http://www.nedfi.com/project_finance.

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Project Finance Scheme

Objective: To provide long term finance for the establishment of new industrial, infrastructure,
agri-horticulture, fishery and animal husbandry projects as well as expansion, diversification and
modernization of existing ones.

Types of Assistance: Term loan, direct subscription/underwriting of equity and debt instruments,
provide financial guarantee and participate in deferred payment guarantee.

Eligibility: Industrial concerns conforming to the definition in Section 2 (c) of the IDBI Act,
Infrastructure, Agro-horticulture, Fishery and Animal Husbandry projects.

Project Cost: Minimum assistance: NEDFi ordinarily finances projects with loan component of
Rs.25 lakh and above. However smaller projects in innovative fields and in the hill states are also
considered.

Maximum assistance: Normally, NEDFi can consider up to maximum exposure of 10% of paid
up capital & reserves. However, it can consider projects requiring higher investment in
consortium with other financial institutions and banks.

Nature of assistance: Rupee Term Loan

Promoters’ contribution: 30-40% of the total project cost. However, in the case of consortium
financing it will be at par with the norms of All India Financial Institutions.

Debt Equity Ratio: Ordinarily 1.5 : 1

Interest Rate: Based on Prime Lending Rate fixed from time to time. Actual rate within the
prevailing rate band depends upon creditworthiness of borrower and risk perception. As on date,
the prevailing interest rate is 15% per annum. There is provision for 1% rebate on interest rate for
timely repayment on due dates.

Up-front fee: 1% of the loan amount sanctioned

Security: First charge on movable and immovable fixed assets.

Documentation:

1. Loan Agreement.
2. Deed of hypothecation.
3. Personal guarantee from main promoters, wherever required.
4. Undertaking from the promoters for
o Meeting overrun/shortfall in the project cost/means of financing
o Non-disposal of shareholdings by the promoters
5. Undertaking from MD for non-receipt of commission, if company is in default to NEDFi.
6. Resolution under Section 293 (1)(a) and 293(1)(d) of the Company’s Act.