders shall be taken in the joint names of the Company and the Subscriber and any other person or institution having an insurable interest in the properties of the Company and acceptable to the Lead Institution. The Company shall keep deposited with the Lead Institution, the insurance policies and renewals thereof.
 
(d) Agree that in the event of failure on the part of the Company to insure the properties or to pay the insurance premia, the Lead Institution may get the properties insured or pay the insurance premia and other sums referred to above, as the case may be, and recover the insurance premia and such other sums referred to above from the Company.
 
(vi) Loss or damage by uncovered risks.-Promptly inform the Subscriber of any loss or damage which the Company may suffer due to any force majeure circumstances or act of God, such as earthquake, flood, tempest or typhoon, etc., against which the Company may not have insured its properties.
 
(vii) Costs and charges.-Pay all taxes, duties, cesses, costs, charges and expenses, in connection with or relating to the issue of NCDs (including cost of investigation of title and protection of the Subscriber's interest). In the event of the Company failing to pay the aforesaid monies, the Subscriber shall be at liberty but shall not be obliged to pay the same.
 
(viii) Annual Accounts/Working Results.-Submit to the Subscriber 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 Company shall get its accounts audited by an independent firm of Chartered Accountants and furnish the same to the Subscriber.
 
(ix) Memorandum and Articles of Association.-Carry out such alterations to its Memorandum and Articles of Association as may be deemed necessary in the opinion of  the Lead Institution to safeguard the interests of the Subscriber arising out of this Agreement..
 
(x) Selling and Purchase Agreement.-If so required by the Lead Institution, the Company shall take reasonable steps to suitably modify or terminate the contracts entered Into by the Company in relation to the Project. The Company shall.-not enter into any fresh agreement for the appointment of sole selling agents / sole purchasing agents without the prior, approval of the Lead Institution. Any such arrangement shall be subject to such terms and conditions as may be stipulated by the Lead Institution.
 
5.4 Security Margin
 
The Company shall maintain a minimum security cover of 1.50 times of its net fixed assets over all the Loans and or debentures outstanding including the present issue of NCI)s and any other borrowings which may have a charge over the assets of the Company on pad-passu basis. The assets revalued would not be taken into account for determining the minimum security cover.
 
ARTICLE VI: NOMINEE DIRECTORS
6.1 Nominee director
 
(i) The Subscriber shall have the right to appoint and remove from time to time, Director(s) on the Board of Directors of the Company at any time during the currency of this Agreement (such directors are hereinafter referred to as 'Nominee Director(s)').
 
(ii) The Nominee Director(s) shall not be required to hold qualification shares nor be liable to retire by rotation.
 
(iii) 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 Subscriber and the same shall accordingly be paid by the Company directly to the Subscriber:
 
Provided that, if any such Nominee Director(s) is an officer of the Subscriber, the sitting fees in relation to such Nominee Director(s) shall also accrue to the Subscriber and the same shall accordingly be paid by the Company directly to the Subscriber.
 
Any expenditure incurred by the Subscriber or the Nominee Director(s) In connection with his appointment as Director shall be borne by the Company.
 
(iv) The Nominee Director(p) shall be appointed. as a Member of the Management Committee or other Committees of the Board, if so desired by the Subscriber.
 
(v) The Nominee Director(s) shall be entitled to receive notices, agenda, etc., and to attend all General Meetings and Board Meetings and Meetings of any Committees of the Board of which he is a member.
 
(vi) If, at any time, the Nominee Director(s) is not able to attend a meeting of the Board of Directors; or any of its Committees of which he is a member, the Subscriber may depute an observer to attend the meeting. The expenses incurred by the Subscriber in this connection shall be borne by the Company.
 
6.2 Management
 
Unless the Lead Institution otherwise agree:
 
(i) Existing Management-The Company shall not remove any person, by whatever name called, exercising substantial powers of management of the affairs of the Company at the time of execution of this Agreement.
 
(ii) Payment of Compensation.-The Company shall not pay any compensation to any person(s) mentioned in (i) above 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 Lead Institution.
 
(iii) Payment of Commission.-The person(s) referred to in (i) above shall not be paid any commission in any year unless all the dues of the Subscriber in that year have been paid to the satisfaction of the Subscriber.
 
(iv)Undertakings.-The Company shall obtain suitable undertakings for giving effect to (i) and (ii) above from the person(s) mentioned in (i) above. The appointment and/or reappointment including terms of appointment (or alteration in such terms) of the person(s) mentioned in (i) above shall be subject to the prior approval of the Subscriber.
 
(v) Future Arrangement-The Company shall, as and when required by the Lead Institution, appoint and change to the satisfaction of the Lead Institution suitable technical, financial and executive staff of 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 Lead Institution.
 
(vi) Review of Management-In case of default in payment of any dues to the Lead Institution or if in the opinion of the Subscriber the business of the Company is conducted in a manner opposed to public policy or in a manner prejudicial to the Subscriber's interest, the Lead Institution shall have the right to review the management set up or organisation of the Company and to require the Company to restructure it as may be considered necessary by the Lead Institution including the formation of Management Committees with such powers and functions as may be considered suitable by the Subscriber.
 
(vii)Appointment of Technical/Management Consultants/Chartered Accountants.-The 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 Company and its factory and to report to the Lead Institution. The 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 systems and procedures adopted by the Company for its working or as concurrent or internal auditors, or for conducting a special audit of the Company. The costs, charges and expenses including professional fees and traveling and other expenses of such consultants or auditors shall be payable by the Company.
 
(viii) Committees.-The Company shall constitute such Committees of the Board on such composition and functions as may be required by the Lead Institution for close monitoring of the different aspects of its working.
 
(ix) Undertaking for Non-Disposal of Shareholdings.-The Company shall not recognise or register any transfer of shares in the Company's capital made or to be made by the Promoters their friends or their associates as specified by the Lead Institution. The Company shall obtain and furnish to the Lead Institution suitable undertakings from the Promoters for giving effect to the above.
 
ARTICLE VII: SECURITY
7.1 Security
 
(A) The NCDs together with all interest, liquidated damages, management fee, premia on prepayment or on redemption, costs, expenses and other monies' payable whatsoever stipulated in this Agreement shall be secured by:
 
(a)	a first mortgage and charge in favour of the Security Trustee in a form satisfactory to the Subscriber of all the 	Company's immovable properties both present and future;
(b)	a first registered mortgage and charge in favour of the Security Trustee of all of the Borrower's immovable 	properties in Maharashtra, its intangible assets both present and future, charge over Project Contracts, insurance 	proceeds and bank accounts; and
(c)	a first charge by way of hypothecation in favour of the Lenders of all the Company's movables (save and except 	book debts), including movable machinery, machinery spares, tools and accessories, present and future, subject to 	prior charges created and/or to be created in favour of the Working Capital Lenders on the Borrower's stocks of 	raw materials, semifinished, finished goods, consumables stores, book debts and such other movables as may be 	agreed by the Lead Institution.
 
The mortgage and charge referred to above shall rank pad passu with the mortgages and charges created and/or to be created in favour of the Lenders in respect of the financial assistance as set out herein:
_________________________________________________________________________________________
Lender		Rupee			Foreign Currency			Guarantee ^		Total
	Term			Loan Amount			Assistance Amount
		Loan/NCD							(Principal)
	Amount	_________________________________________________
Rs.		us $		Rs.		us $		Rs. 		Rs.
Crores		Million		Crores		Million		Crores		Crores
	_________________________________________________________________________________________
XYZ Finance Co.
Ltd.
STR Development
MNO
AAB
PFC
JKL Bank
ABC Bank
DEF Bank
GHI Bank
_________________________________________________________________________________________
Total
_________________________________________________________________________________________
 
Provided that Borrower may create in favour of the Commitment Charge Lenders:
 
1. First charge on the refund amounts by the fuel supplier in respect of Commitment Charges (second charge being in favour of the Lender), subject to the following conditions:
 
(a)	The Borrower shall maintain a separate bank account for the refund of amounts from the fuel supplier in respect 	of commitment charges;
(b)	The Borrower shall service loans taken for commitment charges out of the proceeds of refund of amounts from 	the fuel supplier without any recourse to escrow account and/or Trust and Retention account.
 
2. Second charge on fixed assets; and
 
3. Pledge of equity shares of the Borrower owned by the Promoters aggregating 	12.9% of the equity share capital (which shall be over and above the shares to the extent of 51 % to be pledged to the Lenders).
 
7.2 Creation of Additional Security
 
If, at any time during the subsistence of this Agreement, the Lead Institution is of the opinion that the Security provided by the Company has become inadequate as determined by clause 5.4 to cover the balance of the NCDs then outstanding, then on the Lead Institution advising the Company to that effect, the Company shall provide and furnish to the Lead Institution, to the satisfaction of the Subscriber, such additional security, as may be available with the Borrower, and as may be acceptable to the Lead Institution to cover such deficiency.
 
7.3 Pledge of Shares
 
The Company shall cause the Promoters to create a pledge in favour of the Security Trustee aggregates 51% of the total issued equity share capital of the Company at all times excluding shares issued to the Lenders pursuant to conversion rights in respect of the Loans.
 
7.4 Trust and Retention Agreement
 
The Company shall enter into a Trust and Retention Agreement and open the accounts described therein in which the proceeds of Receivables of the Company would be deposited for the due repayment of the principal amount of the Loans, and interest thereon, and all other payments under this Agreement and for making all payments in accordance with the Trust and Retention Agreement. The appointment of the trustee for operating the accounts shall be subject to approval of the Security Trustee.
 
7.5 Acquisition of Additional Immovable properties
 
So long as any moneys remain due and outstanding to the Subscriber, the Company undertakes to notify the Subscriber in writing of all its acquisitions of immovable properties and as soon as practicable thereafter to make out a marketable title to the satisfaction of the Subscriber and charge the same in favour of the Subscriber by way of first charge in such form and manner as may be decided by the Subscriber.
 
7.6 Guarantee
 
The Borrower shall procure irrevocable and unconditional personal guarantee(s) of S/A & B both joint and several and a Corporate Guarantee of Santex Constructions Limited in favour of Lender for the due repayment of the Loans and the payment of all interest and other monies payable by the Borrower in the form prescribed by the Lender and to be delivered to the Lender before any part of the loan is advanced. The Borrower shall not pay any guarantee commission to the said Guarantors.
 
ARTICLE VIII: REPORTS
 
8. The Company shall furnish to the Lead Institution quarterly reports on its workings with in general or in specific relation to this Agreement as may be required by the Lead Institution.
 
ARTICLE IX: INSPECTION
 
9. The Company shall,
 
(a) Project Expenditure Records.-Maintain records and procedures adequate to record-and monitor the progress of the Project- (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the Subscription amounts, to disclose their use in the Project and the operations and financial condition of the Company and such records shall be open to examination by the Subscriber.
 
(b) Technical, Financial and Legal Inspections
 
(i) Permit the Subscriber, and their authorised representatives, to carry out technical, financial and legal inspections of the goods purchased out of the Subscription amounts and to visit any facilities and construction sites included in the Project and to examine any plants, installations, sites, works, buildings, property, equipment, records and documents relating to the Company. Any such representative of the Subscriber shall have free access at all reasonable times to the Company's properties and shall receive full co-operation and assistance from the employees of the Company.
 
(ii) Permit any whole-time officer of the Subscriber or a qualified practising Auditor to examine the Company's books and papers and will give all facilities to enable any technically qualified person chosen by the Subscriber to report on the business of the Company at any time. Provided that, if the technically qualified person is not a whole-time employee of the Subscriber such technically qualified person shall be reasonably acceptable to the Company having regard to his other activities, if any.
 
(iii) The cost of inspection, including travelling and all other expenses, shall be payable by the Company to Subscriber in this behalf.

ARTICLE X: SUSPENSION AND TERMINATION
10.1 Suspension
 
Access by the Company to the subscription may be suspended or terminated by the Subscriber and the Subscriber may request the Debenture Trustee to declare the principal amount of the NCDs, all interest and all other monies under the Debenture Trustee Deed to be due and payable in accordance with the Debenture Trust Deed and the Security created in terms of Article VII of this Agreement shall become enforceable and the Subscriber by notice in writing to the Company upon the happening of all or any of the following events ("Events of Default") and the Subscriber shall have the following rights viz.:
 
(i)	to enter upon and take possession of the assets of the Company,
(ii)	to transfer the assets of the Company by way of lease or leave and licence or sale,
(iii)	to enforce the Security created pursuant to Article V11 of this Agreement,
(iv)	to draw monies in the bank accounts of the Company pursuant to the Trust and Retention Agreement,
(v)	to call the Promoters to subscribe to the equity committed pursuant to the Financing Plan, and
(vi)	(vi)              to exercise any other rights the Subscriber may have under this Agreement or under law, in accordance with the Security Documents. 
 
Events of Defaults
 
(a) Default in redemption.-Default has occurred in the redemption of a principal amount of the NCDs on the due dates and such default continues for 30 days.
 
(b) Default in payment of interest.-Default has been committed by the Company in payment of any instalment of the NCDs owned by the Subscriber and such default continues for 30 days.
 
(c) Arrears of interest.-Interest amounting to at least Rs. 500 has been in arrears and unpaid for a period of 30 days after becoming due.
 
(d) Default in performance of covenants and conditions.-Default has occurred in the performance of any covenant, condition or agreement on the part of the Company under this Agreement or any other agreement and such default has continued for a period of thirty days after notice in writing thereof has been given to the Company by the Subscriber setting out the nature of the default.
 
(e) Supply of misleading information.-Any information given by the Company in its application for assistance for the Project, in the 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 Subscriber is misleading or incorrect in any material respect at the time given.
 
(f) Inability to pay debts.-If the Company is unable to pay its debts or proceedings for taking it into liquidation, either voluntarily or compulsorily, may be or have been commenced and such proceedings have not been stayed within 30 days from commencement thereof.
 
(g) Inadequate insurance.-If the properties and assets offered to the Lender as security for the FC Loan have not been kept insured by the Borrower or depreciate in value to such an extent that, in the opinion of the Lead Institution, further security to the satisfaction of the Lender should be given and on advising the Borrower to that effect such security, where available with the Borrower, has not been given to the Security Trustee.
 
(h) Sale, disposal and removal of assets.-If, except in accordance with the Financing Plan or in the ordinary course of business, without the prior approval of the Lead Institution, any land, buildings, structures or plant and machinery of the Borrower are sold, disposed off, charged, encumbered or alienated or the said buildings, structures, machinery, plant and machinery are removed, pulled down or demolished, or a whole or substantial part of the Project suffers irreparable damage, is destroyed or abandoned.
 
(i) Refusal to disburse loans by other financial institutions.-If the other financial institution(s) or bank(s) with whom the Borrower has entered into agreements for financial assistance have refused to disburse its/their loan(s) or any part thereof or have recalled its/their loan(s) under their respective loan agreement(s) with the Borrower due to breach of the terms of such agreement(s) by the Borrower.
 
(j) Proceedings against Company.-The Company has voluntarily or involuntarily become the subject of proceedings under any bankruptcy or insolvency law unless such proceedings have been stayed within 30 days from commencement thereof or the Company is voluntarily or involuntarily dissolved.
 
(k) Inability to pay debts on maturity.-The Company is unable or has admitted in writing its inability to pay its debts as they mature.
 
(l) Liquidation or dissolution of the Company.-The Company has taken or appointed or allowed to be appointed a liquidator of all or any part of the undertaking of the Company.
 
(m) Appointment of receiver or liquidator.-A receiver or liquidator has been appointed or allowed to be appointed of all or any part of the undertaking of the Company provided such appointment has not been set aside or application has not been made for setting aside such appointment within 30 days from such date.
 
(n) Attachment or distraint on mortgaged properties.-If an attachment or distraint has been levied on the properties of the Company or any part thereof or certificate proceedings have been taken or commenced for recovery of any dues from the Company unless such proceedings have been stayed within 30 days.
 
(o) Extraordinary circumstances.-If, extraordinary circumstances have occurred which in the reasonable opinion of the Subscriber, make it improbable for the project to be carried out and for the Company to fulfill its obligations under this Agreement.
 
(p) Default in repayment of principal, payment of interest and perforn7ance of covenants and conditions of financial assistance.-Default has occurred in the repayment of any instalment of the principal sum or payment of interest in respect of financial assistance, if any, granted by the Subscriber or default has occurred in the performance of any covenant, condition or agreement on the part of the Company under any agreement(s) in respect of such existing financial assistance and such default has continued for a period of thirty days after the notice in writing thereof has been given to the Company by the Subscriber therein.
 
(q) Termination, Cancellation of Project Contracts and approvals.-Any Project Contract or any governmental approval necessary for the construction and operation of the Project is suspended, cancelled, revoked, repudiated or terminated in whole or a material part thereof or ceases to be in full force and effect in each case which has a material adverse effect on the implementation of the Project in the opinion of the Subscriber and which is not remedied, cured or substituted to the satisfaction of the Subscriber within 45 days.
 
(r) Compulsory Acquisition.-The Government of India, the appropriate State Government or any other statutory authority compulsorily acquires all or a material part of the Project assets and the Company has not taken steps to set aside the acquisition within 30 days thereof.
 
(s) Default under Project Contracts.-Failure of any counter parties to Project Contracts to meet any material obligations under the respective Project Contracts and such failure has a material adverse effect on the Company and is not remedied within 60 days after notice by the Subscriber or the cure periods provided under the respective Project Contracts.
 
(t) Equity Contribution.-Failure of the Promoters to make equity contribution in accordance with the Financing Plan and such failure has not been remedied within 7 days thereof after notice by the Subscriber.
 
(u) Insolvency of Promoters.-Bankruptcy, insolvency or liquidation of the Promoters prior to completion of construction of the Project unless either Santex Industries Limited, Santex Constructions Limited, Santex Investments or UVW Power Generation Limited have exercised their rights under the Shareholders Agreement to purchase the shares of the Promoter in bankruptcy, insolvency or liquidation within a period of 60 days.
 
(v) Non-disposal of shares.-Failure of Santex Industries Limited, Santex Constructions Limited and Santex Investments to collectively hold 33.9% of equity in the Company or failure of UVW Power Generation Limited to hold 30% equity in the Company, excluding for this purposes any shares
 
(a)	transferred within the Promoters group pursuant to the Shareholders Agreement upon the occurrence of an 	Event of Default; and
(b)	any shares subscribed by the Promoters to meet cost of overruns, if any.
 
(w) ADSCR.-The Borrower fails to maintain an Average Debt Service Coverage Ratio of 1.21 and the Lender declares that the Borrower is in default.
 
(x) TRA Default.-A TRA Default (as defined in the Trust and Retention Agreement) occurs.
 
SECTION 10.2: CONSEQUENCES OF DEFAULT
 
On the happening of any of the Events of Default, in addition to the rights specified in section 10.1 hereof, the Subscriber shall be entitled to appoint and remove from time to time one Whole-time Director on the Board of Directors of the Company (such Director is hereinafter referred to as 'the Whole-time Nominee Director'). Such Whole-time Nominee Director shall exercise such powers and duties as may be approved by the Subscriber 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 Company. Such Whole time Nominee Director 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 Subscriber. Such Whole-time Nominee Director shall have the right to receive notices of and attend all General Meetings and Board meetings or any committee(s) of the Company of which he is a Member.
 
Any expense that may be incurred by the Subscriber or such Whole-time Nominee Director(s) in connection with their appointment of directorship shall be paid or reimbursed by the Company to the Subscriber, or as the case may be, to such Whole-time Nominee Director.
 
SECTION 10.3: NOTICE TO THE LEAD INSTITUTION ON THE HAPPENING OF AN EVENT OF DEFAULT
 
If any Event of Default or any event which, after notice, or lapse of time, or both, would constitute an Event of Default has happened, the Company shall, forthwith, give notice thereof to the Subscriber in writing specifying the nature of such Event of Default, or of such event.
 
SECTION 10.4: EXPENSES OF PRESERVATION OF ASSETS OF COMPANY AND OF COLLECTIONS
 
All expenses incurred by the Subscriber after an Event of Default has occurred in connection with:
 
(i)	preservation of the Company's assets (whether then or thereafter existing); and
(ii)	collection of amounts due under this Agreement, shall be payable by the Company.
 
		SECTION 10.5: CANCELLATION BY NOTICE TO THE SUBSCRIBER
 
The Company may, by notice in writing to the Subscriber, cancel the financial assistance sanctioned by the Subscriber or any part thereof which the Company has not drawn prior to the giving of such notice.
 
SECTION 10.6: SUSPENSION
 
Further access by the Company to the use of the undrawn amount of NCDs may be suspended or terminated by the Subscriber in the following circumstances:
 
(a) Non-Compliance of Terms and Conditions.-Upon failure by the Company to carry out all or any of the terms of the Foreign Currency Loan Agreement or on the happening of any Event of Default referred to in Article X hereof.
 
(b) Extraordinary Situation.-If any extraordinary situation makes it improbable that the Company would be able to perform Its obligations under this Agreement.
 
(c) Assignment or Transfer of Properties to Receiver, Assignee, etc.-If the Company 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 Company or by any Court of Law whereby such property shall or may be distributed among the creditors of the Company or the Company suffers any charge to be created over its properties in any legal proceedings.
 
(d) Changes In the Company's Organisational Structure.-If any change in the Company's organisational structure has taken place which, in the opinion of the Lead Institution, would adversely affect the conduct of the Company's business or the financial position or the efficiency of management or personnel or the execution of the Project.
 
SECTION 10.7: SUSPENSION TO CONTINUE UNTILL THE DEFAULT REMEDIED
 
The right of the Company to make withdrawals from the undrawn amount of NCDs shall continue to be suspended until the Subscriber has notified the Company that the right to withdrawals has been restored and during such suspension the Company shall not be liable to make any payment towards commitment fees. SECTION 10.8: TERMINATION
 
Upon the occurrence and subsistence of any of the events described above or in Article X hereof has been continuing or if the right of the Company to make withdrawals from the undrawn amount of NCI)s shall have been suspended with respect to any amount of the NCI)s for a continuous period of thirty days or if the Company has not drawn the NCDs by the date referred to in this Agreement or such later date as may be agreed to by the Subscriber, then in such event, the Subscriber may, by notice in writing to the Company terminate the right of the Company to make withdrawals. Upon such notice, the undrawn amount of the NCDs shall stand cancelled. Notwithstanding any cancellation, suspension or termination pursuant to the aforesaid provisions, all the provisions of this Agreement shall continue to be in full force and effect as herein specifically provided.
 
ARTICLE XI: WAIVER
 
11. Waiver not to Impair the rights of the subscriber
 
No delay in exercising or omission to exercise any right, power or remedy accruing to the Subscriber upon any default under this 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 Subscriber in respect of any default or any acquiescence by them in any default, affect or impair any right, power or remedy of the Subscriber in respect of any other default.
 
ARTICLE XII: MISCELLANEOUS
12.1 Approvals
 
The Company shall approach the Subscriber for obtaining all consents and approvals required under this agreement.
 
12.2 Service of notice
 
Any notice or request to be given or made to the Subscriber or to the Company or to any other party shall be In writing. Such notice or request shall be deemed to have been given or made when it is delivered by hand or dispatched by mail or telegram to the party to which it is required to be given or made at such party's designated address.
 
12.3 Headings
 
The headings of various Articles and Sections in this Agreement are inserted for convenience of reference and are not deemed to affect the construction of this relative provisions.
 
12.4 Effective date of agreement
 
This Agreement shall become binding on the Company and the Subscriber on and from the date first above written. It shall be in force till the Subscriber continues to hold the NCDs acquired by them in terms of this Agreement.
 
12.5 Application of other statutes
 
Nothing contained in this Agreement shall prejudice or in any way affect the rights vested in the Subscriber under any statute.
 
12.6 Evidence of debt
 
(a) The Subscriber shall maintain, in accordance with their usual practice, accounts evidencing the amount from time to time subscribed by and owing to it under the Subscription Agreement.
 
(b) In any legal action or proceedings arising out of or in connection with the Subscription Agreement the entries made in the accounts maintained pursuant to sub-clause (a) above shall be prima facie evidence of the existence and amount of obligations of the Company as therein recorded.
 
12.7 Benefit of the agreement
 
This Agreement shall be binding upon and inure to the benefit of party thereto and its successors and assigns.
 
SCHEDULE 1: SUBSCRIBER, PARTICULARS OF SUBSCRIPTION
_________________________________________________________________________________________
Name of the Subscriber								Subscription Amount
_________________________________________________________________________________________
THE XYZ FINANCE COMPANY LTD.					Rs.54.00 Crores
............................
............................
Mumbai
________________________________________________________________________________________
SCHEDULE II: DEFINITIONS
 
38. "ABC FC Loan Agreement" shall mean the agreement entered into or to be entered into in respect of the Bank of Baroda foreign currency loan.
 
39. "Commitment Charge Lender(s)" shall mean the lender(s) providing fund based or non-fund based finance for Commitment Charges under the Fuel Supply Agreement.
 
40. "Counter Guarantors" shall mean DEF Bank, GHI Bank, and The JKL Bank Limited.
 
41. "Due Date" shall mean, in respect of:
 
I.	an instalment of principal, the date on which the instalment falls due as stipulated in Schedule IV hereto; and
II.	interest, the date on which interest falls due as stipulated in Schedule IV hereto.
 
42. "Effluent Discharge Agreement" shall mean the agreement entered into between the Borrower and the Government of Maharashtra, dated January 23, 2000.
 
43. "EPC Contracts" shall mean the agreements entered into by the Borrower in respect of engineering, procurement and construction of the power plant.
 
44. "Escrow Agreement" shall mean the agreement, dated 27th July, 2000 entered into between Maharashtra State Electricity Board (MSEB), the Borrower and MNO Bank
 
45. "FC Lenders" shall mean the XYZ Finance Company Limited, the Power Finance Corporation Limited, the STR Development Bank and the ABC Bank
 
46. "FC Loans" shall mean the amounts of various foreign currencies specified in the XYZ FC FC Loan Agreement, the STRDB FC Loan Agreement, the PFC Loan Agreement and the ABC FC Loan Agreement or their equivalents in other foreign currencies used for their purchase, agreed to be provided by the FC Lenders for the Project or as the context requires.
 
47. "Financing Plan" means the financing plan as described in Schedule III hereto.
 
48. "Fuel Supply Agreement" shall mean the agreement entered into between the Borrower and…………….. Petroleum Corporation Limited, dated January 19, 2000.
 
49. "GOM Guarantee" shall mean the Guarantee executed by the Government of Maharashtra in favour of the Borrower, dated August 7, 2000 with respect to the obligations of MSEB under the Power Purchase Agreement dated March 31, 2000.
 
50. "Guarantor" or "Guarantors" shall mean the XYZ Finance Company Ltd. the STR Development Bank and ABC Bank.
 
51. "STR 1313 FC Loan" shall mean the foreign currency loan availed or to be availed by the Borrower pursuant to the STR DB FC Loan Agreement.
 
52. "STR 1313 FC Loan Agreement" shall mean the agreement entered into or to be entered into in respect of the STR DB FC Loan.
 
53. FC Loan" shall mean the foreign currency loan availed or to be availed by the Borrower pursuant to this Agreement.
 
54. "ADB" shall mean Asian Development Bank which has agreed to a foreign currency loan to the extent of US Dollar ………………..Million to the Borrower.
 
55. "Lead Institution" shall mean the XYZ Finance Company Ltd. designated by the Lenders and the Commitment Charge Lenders to the Project as their attorney.
 
56. "Lenders" shall mean the Subscriber, the Rupee Lenders, the FC Lenders, Guarantors, the Counter Guarantors the Working Capital Lender(s) and the Commitment Charge Lenders.
 
57. "Loans" shall mean the loans and/or guarantees availed, NCDs issued by the Borrower from/to the Subscriber, FC Lenders, Rupee Lenders, Guarantors, Counter Guarantors, Working Capital Lender(s) and Commitment Charge Lenders.
 
58. "Operations and Maintenance Agreement" shall mean the agreement dated 6th October 1999 entered into between the Borrower and UVW Power Generation Company Limited.
 
59. "Overhaul Costs" means those costs projected to be incurred during scheduled major overhaul outages and excluding costs to be incurred for routine annual overhaul and more frequent maintenance outages.
 
60. "Overhaul Reserve Account" means the account so named and established and maintained by the Borrower to accumulate the amount projected to be required to fund Overhaul Costs the ensuing twelve months.
 
61. "PFC FC Loan" shall mean the foreign currency loan availed or to be availed by the Borrower pursuant to the PFC FC Loan Agreement.
 
62."PFC FC Loan Agreement" shall mean the agreement entered into or to be entered into in respect of the PFC FC Loan.
 
63. "Power Purchase Agreement" shall mean the agreement, dated 31st March, 1999 entered into between the Borrower and MSEB for purchase of electricity generated by the Project.
 
64. "Project" means the Project to be financed as described in Schedule II hereto.
 
65. "Project Contracts" shall mean each of the following agreements:
 
(a) Power Purchase Agreement;
(b) GOM Guarantee;
(c) EPC Contracts;
(d) Operation and Maintenance Agreement;
(e)Escrow Agreement;
(f)Fuel Supply Agreement;
(g)Water Supply Agreement;
(h)Effluent Discharge Agreement; and
(i)Such other contracts, deeds and documents that are entered Into and to be entered into by the Borrower in respect of the Project.
 
66. "Promoters" shall mean Santex Constructions Limited, Santex Industries Limited, Santex Investments Limited and UVW Power Generation Limited/WEB Energy Limited.
 
67. "Receivables" shall mean all monies due and to become due to the Borrower at any time including, without limitation, all proceeds of disbursements of the Lenders, subscriptions for shares in the share capital of the Borrower, working capital, cash credit and instruments of similar nature, monies due or to become due to the Borrower under the Project Contracts, and under all performance bonds, letters of credit and instruments of a similar nature issued in its favour in respect of the Project [except the refund of Commitment Charges by…………….. Petroleum Corporation Limited pursuant to the Fuel Supply Agreement].
 
68. "Rupee Loans" means the loans agreed to be provided by, or non-convertible debentures subscribed by, the Rupee Lenders.
 
69. "Rupee Lenders" shall mean the Subscriber, DEF Bank, AAB Ltd., BBB Ltd., Power Finance Corporation of India and JKL Bank Ltd.
 
70. "Security" shall mean the security created in favour of the Security Trustee/Lead Institution under Article VII of this Agreement.
 
71. "Security Documents" shall mean the agreements entered into or to be entered into between the Borrower and the Security Trustee for creation of Security.
 
72. "Security Trustee" shall mean the Industrial Finance Corporation of India Limited, the Lead Institution among the Financial Institutions and Banks.
 
73. "Trust and Retention Agreement" shall mean the agreement entered into or to be entered into between the Borrower, the Lenders and the Account Banks.
 
74. "Water Supply Agreement" shall mean the agreement entered between the Government of Maharashtra and the Borrower, dated January 23, 2000.
 
75. "Working Capital Lender(s)" shall mean the lender(s) providing working capital facilities to the Borrower.
 
SCHEDULE III: FINANCING PLAN
Project Cost
(Rs. in crore)
Item	Re Cost
(Rs. Cr.)	$ Cost
(US$ M)	Total
(Rs. Cr.	
Land and Site Development	 	 	 	
Payments under EPC Contract	 	 	 	
Inifial Spares	 	 	 	
Pre-Operative Costs	 	 	 	
Financing Expenses	 	 	 	
Interest During Construction	 	 	 	
Provision for Contingency	 	 	 	
Margin Money for Working Capital	 	 	 	
Total Cost	 	 	 	
 
Item	Re Cost
(Rs. Cr.)	$ Cost
(US M)	Total
(Rs. Cr.)	
Other requirement of funds
Commitment Charges to Fuel Suppliei	 	 	 	
Liquidated Damages Payable to APSEB	 	 	 	
Total Project Cost	 	 	 	
 
* Exchange rate for conversion of US$ has been taken at 1 US $ = Rs. 46 during appraisal in January/February, 2000.
Means of Financing	(Rs. in crores)	
Equity	 	 	
Santex Group	 	 	
SIL	 	 	
SCUSIL	 	 	
Santex Group (Sub-Total)	 	 	
UVW/WEB Energy Limited	 	 	
CDC	 	 	
Debt:	 	 	
Rupee Loan NCDs	 	 	
Fls/Banks	 	 	
Foreign Cuffency Loan	 	 	
Fls/Banks	 	 	
Export Credit Assistance from Korea	 	 	
Exim Bank (K-EXIM)	 	 	
Total	 	
 
SCHEDULE IV: REDEMPTION SCHEDULE
NCD AMOUNT OF Rs. 54.00 Crores
1 	Due Date	Opening Balance	Instalment 	Closing Balance	
1. 	December 15, 2003	 	 	 	
2. 	March 15, 2004	 	 	 	
3. 	June 15, 2004	 	 	 	
4. 	September 15, 2004	 	 	 	
5. 	December 15, 2004	 	 	 	
6. 	March 15, 2005	 	 	 	
7. 	June 15,2005	 	 	 	
8. 	September 15, 2006	 	 	 	
9. 	December 15, 2006	 	 	 	
10. 	March 15, 2007	 	 	 	
11. 	June 15,2007	 	 	 	
12. 	September 15, 2007	 	 	 	
13. 	December 15, 2007	 	 	 	
14. 	March 15, 2008	 	 	 	
 
 	Due Date	Opening Balance	Instalment 	Closing Balance	
15. 	June 15, 2008	 	 	 	
16. 	September 15, 2008	 	 	 	
17. 	December 15, 2008	 	 	 	
18. 	March 15, 2009	 	 	 	
19. 	June 15, 2010	 	 	 	
20. 	September 15, 2010	 	 	 	
21. 	December 15, 2010	 	 	 	
22. 	March 15, 2011	 	 	 	
23. 	June 15, 2011	 	 	 	
24. 	September 15, 2011	 	 	 	
25. 	December 15, 2011	 	 	 	
26. 	March 15, 2012	 	 	 	
27. 	June 15, 2012	 	 	 	
28. 	September 15, 2012	 	 	 	
29. 	December 15, 2012	 	 	 	
30. 	March 15, 2013	 	 	 	
 	Total	 	 	 	
 
IN WITNESS WHEREOF the Company has caused its Common Seal to be affixed hereto and to a duplicate hereof on the day, month and year first hereinabove written and the Subscriber have caused the same and the said duplicate to be executed by the hand of Mr. A M Chief General Manager of the Subscriber as hereinafter appearing.
 
THE COMMON SEAL OF ABC Power Company Ltd. has pursuant to the Resolution of its Board of Directors passed in that behalf on the day of……………..2000 hereunto been affixed in the presence of Mr. A and B Director and Mr. C Secretary, of the Borrower who have countersigned the same in token thereof.