1
XXXXXX.XXX INDIA LIMITED
4,600,000 AMERICAN DEPOSITARY SHARES
REPRESENTING
2,300,000 EQUITY SHARES
(PAR VALUE RS. 5 PER SHARE)
UNDERWRITING AGREEMENT
June 13, 2000
Xxxxxxx, Xxxxx & Co.,
Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Inc.
As representatives of the several Underwriters
named in Schedule I hereto
(the "Representatives"),
c/o Goldman, Xxxxx & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
Xxxxxx.xxx India Limited, a limited liability company formed under the
laws of the Republic of India (the "Company"), proposes, subject to the terms
and conditions stated herein, to issue and sell to the Underwriters named in
Schedule I hereto (the "Underwriters") an aggregate of 4,600,000 American
Depositary Shares representing an aggregate of 2,300,000 equity shares (par
value Rs. 5 per share) (the "Equity Shares"), of the Company (the "Firm ADSs")
and, at the election of the Underwriters, up to 690,000 additional American
Depositary Shares (the "Optional ADSs") representing an aggregate of 345,000
Equity Shares. The Firm ADSs and the Optional ADSs that the Underwriters elect
to purchase pursuant to Section 2 hereof are herein collectively called the
"ADSs". The Equity Shares represented by the Firm ADSs are hereinafter called
the "Firm Shares" and the Equity Shares represented by the Optional ADSs are
hereinafter called the "Optional Shares" and the Firm Shares and the Optional
Shares are herein collectively called the "Shares".
The ADSs are to be issued pursuant to a deposit agreement (the "Deposit
Agreement"), dated as of June 13, 2000, among the Company, Citibank, N.A.,
2
as depositary (the "Depositary"), and holders from time to time of the American
Depositary Receipts (the "ADRs") issued by the Depositary and evidencing the
ADSs. Each ADS will initially represent the right to receive one Equity Share
deposited pursuant to the Deposit Agreement.
It is understood by the parties that the Underwriters are offering ADSs
in the United States and internationally outside of India.
1. The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(a) A registration statement on Form F-1 (File No. 333-37376)
(the "Initial Registration Statement") in respect of the Shares has been
filed with the Securities and Exchange Commission (the "Commission");
the Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered to you, and, excluding
exhibits thereto, to you for each of the other Underwriters, have been
declared effective by the Commission in such form, other than a
registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b)
under the Securities Act of 1933, as amended (the "Act"), which became
effective upon filing; no other document with respect to the Initial
Registration Statement has heretofore been filed with the Commission;
and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or to the
Rule 462(b) Registration Statement, if any, has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule
424(a) of the rules and regulations of the Commission under the Act is
hereinafter called a "Preliminary Prospectus"; the various parts of the
Initial Registration Statement and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof and deemed by virtue of Rule 430A under the Act to
be part of the Initial Registration Statement at the time it was
declared effective, each as amended at the time such part of the Initial
Registration Statement became effective or such part of the Rule 462(b)
Registration Statement, if any, became or hereafter becomes effective,
are hereinafter collectively called the "Registration Statement"; and
such final prospectus, in the form first filed pursuant to Rule 424(b)
under the Act, is hereinafter called the "Prospectus");
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
2
3
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations of
the Commission thereunder, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through Xxxxxxx, Sachs & Co. expressly for use therein;
(c) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Registration Statement and any amendment thereto and as of the
applicable filing date as to the Prospectus and any amendment or
supplement thereto, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein;
(d) A registration statement on Form F-6 (File No. 333-12002) in
respect of the ADSs has been filed with the Commission; such
registration statement in the form heretofore delivered to you and,
excluding exhibits, to you for each of the other Underwriters, has been
declared effective by the Commission in such form; no other document
with respect to such registration statement has heretofore been filed
with the Commission; no stop order suspending the effectiveness of such
registration statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (the various
parts of such registration statement, including all exhibits thereto,
each as amended at the time such part of the registration statement
became effective, being hereinafter called the "ADS Registration
Statement"); and the ADS Registration Statement when it became effective
conformed, and any further amendments thereto will conform, in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did not, as of the
applicable effective date, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
(e) The Company has no direct or indirect subsidiaries;
3
4
(f) The Company has not sustained since the date of the latest
audited financial statements included in the Prospectus any material
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus; and, since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any change in the
capital stock or long-term debt of the Company, or any material adverse
change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, shareholders' equity or results of operations of the Company,
otherwise than as set forth or contemplated in the Prospectus;
(g) The Company has good and marketable title to all real
property and good and marketable title to all personal property owned by
it, in each case free and clear of all liens, encumbrances, third party
rights or interests, and defects or any other restriction except such as
are described in the Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company; and any real
property and buildings or personal property held under lease by the
Company are held by it under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the
use made and proposed to be made of such real property and buildings or
personal property, by the Company and no material default (or event
which with notice or lapse of time, or both, would constitute such a
default) by the Company has occurred and is continuing under any of such
leases;
(h) Since the date of the latest audited financial statements
included in the Prospectus, the Company has not (A) entered into or
assumed any contract, (B) incurred or agreed to incur any liability
(including any contingent liability) or other obligation, (C) acquired
or disposed of or agreed to acquire or dispose of any business or any
other asset or (D) assumed or acquired or agreed to assume or acquire
any liabilities (including contingent liabilities) that would be
material to the Company, and that are not otherwise described in the
Prospectus;
(i) The Company has been duly formed and is validly existing as a
company limited by shares in good standing under the laws of the
Republic of India, with legal rights, power and authority (corporate and
other) to own, use, lease and operate its properties and conduct its
business and as described in the Prospectus, and has been duly qualified
as a foreign corporation for the transaction of business and is in good
standing under the
4
5
laws of each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification, except where
the failure to be so qualified or be in good standing as a foreign
corporation would not, individually or in the aggregate, have a material
adverse effect on current or future financial position, stockholders'
equity or results of operations of the Company, (a "Material Adverse
Effect"), the Memorandum of Association and Articles of Association of
the Company comply with the requirements of applicable laws of the
Republic of India and are in full force and effect;
(j) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid
and non-assessable and conform to the description of the Equity Shares
contained in the Prospectus; all of the ADSs have been duly approved for
quotation on the Nasdaq National Market System ("NASDAQ"), subject to
issuance; neither the holders of outstanding shares of capital stock of
the Company nor any other persons are entitled to preemptive or other
rights to acquire the Shares or the ADSs; there are no outstanding
securities convertible into or exchangeable for, or warrants, rights or
options to purchase from the Company, or obligations of the Company to
issue, the Equity Shares or any other class of capital stock of the
Company except as described in the Prospectus; the Shares may be freely
deposited by the Company with the Depositary against issuance of ADRs
evidencing ADSs; the ADSs and the Shares are freely transferable by the
Company to or for the account of the several Underwriters and (to the
extent described in the Prospectus) the initial purchasers thereof; and,
except as described in the Prospectus, there are no material
restrictions on subsequent transfers of the Shares or the ADSs under the
laws of the Republic of India and of the United States;
(k) The unissued Shares to be issued and sold by the Company to
the Underwriters hereunder have been duly and validly authorized and,
when issued and delivered against payment for the ADSs as provided
herein, will be duly and validly issued and fully paid and
non-assessable, will be free and clear of all liens, encumbrances,
equities or claims and will conform to the description of the Equity
Shares contained in the Prospectus;
(l) The Deposit Agreement has been duly authorized, executed and
delivered by the Company, and constitutes a valid and legally binding
agreement of the Company, enforceable in accordance with its terms,
subject, as to enforceability, to bankruptcy, insolvency, reorganization
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; upon issuance by the
Depositary of ADRs
5
6
evidencing ADSs against the deposit of Shares in respect thereof in
accordance with the provisions of the Deposit Agreement, such ADRs will
be duly and validly issued and the persons in whose names the ADRs are
registered will be entitled to the rights specified therein and in the
Deposit Agreement; and the Deposit Agreement and the ADRs conform in all
material respects to the descriptions thereof contained in the
Prospectus;
(m) All consents, approvals, authorizations, orders,
registrations, clearances and qualifications of or with any court or
governmental agency or body or any stock exchange authorities
(hereinafter referred to as a "Governmental Agency") having jurisdiction
over the Company or any of its properties (hereinafter referred to as
"Governmental Authorizations") required for the deposit of Shares and
the issuance of ADSs in respect thereof, and for the authorization,
execution and delivery by the Company of this Agreement and the Deposit
Agreement have been obtained or made and are in full force and effect;
(n) This Agreement has been duly authorized, executed and
delivered by the Company;
(o) All dividends and other distributions declared and payable on
the shares of capital stock of the Company may, under the current laws
and regulations of the Republic of India, be paid in Indian rupees that
may be converted into foreign currency that may be freely transferred
out of the Republic of India, and, except as disclosed in the
Prospectus, all such dividends and other distributions will not be
subject to withholding or other taxes under the laws and regulations of
the Republic of India and are otherwise free and clear of any other tax,
withholding or deduction in the Republic of India and without the
necessity of obtaining any Governmental Authorization in the Republic of
India;
(p) The issue and sale of the ADSs to be sold by the Company
hereunder, the deposit of the Shares being deposited with the Depositary
against issuance of the ADRs evidencing the ADSs and the compliance by
the Company with all of the provisions of this Agreement and the Deposit
Agreement and the consummation of the transactions herein contemplated
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which the Company is a party or by which the Company is
bound or to which any of the property or assets of the Company is
subject, nor will such action result in any violation of the provisions
of the Memorandum of Association, Articles of Association of the Company
or business licenses of the Company or any law or statute or any order,
rule or regulation of any Governmental Agency having jurisdiction over
the Company or any of its properties; and no consent, approval,
authorization, order, registration or qualification of or with any such
Governmental
6
7
Agency is required for the issue and sale of the Shares or the ADSs, for
the deposit of the Shares being deposited with the depositary against
issuance of ADRs evidencing the ADSs to be delivered or the consummation
by the Company of the transactions contemplated by this Agreement,
except (A) the registration under the Act of the Shares and the ADSs,
(B) such Governmental Authorizations as have been duly obtained and are
in full force and effect and copies of which have been furnished to you,
(C) the approval by the National Association of Securities Dealers, Inc.
("NASD") of the terms of the sale of the Shares and the ADSs and (D)
such Governmental Authorizations as may be required under state
securities or Blue Sky laws of any state of the United States or any
laws of jurisdictions outside the Republic of India and the United
States in connection with the purchase and distribution of the ADSs by
or for the account of the Underwriters;
(q) Each of this Agreement, the Deposit Agreement and the ADRs
evidencing the ADSs is in proper form to be legal and valid under the
laws of the Republic of India and to ensure the legality, validity,
enforceability or admissibility into evidence in the Republic of India
of this Agreement, it is not necessary that this Agreement, the Deposit
Agreement, the ADRs or any other documents be approved by any court or
other authority in the Republic of India or that any Indian stamp or
similar tax be paid on or in respect of this Agreement, the Deposit
Agreement, the ADRs or any other documents to be furnished hereunder;
(r) The Company is not in violation of its Memorandum of
Association or Articles of Association or in default in the performance
or observance of any material obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a party
or by which it or any of its properties may be bound;
(s) Except as disclosed in the Prospectus, no stamp or other
issuance or transfer taxes or duties and no capital gains, income,
withholding or other taxes are payable by or on behalf of the Company to
the Republic of India or any political subdivision or taxing authority
thereof or therein in connection with (A) the creation, allotment and
issuance of the Shares, (b) the deposit with the Depositary of Shares by
the Company against the issuance of ADRs evidencing ADSs, (C) the sale
and delivery by the Company of the ADSs to or for the respective
accounts of the Underwriters or (D) the execution and delivery of this
Agreement;
7
8
(t) No stamp or other issuance or transfer taxes or duties and no
capital gains, income, withholding or other taxes are payable by or on
behalf of the Underwriters to the Republic of India or any political
subdivision or taxing authority thereof or therein in connection with
(A) the creation, allotment and issuance of the Shares, (B) the deposit
with the Depositary of Equity Shares by the Company against the issuance
of ADRs evidencing ADSs, (C) the sale and delivery by the Company of the
ADSs to or for the respective accounts of the Underwriters, (D) the
execution and delivery of this Agreement or (E) the sale and delivery
outside the Republic of India by the Underwriters of the ADSs to the
initial purchasers thereof.
(u) The Company has not taken, directly or indirectly, any action
which was designed to or which has constituted or which might reasonably
be expected to cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of
the ADSs;
(v) The statements set forth in the Prospectus under the captions
"Description of Equity Shares" and "Description of American Depositary
Receipts", insofar as they purport to constitute a summary of the terms
of the Equity Shares and the ADSs, "Shares Eligible for Future Sale" and
"Underwriting", insofar as they purport to describe the provisions of
the laws and documents referred to therein, are accurate, complete and
fair;
(w) Other than as set forth in the Prospectus, there are no legal
or governmental proceedings pending to which the Company is a party or
of which any property of the Company is the subject which, if determined
adversely to the Company, would individually or in the aggregate have a
Material Adverse Effect; and, to the Company's knowledge, no such
proceedings are threatened or contemplated by any Governmental Agency or
threatened by others;
(x) The Company is not and, after giving effect to the offering
and sale of the Shares, will not be an "investment company", as such
term is defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(y) Other than as set forth in the Prospectus and other than the
Company's trademark rights for "Rediff on the Net" in the United States,
the Company owns or has valid licenses in full force and effect or
otherwise have the legal right to use, or can acquire on reasonable
terms, all patents, patent rights, inventions, trademarks, service
marks, trade names, domain names, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), information,
proprietary rights and processes ("Intellectual Property")
8
9
currently employed by it in connection with the business currently
operated by it and without any conflict with or infringement of the
interests of others, and has taken all reasonable steps necessary to
secure interests in such Intellectual Property from its contractors;
except as set forth in the Prospectus, the Company is not aware of
outstanding options, licenses or agreements of any kind relating to the
Intellectual Property of the Company which are required to be set forth
in the Prospectus, and, except as set forth in the Prospectus, the
Company is not a party to or bound by any options, licenses or
agreements with respect to the Intellectual Property of any other person
or entity which are required to be set forth in the Prospectus; none of
the technology employed by the Company has been obtained or is being
used by the Company in violation of any contractual fiduciary obligation
binding on the Company or, to the knowledge of the Company, any of its
directors, officers or employees or otherwise in violation of the rights
of any persons; except as disclosed in the Prospectus, the Company has
not received any written or oral communications alleging that the
Company has violated, infringed or conflicted with, or, by conducting
its business would violate, infringe or conflict with any of the
Intellectual Property of any other person or entity other than any such
violations, infringements or conflicts which, individually or in the
aggregate, have not had and are not reasonably likely to result in a
Material Adverse Effect; neither the execution nor delivery of this
Agreement nor the operation of the Company's business by the employees
of the Company will result in any breach or violation of the terms,
conditions or provisions of, or constitute a default under, any material
contract, covenant or instrument known to the Company under which any of
such employees is now obligated; and the Company has taken and will
maintain reasonable measures to prevent the unauthorized dissemination
or publication of its confidential information and, to the extent
contractually required to do so, the confidential information of third
parties in their possession;
(z) The Registration Statement, the Prospectus and the ADS
Registration Statement and the filing of the Registration Statement, the
Prospectus and the ADS Registration Statement with the Commission have
been duly authorized by and on behalf of the Company, and the
Registration Statement and the ADS Registration Statement have been duly
executed pursuant to such authorization by and on behalf of the Company;
(aa) Except as disclosed in the Prospectus, the Company has all
necessary licenses, consents, authorizations, approvals, orders,
certificates and permits of and from, and has made all necessary
declarations and filings with, all Governmental Agencies (including,
without limitation, the Foreign Investment Promotion Board of the
Government of India, to own, lease, license and use its properties and
assets and to conduct its business in the
9
10
manner described in the Prospectus and such licenses, consents,
authorizations, approvals, orders, certificates or permits contain no
burdensome restrictions or conditions not described in the Registration
Statement or the Prospectus. Except as described in the Prospectus, the
Company has no reason to believe that any regulatory body is considering
modifying, suspending or revoking any such licenses, consents,
authorizations, approvals, orders, certificates or permits and the
Company is in compliance with the provisions of all such licenses,
consents, authorizations, approvals, orders, certificates or permits in
all material respects;
(bb) There are no contracts, agreements or understandings between
the Company and any person granting such person the right to require the
Company to file a registration statement under the Act with respect to
any securities of the Company or to include any securities of the
Company with the ADSs registered pursuant to the Registration Statement,
except as described in the Prospectus or as have been validly waived in
writing in connection with the offering of the ADSs contemplated hereby;
(cc) The Company is not a Passive Foreign Investment Company
("PFIC") within the meaning of Section 1296 of the United States
Internal Revenue Code of 1986, as amended, and is not likely to become a
PFIC; the Company believes that the Shares and the ADSs should not be
treated as stock of a PFIC for Unites States federal income tax
purposes;
(dd) The Company does not do business with the government of Cuba
or with any person or affiliate located in Cuba within the meaning of
Section 517.075, Florida Statutes;
(ee) All returns, reports or filings which ought to have been
made by or in respect of the Company for taxation purposes have been
made and all such returns are up to date, correct and on a proper basis,
and are not the subject of any dispute with the relevant revenue or
other appropriate authorities and the provisions included in the audited
accounts as set out in the Prospectus included appropriate provision
required under Indian generally accepted accounting principles ("Indian
GAAP") for all taxation in respect of accounting periods ended on or
before the accounting reference date to which such audited accounts
relate for which the Company was then or might reasonably be expected
thereafter to become or have become liable; the Company has not received
notice of any tax deficiency that has been asserted against the Company
which, if so assessed, would have a material adverse effect on the
business, results of operations or financial condition of the Company;
10
11
(ff) Except as disclosed in the Prospectus, no indebtedness
(actual or contingent) and no contract or arrangement (other than
employment contracts or arrangements) is outstanding between the Company
and any director of the Company or any person connected with such
director (including his spouse, infant children, any company or
undertaking in which he holds a controlling interest);
(gg) No material labor dispute, work stoppage, slow down or other
conflict with the employees of the Company exists or to the best
knowledge of the Company after reasonable inquiry is threatened;
(hh) No holder of any of the Shares or the ADSs after the
completion of the offering contemplated hereby is or will be subject to
any liability in respect of any liability of the Company by virtue only
of its holding of any such Shares or ADSs. Except as required to be
disclosed in the Prospectus, there are no material limitations on the
rights of holders of the Shares or the ADSs to hold, vote or transfer
their securities;
(ii) The historical combined financial statements (and the notes
thereto) of the Company included in the Prospectus were prepared in
accordance with generally accepted accounting principles in the United
States ("U.S. GAAP") consistently applied throughout the period
involved, and fairly present the combined financial condition and
results of operations of the Company at the dates and for the periods
presented; and notes thereto included in the Prospectus were prepared in
accordance with the applicable requirements of the Act, the Company's
assumptions provide a reasonable basis for presenting the significant
effects directly attributable to the events described therein, the
related pro forma adjustments give appropriate effect to those
assumptions. No other financial statements, schedules or pro forma
financial information of the Company are required by the Act or the
rules and regulations thereunder to be included in the Prospectus except
such as have been omitted with the approval of the accounting staff of
the Division of Corporation Finance of the Commission;
(jj) Deloitte Xxxxxxx & Sells, who have audited certain financial
statements of the Company, are independent public accountants as
required by the Act and the rules and regulations of the Commission
promulgated thereunder; the Company maintains a system of internal
accounting controls sufficient to provide reasonable assurance that (A)
transactions are executed in accordance with management's general or
specific authorizations; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with U.S. GAAP;
(C) access to assets is permitted only in accordance with management's
general or specific authorization; (D) the recorded accountability for
assets is compared with existing assets at
11
12
reasonable intervals and appropriate actions taken with respect to any
differences; and (E) the Company has made and kept books, records and
accounts which, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of assets of such entity and provide a
sufficient basis for the preparation of combined financial statements in
accordance with U.S. GAAP; and
(kk) The Company has reviewed its operations and any third
parties with which the Company has a material relationship to evaluate
the extent to which the business or operations of the Company has been
or will be affected by the Year 2000 Problem. As a result of such
review, the Company has no reason to believe, and does not believe, that
the Year 2000 Problem has had or will have a Material Adverse Effect or
has resulted or will result in any material loss of interference with
the Company's business or operations. The "Year 2000 Problem" as used
herein means any significant risk that computer hardware or software
used in the receipt, transmission, processing, manipulation, storage,
retrieval, retransmission or other utilization of data or in the
operation of mechanical or electrical systems of any kind is not
functioning or will not function, in the case of dates or time periods
occurring after December 31, 1999, at least as effectively as in the
case of dates or time periods occurring prior to January 1, 2000.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company at a purchase price per
ADSs of US$__________ (the "ADS Purchase Price"), the number of Firm ADSs set
forth opposite the name of such Underwriter in Schedule I hereto and (b) in the
event and to the extent that the Underwriters shall exercise the election to
purchase Optional ADSs as provided below, the Company agrees to sell to each of
the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company at the purchase price per ADS set forth in
clause (a) of this Section 2, that portion of the number of Optional ADSs as to
which such election shall have been exercised (to be adjusted by you so as to
eliminate fractional shares) determined by multiplying such number of Optional
ADSs by a fraction the numerator of which is the maximum number of Optional ADSs
which such Underwriter is entitled to purchase as set forth opposite the name of
such Underwriter in Schedule I hereto and the denominator of which is the
maximum number of Optional ADSs that all of the Underwriters are entitled to
purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 690,000 Optional ADSs, at the purchase price per ADS set
forth in the paragraph above, for the sole purpose of covering over allotments
in the sale of the Firm ADSs and other transactions. Any such election to
purchase Optional ADSs shall be made in proportion to the maximum number of
Optional
12
13
ADSs to be sold by the Company as set forth in Schedule I hereto. Any such
election to purchase Optional ADSs may be exercised from time to time only by
written notice from you to the Company, given within a period of 30 calendar
days after the date of this Agreement and setting forth the aggregate number of
Optional ADSs to be purchased and the date on which such Optional ADSs are to be
delivered, as determined by you but in no event earlier than the First Time of
Delivery (as defined in Section 4 hereof) or, unless you and the Company
otherwise agree in writing, earlier than two or later than ten business days
after the date of such notice.
3. Upon the authorization by you of the release of the Firm ADSs, the
several Underwriters propose to offer the Firm ADSs for sale upon the terms and
conditions set forth in the Prospectus.
4. (a) The ADSs to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in
such names as Xxxxxxx, Sachs & Co. may request upon at least forty-eight
hours' notice to the Company prior to a Time of Delivery (as defined
below) (the "Notification Time"), shall be delivered by or on behalf of
the Company to Xxxxxxx, Xxxxx & Co., through the facilities of The
Depository Trust Company ("DTC"), for the account of such Underwriter,
against payment by or on behalf of such Underwriter of the purchase
price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company to Xxxxxxx, Sachs & Co. at least
forty-eight hours in advance. The Company will cause the certificates
representing the ADSs to be made available for checking and packaging at
least twenty-four hours prior to the Time of Delivery (as defined below)
with respect thereto at the office of DTC or its designated custodian
(the "Designated Office"). The Shares underlying the ADSs to be
delivered hereunder shall be delivered to Citibank, as custodian (the
"Custodian") for the Depositary against delivery of a copy of a letter
confirming that the Xxxxxxx, Xxxxx & Co. have given irrevocable
instructions to its bank in New York to make the wire transfer of
payment for the ADSs at the Time of Delivery specified in this
subsection (a) of Section 4. It is understood and agreed by the parties
hereto that no delivery or transfer of ADSs to be purchased and sold
hereunder at a Time of Delivery shall be effective until and unless
payment therefor has been made pursuant hereto and each of DTC and the
Company shall have furnished or caused to be furnished to Xxxxxxx, Sachs
& Co., on behalf of the Underwriters at such Time of Delivery
certificates and other evidence reasonably satisfactory to Xxxxxxx,
Sachs & Co. of the execution in favor of the Underwriters of the
book-entry transfer of ADSs, whether by delivery in India or to the
custodian for DTC.
13
14
The time and date of such delivery and payment shall be,
with respect to the Firm ADSs, 9:30 a.m., New York City time, on June
19, 2000 or such other time and date as Xxxxxxx, Xxxxx & Co. and the
Company may agree upon in writing, and, with respect to the Optional
ADSs, 9:30 a.m., New York City time, on the date specified by Xxxxxxx,
Sachs & Co. in the written notice given by Xxxxxxx, Xxxxx & Co. of the
Underwriters' election to purchase such Optional ADSs, or such other
time and date as Xxxxxxx, Sachs & Co. and the Company may agree upon in
writing. Such time and date for delivery of the Firm ADSs is herein
called the "First Time of Delivery", such time and date for delivery of
the Optional ADSs, if not the First Time of Delivery, is herein called
the "Second Time of Delivery", and each such time and date for delivery
is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or
on behalf of the parties hereto pursuant to Section 7 hereof, including
the cross-receipt for the ADSs and any additional documents requested by
the Underwriters pursuant to Section 7(l) hereof, will be delivered via
facsimile to the offices of Xxxxxxxx & Xxxxxxxx, Nine Xxxxx'x Xxxx, 00xx
Xxxxx, Xxxxxxx, Xxxx Xxxx (the "Closing Location"), and the Shares will
be delivered as specified in Section (a) above, all at such Time of
Delivery. A pre-closing conference call will be held at the Closing
Location at 6:00 a.m., New York City time, on the New York Business Day
next preceding such Time of Delivery, at which meeting the final drafts
of the documents to be delivered pursuant to the preceding sentence will
be available for review by the parties hereto. "New York Business Day"
shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to
file such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day
following the execution and delivery of this Agreement, or, if
applicable, such earlier time as may be required by Rule 430A(a)(3)
under the Act; to make no further amendment or any supplement to the
Registration Statement or Prospectus which shall be disapproved by you
promptly after reasonable notice thereof; to advise you, promptly after
it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
and to furnish you copies thereof; to file promptly all reports required
to be filed by the Company with the Commission pursuant to Section
13(a), 13(c) or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), subsequent to the date of the Xxxxxxxxxx
00
00
and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the ADSs; to advise you,
promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending
the use of any Preliminary Prospectus or Prospectus, of the suspension
of the qualification of the ADSs for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any
such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for
additional information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or Prospectus or suspending any such
qualification, promptly to use its best efforts to obtain the withdrawal
of such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares and ADSs for offering and sale
under the securities laws of such jurisdictions as you may request and
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution of the ADSs, provided that in connection
therewith the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time to
time, to furnish the Underwriters with copies of the Prospectus in New
York City in such quantities as you may reasonably request, and, if the
delivery of a prospectus is required at any time prior to the expiration
of nine months after the time of issue of the Prospectus in connection
with the offering or sale of the ADSs and if at such time any events
shall have occurred as a result of which the Prospectus as then amended
or supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary during such period to amend or
supplement the Prospectus in order to comply with the Act, to notify you
and upon your request to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as you may
from time to time reasonably request of an amended Prospectus or a
supplement to the Prospectus which will correct such statement or
omission or effect such compliance, and in case any Underwriter is
required to deliver a prospectus in connection with sales of any of the
ADSs at any time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such Underwriter, to
prepare and deliver to such Underwriter as many copies as you may
15
16
request of an amended or supplemented Prospectus complying with Section
10(a)(3) of the Act;
(d) To use its best efforts to file in a timely manner all
reports or other documents required to be filed by it pursuant to
Section 13 or 15(d) of the Exchange Act. In addition, the Company will
submit to the Commission quarterly reports, which will include unaudited
quarterly condensed consolidated financial information, on Form 6-K for
the first three quarters of each fiscal year and file its annual report
on Form 20-F within the time period prescribed under section 13 of the
Exchange Act for the filing by domestic issuers of quarterly reports on
Form 10-Q and annual reports on Form 10-K, respectively;
(e) To make generally available to its security holders as soon
as practicable, but in any event not later than eighteen months after
the effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company (which need
not be audited) complying with Section 11(a) of the Act and the rules
and regulations of the Commission thereunder (including, at the option
of the Company, Rule 158);
(f) During the period beginning from the date hereof and
continuing to and including the date 180 days after the date of the
Prospectus (the "Lock-Up Period"), not to offer, sell, contract to sell
or otherwise dispose of, except as provided hereunder, any securities of
the Company that are substantially similar to the Equity Shares or ADSs,
including but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Equity Shares
or ADSs or any such substantially similar securities (other than
pursuant to employee stock option plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities
outstanding as of, the date of this Agreement), without prior written
consent; the foregoing restriction is expressly intended to preclude the
Company from engaging in any hedging or other transaction which is
designed to or reasonably expected to lead to or result in a sale or
disposition of the ADSs or Equity Shares even if such ADSs or Equity
Shares would be disposed of by a person other than the Company; such
prohibited hedging or other transactions would include without
limitation any short sale or any purchase, sale or grant of any right
(including without limitation any put or call option) with respect to
any of the ADSs or Equity Shares or with respect to any security or
derivative instrument that includes, relates to, or derives any
significant part of its value from such ADSs or Equity Shares (other
than pursuant to employee stock option plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities
outstanding as of, the date hereof);
16
17
(g) To furnish to its shareholders as soon as practicable after
the end of each fiscal year an annual report (in English) (including a
balance sheet and statements of income, shareholders' equity and cash
flows of the Company certified by independent public accountants and
prepared in conformity with generally accepted accounting principles in
the United States ("U.S. GAAP")), and, as soon as practicable after the
end of each of the first three quarters of each fiscal year (beginning
with the fiscal quarter ending after the effective date of the
Registration Statement), to make available to its shareholders
consolidated summary financial information of the Company for such
quarter in reasonable detail and prepared in accordance with U.S. GAAP;
(h) During the time any ADSs remain outstanding, to furnish to
the Depositary, and to use its best efforts to cause the Depositary to
furnish holders of the ADRs evidencing such ADSs, as soon as practicable
after the end of each fiscal year and the end of the first interim
period of each fiscal year, as applicable, the financial statements
referred to in the preceding paragraph (g);
(i) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to shareholders, and to
deliver to you (A) as soon as they are available, copies of any reports
and financial statements furnished to or filed with the Commission or
any securities exchange on which any class of securities of the Company
is listed; and (B) such additional information concerning the business
and financial condition of the Company as you may from time to time
reasonably request (such financial statements to be on a consolidated
basis to the extent the accounts of the Company are consolidated in
reports furnished to its shareholders generally or to the Commission);
(j) To use the net proceeds received by it from the sale of the
ADSs pursuant to this Agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
(k) Prior to each Time of Delivery, to deposit Shares with the
Depositary in accordance with the provisions of the Deposit Agreement
and otherwise to comply with the Deposit Agreement so that ADRs
evidencing ADSs will be executed (and, if applicable, countersigned) and
issued by the Depositary against receipt of such Equity Shares and
delivered to the purchasers at such Time of Delivery;
(l) Not to take, directly or indirectly, any action which is
designed to or which constitutes or which might reasonably be expected
to cause or
17
18
result in stabilization or manipulation of the price of any security of
the Company or facilitate the sale or resale of the Equity Shares and
the ADSs;
(m) To use its best efforts to obtain approval for quotation the
ADSs on the National Association of Securities Dealers Automated
Quotations National Market System ("NASDAQ");
(n) If the Company elects to rely upon Rule 462(b), the Company
shall file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 p.m., Washington, D.C. time, on the
date of this Agreement, and the Company shall at the time of filing
either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment
of such fee pursuant to Rule 111(b) under the Act;
(o) To file with the Commission such information on Form 20-F as
may be required by Rule 463 under the Act;
(p) To the extent so specified by Xxxxxxx, Xxxxx & Co., to cause
the ADSs representing Firm Shares and Optional Shares, respectively, and
the ADRs evidencing such ADSs, to be issued and delivered at the Time of
Delivery of the Firm Shares and the Time of Delivery of the Optional
Shares, respectively, and at each such Time of Delivery, to cause the
Depositary to furnish or cause to be furbished to you as of such Time of
Delivery certificates satisfactory to you evidencing the deposit with it
or its custodian of the Shares being so deposited against issuance of
the ADRs evidencing such ADSs to be delivered at such Time of Delivery,
and the execution, countersignature (if applicable), issuance and
delivery of the ADRs evidencing such ADSs pursuant to the Deposit
Agreement;
(q) Between the date hereof and the Time of Delivery of the
Optional Shares, or, if the Underwriters do not elect to purchase any
Optional Shares pursuant to Section 2 hereunder, the Time of Delivery of
the Firm Shares (both dates inclusive), not to, without prior
consultation with Xxxxxxx, Sachs & Co., issue any announcement in the
Republic of India or elsewhere which could be material in the context of
the distribution of the ADSs and the Shares;
(r) During the Lock-up Period, not to make any public
announcement that would reasonably be expected require the Company to
update the Prospectus after the effectiveness of the Registration
Statement except after consultation with you;
18
19
(s) For so long as the Shares or the ADSs are outstanding, the
Company agrees to file with the Commission, and any other governmental
agency, authority or instrumentality in the United States, such relevant
reports, documents, agreements and other information which may from time
to time be required by applicable law or regulation to be so filed
because the Shares or the ADSs are outstanding; and
(t) The Company agrees to indemnify and hold the Underwriters
harmless against any documentary, stamp or similar issuance or transfer
taxes, duties or fees, including any interest and penalties, which are
or may be required to be paid in connection with the creation,
allotment, issuance, offer and distribution of the Shares or the ADSs
and the execution and delivery of this Agreement and the Deposit
Agreement.
(u) The Company agrees to use its best efforts to obtain the
approval from the Reserve Bank of India to increase the maximum limit on
issue related expense (as defined under Guidelines of ADR/GDR issues by
the Indian Companies, dated January 19, 2000 issued by the Ministry of
Finance of India) to include all amounts of underwriting discounts,
commissions, fee reimbursements and other reimbursable expenses as
provided for in this Agreement.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares and the ADSs under the Act and
all other expenses in connection with the preparation, printing and filing of
the Registration Statement, the ADSs Registration Statement, any Preliminary
Prospectus and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the cost of printing or producing any Agreement among Underwriters, this
Agreement, the Deposit Agreement, any Blue Sky Memorandum, closing documents
(including compilations thereof) and any other documents in connection with the
offering, purchase, sale and delivery of the Shares and the ADSs; (iii) all
expenses in connection with the qualification of the Shares and the ADSs for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with any Blue Sky survey;
(iv) all fees and expenses in connection with listing the ADSs on NASDAQ; (v)
the filing fees incident to, and the fees and disbursements of counsel for the
Underwriters in connection with, securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the ADSs;
(vi) all expenses and taxes arising as a result of (A) the deposit of the Shares
with the Depositary and the issuance and delivery of the ADRs evidencing ADSs in
exchange therefor by the Depositary to the underwriters, (B) the sale and
delivery of the ADSs by the Company to or for the account of the Underwriters
and (C) the sale and delivery of the ADSs by the Underwriters to the initial
purchasers thereof in the manner contemplated under this Agreement, including,
in any such case, any India income, capital gains, withholding, transfer, stamp
or other tax asserted against an Underwriter by reason of the purchase and sale
of ADSs pursuant to this Agreement; (vii) the fees and expenses (including fees
and disbursements of counsel), if any, of the Depositary and any custodian
appointed under the Deposit Agreement, other than the fees and
19
20
expenses to be paid by holders of ADRs (other than the Underwriters, in
connection with the initial purchase of ADSs); (viii) the fees and expenses of
the Authorized Agent (as defined in Section 14 hereof); (ix) the cost of
preparing ADRs; (x) the cost and charges of any transfer agent or registrar;
(xi) the Company's travel expenses relating to the roadshows for the offering of
the ADSs, and (xii) all other costs and expenses incident to the performance of
its obligations hereunder which are not otherwise specifically provided for in
this Section. It is understood, however, that, except as provided in this
Section, and Sections 8 and 11 hereof, the Underwriters will pay all of their
own costs and expenses, including the fees of their counsel, stock transfer
taxes (other than any imposed by the Republic of India or any political
subdivision or taxing authority thereof or therein) on resale of any of the ADSs
by them, and any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the ADSs to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company herein are, at and as of such Time of Delivery, true and correct,
the condition that the Company shall have performed all of its obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance
with Section 5(a) hereof; if the Company has elected to rely upon Rule
462(b), the Rule 462(b) Registration Statement shall have become
effective by 10:00 p.m., Washington, D.C. time, on the date of this
Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by
the Commission; and all requests for additional information on the part
of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Xxxxxxxx & Xxxxxxxx, U.S. counsel for the Underwriters,
shall have furnished to you such written opinion or opinions, dated such
Time of Delivery, with respect to such matters as you may reasonably
request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon
such matters;
(c) Amarchand & Mangaldas & Xxxxxx X. Xxxxxx & Co., Indian
counsel for the Underwriters, shall have furnished to you such written
opinion or opinions, dated such Time of Delivery, with respect to such
matters as you may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
20
21
(d) Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, U.S. counsel for the
Company, shall have furnished to you their written opinion (a draft of
such opinion is attached hereto as Annex III (a)), dated such Time of
Delivery in form and substance satisfactory to you;
(e) Xxxxxxx Xxxxx Associates, Mumbai, India, Indian counsel for
the Company, shall have furnished to you their written opinion, (a draft
of such opinion is attached hereto as Annex III (b)), dated such Time of
Delivery in form and substance satisfactory to you;
(f) Patterson, Belknap, Xxxx & Xxxxx, counsel for the Depositary
shall have furnished to you their written opinion, (a draft of such
opinion is attached hereto as Annex III (c)) dated such Time of
Delivery, in form and substance satisfactory to you;
(g) On the date of the Prospectus at a time prior to the
execution of this Agreement, at 9:30 a.m., New York City time, on the
effective date of
21
22
any post-effective amendment to the Registration Statement filed
subsequent to the date of this Agreement and also at each Time of
Delivery, Deloitte Xxxxxxx & Sells shall have furnished to you a letter
or letters, dated the respective dates of delivery thereof, in form and
substance satisfactory to you (the executed copy of the letter delivered
on the date of the preliminary Prospectus, is attached as Annex I(a)
hereto and a draft of the form of letter to be delivered on the date of
the final Prospectus, the effective date of any post-effective amendment
to the Registration Statement and as of each Time of Delivery is
attached as Annex I(b) hereto);
(h) (i) The Company shall not have sustained since the date of
the latest audited financial statements included in the Prospectus any
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus, and (ii) since the
respective dates as of which information is given in the Prospectus
there shall not have been any change in the capital stock, short-term
debt or long-term debt of the Company or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, shareholders' equity or results of
operations of the Company, otherwise than as set forth or contemplated
in the Prospectus, the effect of which, in any such case described in
clause (i) or (ii), is in the judgment of the Representatives so
material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Shares and ADSs
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(i) On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or material limitation in trading
in securities generally on NASDAQ; (ii) a suspension or material
limitation in trading in the ADSs on NASDAQ; (iii) a general moratorium
on commercial banking activities in New York, London or the Republic of
India declared by the relevant authorities; (iv) a change or development
involving a prospective change in taxation which could have a Material
Adverse Effect on the Company, the Shares or the ADSs or the transfer
thereof or the imposition of or change in existing exchange controls by
the United States or India; or (v) the outbreak or escalation of
hostilities involving the United States, the United Kingdom or the
Republic of India or the declaration by the United States, the United
Kingdom or the Republic of India of a national emergency or war, if the
effect of any such event specified in this clause (v) in the judgment of
the Representatives makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the ADSs being delivered at
such Time of Delivery on the terms and in the manner contemplated in the
22
23
Prospectus or (vi) the occurrence of any change in the existing
financial, political or economic conditions in the United States, the
United Kingdom, the Republic of India or elsewhere which, in the
judgment of the Representatives would materially and adversely affect
the financial markets or the market for the ADSs and other equity
securities;
(j) The ADSs to be sold by the Company at such Time of Delivery
shall have been duly approved for quotation on NASDAQ, subject to
issuance;
(k) The Depositary shall have furnished or caused to be furnished
to you at such Time of Delivery certificates satisfactory to you
evidencing the deposit with it of the Shares being so deposited against
issuance of ADRs evidencing the ADSs to be delivered by the Company at
such Time of Delivery, and the execution, countersignature (if
applicable), issuance and delivery of ADRs evidencing such ADSs pursuant
to the Deposit Agreement;
(l) Each shareholder who beneficially owns more than 1% of the
shares of the Company's capital stock and each executive officer and
director of the Company shall have entered into an agreement (each the
"Lock-Up Agreement") substantially in the form attached as Annex II
hereto whereby during the Lock-Up Period, such shareholder, executive
officer or director shall not offer, sell, contract to sell or otherwise
dispose of, except as provided hereunder, any securities of the Company
that are substantially similar to the ADSs or Equity Shares, including
but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Equity Shares
or ADSs, or any such substantially similar securities (other than
pursuant to employee stock option plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities
outstanding as of, the date of this Agreement), without your prior
written consent;
(m) The Company shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of prospectuses on
the New York Business Day next succeeding the date of this Agreement;
and
(n) The Company shall have furnished or caused to be furnished to
you at such Time of Delivery certificates of officers of the Company
satisfactory to you as to the accuracy of the representations and
warranties of the Company herein at and as of such Time of Delivery, as
to the performance by the Company of all of their respective obligations
hereunder to be performed at or prior to such Time of Delivery, and as
to such other matters as you may reasonably request, and the Company
shall have furnished or caused to be furnished certificates as to the
matters set forth in
23
24
subsections (a) and (h) of this Section, and as to such other matters as
you may reasonably request.
(o) The Company shall have either (i) obtained an approval from
the Reserve Bank of India to increase the maximum limit on issue related
expense (as defined under Guidelines of ADR/GDR issues by the Indian
Companies, dated January 19, 2000 issued by the Ministry of Finance of
India) to include all amounts of underwriting discounts, commissions,
fee reimbursements and other reimbursable expenses as provided for in
this Agreement or (ii) entered into an escrow agreement in the form
attached hereto as Annex IV with an escrow agent satisfactory to you for
expenses reimbursable to you in connection with the offering and sale of
the ADSs.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to
which such Underwriter may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement, the ADS Registration Statement
or the Prospectus, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each Underwriter
for any legal or other expenses reasonably incurred by such Underwriter
in connection with investigating or defending any such action or claim
as such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement
or alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, the Registration Statement, the ADS Registration
Statement or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to
the Company by any Underwriter through Xxxxxxx, Sachs & Co. expressly
for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of
a material fact contained in any Preliminary Prospectus, the
Registration Statement, the ADS Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in any Preliminary Prospectus, the
Registration Statement, the ADS Registration Statement or the Prospectus
or any such amendment or supplement in reliance upon and in conformity
with written information furnished to the Company by such Underwriter
through Xxxxxxx, Xxxxx & Co. expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with
24
25
investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against
any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (which
shall not, except with the consent of the indemnified party, be counsel
to the indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified
party under such subsection for any legal expenses of other counsel or
any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without
the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to,
any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified party is an actual or potential party to such action or
claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party
under subsection (a) or (b) above in respect of any losses, claims,
damages or liabilities (or actions in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters on the other from
the offering of the Shares and the ADSs. If, however, the allocation
provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the
25
26
notice required under subsection (c) above, then each indemnifying party
shall contribute to such amount paid or payable by such indemnified
party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one
hand and the Underwriters on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the
offering of the Shares and the ADSs purchased under this Agreement
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters with
respect to the Shares and the ADSs purchased under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus.
The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or the
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this
subsection (d) were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this subsection (d). The amount paid
or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter
shall be required to contribute any amount in excess of the amount by
which the total price at which the Shares and the ADSs underwritten by
it and distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d)
to contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section 8 shall be
in addition to any liability which the Company may otherwise have and
shall
26
27
extend, upon the same terms and conditions, to the respective affiliates
and agents of each Underwriter and to each person, if any, who controls
any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section 8 shall be in addition to any
liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director
of the Company (including any person who, with his or her consent, is
named in the Registration Statement as about to become a director of the
Company) and to each person, if any, who controls the Company within the
meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Shares and the ADSs which it has agreed to purchase
hereunder at a Time of Delivery, you may in your discretion arrange for
you or another party or other parties to purchase such Shares and the
ADSs on the terms contained herein. If within thirty-six hours after
such default by any Underwriter you do not arrange for the purchase of
such Shares and the ADSs, then the Company shall be entitled to a
further period of thirty-six hours within which to procure another party
or other parties satisfactory to you to purchase such Shares and the
ADSs on such terms. In the event that, within the respective prescribed
periods, you notify the Company that you have so arranged for the
purchase of such Shares and the ADSs, or the Company notify you that
they have so arranged for the purchase of such Shares and the ADSs, you
or the Company shall have the right to postpone such Time of Delivery
for a period of not more than seven days, in order to effect whatever
changes may thereby be made necessary in the Registration Statement or
the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments to the Registration
Statement or the Prospectus which in your opinion may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as if
such person had originally been a party to this Agreement with respect
to such Shares and ADSs.
(b) If, after giving effect to any arrangements for the purchase
of the Shares and ADSs of a defaulting Underwriter or Underwriters by
you and the Company as provided in subsection (a) above, the aggregate
number of such Shares and ADSs which remains unpurchased does not exceed
one-eleventh of the aggregate number of all of the Shares to be
purchased at such Time of Delivery, then the Company shall have the
right to require each non-defaulting Underwriter to purchase the number
of Shares and ADSs which such Underwriter agreed to purchase hereunder
at such Time of Delivery and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
number of Shares and ADSs which such Underwriter agreed to purchase
hereunder) of the Shares and ADSs
27
28
of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase
of the Shares and ADSs of a defaulting Underwriter or Underwriters by
you and the Company as provided in subsection (a) above, the aggregate
number of such Shares and ADSs which remains unpurchased exceeds
one-eleventh of the aggregate number of all of the Shares and ADSs to be
purchased at such Time of Delivery, or if the Company shall not exercise
the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares and ADSs of a defaulting Underwriter or
Underwriters, then this Agreement (or, with respect to the Second Time
of Delivery, the obligations of the Underwriters to purchase and of the
Company to sell the Optional Shares and the Optional ADSs) shall
thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the
Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its
default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, or any
controlling person, and shall survive delivery of and payment for the ADSs.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Underwriter except as
provided in Sections 6 and 8 hereof; but, if for any other reason any Shares or
ADSs are not delivered by or on behalf of the Company as provided herein, the
Company will reimburse the Underwriters through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Shares and ADSs not so delivered, but the
Company shall then be under no further liability to any Underwriter in respect
of the Shares and ADSs not so delivered except as provided in Sections 6 and 8
hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
28
29
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Sachs & Co. on behalf of you as the
Representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the Representatives in care of Xxxxxxx, Xxxxx &
Co., 00 Xxx Xxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department; and if to the Company shall be delivered or sent by registered mail,
overnight courier or facsimile transmission to the address of the Company set
forth in the Registration Statement, Attention: Chief Financial Officer (with a
copy to: Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, 000 Xxxx Xxxx Xxxx, Xxxx Xxxx, XX
00000, Facsimile (000) 000-0000, Attention: Xxxxxxx X. Xxxxxxx, Esq.); provided,
however, that any notice to an Underwriter pursuant to Section 8 (c) hereof
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its Underwriters' Questionnaire or telex
constituting such Questionnaire, which address will be supplied to the Company
by you upon request. Any such statements, requests, notices or agreements shall
take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and, to the extent provided in
Sections 8 and 10 hereof, the respective affiliates and agents of each
Underwriter, the officers and directors of the Company and each person who
controls the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Shares and ADSs from any Underwriter shall be deemed a successor or assign by
reason merely of such purchase.
14. Each of the parties hereto irrevocably (i) agrees that any legal
suit, action or proceeding arising out of or based upon this Agreement or the
transactions contemplated hereby may be instituted in any New York Court, (ii)
waives, to the fullest extent it may effectively do so, any objection which it
may now or hereafter have to the laying of venue of any such proceeding and
(iii) submits to the exclusive jurisdiction of such courts in any such suit,
action or proceeding. The Company has appointed CT Corporation as its authorized
agent (the "Authorized Agent") upon whom process may be served in any such
action arising out of or based on this Agreement or the transactions
contemplated hereby which may be instituted in any New York Court by any
Underwriter or by any person who controls any Underwriter, expressly consents to
the jurisdiction of any such court in respect of any such action, and waives any
other requirements of or objections to personal jurisdiction with respect
thereto. Such appointment shall be irrevocable. The Company represents and
warrants that the Authorized Agent has agreed to act as such agent for service
at process and agrees to take any and all action, including the filing of any
and all documents and instruments, that may be necessary to continue such
appointment in full force and effect as aforesaid. Service of process
29
30
upon the Authorized Agent and written notice of such service to the Company
shall be deemed, in every respect, effective service of process upon the
Company.
15. In respect of any judgment or order given or made for any amount due
hereunder that is expressed and paid in a currency (the "judgment currency")
other than United States dollars, the Company, as the case may be, will
indemnify each Underwriter against any loss incurred by such Underwriter as a
result of any variation as between (i) the rate of exchange at which the United
States dollar amount is converted into the judgment currency for the purpose of
such judgment or order and (ii) the rate of exchange at which an Underwriter is
able to purchase United States dollars with the amount of the judgment currency
actually received by such Underwriter. The foregoing indemnity shall constitute
a separate and independent obligation of the Company and shall continue in full
force and effect notwithstanding any such judgment or order as aforesaid. The
term "rate of exchange" shall include any premiums and costs of exchange payable
in connection with the purchase of or conversion into United States dollars.
16. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
17. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
18. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
30
31
If the foregoing is in accordance with your understanding, please sign
and return to us one for the Company and for each of the Representatives plus
one for each counsel counterparts hereof, and upon the acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof
shall constitute a binding agreement among each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of each
of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on your part as to
the authority of the signers thereof.
Very truly yours,
Xxxxxx.xxx India Limited
By:
------------------------------
Name:
Title:
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Inc.
By:
-----------------------------------
(Xxxxxxx, Xxxxx & Co.)
On behalf of each of the Underwriters
31
32
SCHEDULE I
NUMBER OF OPTIONAL
ADSS TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM ADSS MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
----------- --------------- -------------------
Xxxxxxx, Sachs & Co. ............................
Credit Suisse First Boston Corporation...........
Xxxxxx Xxxxxxx Inc...............................
X.X. Xxxxxxx & Sons, Inc. .......................
X.X. Xxxxxxxxx, Towbin...........................
First Union Securities, Inc. ....................
Gruntal & Co., L.L.C. ...........................
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated.....................................
U.S. Bancorp Xxxxx Xxxxxxx Inc. .................
Xxxxxxxxxxx Xxxxxxx Securities, Inc. ............
Wit SoundView Corporation........................
--------------- ---------------
Total ...................................
=============== ===============
32
33
ANNEX I(A)
[LETTERHEAD OF DELOITTE XXXXXXX & XXXXX]
Xxx , 0000.
Xxxxxxx Sachs (Asia) LLC.
Credit Suisse First Boston Corporation.
Xxxxxx Xxxxxxx Inc.
(as representatives of the underwriters named in the underwriting
agreement)
c/o Goldman Sachs (Asia) LLC,
68/F, Xxxxxx Kong Center,
0, Xxxxx'x Xxxx Xxxxxxx,
Xxxx Xxxx,
Xxxxxx'x Xxxxxxxx of China.
Dear Sirs:
We have audited the Balance Sheets of Xxxxxx.xxx India Limited ("the
Company") as of March 31, 1999 and 2000, and the related Statements of
Operations, Cash Flows and Shareholders' Equity (Deficit) for each of
the years ended March 31, 1998, 1999 and 2000, all included in the
registration statement (No. 333- ) ("registration statement") on Form
F-1, filed by the Company under the Securities Act of 1933 ("the Act"),
as amended on May 19, 2000. Our report dated May 3, 2000 with respect
thereto is also included in that registration statement.
In connection with the registration statement--
1. We are independent Accountants with respect to the Company within the
meaning of the Act and the applicable rules and regulations
thereunder adopted by the SEC.
2. In our opinion, the financial statements audited by us and included
in the registration statement comply as to form in all material
respects with the applicable accounting requirements of the Act
and the related rules and regulations adopted by the SEC.
3. We have not audited any financial statements of the Company as of any
date or for any period subsequent to March 31, 2000. Although we have
conducted an audit for the years ended March 31, 1998, 1999 and 2000,
33
34
the purpose (and therefore the scope) of the audits was to enable us
to express our opinion on the financial statements as of March 31,
1999 and 2000, and for the years ended, March 31, 1998, 1999, and
2000. Therefore, we are unable to and do not express any opinion on
the statement of financial position, results of operations, or cash
flows as of any date for any period subsequent to March 31, 2000.
4. For the purposes of this letter, we have read minutes of meetings of
the shareholders and the board of directors of the Company held
during the years ended March 31, 1998, 1999 and 2000 and for the
period from April 1, 2000 to May __, 2000. [Date five days before the
issuance date of the letter], as set forth in the minutes books
maintained by the Company. Officials of the Company having advised us
that the minutes of all such meetings through that date were set
forth therein. Our work did not extend to the period from May __,
2000 [Date five days before the issuance date of the letter], to May
__, 2000 [Issuance date of letter], both days inclusive.
5. With respect to the period from April 1, 2000, to April 30, 2000
[being the subsequent period up to which the Company will be required
to prepare the financial statements]:
(1) We have read the unaudited financial statements of the
Company for each of the periods from April 1 to 30, 1999
and 2000 furnished to us by the Company; officials of
the Company have advised us that no such financial
statements as of any date or for any period subsequent
to April 30, 2000, were available.
(2) We have inquired of certain officials of the Company who
have responsibility for financial and accounting matters
whether the unaudited financial statements referred to
in (i) above are stated on a basis substantially
consistent with that of the audited financial statements
included in the registration statement.
The foregoing procedures in i) and ii) above do not constitute
an audit conducted in accordance with generally accepted
auditing standards. Also, they would not necessarily reveal
matters of significance with respect to the comments in the
following paragraph. Accordingly, we make no representations
regarding the sufficiency of the foregoing procedures for your
purposes.
6. Nothing came to our attention as a result of the foregoing
procedures, in
34
35
paragraph 5 above, however, that caused us to believe that:
(i) As of April 30, 2000, there have been any changes in the
capital stock or any creation or increase of long-term debt of
the Company, or any decreases in the net current assets or
stockholders' equity or other items specified by Representatives
of Xxxxxxx, Sachs & Co., Credit Suisse First Boston or Xxxxxx
Xxxxxxx Inc. ("the Representatives") or any increases in any
items specified by the Representatives, in each case as compared
with amounts shown in the balance sheet as at April 30, 2000
included in the Registration Statement, except in each case for
changes, increases or decreases which the Registration Statement
discloses have occurred or may occur or which are described in
this letter.
(ii) For the period from March 31, 2000 to April 30, 2000 there
were any decreases, as compared to the corresponding period in
the preceding year in net revenues or increase in operating loss
or the total or per share amounts of net loss, or other items
specified by the Representatives, in each case, except in each
case for decreases or increases which the Registration Statement
discloses that have occurred or may occur or which are described
in this letter.
7. As mentioned in paragraph 4 ii) above, officials of the Company have
advised us that no financial statements as of any date or for period
subsequent to April 30, 2000, are available; accordingly, the procedures
carried out by us with respect to changes in financial statement items
after April 30, 2000, have, of necessity, been even more limited than
those with respect to period the procedures carried out by us for the
period from April 1, 2000, to April 30, 2000 referred to in paragraph 4.
We have inquired of certain officials of the Company who have
responsibility for financial and accounting matters whether (a) at
[May __, 2000] Date: five days before issuance date of the letter],
there was any change in the capital stock, increase in long-term debt or
any decreases in net current assets or stockholders' equity of the
Company as compared with amounts shown on the March 31, 2000, balance
sheet included in the registration statement or (b) for the period from
April 1, to [May __, 2000] [Date five days before the issuance date of
the letter], whether there were any decreases in net revenues or
increase in operating loss or total or per-share amounts of net loss or
any increases in any items specified by the Representatives, in each
case as compared with the comparable period of the preceding year and
with any other period of corresponding length specified by the
Representatives. On the
35
36
basis of these inquiries and our reading of the minutes as described in
paragraph 4 above, nothing came to our attention that caused us to
believe that there was any such change, increases, or decrease, except
in all instances for changes, increases, or decreases that the
registration statement discloses have occurred or may occur.
8. In addition to the audit referred to in our report included in the
Registration Statement and the limited procedures, inspection of minute
books, inquiries and other procedures referred to above, we have carried
out certain specified procedures with respect to certain amounts,
percentages and financial information as specified by the
Representatives as set out in Appendix "A". These procedures do not
constitute an audit conducted in accordance with auditing standards
generally accepted in the United States of America. Also, they would not
necessarily reveal matters of significance with respect to the comments
in the foregoing paragraph. Accordingly, we make no representations
regarding the sufficiency of the foregoing procedures for your purposes.
9. This letter is solely for the information of the addressees and to
assist the underwriters in conducting and documenting their
investigation of the affairs of the Company in connection with the
offering of the securities covered by the registration statement, and it
is not to be used, circulated, quoted, or otherwise referred to within
or without the underwriting group for any purpose, including but not
limited to the registration, purchase, or sale of securities, nor is it
to be filed with or referred to in whole or in part in the registration
statement or any other document, except that reference may be made to it
in the underwriting agreement or in any list of closing documents
pertaining to the offering of the securities covered by the registration
statement.
Yours truly,
Deloitte Xxxxxxx & Sells
36
37
ANNEX I(B)
FORM OF BRING-DOWN COMFORT LETTER
[Letterhead of Deloitte Xxxxxxx & Sells]
_________ , 2000 [Closing Date]
The Board of Directors
Xxxxxx.xxx India Limited
Xxxxxxxxx Engineering Estate
1st Floor, X.X. First Cross Road
Mahim (West), Mumbai 400 016
India
Xxxxxxx, Sachs (Asia) L.L.C.
Credit Suisse First Boston
Xxxxxx Xxxxxxx Inc.
As Representatives of the several Underwriters
c/o Goldman Sachs (Asia) L.L.C.
68/F, Xxxxxx Kong Center
0 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
Dear Sirs:
We refer to our letter of ______ , 2000 [Pricing Date] relating to
the Registration Statement (No. 333-o) of Xxxxxx.xxx India Limited
(the "Company"). We reaffirm as of the date hereof (and as though
made on the date hereof) all statements made in that letter, except
that for purposes of this letter:
1. The Registration Statement to which this letter relates is the
Registration Statement in the form in which it became effective.
2. The reading of minutes described in paragraph 4 of that letter
has been carried out through ________ , 2000.
3. The procedures and inquiries covered in paragraph 4 of that
letter were carried out to _______ , 2000 (our work did not
extend to the period from _______ , 2000 to ________ , 2000
[Closing Date], inclusive).
38
This letter is solely for the information of the addresses and to
assist the underwriters in conducting and documenting their
investigation of the affairs of the Company in connection with the
offering of the securities covered by the Registration Statement, and
is not to be used, circulated, quoted or otherwise referred to within
or without the underwriting group for any other purpose, including,
but not limited to, the registration, purchase, or sale of
securities, nor is it to be filed with or referred to in whole or in
part in the Registration Statement or any other document, except that
reference may be made to it in the underwriting agreement or any list
of closing documents pertaining to the offering of the securities
covered by the Registration Statement.
Very truly yours,
2
39
ANNEX II
FORM OF LOCK-UP AGREEMENT
XXXXXX.XXX INDIA LIMITED
LOCK-UP AGREEMENT
__________, 2000
Xxxxxxx, Sachs & Co.,
Credit Suisse First Boston Corporation,
Jardine Xxxxxxx Securities Limited,
As Representatives of the several Underwriters
named in Schedule I hereto
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Xxxxxx.xxx India Limited - Lock-Up Agreement
Ladies and Gentlemen:
The undersigned understands that you, as Representatives (the
"Representatives"), propose to enter into an Underwriting Agreement on behalf of
the several Underwriters named in Schedule I to such agreement (collectively,
the "Underwriters"), with Xxxxxx.xxx India Limited, a limited liability company
formed under the laws of the Republic of India (the "Company"), providing for a
public offering of the American Depositary Shares ("ADS") representing one-half
of one equity share (par value Rs. 10 per share) (the "Equity Shares") of the
Company pursuant to a Registration Statement on Form F-1 filed with the
Securities and Exchange Commission (the "SEC").
In consideration of the agreement by the Underwriters to offer and sell
the ADSs, and of other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the undersigned agrees that, during
the period beginning from the date of the final Prospectus covering the public
offering of the ADSs and continuing to and including the date 180 days after the
date of such final
40
Prospectus, the undersigned will not offer, sell, contract to sell, pledge,
grant any option to purchase, make any short sale or otherwise dispose of any
Equity Shares or ADSs of the Company, or any options or warrants to purchase any
Equity Shares or ADSs of the Company, or any securities convertible into,
exchangeable for or that represent the right to receive Equity Shares or ADSs of
the Company, whether now owned or hereinafter acquired, owned directly by the
undersigned (including holding as a custodian) or with respect to which the
undersigned has beneficial ownership within the rules and regulations of the SEC
(collectively the "Undersigned's Shares").
The foregoing restriction is expressly agreed to preclude the
undersigned from engaging in any hedging or other transaction which is designed
to or which reasonably could be expected to lead to or result in a sale or
disposition of the Undersigned's Shares even if such Shares would be disposed of
by someone other than the undersigned. Such prohibited hedging or other
transactions would include without limitation any short sale or any purchase,
sale or grant of any right (including without limitation any put or call option)
with respect to any of the Undersigned's Shares or with respect to any security
that includes, relates to, or derives any significant part of its value from
such Shares.
Notwithstanding the foregoing, the undersigned may transfer the
Undersigned's Shares (i) as a bona fide gift or gifts, provided that the donee
or donees thereof agree to be bound in writing by the restrictions set forth
herein, (ii) to any trust for the direct or indirect benefit of the undersigned
or the immediate family of the undersigned, provided that the trustee of the
trust agrees to be bound in writing by the restrictions set forth herein, and
provided further that any such transfer shall not involve a disposition for
value, or (iii) with the prior written consent of Xxxxxxx, Xxxxx & Co. on behalf
of the Underwriters. For purposes of this Lock-Up Agreement, "immediate family"
shall mean any relationship by blood, marriage or adoption, not more remote than
first cousin. In addition, notwithstanding the foregoing, if the undersigned is
a corporation, the corporation may transfer the capital stock of the Company to
any wholly-owned subsidiary of such corporation; provided, however, that in any
such case, it shall be a condition to the transfer that the transferee execute
an agreement stating that the transferee is receiving and holding such capital
stock subject to the provisions of this Agreement and there shall be no further
transfer of such capital stock except in accordance with this Agreement, and
provided further that any such transfer shall not involve a disposition for
value. The undersigned now has, and, except as contemplated by clause (i), (ii),
or (iii) above, for the duration of this Lock-Up Agreement will have, good and
marketable title to the Undersigned's Shares, free and clear of all liens,
encumbrances, and claims whatsoever. The undersigned also agrees and consents to
the entry of stop transfer instructions with the Company's transfer agent and
registrar against the transfer of the Undersigned's Shares except in compliance
with the foregoing restrictions.
2
41
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
offering. The undersigned
3
42
further understands that this Lock-Up Agreement is irrevocable and shall be
binding upon the undersigned's heirs, legal Representatives, successors, and
assigns.
Very truly yours,
----------------------------------------------
Exact Name of Shareholder, Director or Officer
----------------------------------------------
Authorized Signature
----------------------------------------------
Title
4
43
ANNEX III(A)
[WSGR DRAFT
DATE: MAY 21, 2000]
___________________, 2000
Xxxxxxx, Sachs & Co.,
Credit Suisse First Boston Corporation
Jardine Xxxxxxx Securities Limited
As representatives of the several Underwriters
Named in Schedule I hereto
(the "Representatives"),
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
RE: XXXXXX.XXX INDIA LIMITED, _______________ AMERICAN DEPOSITARY
SHARES REPRESENTING ___________ EQUITY SHARES (INCLUDING
___________ AMERICAN DEPOSITARY SHARES REPRESENTING ____________
EQUITY SHARES TO COVER OVER-ALLOTMENTS, IF ANY).
Ladies and Gentlemen:
This opinion is furnished to you as representatives (the
"Representatives") of the Underwriters (as hereinafter defined) pursuant to
Section 7(d) of the Underwriting Agreement dated ________, 2000 (the
"Underwriting Agreement") by and between Xxxxxx.xxx India Limited, a company
with limited liability incorporated under the laws of the Republic of India (the
"Company"), and the several Underwriters named in Schedule I thereto (the
"Underwriters").
Although we are not general outside counsel to the Company, we have
acted as special United States counsel to the Company in connection with (i) the
Underwriting Agreement; (ii) the Deposit Agreement dated as of ___________, 2000
(the "Deposit Agreement"), by and among the Company, Citibank, N.A., as
Depositary, and the holders from time to time of the American Depositary
Receipts evidencing the ADSs (as hereinafter defined); (iii) the preparation and
filing of the Registration Statement on Form F-1 (File No. 333-__________) filed
by the Company with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the "Act")
on May 19, 2000, as amended by Amendment No. 1 filed on May 23, 2000 and
Amendment No. 2 filed on May _____, 2000 (as so amended, the "Registration
Statement"); (iv) the Prospectus dated __________, 2000 filed with the
1
44
To the Representatives of the
Several Underwriters
_____________, 2000
Page 2
Commission pursuant to Rule 424(b)(4) under the Act on _________, 2000; (v) the
Registration Statement on Form 8-A as filed by the Company with the Commission
on May 23, 2000 (the "Form 8-A") in accordance with Section 12(g) of the
Securities and Exchange Act of 1934, as amended (the "1934 Act"); and (vi) the
Registration Statement (the "ADS Registration Statement") filed on Form F-6
(File No. 333-______) relating to the registration of __________ American
Depositary Shares (including ______ shares to cover over-allotments, if any)
(the "ADSs") each representing one-half of one Equity Share, par value Rs.5 per
share, of the Company (the "Equity Shares"). Capitalized terms used herein shall
have the same meaning given to them in the Underwriting Agreement unless
otherwise defined herein.
As such United States special counsel, we have made such legal and
factual examinations and inquiries as we have deemed advisable or necessary for
the purpose of rendering this opinion. In addition, we have examined originals
or copies of such corporate records of the Company, certificates of public
officials and such other documents that we consider necessary or advisable for
the purpose of rendering this opinion, including the following:
(a) the Underwriting Agreement and its executed counterparts;
(b) the Articles of Association and Memorandum of Association of the
Company, as amended (the "Articles" and the "Memorandum,"
respectively);
(c) minutes of the meetings of the shareholders and Board of
Directors of the Company with respect to the transactions
covered by this opinion;
(d) the Registration Statement and the Prospectus;
(e) the ADS Registration Statement;
(f) the Form 8-A;
(g) telephonic confirmation by the Staff of the Commission fixing
the effective date of the Registration Statement as _________,
2000;
(h) telephonic confirmation by the Staff of the Commission fixing
the effective date of the Form 8-A as _________, 2000;
(i) telephonic confirmation by the Staff of the Commission fixing
the effective date of the ADS Registration Statement as
_________, 2000;
2
45
To the Representatives of the
Several Underwriters
_____________, 2000
Page 3
(j) specimen certificates for the Company's Equity Shares;
(k) the Deposit Agreement and the Certificate of the Depositary;
(l) specimen certificates for the American Depositary Receipts
included as Exhibit A to the Deposit Agreement (the "ADRs");
(m) the letters dated ________, 2000 and ________, 2000 of Deloitte
Xxxxxxx & Sells, independent accountants, addressed and
delivered to you pursuant to Section 5(a) of the Underwriting
Agreement;
(n) the Officers' Certificate dated ________, 2000 delivered to you
pursuant to Section 7(n) of the Underwriting Agreement;
(o) the Secretary's Certificate of the Company dated ________, 2000
delivered to you;
(p) confirmation that a credit in same-day funds to the Company's
account had been received, in satisfaction of the cash purchase
price by the Underwriters for the ADSs;
(q) the cross-receipts delivered by you and the Company on the date
hereof; and
(r) the opinion dated the date hereof of Xxxxxxx Xxxxx Associates,
Indian counsel to the Company.
In such examination we have assumed the genuineness of all signatures on
original documents, the authenticity and completeness of all documents submitted
to us, the conformity to original documents of all copies submitted to us and
the due execution and delivery of all documents where due execution and delivery
are a prerequisite to the effectiveness thereof.
As used in this opinion, the expression "to our knowledge," "known to
us" or similar language with reference to matters of fact means that, after
inquiries of officers of the Company, but without any further independent
factual investigation, we do not believe that the opinions expressed herein are
factually incorrect. Further, the expression "to our knowledge," "known to us"
or similar language with reference to matters of fact refers to the current
actual knowledge of the attorneys of this firm who have worked on matters for
the Company solely in connection with the Underwriting Agreement and other
transactions contemplated thereby. We have not undertaken any independent
investigation to determine the existence or absence of any fact, and
3
46
To the Representatives of the
Several Underwriters
_____________, 2000
Page 4
no inference as to our knowledge of the existence or absence of any fact should
be drawn from our representation of the Company or the rendering of the opinions
or the making of the statements set forth below.
For purposes of this opinion, we are, with your permission, assuming all
of the following, none of which we have independently verified: that you have
all requisite power and authority, and have taken any and all necessary
corporate or partnership action, to execute and deliver the Underwriting
Agreement; that the representations and warranties as to factual matters made by
the Company, the Representatives and the Underwriters in the Underwriting
Agreement and pursuant thereto are true and correct; that the representations
and warranties as to factual matters made by the Company to us in a certificate
delivered to us concurrently herewith, a copy of which has been made available
to you (the "Company Certificate"), are true and correct; that the individuals
executing all documents and instruments examined by us have the legal capacity
to execute and deliver the same; that any wire transfers, drafts or checks
rendered by you will be honored; that you have filed all required state
franchise, income or similar tax returns and have paid all state franchise,
income or similar taxes; and that there are no extrinsic agreements or
understandings among the parties to the Underwriting Agreement or the Deposit
Agreement that would modify or interpret the terms of the Underwriting Agreement
or the Deposit Agreement or the respective rights or obligations of any of the
parties thereunder.
With respect to the opinion set forth in paragraph 11 below relating to
the ADSs, we have with your permission relied on the legal opinion of Xxxxxxxxx,
Beklnap, Xxxx & Tyler LLP, counsel for the Depositary.
The opinions and statements hereinafter expressed are subject to the
following additional qualifications and exceptions:
a. With respect to paragraph 2 below, we express no opinion and
make no statement as to the effect of rules of law governing
specific performance, injunctive relief or other equitable
remedies (regardless of whether any such remedy is considered in
a proceeding at law or in equity);
b. With respect to paragraph 9 below, we express no opinion as to
the effect of, any requirements of or compliance with federal,
state or other securities laws;
c. We express no opinion and make no statement as to the effect of
any federal or state antitrust laws, rules, regulations or
common law;
4
47
To the Representatives of the
Several Underwriters
_____________, 2000
Page 5
d. For the purpose of paragraph 2 below, the opinions expressed and
statements made therein are subject to the effect of statutes,
principles of equity and court decisions providing (i) that
certain covenants and provisions of agreements are unenforceable
where enforcement of such covenants or provisions under the
circumstances would violate the enforcing party's implied
covenant of good faith and fair dealing, and (ii) that a court
may refuse to enforce, or may limit the application of, a
contract or any clause thereof that the court finds to be
unconscionable or contrary to public policy; and
e. We are members of the Bar of the State of California, and we
express no opinion as to any matter relating to the laws of any
jurisdiction other than the federal laws of the United States of
America and the laws of the State of California. For the purpose
of paragraph 2 below, we have assumed that the laws of the State
of New York are the same as the laws of the State of California.
f. We note that you have received the separate opinion of the
Company's Indian counsel, Xxxxxxx Xxxxx Associates. We express
no opinion as to any matter relating to the laws of India. In
particular, we express no opinion as to the enforceability of
any agreements under the laws of India or in Indian courts, or
as to the enforceability of the judgments of United States
courts under the laws of India or in Indian courts.
g. For purposes of our opinion set forth in paragraph 10 below, we
have relied as to certain factual matters upon a certificate of
an officer of the Company and have assumed that, pending their
uses identified in the Prospectus, the net proceeds of the
offering made by the Prospectus will be invested in "government
securities" within the meaning of the Investment Company Act of
1940, as amended (the "Investment Company Act"), to the extent
necessary to ensure that the Company will not hold "investment
securities" (within the meaning of the Investment Company Act)
having a value exceeding 40% of the Company's total assets
(exclusive of government securities and cash items) on an
unconsolidated basis.
You should be advised that our opinion is based upon current statutes,
rules, regulations, case and official interpretive opinions, and that it covers
certain items that are not directly or definitively addressed by such
authorities.
Based upon and subject to the foregoing, we are of the opinion that:
5
48
To the Representatives of the
Several Underwriters
_____________, 2000
Page 6
1. The Underwriting Agreement has been duly executed and delivered
by the Company.
2. The Deposit Agreement has been duly executed and delivered by
the Company, and assuming the Deposit Agreement has been duly
authorized by the Depositary, the Deposit Agreement is a valid
and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as rights to
indemnification thereunder may be limited by applicable law and
except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to or affecting creditors' rights generally or by
general equitable principles.
3. Each of the Registration Statement and the ADS Registration
Statement has been declared effective by the Commission under
the Securities Act, and the Form 8-A Registration Statement has
been declared effective by the Commission under the Exchange
Act. To our knowledge, no stop order suspending the
effectiveness of either the Registration Statement, the ADS
Registration Statement or the Form 8-A Registration Statement
has been issued under the Securities Act or the Exchange Act, as
applicable, and, to our knowledge, no proceedings for such
purpose have been instituted or are pending or are contemplated
or threatened by the Commission. Any required filing of the
Prospectus and any supplement thereto pursuant to Rule 424(b)
under the Securities Act has been made in the manner and within
the time period required by such Rule 424(b).
4. The Registration Statement, the ADS Registration Statement, the
Prospectus, and each amendment to the Registration Statement
and/or the ADS Registration Statement and the Prospectus, as of
their respective effective or issue dates (other than the
financial statements and supporting schedules included therein
or in exhibits to the Registration Statement or the ADS
Registration Statement, as to which we express no opinion)
comply as to form in all material respects with the applicable
requirements of the Securities Act.
5. The ADSs have been approved for inclusion on the Nasdaq National
Market.
6. We have reviewed the statements in the Prospectus under the
captions "Management's Discussion and Analysis and Results of
Operations - Liquidity and Capital Expenditures," "Business -
Legal Proceedings," "Management -Benefit Plans 2000 Stock Option
Plan," "Certain Transactions," "Description of American
Depositary Shares," "Taxation -United States Federal Taxation,"
6
49
To the Representatives of the
Several Underwriters
_____________, 2000
Page 7
"Shares Eligible For Future Sale" and "Underwriting," insofar as
such statements constitute matters of United States federal or
state law, summaries of legal matters, documents or legal
proceedings, or legal conclusions, fairly present and summarize,
in all material respects, the matters referred to therein.
7. To our knowledge, there are no material legal or governmental
actions, suits or proceedings pending or threatened which are
required to be disclosed in the Registration Statement or the
ADS Registration Statement, other than those disclosed therein.
8. No consent, approval, authorization or other order of, or
registration or filing with, any United Sates federal or state
court or other United States governmental authority or agency,
is required for the Company's execution, delivery and
performance of the Underwriting Agreement and the Deposit
Agreement and consummation of the transactions contemplated
thereby and by the Prospectus, except as required under the
Securities Act, and applicable United States state securities or
blue sky laws (all of which have been made or obtained and, to
our knowledge, are in full force and effect as of the date
hereof).
9. The execution and delivery of the Underwriting Agreement and the
Deposit Agreement by the Company and the performance by the
Company of its obligations thereunder (other than performance by
the Company of its obligations under the indemnification
sections of the Underwriting Agreement and Deposit Agreement, as
to which we express no opinion) will not result in any violation
of any United States federal or state law, administrative
regulation or administrative or court decree applicable to the
Company.
10. The Company is not and, after giving effect to the offering and
sale of the ADSs, the receipt of the proceeds therefrom and the
investment of such funds as contemplated by the Prospectus, will
not be an "investment company," as such term is defined in the
Investment Company Act.
11. The ADSs conform to the requirements of the Deposit Agreement
and the Nasdaq National Market.
In addition, we have participated in conferences with officers and other
representatives of the Company, representatives of the independent public or
certified public accountants for the Company and representatives of the
Underwriters at which the contents of the Registration
7
50
To the Representatives of the
Several Underwriters
_____________, 2000
Page 8
Statement, the ADS Registration Statement, the Prospectus, and the amendments
thereto, and related matters were discussed and, although we are not passing
upon and do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement, the ADS
Registration Statement or the Prospectus (other than as specified above), and
the amendments thereto, on the basis of the foregoing, we have no reason to
believe that the Registration Statement, the ADS Registration Statement or any
amendments thereto, at the time the Registration Statement, the ADS Registration
Statement or such amendments became effective, contained an untrue statement of
a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectus, as of its date or at the First Time of Delivery, contained an untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading (provided, however, that we express no
belief as to the financial statements or schedules or other financial data
derived therefrom, included in the Registration Statement, the ADS Registration
Statement or the Prospectus and the amendments thereto).
This letter is furnished as of the date hereof to you as Representatives
of the several Underwriters, and is solely for the benefit of the several
Underwriters. Neither this letter nor any opinion expressed herein may be relied
upon, nor may copies be delivered or disclosed to, any other person or entity
without our prior written consent. We undertake no obligation to inform you, and
we will not inform you, of any change subsequent to the date of this letter to
the information included in this letter.
Very truly yours,
XXXXXX XXXXXXX XXXXXXXX & XXXXXX
Professional Corporation
8
51
[Form of Opinion of Xxxxxxx Xxxxx Associates] ANNEX III(B)
XXXXXXX XXXXX ASSOCIATES
Legal & Tax Counselling Worldwide
Tel. # : 91 + 22 + 282 0609 93-B, Mittal Court
Tel. # : 91 + 22 + 204 0068 Nariman Point
Fax # : 91 + 22 + 287 5792 Mumbai 400 021
DRAFT OPINION
Ref: RED-01/ draft opinion-NDA1
June - , 2000
Xxxxxxx, Sachs & Co.
Credit Suisse First Boston
Xxxxxx Xxxxxxx Inc. As Representatives of the several International Underwriters
C/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
X.X.X.
Ladies and Gentlemen:
RE: XXXXXX.XXX INDIA LIMITED - LEGAL OPINION
We have served as the Indian legal counsel to Xxxxxx.xxx India Limited
(hereinafter referred to as the "COMPANY"), a public limited company
incorporated in India under the Indian Companies Act, 1956 of India, for the
American Depositary Receipt (hereinafter referred to as "ADR") issue.
Pursuant to section 7(e) of the underwriting agreement entered into between the
Underwriters and the Company (hereinafter referred to as the "Underwriting
Agreement"), we hereby render our opinion on matters relating to Indian law.
This opinion is limited to Indian law as currently applied by the courts in
India and is given on the basis that it will be governed and construed in
accordance with Indian law. In rendering our opinion below, as to any facts
material to the statements expressed below that we did not independently
establish or verify, we have relied upon certificates or representations of
responsible officers or other appropriate representatives of the Company and we
are not aware of any
52
facts to the contrary. In giving this opinion we have relied upon the
assumptions set out in the Schedule hereto.
Words and expressions not defined herein shall have the same meanings
respectively assigned to them under the Underwriting Agreement wherever used in
this opinion.
Based on the foregoing, we are of the opinion that:
1. The Company has been duly incorporated and is validly existing and in
good standing as a company under the laws of the Republic of India and
has all corporate power and authority necessary to conduct its
businesses and to own, lease and operate its properties as described or
contemplated in the Prospectus.
2. The Company has equity and issued capitalization as set forth in the
Prospectus and such capitalization complies with Indian law. The summary
of the Charter Documents and Indian law set forth in the Prospectus is
accurate and complete in all material respects. The authorized share
capital of the Company (including the Equity Shares, the ADSs and the
ADRs) conforms to the description thereof under the heading "Description
of Equity Shares" in the Prospectus.
3. The shares of capital stock of the Company outstanding prior to the
issuance of the Equity Shares represented by the ADSs have been duly and
validly authorized, are validly issued and outstanding, are fully paid
and nonassessable, conform to the description thereof contained in the
Prospectus and, to the best of our knowledge after due inquiry, have
been issued in compliance with the registration and qualification
requirements of Indian securities laws. The Equity Shares represented by
the ADSs and deposited pursuant to the Deposit Agreement in accordance
with the Underwriting Agreement (the "Deposited Shares")have been duly
and validly authorized by the Company, and when such Equity Shares are
issued and delivered upon payment in accordance with the terms of the
Underwriting Agreement, such Equity Shares will be duly and validly
issued and outstanding, fully paid, and nonassessable, rank pari passu
with the other Equity Shares outstanding (except as specifically
indicated to the contrary in the Prospectus) and will not be subject to
any lien, encumbrance, preemptive right, equity, call right or other
claim, and there are no restrictions on the voting or transfer of the
Deposited Shares, the ADSs or the ADRs, except as described in the
Prospectus. The Deposited Shares, when deposited pursuant to the Deposit
Agreement in accordance with the Underwriting Agreement, will continue
to be validly issued and outstanding and fully paid and non-assessable
and will entitle the holders thereof to the rights specified in the
ADSs, the ADRs and the Deposit Agreement. There are no restrictions on
the transfer of the Deposited Shares, the ADSs or the ADRs, except as
fully and accurately described in the Prospectus. The form of
certificate for the Equity Shares conforms to the requirements of Indian
law and the Charter Documents of the Company.
4. There are neither any preemptive nor other similar rights to subscribe
for or to
53
purchase any of the Deposited Shares, the ADSs or the ADRs, except for
rights that have been validly waived, nor any restrictions on the voting
or transfer of any of the Equity Shares, in either case, pursuant to the
Charter Documents of the Company or any agreement known to us to which
the Company is a party, and the deposit of such Equity Shares pursuant
to the Deposit Agreement will not give rise to any such preemptive or
other similar rights or restrictions.
5. The Company has full power and authority to enter into and perform its
obligations under the Underwriting Agreement and the Deposit Agreement
(referred to collectively as the "Principal Agreements"). The Principal
Agreements have been duly authorized, executed and delivered by the
Company and, assuming they are valid and binding agreements under laws
of the State of New York by which they are expressed to be governed, the
Principal Agreements constitute valid and binding agreements of the
Company, enforceable in accordance with their terms subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles, save that the said
Principal Agreements will only be admissible in evidence in India for
the purposes of enforcement if they are duly stamped in accordance with
the Indian Stamp Act, 1899 and the Xxxxxx Xxxxx Xxx, 0000 within three
months from the date of their first receipt in India with the proper
Stamp Duty chargeable thereon. The Deposit Agreement, the ADSs and the
ADRs conform to the description thereof in the Prospectus. The Deposit
Agreement is in proper legal form for enforcement against the Company in
India, subject to the aforesaid qualification regarding payment of stamp
duties.
6. The execution, delivery and performance by the Company of the Principal
Agreements and the consummation of the transactions contemplated thereby
(including the issuance of the Equity Shares to be represented by the
ADSs, the deposit of such Equity Shares pursuant to the Deposit
Agreement, the issuance and sale of the ADSs and the issuance of the
ADRs) will not conflict with, result in the creation or imposition of
any lien, charge or encumbrance upon any of the assets of the Company
pursuant to the terms of, result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
to which the Company is a party or by which the Company is bound or to
which any of the property or assets of the Company is subject, nor will
such action result in a violation of the Charter Documents of the
Company or of any Indian law or of any order, rule or regulation of any
Indian court or governmental body or agency having jurisdiction over the
Company, or its properties or assets or the rules and regulations of the
Indian Exchanges, except as is disclosed in the Prospectus.
7. No consent, approval, authorization or order of, or filing, registration
or qualification with, any Indian court or governmental agency or body
is required for the execution, delivery and performance of the Principal
Agreements, the issuance or sale of the Deposited Shares or the ADSs,
the issuance of the ADRs and the consummation of the transactions
contemplated by the Principal Agreements, except such
54
consents, approvals, authorizations, orders, filings, registrations or
qualifications except those which have already been obtained.
8. Each of the Registration Statement, the ADS Registration Statement, the
Rule 462(b) Registration Statement, if any, and the Prospectus has been
duly approved by the Board of Directors of the Company, and each of the
Registration Statement, the ADS Registration Statement and the Rule
462(b) Registration Statement, if any, and the Prospectus has been duly
executed by the officers and directors of the Company set forth on the
signature pages thereto.
9. The execution and delivery by the respective parties to the Principal
Agreements and the performance by such parties of the obligations
thereunder and the consummation of the transactions contemplated by such
agreements will not result in a breach or violation of any of the terms
and provisions of, any applicable Indian law or, to the best of such
counsel's knowledge, any judgment, order or decree of any governmental
agency or body in India or any Indian court.
10. Except as described in the Prospectus, no stamp and other issuance or
transfer taxes or duties are payable by or on behalf of the Underwriters
to India or to any political subdivision or taxing authority thereof or
therein in connection with (A) the deposit with the Depositary of the
Equity Shares against the issuance of ADSs or ADRs, (B) the purchase of
the ADSs by the Underwriters, (C) the sale and delivery by the
Underwriters of the ADSs or ADRs to the initial purchasers thereof, or
(D) the consummation of any related transactions contemplated in the
Principal Agreements in connection with the issuance and sale of the
ADSs or the issuance of the ADRs.
11. The indemnification provisions set forth in Section 8 of the
Underwriting Agreement do not contravene Indian law or public policy.
12. Except as described in the Prospectus, all dividends and other
distributions declared and payable on the Deposited Shares may under
current Indian laws and regulations be paid to the custodian of the
Depositary in Indian rupees that may be converted into foreign currency
and freely transferred out of India; all such dividends and other
distributions made to holders of Equity Shares, ADSs or ADRs who are
non-residents of India will not be subject to Indian income, withholding
or other taxes under Indian laws and regulations and are otherwise free
and clear of any other tax duty, withholding or deduction, without the
necessity of obtaining any Indian governmental authorization in India.
13. The Indian courts will observe and give effect to the choice of the law
of the State of New York as the governing law of the Principal
Agreements.
14. The Company has the power to submit, and has taken all necessary action
to submit, to the jurisdiction of any New York Court and to appoint CT
Corporation as its agent for service of process. The waiver by the
Company of any objection to
55
venue of a proceeding in any New York Court is valid and legally
binding. Service of process effected in the manner set forth in the
Underwriting Agreement, assuming it is valid under New York law, will be
effective, subject to the Indian procedural laws governing service of
process, to confer valid personal jurisdiction over the Company. The
Company and the holders of Equity Shares, ADSs or ADRs can xxx and be
sued in their own names under the laws of India. The irrevocable
submission by the Company to the jurisdiction of any New York Court
constitutes a valid and legally binding obligation of the Company so
long as such submission to jurisdiction is not contrary to Indian public
policy, and we have no reason to believe that such submission to
jurisdiction is contrary to Indian public policy. Any judgment obtained
in a New York Court arising out of or in relation to the obligations of
the Company under the Principal Agreements, as the case may be, or the
transactions contemplated thereby will be recognized and enforced by
Indian courts subject to what is provided under the caption
"Enforceability of Civil Liabilities" in the Prospectus.
15. The Principal Agreements are in proper legal form for enforcement
against the Company in India, subject to the payment of the stamp duty
as mentioned above, and any Underwriter in respect of the Underwriting
Agreement. None of the Underwriters is or will be deemed to be resident,
domiciled, carrying on business or subject to taxation in India merely
by reason of the ownership of Equity Shares, ADSs or ADRs or the entry
into, performance and/or enforcement of this Agreement.
16. The Company is subject to civil and commercial law with respect to its
obligations under the Principal Agreements, the ADSs and the ADRs. The
execution and delivery by the Company and the performance by the Company
of its obligations thereunder constitute private and commercial acts
rather than governmental or public acts, and neither the Company, any
subsidiary of the Company nor any of their respective properties enjoys
any right of immunity in any jurisdiction in India from suit, judgment,
execution on a judgment or attachment (whether before judgment or in aid
of execution) in respect of such obligations.
17. To the best of our knowledge after due inquiry and except as described
in the Prospectus, there are no litigation or governmental proceedings
pending or threatened against the Company or any subsidiary of the
Company which, if determined adversely to the Company, would
individually or in the aggregate have a material adverse effect on the
business, properties, financial condition or results of operations of
the Company or on the ability of the Company to perform its obligations
under the Principal Agreements.
18. To the best of our knowledge after due inquiry, the Company and its
subsidiaries have all material licenses, permits, certificates,
franchises and other approvals or authorizations from all regulatory
officials and bodies that are necessary to the conduct of its businesses
and to the ownership or lease of its properties as described or
contemplated in the Prospectus. and such licenses, permits,
56
certificates and franchises, approvals and authorizations contain no
materially burdensome restriction or condition which has not been
disclosed or described in the Registration Statement or the Prospectus.
Except as described in the Prospectus, we have no reason to believe that
any governmental agency is considering modifying, suspending or revoking
such licenses, authorizations, approvals, orders, certificates or
permits and to the best of our knowledge, the Company is in compliance
with the provisions of all such licenses, permits, certificates and
franchises, approvals.
19. To the best of such counsel's knowledge, after due inquiry, the Company
has complied in all material respects with its Charter Documents and,
except as described in the Prospectus, with each of its documents of
title to its properties, mortgages, deeds of trust, and loan agreements
and there exists no default under any such documents of title,
mortgages, deeds of trust or loan agreements which has not been waived
nor has the Company nor any such subsidiary received any notice of
default with respect thereto.
20. The statements in the Prospectus under the captions "Enforcement of
Civil Liabilities," "Risk Factors--Risks Related to Investments in
Indian Companies," "Risk Factors--Risks Associated with Possible
Acquisitions," "Risk Factors--Restrictions on Exercise of Preemptive
Rights by ADS Holders," "Risk Factors--Control by Principal
Shareholders, Officers and Directors; Anti-Takeover Provisions,"
"Dividend Policy," "Price Range of Equity Shares," "Management's
Discussion and Analysis and Results of Operations--Liquidity and Capital
Resources," "Management's Discussion and Analysis and Results of
Operations--Income Tax Matters," "Business--Intellectual Property,"
"Business--Legal Proceedings," "Management," "Certain Transactions,"
"Description of Equity Shares," "Restrictions on Foreign Ownership of
Indian Securities," "Government of India Approvals" and
"Taxation--Indian Taxation," insofar as such statements constitute a
summary of legal documents or matters of Indian law or regulations or
legal conclusions with respect thereto, are complete and accurate and
are confirmed in all material respects. and nothing has been omitted
from such statements which make the same misleading in any respect.
21. To the best of our knowledge, there are no persons with registration or
other similar rights to have any equity or debt securities Equity for
sale under the Registration Statement or the ADS Registration Statement
or included in the offering contemplated by the Underwriting Agreement,
except for such rights as have been duly waived and except as disclosed
in the Prospectus.
22. It is not necessary (a) in order to enable the Underwriters or any of
them to exercise or enforce any of their rights under the Underwriting
Agreement; (b) to enable the Depositary or the holders or owners of ADSs
to exercise or enforce any of its rights under the Deposit Agreement and
(c) by reason of the entry into and/or performance of the Underwriting
Agreement or the Deposit Agreement that any or all of the Underwriter's
or the Depositary or the holders or owners of ADSs should
57
be licensed, qualified or entitled to do business in India.
23. None of the Purchasers or the Depositary is or will be resident,
domiciled, carrying on business or subject to taxation in India by
reason only of the entry into, performance and/or enforcement of the
Principal Agreements.
24. To the best of our knowledge after reasonable inquiry, since the date of
the latest audited financial statements included in the Prospectus, the
Company has not (i) entered into or assumed any contract, (ii) incurred
or agreed to incur any liability (including any contingent liability) or
other obligation, (iii) acquired or disposed of or agreed to acquire or
dispose of any business or any other asset, or (iv) assumed or acquired
or agreed to assume or acquire any liabilities (including contingent
liabilities) that would be material to the Company, and that are not
otherwise described in the Prospectus.
In addition, we have participated in conferences with officers and other
representatives of the Company, representatives of the independent public or
certified public accountants for the Company and with representatives of the
Underwriters at which the contents of the Registration Statement, the ADS
Registration Statement, the Prospectus, and any supplements or amendments
thereto, and related matters were discussed and, although we are not passing
upon and do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement, the ADS
Registration Statement or the Prospectus (other than as specified above), and
any supplements or amendments thereto, on the basis of the foregoing, nothing
has come to our attention which would lead us to believe that either the
Registration Statement, the ADS Registration Statement or any amendments
thereto, at the time the Registration Statement, the ADS Registration Statement
or such amendments became effective, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the Prospectus,
as of the date hereof, contained an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (it being understood that we express no belief as to the financial
statements or schedules or other financial and statistical data derived
therefrom, included in the Registration Statement, the ADS Registration
Statement or the Prospectus or any amendments or supplements thereto).
In giving such opinion, we state that with respect to all matters of United
States law we have relied upon the opinions of United States counsel for the
Company delivered pursuant to Section 7(d) of the Underwriting Agreement.
THIS OPINION IS RENDERED BY US TO THE UNDERWRITERS AS INDIAN COUNSEL TO THE
COMPANY IN RELATION TO MATTERS GOVERNED BY INDIAN LAW AND IS RENDERED SOLELY IN
CONNECTION WITH THE PROSPECTUS AND THE PRINCIPAL AGREEMENTS. THIS OPINION IS FOR
THE EXCLUSIVE USE OF THE UNDERWRITERS AND SHALL NOT BE DISCLOSED TO OR RELIED
UPON BY ANYONE WITHOUT OUR WRITTEN CONSENT.
58
Sincerely yours,
Xxxxxxx Xxxxx Associates
ENCL. AS ABOVE
59
SCHEDULE
ASSUMPTIONS
The opinions hereinbefore given are based upon the following assumptions:
1. It has been represented to us by Xxxxxx.xxx India Limited (the
"Company") and the Underwriters that the 7% which is termed as the
"underwriting discount and fees" in the Prospectus and the Underwriting
Agreement consists of the following components:
(1) 5%: Underwriting fees.
(2) 2%: Management Fees. This fee is paid to the underwriters for
conducting the activities of structuring the transaction,
drafting the prospectus, conducting the due diligence,
shepherding the transaction through the Securities and Exchange
Commission.
For the purposes of this opinion, we have assumed the above mentioned
details to be true, without conducting any due diligence with respect to
this particular issue.
2. Since litigation records are not public records in India we have assumed
that the information on all pending or certain litigations received from
the Company is accurate.
3. All organization documents are authentic, all signatures are genuine,
all documents purporting to be signed have been so signed and that all
copies conform to their original.
60
ANNEX III(C)
[Opinions of Patterson, Belknap, Xxxx & Xxxxx]
(i) The Deposit Agreement has been duly authorized, executed and
delivered by the Depositary and constitutes a valid and legally binding
obligation of the Depositary, enforceable in accordance with its terms,
subject as to enforcement to bankruptcy, insolvency, reorganization and
similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(ii) Upon issuance by the Depositary of ADRs evidencing ADSs
against the deposit of Shares in respect thereof in accordance with the
provisions of the Deposit Agreement, such ADRs will be duly and validly
issued;
(iii) The ADRs issued under and in accordance with the provision
of the Deposit Agreement to evidence ADSs will entitle the holders
thereof to the rights specified therein and in the Deposit Agreement,
assuming that (A) the Shares represented by the ADSs which are in turn
evidenced by the ADRs have been duly authorized and validly issued and
are fully paid and nonassessable and that any preemptive rights with
respect to the Shares have been validly waived or exercised and (B) such
Shares have been duly deposited with Citibank, N.A., as Custodian, in
each case under and in accordance with all applicable laws and
regulations; and
(iv) The ADS Registration Statement and any amendments thereof
or supplements thereto, as of their respective effective dates, complied
as to form in all material respects with the requirements of the Act and
the rules and regulations of the Commission thereunder;
61
ANNEX IV
ESCROW AGREEMENT
ESCROW AGREEMENT, dated as of _______________, 2000 (this "Agreement"),
among Xxxxxx.xxx India Limited (the "Company"), Xxxxxxx, Sachs & Co. ("Xxxxxxx
Xxxxx") and ___________________, as Escrow Agent (the "Escrow Agent"). Xxxxxxx
Sachs, the Company and the Escrow Agent shall collectively be referred to as the
"Parties" hereinafter.
WITNESSETH:
WHEREAS, Xxxxxxx Xxxxx as a representative several underwriters (the
"Underwriters") and the Company have entered into an underwriting agreement,
dated as of June 13, 2000 (the "Underwriting Agreement"), pursuant to which the
Company issued and sold to the Underwriters an aggregate of 4,600,000 American
Depositary Shares (the "Offering"); and
WHEREAS, Xxxxxxx Sachs and the Company have agreed that payment of an
amount representing the expenses (the "Expenses") reimbursable to the
Underwriters in connection with the Offering shall be deposited in escrow with
the Escrow Agent in accordance with the terms herein set forth;
NOW, THEREFORE, in consideration of the foregoing and of the mutual
representations, warranties, covenants and agreements contained herein and in
the Underwriting Agreement and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending legally to be bound, agree as follows:
1. Appointment of Escrow Agent. __________, is hereby appointed as
Escrow Agent hereunder upon the terms and conditions hereof.
2. Escrow Account. The Escrow Agent today has opened in the name of the
Company at _________ in New York, New York a segregated escrow account, account
no. _______ (the "Escrow Account"). The Company shall deposit an amount
equivalent to the Expenses into the Escrow Account upon the closing of the
Offering. All moneys held in the Escrow Account shall be escrow funds held by
the Escrow Agent under this Agreement.
3. Funds held in the Escrow Account shall be invested by the Escrow
Agent in deposits with banks which are rated for short term obligations A1+ by
Standard & Poor or P1 by Moody's or with the branches of Indian banks in New
York or in treasury bills and other monetary instruments with maturities not
exceeding ninety (90) days, as directed by Xxxxxxx Sachs. All interest and other
income earned on the principal amount of the deposits in the Escrow Account
shall be reinvested in accordance with this clause promptly (and in any case
within one banking day in New York) upon receipt thereof. For purposes
62
of this Agreement, "Banking Day" shall mean a day on which commercial banks in
The City of New York are authorized by law to be open for the transaction of
business.
4. Distribution from the Escrow Account. Except as otherwise expressly
provided in this Section, the Escrow Agent shall not distribute any funds on
deposit in the Escrow Account. The Escrow Agent shall make distributions of all
funds in the Escrow Account at the time and to the persons indicated in an
instruction received from Xxxxxxx Xxxxx, provided that the instruction includes
a copy of the approval from the Reserve Bank of India to increase the limit on
issue related expenses (as defined under Guidelines of ADR/GDR issues by the
Indian companies, dated January 19, 2000 issued by the Ministry of Finance of
India) applicable to the Offering from the existing ceiling of 7% of the issue
proceeds to include all amounts of underwriting discounts, commissions, fee
reimbursements and other reimbursable expenses as provided for in the
Underwriting Agreement.
5. Books and Accounts. The Escrow Agent shall maintain all such
accounts, books and records as may be necessary properly to record all
transactions carried out by it under this Agreement. The Escrow Agent shall
permit the Parties and their authorized representatives to examine such
accounts, books and records; provided that any such examination shall occur upon
reasonable notice and during normal business hours.
6. No Set-offs. The Escrow Agent shall not have, and hereby waives, any
right to banker's lien, set-off or counterclaim in respect of funds or
investments in the Escrow Account.
7. Expenses; Indemnification. (i) The Company shall pay directly and not
out of the Escrow Account the fees of the Escrow Agent for the services rendered
pursuant or relating to this Escrow Agreement chargeable in accordance with the
Escrow Agent's usual rate of compensation. The Xxxxxxx Sachs shall have no
obligation to pay the Escrow Agent any fees.
(ii) The Company agrees to indemnify the Escrow Agent and hold it
harmless against any and all losses, liabilities and expenses (including
reasonable attorney's fees and expenses) incurred by it arising out of or in
connection with the performance of its duties hereunder except those resulting
from its own willful misconduct or gross negligence. The foregoing indemnities
shall also extent to each and every employee and agent of the Escrow Agent and
shall remain in full force and effect regardless of any investigation made by or
on behalf of the Escrow Agent or its employees and agents, and survive the
resignation of the Escrow Agent and the termination of this Agreement. Xxxxxxx
Xxxxx shall have no indemnification obligation to the Escrow Agent.
8. Resignation; Removal. The Escrow Agent at any time may resign as
escrow agent under this Agreement upon given not less than 60 days' notice in
writing to the Parties, provided that such resignation shall not be effective
until a replacement Escrow Agent reasonably satisfactory to the Parties shall
have been appointed. The Parties may remove the Escrow Agent as escrow agent
under this Agreement for any reason, with or
63
without cause, upon given the Escrow Agent and the other party hereto 60 days'
notice thereof; provided that such removal shall not be effective until a
replacement Escrow Agent satisfactory to the Parties shall have been appointed.
9. Termination. When all funds in the Escrow Account have been
distributed pursuant to Section (d), the Escrow Agent shall promptly deliver
written notice of that fact to the Parties. On the 10th Business Day following
delivery of such notice, this Agreement shall terminate.
10. Governing Law. This agreement shall be governed by, and construed in
accordance with, the laws of the state of New York.
Xxxxxx.xxx India Limited
By:
Xxxxxxx, Sachs & Co.
By:
By:
