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PRINCIPAL AGREEMENT

THIS AGREEMENT is made at _____________

this _____ day of

_______________ 2010

BETWEEN

GORJA HEALTH CARE & RESEARCH CENTRE PRIVATE LIMITED, a


company incorporated under the companies Act, 1956 having its
registered office at Gorja Main Road, Kallamb, Dist Osmanabad
(hereinafter referred to a GORJA COMPANY (Which expression shall,
unless it be repugnant to the context or meaning thereof be deemed to
include its successors and assigns)

AND

(1) DR. BADRINARAYAN MUNDADA (2) MR. BALAPRASAD KARWA, (3)


BADRINARAYAN MUNDADA (HUF) through DR. BADRINARAYAN
MUNDADA, (4) MR. SHRIDHAR REDDY, (5) MR. NAMDEV PAUL AND
(6) MRS. SORJABAI SADAFULE All of Dist Osmanabad, THE EXISTING
SHAREHOLDERS GROUP OF GORJA COMPANY, (Herein after referred
to as ES GROUP as per the list of existing shareholders of the company,
and includes existing board members)

AND

(1) MR.________________________ (2) MR. ANAND BIRBICHAND BALAI,


(3)

MR. SHREEDHAR GANGADHAR BHANWAR, (4) MR. VIJAY

PARSHURAM KADAM, (5) DR. ABHIJEEET MANIKRAO DIKLE, (6) DR.


SANJAY HIMATRAO BAVALE (7) MR. SANJAY UDHAVRAO ADSUL
AND (8) DR. RAMESH DHANRAJ JADHAVAR, All of Taluka Kallamb,
District Osmanabad THE PROPOSED INVESTOR GROUP (Herein after
referred to as PI GROUP which expression shall, unless it be repugnant

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to the context or meaning thereof be deemed to include Companies,
Individuals, HUF etc.)

Collectively referred to as Parties and individually as Party and


include its successor or permitted assignees.

WHEREAS

(i)

Gorja Company is a company incorporated on 28-10-2005 vide


CIN No. U85190MH2005PTC157117 for the main object to
establish, maintain, run, manage, develop, own, acquire,
purchase,

undertake,

improve,

equip,

promote,

initiate,

encourage, subsidise and organise, hospitals, dispensaries,


polyclinics, for reception and treatment of persons suffering
from illness or mental defect or of persons requiring medical
attention or rehabilitation or for treatment of gynaelogical
problems and to promote medical relief to the public in all
branches of medical sciences by conducting and running day
care centre, clinics, hospitals, dispensaries, mobile dispensaries
etc., and other incidental objects of the company.

(ii)

The details of the present status of the project is informed to PI


and it is also informed by ES Group to PI Group that the project
is 29 bed hospital being situated at Dhoki Road, Taluka
Kallamb,

District

Osmanabad

and

has

already

been

implemented but not fully functioning.

(iii)

Gorja Company by a registered Sale Deed dated 13-10-2005


acquired the ownership rights in Plot bearing nos. 7,8,9, 101,
102, 96, 95, 100, 95 & 103 admeasuring 1973.97 square
meters out of Survey No.5/B at Village Dhiksal, Taluka
Kallamb, Disrict Osmanabad (hereinafter referred to as the
said first property).

(iv)

Two of the directors of ES group i.e. Dr. Badrinarayan


Bhagwandas Mundada and Mr. Balaprasad Babulal Karwa
jointly vide a registered Sale Deed dated 13-10-2005 acquired
the ownership rights in Plot bearing nos. 94, 98, 99, 95 & 103
admeasuring 724.90 square meters out of Survey No.5/B at
Village

Dhiksal,

Taluka

Kallamb,

Disrict

Osmanabad

(hereinafter referred to as the said second property). The


said directors of ES group i.e. Dr. Badrinarayan Bhagwandas
Mundada and Mr. Balaprasad Babulal Karwa had agreed and
confirmed with Gorja Company and the other directors of ES
group that the said second property shall be conveyed unto
Gorja Company in lieu of the equity shares issued to them
without any consideration.

(v)

Gorja Company appointed architects M/s. Design Desk to


prepare plans, drawings etc., for the proposed hospital project
of 100 bed hospital. By an Agreement dated 10-06-2006
appointed Mr. Rajakhan Osmankhan Pathan as its contractor
for carrying out construction of 29 bed hospital at Dhoki Road,
Taluka Kallamb, District Osmanabad. The said contractor
constructed a building comprising of lower ground floor, ground
floor and first floor aggregately admeasuring 30,141.88 square
feet alongwith with a Medical Shop admeasuring 676 square
feet.

(vi)

Details of expenditure incurred and means of finance there for


and details of existing liabilities and assets as on March 31,
2010 is given in the provisional balance sheet of Gorja Company
as on March 31, 2010 duly signed by ES Group and also a
certified copy of the audited balance sheet of Gorja Company as
on March 31, 2010 is given to PI Group. A copy of provisional
balance sheet of Gorja Company as March 31, 2010 and a copy
of the audited balance sheet as on March 31, 2010 and also a

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copy of the list of existing Assets as on March 31, 2010
(including preliminary and pre-operative expenses and advance
paid for supply erection and installation of plant and machinery
and land and building, and liabilities as on March 31, 2010 is
annexed hereto and marked as Annexure ____ hereto.

(vii)

ES Group and present board members informed that Gorja


Company is holding all the necessary permission, licenses
which are required to run the hospital. A list of such licenses
and permissions are given in separate list attached to this
Agreement as Annexure _____ hereto. Gorja Company will
obtain

remaining

permissions

and

licenses

required

for

commencing the operations of the company will be applied and


shall be obtained by Gorja Company as and when required.

(viii) ES Group and the board members of Gorja Company also


informed PI Group that the technical and financial viability
study of Gorja Companys object is carried out independently by
a financial consultant and have given their opinion that the
project is technically and financially viable project. Besides, the
bankers have also ascertained the viability of the project and
being convinced they have sanctioned financial limits from time
to time.

(ix)

PI Group has approached ES Group showing their willingness


in taking over the entire shareholding of the ES Group by
participating in equity of Gorja Company. Representatives of PI
Group including technically qualified persons have visited the
hospital site of Gorja Company several times and PI Group has
informed ES Group that they are satisfied about the viability of
the hospital project.

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(x)

ES Group have informed PI Group that they shall transfer the


share capital of the Gorja Company and shall complete the
required formalities as per provisions of The Companies Act,
1956 to make suitable entry of PI Group in the equity share
capital of Gorja Company as well as in the management of the
company by appointing on board the nominated persons by PI
Group.

(xi)

PI Group have gone through all documents given by ES Group


as mentioned herein above and they do not have any objection
of whatsoever nature so far as to the expenditure incurred and
means of finance and liabilities and assets existing on March
31, 2010 as reflected in the provisional balance sheet as on that
date and are satisfied and convinced about the various
information provided by ES Group from time to time as
mentioned herein above.

(xii)

It is agreed between the parties hereto that the PI Group shall


take over only the following loans/ liabilities aggregating to sum
of Rs.2,25,00,000/-being the lump sum consideration price/
take over price as enlisted hereunder and which are reflected in
the provisional balance sheet of Gorja Company as on 31-032011 :

Term

Loan

bearing

A/c

No.

772

1,57,00,000/-

(18/23) availed from The Vaidyanath


Urban Co-operative Bank Ltd., Branch
Kaij.
CC

Loan

bearing

A/c

36,00,000/-

No.387/378/380/379 availed from The


Priyadarshini Urban Co-operative Bank
Ltd., Branch Kallam
Unsecured

Loan

taken

from

Mr.

12,00,000/-

Shridhar Bhanvar

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Outstanding Payment of Mr. Rajakhan

10,00,000/-

Osmankhan Pathan (Contractor)


Consideration Price payable for Rs.

10,00,000/-

10.00 Lacs Equity Shares divided into


1,00,000 Equity Shares of the face
value of Rs.10/- each held by the ES
Group
Total

The

2,25,00,000/-

PI

Group

shall

immediately

make

payment

of

Rs.85,28,000/- to the Vaidyanath Urban Co-operative Bank


Limited in order to regularize the NPA account and shall
thereafter make payment of all installments of loan till the
entire dues are repaid in full. The PI Group shall also regularize
the NPA account with the Priyadarshini Urban Co-operative
Bank

Ltd.,

and

shall

thereafter

make

payment

of

all

installments of loan till the entire dues are repaid in full. The PI
Group shall within 2 months from the date hereof make
payment

of

Rs.12,00,000/-

Rs.10,00,000/-

to

Mr.

to

Raja

Mr.

Shridhar

Khan

Bhanvar,

(Contractor)

and

Rs.10,00,000/- to the ES Group in proportion to their


shareholding in Gorja Company for Rs. 10.00 Lacs Equity
Shares divided into 1,00,000 Equity Shares of the face value of
Rs.10/- each held by the ES Group

(xiii) Presently the authorized share capital of Gorja Company is


Rs.25.00 Lacs divided into 2,50,000 lacs Equity Shares of the
face value of Rs.10/- each. The issued, subscribed and paid up
equity share capital of Gorja Company as on the date of this
agreement is Rs. 10.00 Lacs divided into 1,00,000 Equity
Shares of the face value of Rs.10/- each. These shares are held
by ES as follows:

Name of the shareholder

Number of

Percentage

shares of Rs.

held in the

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10/- each
Mr. Badrinarayan Mundada
Mr. Balaprasad Karwa
Badrinarayan Mundada (HUF)
Mr. Shridhar Reddy
Mr. Namdev Paul
Mrs. Sorjabai Sadafule
Total

total paid up

6,500
27,000
50,500
6,000
5,000
5,000
1,00,000

capital
6.5______%
27______%
50.5______%
6______%
5______%
5______%
100______%

Simultaneously upon execution of this agreement, the ES


Group shall sign the transfer forms and hand over the original
share certificates of the aforesaid shares to the PI Group. Gorja
Company after completing the process of transferring the shares
held by the ES Group shall increasing the issued, subscribed
and

paid

capital

of

1.00

Lac

shares

from

present

Rs.10,00,000/- to Rs. 25,00,000/- divided into 2.50 Lacs equity


shares of the paid up value of Rs. 10/- each and shall thereafter
issue the additional 1.50 Lac shares to the PI Group or to such
persons as instructed by the PI Group in such proportion as
agreed between the PI Group..

(xiv)

The ES Group have represented that they are the promoters of


Gorja Company and are the legal and beneficial owner of
1,00,000 fully paid up Equity

Shares of the face value of

Rs.10/- each of the Gorja Company representing in the


aggregate 100% of the total issued, subscribed and paid-up
equity share capital of Gorja Company.

(xv)

The PI Group being convinced about the viability of the project


and after having accepted the cost incurred on the project and
means of finance thereof as on March 31, 2010 and as per the
provisional balance sheet as on March 31, 2010. PI Group are
desirous of purchasing 100 % of the Equity shares of the Gorja
Company and have entered into separate Share Transfer
Agreement. After completion of the transfer of shares as

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contemplated by the said agreement, the shareholding pattern
of Gorja Company would be as follows:

Name of the shareholder

Number of

Percentage

shares of Rs.

held in the

10/- each

total paid up

allotted at a

capital

premium of
Rs.115/- per
share
Mr.
Mr. Anand Birbichand Balai

8600

Age 44 years r/o Main Road, Kallamb,


Dist Osmanabad
Mr. Shreedhar Gangadhar Bhanwar

8600

Age 47 years r/o Punvarsan, Swaragaon,


Kallamb, Dist Osmanabad
Mr. Vijay Parshuram Kadam

4300

Age ___ years r/o Shramik Niwas,


Datanagar, Kallamb, Dist Osmanabad
Dr. Abhijeeet Manikrao Dikle

4300

Age 24 years r/o Moha Road, Kallamb,


Dist Osmanabad
Dr. Sanjay Himatrao Bavale

4300

Age 40 years r/o Baba Nagar, Kallamb,


Dist Osmanabad
Mr. Sanjay Udhavrao Adsul

4300

Age 30 years r/o Adsul Complex, Dhoki


Road, Kallamb, Dist Osmanabad
Dr. Ramesh Dhanraj Jadhavar

4300

Age 28 years r/o Tadgaon Poghargaon,


Kallamb, Dist Osmanabad
Total

(xvi)

ES Group and PI Group have mutually agreed to allow the PI


Group to take over the entire equity of Gorja Company on the
terms and conditions hereinafter appearing.

NOW

THEREFORE,

IN

CONSIDERATION

OF

THE

MUTUAL

COVENANTS, TERMS AND CONDITIONS AND UNDERSTANDINGS SET


FORTH IN THIS AGREEMENT, THE PARTIES, WITH THE INTENT TO
BE

LEGALLY

BOUND

HEREBY,

COVENANT

AND

AGREE

AS

FOLLOWS:

1.1

DEFINITIONS AND INTERPRETATION

DEFINITION

Unless otherwise clearly required by the context, the following terms as


used in this Agreement shall have the respective meanings as defined
below. Any other term not defined below but defined elsewhere in this
Agreement shall have the respective meanings as per those definitions:

1.1.1 "Auditors" mean (Jagdish Toshniwal and company) Chartered


Accountants, ________ or such other firm of Chartered Accountants as
the Shareholders may from time to time appoint.

1.1.2 "Board" means the board of directors of Gorja Company.

1.1.3 "Closing Date" means the Closing Date as defined in the Share
Purchase Agreement which is being executed simultaneously with this
agreement

1.1.4 "Financial Year" means each period of twelve (12) months which
shall end on 31st March every year.

1.1.5 "GAAP" means, in respect of any country, the generally accepted


accounting principles of that country.

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1.1.6 "Group Company" means with its grammatical variations, a
company in which any one or more of the Shareholders, in the case of
individuals either by themselves and/or through their relatives and in
the case of a company either by itself and /or through its holding or
subsidiary company, holds at least twenty six percent (26%) of the paidup share capital of that company.

1.1.7 Information" means collectively "Technical Documentation" and


"Know-how".

1.1.8 "Parties" means (i) ES ,(ii) PI and (iii) Gorja Company and "Party"
shall be construed accordingly referring to (i) , (ii) or (iii) .

1.1.9 "Shareholders" means ES & PI.

1.1.10

"Shares" means the equity shares of Rs. 10/- (Rupees Ten

only) each in the share capital of Gorja Company

1.1.11

Securities

means

preference

shares,

or

any

other

instrument convertible into equity shares of the Gorja Company

1.1.12

"Territory" means the entire Osmanabad District in the State

of Maharashtra.

1.2

INTERPRETATION

Unless otherwise provided or the subject or context otherwise requires,


in this Agreement:

1.2.1 Any reference to the provisions of any statute or subordinate


legislation or of any rule made by a local authority and having the effect
of law shall be deemed to include reference to the same as in force
(including any amendment or re-enactment or consolidation) at the time
the matter relating thereto occurs;

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1.2.2 Article and paragraph headings are inserted for ease of reference
only and shall not affect the interpretation of this Agreement;

1 2.3 Words and expressions not defined herein shall have the same
meanings as defined in the (Indian) Companies Act, 1956 (Act);

1.2.4 References to Recitals, Articles, Paragraphs, Sub-Paragraphs and


Annexure are to the recitals, articles, paragraphs, sub-paragraphs and
annexures of and to this Agreement;

1.2.5 Words denoting one gender include all genders, words denoting
individuals or persons include corporations and trusts and vice versa,
words denoting the singular include the plural and vice versa, and words
denoting the whole include a reference to any part thereof;

1.2.6 Reference to Agreement or any document or agreement includes


references to such document or agreement as amended, novated,
supplemented, varied or replaced from time to time;

1.2.7 References to "this Agreement" mean this agreement together with


its Recitals and Annexure;

1.2.8 An "Affiliate" of, or a person "Affiliated" with, a specified person


shall mean a person that directly or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control
with, the specified person or a relative of a specified person;

1.2.9 The words "including", "include" and "in particular" shall be


construed as being by way of illustration only and shall not be construed
as limiting the generality of any preceding words.

REPRESENTATIONS AND WARRANTIES

Each of the Parties represents and warrants that:

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2.1

It is validly authorized to execute this Agreement to which it is a

party in accordance with the laws and regulations of its jurisdiction of


incorporation and in accordance with its own constitutional documents;

2.2

There is no conflict or inconsistency between (a) this Agreement

and (b) any law or regulation of its jurisdiction of incorporation or its own
constitutional documents or any other agreement to which it is a party;
and

2.3

There is no actual or threatened claim, litigation, regulatory action

or investigation affecting it which is or may be material in the context of


this Agreement.

3.

BUSINESS OF GORJA COMPANY

3.1

The main objectives of Gorja Company are as under:

To establish, maintain, run, manage, develop, own, acquire, purchase,


undertake, improve, equip, promote, initiate, encourage, subsidise and
organise, hospitals, dispensaries, polyclinics, for reception and treatment
of persons suffering from illness or mental defect or of persons requiring
medical attention or rehabilitation or for treatment of gynaelogical
problems and to promote medical relief to the public in all branches of
medical sciences by conducting and running day care centre, clinics,
hospitals, dispensaries, mobile dispensaries etc., and other incidental
objects of the company.

3.2

Unless otherwise agreed, the business shall be carried on in the

Territory and also through branches / offices as the Board may decide.

3.3

The Parties shall procure that any agreement or transaction

entered into by Gorja Company with a Party or a person affiliated or


related to such Party is made and conducted on arm's length terms and

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any such agreement or transaction shall be documented on that basis
and shall be communicated to the other Party.

MANAGEMENT OF GORJA COMPANY

4.1

Each of the Parties agree to exercise his or its respective rights

hereunder and as a Shareholder in Gorja Company so as to ensure that


they perform and comply with all obligations on its part under the
Agreement and complies with restrictions imposed upon it under the
Articles.

4.2

All aspects concerning general meetings of shareholders, for e.g.

quorum, resolutions, voting rights, etc. shall be in accordance with the


terms of the articles of association of Gorja Company (as altered to
implement the terms hereof) and the applicable provisions of law in
India.

4.3

The Board shall have the responsibility for the overall management

and operations of the hospital project of 100 beds.

4.4

The Board shall have the following constitution:

(i)

There shall be Six (6) directors on the Board.

(ii)

PI Group shall be entitled from time to time to nominate and

replace 6 (6) directors in accordance with the shareholding in Gorja


Company. From the PI Group, Mr. _________________ shall be entitled to
be appoint Four (4) directors and Mr. Anand Birbichand Balai
And Mr. Shreedhar Gangadhar Bhanwar shall also be appointed as
Directors of the Gorja Company

Following are hereby designated as the Directors of the Gorja


Company.

1] Mr.
2] Mr.
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3] Mr.
4)Mr.
5) Mr. Anand Birbichand Balai
6)Mr. Shreedhar Gangadhar Bhanwar

(iii)

Mr.__________________ of the PI Group shall also have the right to


nominate one (1) of its directors as the Chairman & Managing
Director

(iv ) The persons above and so also any person whose name is proposed
to be appointed as the Director of Gorja Company shall give a
declaration :

That their names are not included in the RBI defaulters list.

That no civil or criminal cases are pending against the


director in any court of law in India

The

details

of

interest

in

other

firms/companies

as

shareholders, directors, partners and proprietor should be


given with the nature of activity of such firm/company,
shareholding %, share of profit in case of partnership firm
and the name of the bankers of these firms and companies.

(v)

The right of a Shareholder to nominate and replace directors (and


in the case of ES, the Chairman) shall cease if that Shareholder
(together with the Shares held by its Affiliates) at any time ceases
to hold at least Eight percent (8%) of the issued equity share
capital of Gorja Company.

4.5

The articles of association of Gorja Company shall at all times

contain appropriate provisions to give effect to Article 4.4 above.

4.6

(i) Subject to the other provisions of this Agreement, the members

of the Board shall be elected in accordance with the provisions of the Act.
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(ii)

In case of any vacancy on Board, the Party who nominated the

director, whose seat has become vacant shall have a right to nominate
another person to fill up such vacancy. The Parties agree to exercise their
voting rights in Gorja Company in such manner as to effect the
appointment of the person so nominated by a Party as a director.

(iii)

Each Party agrees not to vote to remove the appointees of the other

Party hereto from the Board except as otherwise directed in writing by


them. A Party shall have right to remove its nominee from the Board and
to appoint another person as its nominee. The other Party shall
cooperate and vote in such a manner so as to give effect to such removal
and appointment.

4.7 The board may from time to time appoint and constitute various
committees to take certain decision in respect of

matters not falling

within the purview of the board of directors and within limits specified in
the board meeting in relation to purchase of fixed assets, purchase of
stores, maintenance, legal and statutory matters, Personal (for staff and
workers), administration, Marketing, Finance, and Budget etc. and
respective Directors, General Managers, Staff members and Professional
consultants will represent these committees. All committee head shall
submit the report of monthly performance to board.

5. CONSIDERATION FOR TRANSFER OF SHARES OF ES GROUP:

Is agreed between the parties that the ES Group will transfer 1.00 Lacs
equity shares to the PI Group at the face value of Rs.10/- per share
which amounts to Rs.10.00 Lacs at the share value of Rs.10/- per share
aggregating to sum of Rs.10,00,000/-

6. SCHEDULE OF PAYMENT:

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PI Group will pay the total consideration of Rs.2,25,00,000/- for the
entire shares of the ES Group as per the details given below:

Take over of Loan of Term Loam A/c

1,57,00,000/-

No. 772,(18/23) with The Vaidyanath


Urban Co-operative Bank Ltd., Branch
Kaij.
Take over of Loan of _____ Loan A/c
No.387/378/380/379

with

36,00,000/-

The

Priyadarshini Co-operative Bank Ltd.,


Branch Kallam.
Re-payment of unsecured loan taken

12,00,000/-

from Mr. Shridhar Bhanvar


Payment of outstanding dues of Mr.
Rajakhan

Osmankhan

10,00,000/-

Pathan

(Contractor)
Share Price payable for Rs. 10.00 Lacs

10,00,000/-

Equity Shares divided into 1,00,000


Equity Shares of the face value of
Rs.10/- at each held by the ES Group
at the share value of Rs.10/- per share
Total

The

2,25,00,000/-

PI

Group

shall

immediately

make

payment

of

Rs.85,28,000/- to the Vaidyanath Urban Co-operative Bank


Limited in order to regularize the NPA account bearing no. 772,
(18/23) of the Gorja Company and shall thereafter make
payment of all installments of loan till the entire dues are repaid
in full. The PI Group shall also regularize the NPA account of
Gorja Company with the Priyadarshini Urban Co-operative
Bank

Ltd.,

and

shall

thereafter

make

payment

of

all

installments of loan till the entire dues are repaid in full. The PI
Group shall within 2 months from the date hereof make
payment

of

Rs.10,00,000/-

Rs.12,00,000/to

Mr.

to

Mr.

Rajakhan

Shridhar
Osmankhan

Bhanvar,
Pathan

(Contractor). The PI Group shall simultaneously upon execution

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of this agreement make payment of Rs.10,00,000/- to the ES
Group being the share value of equity shares held by the ES
Group in proportion to their shareholding in Gorja Company for
Rs. 10.00 Lacs Equity Shares divided into 1,00,000 Equity
Shares of the face value of Rs.10/- each held by the ES Group

7. SCHEDULE FOR TRANSFER OF SHARES AND HANDOVER OF


ORIGINAL SHARE CERTIFICATES :

The ES Group shall simultaneously upon execution of this Agreement


shall transfer the equity shares held by the ES Group in favour of PI
Group and/or its nominees and shall also handover the original share
certificates alongwith the duly signed transfer forms held by the ES
Group.

8. SCHEDULE FOR HANDOVER OF ALL ORIGINAL RECORDS OF


GORJA COMPANY:

The ES Group shall simultaneously upon execution of this Agreement


handover all original records of the Gorja Company i.e. Minutes Book,
Share Register, Common Seal, ROC Records etc., to the PI Group
and/or its nominees.

9. SCHEDULE FOR TRANSFER OF SECOND PROPERTY:

The two directors of the ES Group in respect i.e. Dr. Badrinarayan


Bhagwandas Mundada and Mr. Balaprasad Babulal Karwa shall
simultaneously upon execution of this Agreement shall execute the
Sale Deed in favour of Gorja Company in respect of Plot bearing nos.
94, 98, 99, 95 & 103 admeasuring 724.90 square meters out of
Survey

No.5/B

at

Village

Dhiksal,

Taluka

Kallamb,

Disrict

Osmanabad.
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10.

BOARD OF DIRECTORS:

It has been agreed by the parties that the board of directors will be
constituted from PI Group and it will be observed in future that the
constitution of board of PI Group will also be in proportion to
shareholding.

The persons above nominated as directors and so also any person whose
name is proposed to be appointed as the Director of Gorja Company shall
give a declaration:

That their names are not included in the RBI defaulters list.

That no civil or criminal cases are pending against the


director in any court of law in India

The

details

of

interest

in

other

firms/companies

as

shareholders, directors, partners and proprietor should be


given with the nature of activity of such firm/company,
shareholding ______ %, share of profit in case of partnership
firm and the name of the bankers of these firms and
companies.

11.

APPOINTMENT OF CHAIRMAN & MANAGING DIRECTOR:

1. The right to appoint the Chairman and Managing Director of


Gorja Company will rest exclusively with Mr.____________________ of
PI Group and person nominated by Mr.___________________ of the PI
Group shall be appointed as the Chairman and Managing Director
of Gorja Company.

12.

DESIGNATION OF THE DIRECTORS:

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The PI Group shall appoint 4 full time directors.

13.

FORMING VARIOUS COMMITTEES:

The Board shall appoint a committee/s comprising of four (4) full time
directors from PI Group to take certain decision in respect of matters
relating to

purchase

of

medical

equipments,

X-ray machines,

Ultrasound machines, Pathology and Blood Bank equipments, testing


devices, drugs, pharmacy stores etc., and maintenance, appointment
of doctors, technicians, legal and statutory matters, personal (for staff
and workers), administration, Marketing, Finance, and Budget etc.
and respective Directors, General Managers, Staff members and
Professional

consultants

will

represent

these

committees.

The

committee shall submit the report of monthly performance to Board.

14.

LOANS OF GORJA COMPANY

The PI Group agree to take over the liability of the outstanding


loan of sum of Rs.1,57,00,000/- under term Loan A/c No.772,
(18/23) availed from Vaidyanath Urban Co-operative Bank
Limited., Branch kaij

and shall upon execution of this

agreement immediately make payment of Rs.85,28,000/- to the


in order to regularize the NPA account of Gorja Company and
shall thereafter make payment of all installments of loan till the
entire dues are repaid in full. The PI Group has also agreed to
take over the liability of the outstanding loan of sum of
Rs.36,00,000/- under CC Loan A/c No. 378/380/379/387
availed

from the Priyadarshini Urban Co-operative Bank

Limited., Branch Kallam

and shall upon execution of this

agreement immediately regularize the NPA account with the


Priyadarshini

Urban

Co-operative

Bank

Ltd.,

and

shall

thereafter make payment of all installments of loan till the


19

20
entire dues are repaid in full. The PI Group shall within 2
months from the date hereof make payment of unsecured loan
of Rs.12,00,000/- taken from Mr. Shridhar Bhanvar and make
payment of outstanding payment of Rs.10,00,000/- to Mr.
Rajakhan Osmankhan Pathan (Contractor). The PI Group shall
simultaneously

upon

execution

of

this

agreement

make

payment of Rs.10,00,000/- to the ES Group being the share


value of equity shares held by the ES Group in proportion to
their shareholding in Gorja Company for Rs. 10.00 Lacs Equity
Shares divided into 1,00,000 Equity Shares of the face value of
Rs.10/- each held by the ES Group at the share value of
Rs.10/- per share for an aggregate price of Rs.10,00,000/-

The ES Group has agreed and confirmed with the PI Group that
save and except the aforesaid dues payable by the PI Group all
other loans/liability/outstanding sums as may be reflected
and/or which are not specifically reflected in the provisional
balance sheet of the Gorja Company as on 31-03-2010 shall be
the sole liability of the ES Group and they shall repay/settle the
same in due course. The ES Group has further agreed and
confirmed that save and except the aforestated dues payable by
the PI Group,

no other dues shall be payable either by the

Gorja Company and/or the PI Group.

The ES Group has further agreed and confirmed that the


collateral security offered by the ES Group for the loans availed
by the Gorja Company to the Vaidyanath Urban Co-operative
Bank Limited., and the Priyadarshini Urban Co-operative Bank
Limited., shall continue to remain as collateral security till the
Vaidyanath Co-operative Bank Limited sanction a term loan of
Rs.40,00,000/- and/or till all loan accounts with Vaidyanath
Co-operative Bank Limited are transferred and/or taken over
by any other Bank.

20

21
15.

INDEMNITY BY THE ES GROUP

The ES Group has agreed to indemnify and keep indemnified the PI


Group and the Gorja Company from all and/or any actions,
claims, demands of whatsoever nature including all costs, charges
and expenses incurred and/or that may be incurred for defending
such claims arising from any creditor of the Gorja Company in
respect of all and/or any liability of the Gorja Company which the
ES Group has specifically agreed to take over save and except the
aforestated dues payable by the PI Group.

16.

THE

TRANSFER

OF

SHAREHOLDING

SHALL

BE

APPROVED FROM THE BANKERS.

Even though in principally agreed to accept the proposal for taking


the entire shares of the ES Group, the ES Group shall take the
approval officially after the execution of this agreement from the
bankers of the Gorja Company.

17.

STATUTORY COMPLIANCES:

ES Group and Gorja Company assures to PI Group that all statutory


compliances, filing of necessary documents and returns to the
concerned government department viz. Registrar of companies,
Income Tax, Sales tax, Factories Act, etc. and shall be complied with
by end of

July 2010 and it will entire responsibility of ES for

submission of these documents pertaining to the period till July 2010


and PI Group in no way be held responsible for the non-compliances
till July 2010.

18.

MAKING NECESSARY CHANGES IN MOA & AOA:

21

22
It has been observed that for giving the effect of the terms and
conditions as agreed by the parties in MOU existing clauses of
Memorandum of Association and Articles of Association of the Gorja
Company may require amendment in existing clauses so that PI
Group will get all rights in the proportionate holding for dividend,
bonus, rights, preferential allotment or nay other rights attached with
the shareholding and benefits in the project existing, past or future as
well as nomination of directors/Chairman by PI Group, issue of
shares, transfer of shares, general powers of the company vested in
directors.

19.

BANK ACCOUNT OPERATIONS:

All existing and future bank accounts of Gorja Company will be


operated jointly by two directors from the PI Group.

20.

EXECUTION OF SHARE PURCHASE AGREEMENT:

It has been agreed by both the parties to give effect of this Agreement
the parties to this Agreement shall enter into a separate Share
purchase agreement as per the draft enclosed with this agreement.

21.

FURTHER ISSUE OF CAPITAL

21.1 PRE-EMPTIVE RIGHTS ON A FURTHER ISSUE

21.1.1

Subject to the provisions herein contained, the PI Group


shall at all times be entitled to maintain its percentage
interest in ABL.

21.1.2If ABL at any time takes any steps towards increasing its
capital,

issuing

new

capital,

or

reorganization,

restructuring, or rearranging its existing capital, or takes


any steps for the issuance of instruments with underlying
22

23
rights for conversion into shares or options, or take any
other action which could have the effect of diluting the
percentage interest of any of the PI Group in the Gorja
Company, the Gorja Company shall :

(a)

issue notice to the PI Group of its intention to take such


action;

(b)

provide the PI Group with the terms and conditions


under which further issue of new capital is proposed; and

(c)

provide the PI Group with an opportunity to subscribe to


such new capital or instruments, or participate in such
restructuring or reorganization, so as to enable the PI
Group to maintain its percentage interest in Gorja
Company .

Further, the PI Group shall have first right of offering its


unsubscribed portion of shares, if any, agreed to be taken by
any outside person at a price at which new capital is proposed
to be issued.

The PI Group shall have first right to sell their shares in case
the Gorja Company considers to issue further shares to any
other persons and exit as a shareholder.

21.1.3The Offer shall be made to the PI Group in writing and shall be


on terms, including pricing and timings, which are not less
favourable, in any manner whatsoever, than those which are
offered to any other person. The Offer shall clearly set out the
proposal and the terms thereof.

21.1.4The PI Group may, in its sole discretion, elect to accept or reject


the offer so received partially or fully. In the event the PI Group
elects to accept the offer, the PI Group shall be entitled to
participate in such increase, reorganization, restructuring or
23

24
rearrangement, so as to enable it to maintain its percentage
interest in Gorja Company to the extent it has accepted the
offer, as of the date of the offer.

21.1.5In the event of the offer not being accepted by the PI Group
within 30 days, the Gorja Company shall offer the same to any
persons.

21.1.6Non acceptance of the offer by the PI Group would not in any


manner affect the rights of that the PI Group to maintain its
shareholding, as diluted pursuant to the rejected offer, in
respect of any subsequent offer, including but not limited to any
new or modified offer made by Gorja Company subsequent to
such rejected offer.

22. CERTAIN VOTING AGREEMENTS AND OTHER CORPORATE


MATTERS

A. BOARD OF DIRECTORS OF THE COMPANY

i. The Board of Directors may be composed of up to 6


members.

ii. So long as the PI Group holds not less than 100% of


the Shares, it shall be entitled to designate 6 directors
(including the Chairman and Managing Director) for
appointment to the Board Upon appointment of the
directors of the PI Group, Gorja Company shall provide
to the PI Group concurrently with the members of the
Board, and in the same manner, notice of such
meetings and a copy of all materials provided to the
concerned Directors. Mr. ________________ of the PI
Group shall have the right to appoint Four (4) Directors
including the Chairman and Managing Director of the
Board of Directors The Chairman shall have a casting
vote.

24

25
iii. In addition to personal meetings, the Board may
act by circular resolution on any matter except
matters which by law may only be acted upon at a
meeting. Such draft of a proposed resolution must
be circulated to every member of the board. A
circular resolution on a matter will require the
affirmative vote in writing of at least two directors.

iv. Travel, stay and incidental Expenses incurred by or


on behalf of the directors designated by the parties
hereto for attending meetings of the Board shall be
borne by the respective parties and shall, under no
circumstances,

be

borne

by

Gorja

Company.

Further, no sitting fees shall be paid for attending


Board meetings or committees of the Board, unless
otherwise agreed to.

v. The quorum for a meeting of the Board of Directors,


including meetings adjourned or reconvened for
any reason including lack of quorum, shall be at
least the greater of one third of its total strength or
three directors whichever is less.

vi. No business shall be transacted at any meeting of


the Board of Directors of the Company unless at
least 8 (eight) 14 clear days notice (or such shorter
notice as agreed by the Directors unanimously)
along with agenda of the meeting (unless the notice
requirement

is

waived

by

the

Directors

unanimously) has been given to each Director, and


a quorum is present. If a quorum is not present on
the date on which a meeting is convened, the
meeting will automatically stand adjourned and
shall be reconvened 7 days after the original
meeting, and the Directors who are present at the
25

26
reconvened meeting (being not less than one third
of the total strength of the Board, or three,
whichever is less), as the case may be, will
constitute a valid quorum, except where the agenda
for that meeting includes items of this Agreement.

Provided that notwithstanding anything to the contrary


contained herein for the matters described therein shall
be required in connection with any meeting of the Board
of Directors, unless the requirement of an approval of the
PI Group Director is waived by a written communication
in writing by the PI Group in respect of a specific item or
items of the agenda of the meeting of the Board where
such item requires approval of the PI Group. Provided
further that any Party, may by notice in writing waive the
requirement of the presence of the Party's Director, for
the purposes of constituting a valid quorum in respect of
a specific meeting of the Board of Directors.

i. The Parties hereby agree that, at any time they are


entitled to vote for the election or removal of directors.
They will vote in favour of the election of, and will not
vote in favor of the removal of any directors of any
other Party unless such removal shall be either at the
request of the Party that designated such director for
election to the Board of Directors, or for Cause. For
the purposes of this Article 3.1.8, "Cause" shall mean
(A) the willful engaging by a director in conduct which
is demonstrably and materially injurious to the
Company, or the director's conviction of any crime
constituting a felony; or (B) the vacating of the office
by such director pursuant to Section 283(1)(b), (c), (d),
(i), (j) or other applicable provisions of the Act to serve
as a director of an Indian corporation under applicable
India law.

26

27
B.SHAREHODLERS MEETINGS

b. All

mattes

relating

to

the

place,

the

manner

or

convocation of, the agenda of, voting at, voting by proxy at


and keeping of minutes of meeting of the shareholders of
Gorja

Company

shall

be

provided

by

mandatory

provisions of law and by the Articles of Association of the


Gorja Company from time to time in effect and by this
Agreement. All notices and agenda of meetings of the
shareholders of Gorja Company shall be in the English
language.

c. No business shall be transacted at any annual or


extraordinary general meeting of Shareholders of the
Company unless at least 21 days notice (or such shorter
notice as agreed by the Directors unanimously) along
with

agenda

of

the

meeting

(unless

the

agenda

requirement is waived by the Shareholders unanimously)


has been given to each Shareholder whether resident in
India or abroad, and a quorum of three members present
in person is present of which at least one shall be a
representative of both the parties hereto. If a quorum is
not present on the date on which a meeting is convened
the meeting will automatically stand adjourned and shall
be reconvened 7 days after the original meeting and the
shareholders who are present at the reconvened meeting
will constitute a valid quorum except where the agenda
for that meeting includes items enumerated in this
Agreement.

Provided

that

notwithstanding

anything

to

the

contrary

contained herein subject to, the approvals provided herein for


the matters described therein shall be required in connection
with any meeting of the Shareholders, unless the requirement
of any approval of the PI Group is waived by a written
communication by the PI Group in respect of any specific
27

28
item(s) of the agenda of the meeting of the Shareholders where
such item(s) requires approval of the PI Group. Provided further
that any Party to this agreement may waive the requirement of
the presence of its representative by notice in writing for the
purposes of constituting a valid quorum in respect of a specific
meeting of the Shareholders.

i.

Travel, stay and other incidental expenses incurred by or on


behalf of Shareholders for attending meetings shall be borne
by the respective Shareholders.

ii.

Each of the Shareholder agrees to vote (whether in person or


by proxy) in respect of all of the Shares owned or held of
record by such Shareholder at any annual or extraordinary
general meeting of the shareholders of the Gorja Company
called for the purpose of filling positions on the Board of
Directors, and agrees to take all actions otherwise necessary,
to ensure the election to the Board of Directors and the PI
Groups nominees.

C.CHARTER AND BY-LAWS

In order to meet the objective of this Agreement and to avoid


any dispute or controversy, the parties hereto shall cause
their mutual rights and obligations as set out in this
Agreement to be specified in the Articles of Association of
Gorja Company in accordance with the amendments set out
in Schedule A.

i.

The Gorja Company covenants that it will act in accordance


with the Charter Documents. Each Shareholder shall vote all
the Shares owned or held of record by such Shareholder at
any annual or extraordinary general meeting of shareholders
of the Company in accordance with its obligations under this
Agreement and shall take, to the extent permitted by

28

29
applicable law, all action necessary to ensure that the
Charter Documents do not, any time, conflict with the
provisions of this Agreement and unless an amendment is
approved by the Board of Directors in accordance with
Article 3.4, that the Charter Documents continue to be in
effect in the form (as amended to incorporate the provisions
of this Agreement) described in Article 3.3.1.

D. CERTAIN CORPORATE ACTIONS

i.

No decision or resolution shall be taken or passed, either at


a meeting of the Board or any Committee thereof or by
circulation regarding the following matters without the
affirmative votes of at least two directors appointed by the PI
Group, and if a Shareholders resolution is required, the
affirmative vote of the representatives of the PI Group.

(a) To appoint, remove, or dismiss the Company's Managing


Director, Chief Executive Officer, Chief Financial Officer,
Chief Operating Officer, if any (by whatever designations
called).

(b) To appoint, remove, or dismiss the Doctors, Consultants


(by whatever designations called).

(c) To approve compensation and remuneration payable to all


Directors including any distribution of profits.

(d) To appoint additional Directors except for reasons of


maintaining proportional representation (Provided that
the affirmative vote of the PI Group's Directors shall not
be required for appointment of the nominees of the
financial

institutions/banks

as

directors

of

Gorja

29

30
Company, under the agreements entered/ to be entered
into by the Gorja Company with them.

(e) To create any lien, charge or other encumbrance over any


assets or to acquire, sell, lease, transfer, license, or in
any way dispose of any assets of the Gorja Company
except in the usual and ordinary course of the Gorja
Companys

business

(as approved

in the

Annual

Business Plan). Provided that this sub clause shall not


apply to any of the aforesaid matters up to an asset
value limit of Rs. 500,000 per annum in the aggregate.

(f) To dispose of or close the whole or any substantial part of


any undertaking of Gorja Company or make any
material change in or extension of the Gorja Companys
Business or diversify into new areas of business, or to
make any further investments in any business which
require additional capital contributions specified in the
approved Annual Business Plan.

(g) To sell or assign technical know-how, trade secrets,


patents, copyrights, or other intellectual property of
Gorja Company.

(h) To approve merger or consolidation with, or acquisition by


Gorja Company of any other business, or the Gorja
Company entering into a joint venture or technical
collaboration with any other company.

(i) To acquire or sell shares debentures, bonds or any other


financial interests in any other company.

(j) To recommend, give or renew any guarantee, indemnity or


security in respect of obligations of third parties.

30

31
(k) To change the Accounting Policy and/or Fiscal year of
Gorja Company.

(l) To increase the authorized, issued or paid-up share


capital, or to issue, allot, buy-back or redeem any
shares, debentures or warrants, or plant any options
over the Gorja Companys shares, or approve the terms
of a Public Offering by the Gorja Company, except as
provided under this Agreement.

(m) To approve or disapprove the Transfer of any shares


held by the parties hereto.

(n) To delegate the authority or any of the powers of the


Board to any person or committee.

(o) To remit or give time for the repayment of any debt due to
Gorja

Company

excluding

debts

incurred

in

the

ordinary course of business.

(p) To approve and adopt the Annual Business Plan, annual


capital expenditure budget, annual operating plans and
annual financial statements of Gorja Company.

(q) To recommend any dividend or distribution of profits.

(r) To

divulge

or

communicate

to

third

parties

any

confidential technical or commercial information owned


by or affecting the Company, except such information as
is required to be divulged, communicated, or disclosed
in the ordinary course of business.

(s) To establish or change the profit sharing, ESOP or other


benefit plans granted to Directors and/or key executives
of Gorja Company.

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32
(t) To recommend amendments to the Memorandum or
Articles of Association of Gorja Company.

(u) To enter into agreements or any transactions with Related


Parties, including in relation to resource sharing, in
excess of Rs. 5,00,000 for each transaction or in excess
cumulatively in any Financial Year of 5% of the gross
revenues of the Company in the preceding Financial
Year.

(v) To change the name or the registered office of Gorja


Company,

(w) To appoint or change auditors or internal auditors

(x) To issue Duplicate share certificates.

(y) To delegate powers to any committee with regard to


matters covered in this Article.

(z) Pledge of shares held by Gorja Company in any other


company, or the creation of any change or lien thereon.

(aa) To decide to wind up/liquidate/reorganize the Gorja


Company.

(bb) Any disclosure to be made by or about Gorja Company


in respect of Public Offer documents of any member
provided that the Party of the Second Part shall not
unreasonably delay or withhold their consent to such
disclosure.

a.

In

determining

whether

any

of

the

matters

described in this Article 3.4.1 require the approvals


described herein, a series of related transactions
which, when aggregated, exceed any specified
32

33
amount triggering an approval requirement, shall
be construed as a single transaction for which such
approval is required.

b.

All matters arising at a meeting of the Board of


Directors other than those specified in Article 3.4.1
shall be decided by a majority vote.

c.

Shareholders

and

any

representative

nominated

auditor
by

or

them

other

shall

be

permitted, at their own expense, to visit during


regular business hours any of the premises where
the business of the Company is conducted and to
have access to its books of account and record.

E. CERTAIN COVENANTS OF GORJA COMPANY:


(i) The Gorja Company shall furnish the following information
to PI Group (and/0r any other Shareholder that makes a
request therefor) to the extent permissible in law.
[ii] Audited financial statements for such Financial Year,
together with an audit report thereon from the Auditors, in
a form which is in compliance with the Companies Act,
1956 within ninety (90) days after the end of each
Financial Year.

(iii) Un-audited quarterly financial statements within 45 days


of the end of each fiscal quarter;

[iv] Un-audited monthly financial statements within 30 days of


the end of each month;

a.

Financial statements will include without limitation


an income statement, a balance sheet and a
statement of cash flows;

33

34
b

Upon written request by any the PI Group, such


information as the PI Group shall reasonably
request.

ii. All financial statements referred to in Article


3.5.1(a) will be prepared in accordance with
generally accepted accounting principles applied on
a consistent basis.

iii. The Gorja Company shall inform PI Group of any


resignation,

recruitment

or

change

in

senior

managerial personnel. Such information in respect


of any recruitment and change of personnel shall
be provided in advance and in respect of any
recruitment, at the earliest after such resignation.

iv. The Board shall have the authority to determine,


subject to any requirements of Indian law, the
amount

and

timing

for

the

declaration

and

payment of any dividend or the making of any other


distribution of its profits by Gorja Company. The
parties hereto agree that, subject to the Act and
other applicable laws, Gorja Company shall declare
and pay a dividend to the extent that the amount of
its profits after tax from its operations exceed its
working capital requirement and its need for
reserves as determined in good faith by its Board in
terms of Article 3.4.1

v. The Gorja Company shall not give effect to any


resolution passed or decision taken which is
contrary to the terms of this Agreement.

vi. The Gorja Company shall not be responsible and


not give effect to any promise or promise of gift or
any

payment

made

by

any

officer,

director,
34

35
employee, consultant or agent acting on behalf of
Gorja Company directly or indirectly to :-

(i)

any political party or official thereof or


candidate for political office for the
purpose of influencing any official act
or decision of such party, official or
candidate or influencing such party,
official or candidate to use his, her or
its influence to affect any act or
decision of a government or agency or
subdivision thereof, in order to assist
Gorja Company to obtain or retain
business for, or direct business to,
Gorja Company.

23

COVENANTS OF THE ES GROUP TO THIS AGREEMENT:

23.1 As long the PI Group holds 100% of the company's paid-up


equity capital:

23.1.1No member of the ES Group and PI Group shall, without


the prior written consent of the PI Group, for a period of
5 years commencing from the date of this Agreement
promote or organize any other business organization
engaged directly or indirectly in a business competing
with the Gorja Companys Business as proprietor,
partner, promoter, director or shareholder, without the
prior written consent of the PI Group.

23.2 The Parties to this agreement jointly and severally covenant and
undertake that they shall cause Gorja Company to give effect to
the terms and conditions of this Agreement.

24.

TRANSFER OF SECURITIES

35

36
24.1 RIGHTS OF FIRST OFFER ON TRANSFERS OF SECURITIES

24.1.1So long as the ABLs shares are not listed on any Stock
Exchange,

any

Shareholder

(the

proposed

Transferor)

desirous of transferring its shares in ABL or any portion thereof


(the Sale Shares) shall first offer in writing (the Sale
Notice) the sale of shares to the other existing shareholders
(Other Shareholders) pro rata in the proportion of their
existing holding of shares in Gorja Company at the price fixed
by an approved valuer mutually appointed by the parties
hereto.. The sale notice shall be issued to Gorja Company who
shall forthwith issue to each of the shareholder a copy of the
sale notice.

24.1.2The other shareholders shall communicate their decision to


either buy or not to buy the said shares or any part thereof
within 30 days of issue of the sale notice in writing to the
proposed transferor. In the event any of the shareholders accept
the sale notice such shareholders shall purchase that portion of
the sale shares offered to them in the sale notice along with any
portion rejected by any other shareholder, if they so desire on
pro rata basis within 60 days of such acceptance of the sale
notice.

24.1.3The overall timeframe for the completion of the transaction will


be 120 days from the said Sale Notice. In the event that the
Proposed Transferor does not receive the price offered by it in
the sale notice he/she shall have the right to offer the sale
shares, or such portion of the sale shares not accepted by the
other shareholders to any third person of his/her choice at the
same price and on the same terms and conditions as are
offered in the Sale Notice, subject to the third person executing
a Deed of Adherence in the form annexed hereto. Gorja
Company shall duly register such transfer in favour of any
person, subject to the third person executing a Deed of

36

37
Adherence in the form annexed hereto and marked as
Annexure * . Notwithstanding the above, the ABL shall not
register any transfer in favour of a person carrying on a
competing business (as per the definition of Gorja Companys
Business in Article 1.1.5), without the prior written consent (i)
of the PI Group, or (ii) of the Shareholders other than the
proposed transferor, in any other case.

24.1.4Any transfer of sale shares pursuant to the Right to First offer


contained in this Article 4.3 shall be at a rate not less than the
price fixed by an approved valuer mutually appointed by the
parties

hereto

if

there

were

no

restrictions

on

their

transferability. The price fixed by an approved valuer mutually


appointed by the parties hereto for the purpose of this Article
shall be determined in accordance with the provisions of this
Article 4.3 (the Appraised Value).

24.1.5Appraised

value

shall

be

determined

by

any

reputed

independent firm of Chartered Accountants, who shall be


selected unanimously by the parties within 10 days of delivery
of the Offer Notice (the Appraiser). If the parties hereto fail to
agree on an appraised value determined by the appraiser within
25 days of delivery of the Offer Notice the appraiser shall within
7 days determine minimum price; thereafter the appraised
value shall be determined by such recognized investment
bank? as the parties hereto shall select jointly within 35 days
of delivery of the Offer Notice (the Investment Bank), provided
that the appraised value as determined by the Investment Bank
shall not be less than the minimum price determined by the
Appraiser. The parties hereto shall use their best efforts to
cause the determination of appraised value by the alternative
Investment Bank to be completed within 50 days of delivery of
the offer notice.

37

38
24.1.6The time taken to determine the appraised value under this
section shall not be excluded for the purposes of computing the
120 days period available to the purchaser of the sale shares to
make payment for the sale shares.

Gorja Company shall co-operate with the PI Group, the


Appraiser and any Investment Bank in connection with the
determination of appraised value and shall give the PI Group,
the appraiser and any Investment Bank access to the books,
records and personnel of the Gorja Company (including all
historical and projected financial and operating information
reasonably necessary to determine the appraised value). The PI
Group shall bear all fees and expenses of the appraiser and any
Investment Bank incurred in connection with the determination
of appraised value

24.2 TAG-ALONG RIGHTS

24.2.1No member of the PI Group shall not, directly or indirectly,


transfer, any shares of the Gorja Company, (collectively, Share
Capital) other than for cash in an arms length transaction,
and without the previous consent of the other members of the
PI Group, and on the execution, of a Deed of Adherence by the
transferee in accordance with this agreement. If at any time,
any member of the PI Group proposes to transfer share capital
(subject to the provisions of Article 4.1 and 4.3 to an affiliate) to
any proposed transferee in any transaction or series of related
or similar transactions, as permitted by this agreement, the
selling shareholder shall afford other members of the PI Group
the opportunity to participate in such transfer in accordance
with this Article 4.4.

24.2.2At the time of any such proposed Transfer, the selling


shareholder proposing to make such transfer (the Transferor)
shall give notice to each of the PI Group of its right to sell
shares hereunder (a Tag-Along Notice), which notice shall
38

39
identify the proposed purchaser and state the number of shares
(or interest therein) (on a fully diluted basis) proposed to be
transferred in such transfer, the proposed offering price and
any other material terms and conditions of the proposed
Transfer. The Tag-Along Notice shall also contain a true and
correct copy of any offer to the transferor by the proposed
purchaser of such shares (or interest therein) as well as the
extent and nature of representations and warranties required, if
any, to be provided by the PI Group

24.2.3Within thirty (30) days after the date of delivery of a Tag-Along


Notice, the PI Group may elect to participate pro rata, in such
Transfer pursuant to the terms and conditions of such TagAlong Notice including the wording of the representations and
warranties required to be given by the PI Group by delivery of a
notice to the transferor. It is clarified that the PI Group will not
be obliged to make any representations and warranties to any
person in connection with such transfer except to the extent of
title with respect to the PI Groups shares and the authority for
and the validity and binding effect of any agreements entered
into by the PI Group in connection with such transfer.

24.2.4In the event a shareholder should sell any securities by an


transfer in contravention of the rights of the PI Group under
this agreement (a Prohibited Transfer), the PI Group, in
addition to such other remedies as may be available in law, in
equity or hereunder, shall have the put option provided below,
and the transferring member shall be bound by the applicable
provisions of such option.

24.2.5In the event of a prohibited transfer, the PI Group shall have


the right to sell to the transferring member the type and
number of securities equal to the number of securities the PI
Group would have been entitled to transfer to the purchaser
under this agreement had the prohibited transfer been effected

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40
pursuant to and in compliance with the terms hereof. Such sale
shall be made on the following terms and conditions:

24.2.5.1

The price per share at which the securities are to be sold


to the transferring member shall be equal to the price per
share paid by the purchaser to the transferring member
in the prohibited transfer. The transferring founder shall
also reimburse the PI Group for any and all fees and
expenses, including legal fees and expenses, incurred
pursuant to the exercise or the attempted exercise of the
PI Groups rights under this agreement.

24.2.5.2 Within ninety (90) days after the later of the dates on
which the PI Group (A) received notice of the Prohibited
Transfer or (B) otherwise become aware of the Prohibited
Transfer, the PI Group shall, if exercising the option
created hereby, deliver to an independent third party
nominated as escrow agent (the "Escrow Agent) the
certificate representing shares to be sold, each certificate
to be properly endorsed for transfer. The said period of 90
days shall be extended by such further period as may be
required for obtaining any approvals and for which the
Gorja Company shall render co-operation and assistance
to the PI Group.

24.2.5.3

The transferring founder shall, on delivery to the Escrow


Agent of the certificate or certificates for the shares to be
sold by the PI Group, pursuant to this subparagraph, pay
the aggregate purchase price therefor and the amount of
reimbursable

fees

and

expenses,

as

specified

in

subparagraph, in cash or by other means acceptable to


the PI Group. Simultaneously with such payment being
made, the Escrow Agent shall release to the transferring
founder the certificate or certificates for the shares to be
sold by the PI Group.

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41
24.2.6Notwithstanding the foregoing, any attempt by the selling
founder to transfer share in violation of this agreement shall be
void and the Gorja Company agrees it will not effect such a
transfer nor will it treat any alleged transferee as the holder of
such securities shares without the written consent of the PI
Group.

24.3 CONFIRMATION OF RESTRICTIONS

24.3.1Each member of the PI Group shall execute a non-disposal


undertaking addressed to the Company Secretary/Board of
Directors of the Gorja Company in confirmation of the transfer
restrictions under this Agreement, in the form set out in
Schedule C.

25

CORPORATE OPPORTUNITIES AND INVESTMENTS

25.1 GORJA BUSINESS

25.1.1 Gorja Company currently is engaged in, or proposes to be


engaged mainly to establish, maintain, run, manage, develop,
own, acquire, purchase, undertake, improve, equip, promote,
initiate,

encourage,

subsidise

and

organise,

hospitals,

dispensaries, polyclinics, for reception and treatment of persons


suffering from illness or mental defect or of persons requiring
medical

attention

or

rehabilitation

or

for

treatment

of

gynaelogical problems and to promote medical relief to the


public in all branches of medical sciences by conducting and
running day care centre, clinics, hospitals, dispensaries, mobile
dispensaries etc., and other incidental objects of the company.

25.1.2The parties to this agreement shall not pursue or undertake


any transaction with any person relating to the Gorja
Companys Business (Corporate Opportunity) otherwise than
through Gorja Company so long as the PI Group holds at least

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42
100% of the Gorja Companys equity capital, unless all the
Directors of the Gorja Company, including the PI Groups
nominee, decide unanimously that Gorja Company shall not
pursue or undertake such Corporate opportunity.

25.2THE PI GROUP INFORMATION

25.2.1 Gorja Company acknowledges that the parties to this


agreement will likely have, from time to time information that
may be of interest to the Gorja Company (Information)
regarding a wide variety of matters including, by way of example
only,

1.

Gorja Companys technologies, plans and services, and


plans and strategies relating thereto;

2.

Current and future investments the Gorja Company have


made, may make, may consider or may become aware of
with respect to other companies and other technologies,
products and services, including, without limitation,
technologies,

products

and

services

that

may

be

competitive with the Gorja Companys; and

3.

Developments with respect to the technologies, products


and services, and plans and strategies relating thereto, of
other companies, including without limitation, companies
that may be competitive with Gorja Company.

26 FINANCIAL POLICY CONTROL AND ACCOUNTING STANDARDS

26.1 The overall financial policy of Gorja Company shall be established


by the Board.

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43
26.2 Each Party hereto, so long as its shareholding in Gorja Company is
at least fifteen percent (15%), shall have the right, at its own expense, to
acquaint itself with, audit and investigate the operations of ABL, through
its employees or Auditors. Full access to all records will be given for this
purpose and officers of Gorja Company shall extend all possible cooperation for this purpose.

26.3 Gorja Company will adopt the Indian GAAP.

27

ACCOUNTING MATTERS

27.1 Gorja Company shall at all times maintain accurate and complete
accounting

and

other

financial

records

in

accordance

with

the

requirements of all applicable laws and generally accepted Indian GAAP.

27.2 Monthly management accounts containing such information as the


PI Group shall reasonably require and specify, shall be prepared and
dispatched by Gorja Company to PI Group within ten (10) working days of
the end of the month in question.

27.3 As soon as reasonably practicable after the end of each Financial


Year, Gorja Company shall procure that an account shall be taken of all
assets, liabilities, dealings and transactions of Gorja Company during
such Financial Year, and that the Board shall prepare a report and
accounts in accordance with Indian GAAP, to be audited within four (4)
months from the end of such Financial Year.

27.4 Gorja Company shall prepare an annual business plan for every
Financial Year which shall include the following:

(i)

An estimate of the working capital requirements of Gorja Company


incorporating therein a cash flow statement together with an
indication of the amount (if any) which it considered prudent to

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44
retain out of the previous Financial Year's distributable profits to
meet such working capital requirements;

(ii)

a projected profit and loss account;

(iii)

an operating budget (including estimated capital expenditure


requirements and balance sheet forecast; and

(iv)

a review of the projected business.

27.5 Business plans (including business projections for first, third and
fifth year future financial periods) shall be submitted for approval by the
Board not later than thirty (30) days before the commencement of the
Financial Year in question.

27.6 It is agreed between the Parties that unless otherwise agreed in


writing by all the parties they shall take such action as may be necessary
to procure that Gorja Company distributes to and among Shareholders
minimum 60%

of its profits lawfully available for distribution as

dividends for each Financial Year or additional dividend as the Board


shall from time to time resolve.

28. INSURANCE

Gorja Company shall insure all its assets and properties, against such
risks and in such amount as may be decided in a Board meeting of Gorja
Company. Gorja Company shall obtain all requisite insurance cover for
property and persons, as prescribed or needed as per the applicable
laws.

29.

NON-COMPETITION

27.1 Parties to this agreement shall not, and shall ensure that none of
its affiliates, relatives, associates or companies or their subsidiaries,
shall directly or indirectly:

44

45
(i)

Solicit the doctors, consultants, employees or distributors of Gorja


Company to work as employees or distributors of the ES Group or
any of its affiliates, relatives, associates or companies or their
subsidiaries during the term of this Agreement.

(iii)

associate in any way whether by way of financial participation in


any company, membership of any firm or in any other manner
whatsoever, which are involved in the business similar to the
business of Gorja Company; or

(iv)

solicit any of Gorja Companys employees or distributors to work as


his/her employees or any of its subsidiaries during the term of this
Agreement.

10.2 The non-competition and non-solicitation restrictions set forth


herein on parties to this agreement shall be binding on the Parties
during the term of this Agreement and for a period of three (3) years after
transfer of all their shareholding in Gorja Company.

30

DURATION OF AGREEMENT

The Agreement shall remain in full force and effect for an indefinite
period, unless terminated in terms of the provisions of Article 18 hereto,
or upon the ES Group ceasing to be the Shareholder of Gorja Company.

31

TERMINATION

31.1 This Agreement may be terminated if either Party hereto defaults in


the performance of any of its obligations under this Agreement and does
not rectify such default within thirty (30) days following the giving of
notice in writing by the other Party requesting the Party in default to
rectify the default, then the Party giving such notice may forthwith
terminate this Agreement by giving the Party in default a written notice
to that effect.

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46

31.2 In case there is a breach of the terms of this Agreement by one


Party hereto, the following shall be the procedure: (i) the other Party
hereto shall give a notice of thirty (30) days calling upon the defaulting
Party hereto to rectify the breach; (ii) the other Party hereto having
received notice shall endeavor to rectify the breach; (iii) if the Parties
hereto agree that the breach is rectified, the breach will be considered as
having come to an end; (iv) if Parties hereto do not agree that breach has
been rectified, but if the Party, other than the Party making the breach,
decides it does not want to act on such breach, the breach will be
considered as coming to an end; (v) if however the other Party wishes to
act on the breach, the matter will be referred to Arbitration for deciding
whether the breach is a Serious Breach; (vi) if the arbitration award
holds that the breach is not serious, then breach will come to an end;
(vii) if the arbitration award holds the breach as Serious Breach, the
Party other than the Party making the Serious Breach shall have the
options to act as specified in Articles 18.3 and 18.4 hereto.

31.3 In the event the Serious Breach of this Agreement is occasioned by


ES Group, the PI Group shall have the option to terminate this
Agreement

31.4 "Serious Breaches" shall for the purposes of this Agreement


include:

(i)

willful neglect and/or gross negligence by the Parties in fulfilling


their respective obligations under this Agreement,

(ii)

any

of

the

Parties

furnishing

any

untrue

or

misleading

information; and

(iii)

any other breach notified to the Party in default and the defaulting
Party failing to remedy the same within thirty (30) days of written
notice in that behalf.

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47
31.5 This Agreement shall terminate when either party purchases all
the Shares of the other party.

32 SUCCESSORS IN INTEREST

This Agreement shall be binding upon respective heirs, executors,


administrators, successors and permitted assigns of Parties .

33

NON-ASSIGNABILITY

Neither this Agreement nor any of the rights, duties or obligations


hereunder shall be assignable, delegable or transferable, directly or
indirectly by either Party, otherwise than as permitted herein.

34

FORCE MAJEURE

34.1 Neither Party to this Agreement shall be liable for any failure or
delay on its part in performing any of its obligations under this
Agreement or for any loss, damage, costs, charges or expenses incurred
or suffered by the other Party by reason of such failure or delay, if and so
far as such failure or delay shall be the result of or arising out of force
majeure i.e., civil commotion, sabotage, lockout, strike or other labour
disturbances, accident, fire, flood, explosion, damage to plant or
facilities, epidemic, quarantine, restrictions or absence of usual means of
communications or transportation, or any other cause whether of the
same or a different nature, unavoidable or beyond the control of the
Party concerned.

34.2 The Party concerned shall immediately give notice in writing to the
other Party in case of any delay or unforeseen events.

35

TERMINATION OF PRIOR AGREEMENTS

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48

35.1 With effect from the Effective Date, all earlier understandings,
arrangements and agreements if any in between the parties touching the
subject matter of this agreement shall stand terminated and neither
Party shall have any right of action against the other Party under it.

36.

MISCELLANEOUS

36.1 REPRSENTATIONS AND WARRANTIES

36.1.1 Gorja Company confirms that all the representations and


warranties contained in Schedule D are true and to the extent
they contain any continuing obligations, will continue to be
true thereafter during the term of this agreement.

36.1.2The ES Group confirm that all the representations and


warranties contained in Schedule E are true and will be true,
and to the extent they contain any continuing obligations, will
continue to be true thereafter during the term of its agreement.
The PI Group confirm that all the representations and
warranties contained in Schedule E are true and will be true,
and to the extent they contain any continuing obligations, will
continue to be true thereafter during the term of its agreement.

37

NOTICES

37.1.1Except as otherwise expressly provided therein, all notices and


other communications provided for hereunder shall be in
English and in writing and shall be transmitted (i) by post, prepaid registered mail or by internationally recognised courier
service, or (ii) by facsimile transmission or by cable, (iii) by email, confirmation copies to be sent by mail, to the parties
hereto as follows, as elected by the party hereto giving such
notice:

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49
.

In the case of notices to the ES Group at the following address:


Address: Mundada Clinic,
Gorja main road kallam

In the case of notices to the PI Group at the following

address:
Address:

37.1.2

Any notice or other communications shall be deemed to

have been validly given on (i) the expiry of 7 days after posting if
transmitted by airmail or [ii] the expiry of 15 days after posting
if transmitted by postal department [iii] the date of receipt if
transmitted by registered post (ii) the proof of delivery (POD), if
transmitted by courier, or (iii) the business date immediately
after the date of transmission with confirmed answer back, if
transmitted by facsimile or cable transmission, [iv] confirmation
of e-mail whichever shall first occur.

37.1.3Either party may from time to time change its address or


representative for receipt of notices or other communications
provided for in this agreement by giving to the other not less
than 10 days prior written notice.

38

SUCCESSION

38.1.1In the event of any merger or takeover of the Gorja Company,


the acquiring Gorja Company will, in the absence of any
agreement between the PI Group/ES Group and the acquiring
Gorja Company, succeed to all of the Gorja Companys liabilities
under this agreement.

39

BENEFIT OF AGREEMENT

39.1.This agreement shall be binding upon and inure to the benefit of


and

be

enforceable

by

the

respective

heirs,

executors,

49

50
administrators, permitted successors and assigns of the parties
hereto; provided however, that neither the Shareholders nor the
Gorja Company may assign or transfer any of their rights or
obligations hereunder without the prior written consent of the
other parties hereto, except that shareholders may assign rights
and obligations hereunder to an affiliate in connection with a
transfer of shares to such affiliate as stipulated in Article 4 ?
hereof. Any assignee of rights hereunder will be required by the
assignor to enter into an agreement to be bound by the terms of
this agreement.

40

DOCUMENTS

40.1 All documents to be furnished or communications to be given


or made under this Agreement shall be in the English language.

41

GOVERNING LAW

41.1 This agreement and the rights and obligations of the parties
hereunder shall be construed in accordance with and be
governed by the laws of India.

42

ARBITRATION

42.1 The parties agree to negotiate in good faith to resolve any


dispute

between

them

regarding

this

agreement.

If

the

negotiations do not resolve the dispute to the reasonable


satisfaction of both parties, then each party shall nominate one
senior officer of the rank of Vice President or higher as its
representative. These representatives shall, within thirty (30)
days of a written request by either party to call such a meeting,
meet in person and alone (except for one assistant for each
party) and shall attempt in good faith to resolve the dispute. If
the disputes cannot be resolved by such senior managers in

50

51
such meeting, the parties agree that they shall, if requested in
writing by either party, meet within thirty (30) days after such
written notification for one day with an impartial mediator and
consider dispute resolution alternatives other than litigation. If
an alternative method of dispute resolution is not agreed upon
within thirty (30) days after the one day mediation, either party
may invoke arbitration proceedings for the resolution of the
disputes which shall be finally settled under the Arbitration and
Conciliation Act, 1996. Notwithstanding any provision to the
contrary, the arbitrator(s) shall have no power or authority to
award punitive damages to any party hereto. The place of
arbitration shall be Mumbai.

42.2 If the arbitrator(s) shall rule that one or more of the provisions
in this agreement is void or, voidable (by any party) or otherwise
unenforceable in any respect, then such provision shall be
stricken and the agreement shall be construed without such
provision, and the remainder of the agreement shall remain in
full force and effect. Notwithstanding the foregoing, if the
arbitrator(s) shall rule that any of the agreement is void,
voidable or unenforceable in any respect, the parties agree that
the arbitrator(s), upon the request of the parties may revise
such

paragraph

(or

offending

that

thereof)

to

make

it

enforceable to the fullest extent, giving effect to the parties


intention that the protections provided.

42.3 The award of the arbitrators shall be final and binding upon the
parties and non-appealable and the parties agree to be bound
by the same and the successful party may seek to enforce the
same in an appropriate jurisdiction.

42.4 Each of the parties agree and acknowledge that damages would
be inadequate to compensate for the breach of this agreement
by either party, and each party shall be entitled to equitable
relief by way of injunction or specific performance.

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52
42.5 The arbitrators shall issue a written statement of their award
detailing the facts and reasons upon which their decision was
based.

42.6 The parties consent to a single consolidated arbitration for all


disputes that may at the time exist. All communications,
whether or not in writing between the parties or their
representatives in connection with the attempted resolution of
any dispute shall be deemed to have been delivered in
furtherance of a dispute settlement and be without prejudice
and shall be exempt from any discovery or production otherwise
applicable and shall not be admissible in evidence (whether as
an admission or otherwise), in any arbitral proceeding for the
resolution of the dispute.

43 COUNTERPARTS: INTEGRATION

43.1 This agreement may be executed in any number of counterparts


and the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same
instrument. A set of counterparts executed by all the parties
hereto shall be lodged with the Company. This agreement
constitutes the entire agreement and understanding amount
the parties hereto and supersedes and all prior agreements and
understandings, oral or written, relating to the subject matter
hereof.

44 HEADINGS DESCRIPTIVE

44.1

The headings of the articles and sub articles of this


agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of
this agreement.

45 AMENDMENTS OR WAIVER
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53

45.1 Neither this agreement nor any of the terms hereof may be
amended, changed, waived discharged or terminated unless
such amendment, change, waiver, discharge or termination is
mutually agreed in writing and signed by all of the parties
hereto.

46 SEVERABILITY

46.1 If any provision hereof is invalid or unenforceable in any


jurisdiction, then, to the fullest extent permitted by law, (i) the
other provisions hereof shall remain in full force and effect in
such jurisdiction and shall be liberally construed in order to
carry out the intentions of the parties hereto as nearly as may
be possible; and (ii) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity
or enforceability of such provision in any other jurisdiction.

IN WITNESS WHEREOF, the parties hereto have caused this


agreement to be duly executed by their respective authorized officers

SIGNED AND DELIVERED by the

withinnamed the ES Group

(1) DR. BADRINARAYAN MUNDADA

(2) MR. BALAPRASAD KARWA

(3) BADRINARAYAN MUNDADA (HUF)

through DR. BADRINARAYAN MUNDADA]


(4) MR. SHRIDHAR REDDY

(5) MR. NAMDEV PAUL AND

(6) MRS. SORJABAI SADAFULE

in the presence of

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54

SIGNED AND DELIVERED by the

withinnamed the PI Group

(1) MR.________________________

(2) MR. ANAND BIRBICHAND

BALAI

(3) MR. SHREEDHAR GANGADHAR

BHANWAR

(4) MR. VIJAY PARSHURAM

KADAM

(5) DR. ABHIJEEET MANIKRAO

DIKLE

(6) DR. SANJAY HIMATRAO

BAVALE

(7) MR. SANJAY UDHAVRAO

ADSUL AND

(8) DR. RAMESH DHANRAJ

JADHAVAR

in the presence of

THE COMMON SEAL of

GORJA HEALTH CARE &

RESEARCH CENTRE PRIVATE

LIMITED the Company is affixed

pursuant to board resolution dated

____________________ through its

authorized signatory

DR. BADRINARAYAN MUNDADA

in the presence of

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55

SCHEDULE A

AMENDMENTS TO THE GORJA CMPANYS ARTICLES OF


ASSOCIATION

[THE ARTICLES OF ASSOCIATION OF THE COMPANY WILL BE IN A


FORM MUTUALLY ACCEPTABLE TO THE PARTIES]

55

56

SCHEDULE B

DEED OF ADHERENCE

THIS DEED OF ADHERENCE is made at _____________ this ____ day of


_______________ 2010

BETWEEN

(1) DR. BADRINARAYAN MUNDADA (2) MR. BALAPRASAD KARWA, (3)


BADRINARAYAN MUNDADA (HUF) through DR. BADRINARAYAN
MUNDADA, (4) MR. SHRIDHAR REDDY, (5) MR. NAMDEV PAUL AND
(6) MRS. SORJABAI SADAFULE All of Dist Osmanabad, EXISTING

56

57
SHAREHOLDERS GROUP OF GORJA COMPANY, (Herein after referred
to as THE COVENANTOR as per the list of existing shareholders of the
company, and includes existing board members)

AND
GORJA HEALTH CARE & RESEARCH CENTRE PRIVATE LIMITED, a
company incorporated under the companies Act, 1956 having its
registered office at Gorja Main Road, Kallamb, Dist Osmanabad
(hereinafter referred to a the GORJA COMPANY which expression
shall, unless it be repugnant to the context or meaning thereof be
deemed to include its successors and assigns)

AND

(1) MR.________________________ (2) MR. ANAND BIRBICHAND BALAI,


(3)

MR. SHREEDHAR GANGADHAR BHANWAR, (4) MR. VIJAY

PARSHURAM KADAM, (5) DR. ABHIJEEET MANIKRAO DIKLE, (6) DR.


SANJAY HIMATRAO BAVALE (7) MR. SANJAY UDHAVRAO ADSUL
AND (8) DR. RAMESH DHANRAJ JADHAVAR, All of Taluka Kallamb,
District Osmanabad

PROPOSED INVESTOR GROUP (Herein after

referred to as THE INCOMING SHAREHOLDERS which expression


shall, unless it be repugnant to the context or meaning thereof be
deemed to include Companies, Individuals, HUF etc.)

Collectively referred to as Parties and individually as Party and


include its successor or permitted assignees.

WHEREAS:

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58
A.

This Deed is Supplemental to the Agreement dated ___________

("the Agreement") is made at Mumbai the ______ day of _____________,


2010 between the Company, the Outgoing Shareholders and

the

Covenantor.

NOW THEREFORE THIS DEED OF ADHERENCE WITHNESSETH AS


FOLLOWS:

In consideration of the Outgoing Shareholders transferring 1.00 Lac


shares of Rs.10/- each to the Covenantor and in consideration of having
agreed to such allotment, the Covenantor hereby agrees and undertakes
as follows:

1.

The Covenantor hereby confirms that a copy of the Agreement and


the Articles of Association of the Company have been made
available to the Incoming Shareholders and hereby covenants with
the Incoming Shareholders and the Incoming Shareholders shall
observe, perform and be bound by all the terms which are capable
of applying to the Incoming Shareholders and the Incoming
Shareholders shall be deemed to be a Shareholder with effect from
the date on which the Covenantor has signed the Transfer Forms
and handed over the original share certificates of the Company to
the Incoming Shareholders and have lodged the same to register as
a member of the Company to be a party to the Agreement and to
be a shareholder.

2.

The Covenantor hereby covenants that it has done nothing that


derogates from the provisions of the Agreement or the Articles of
Association.

3.

The Covenantor further confirms and recognises that the Company


shall not be bound to give effect to any act or voting rights

58

59
exercised by the Covenantor which are not in accordance with the
Agreement.

4.

The

Covenantor

represents

and

warrants

to

the

Incoming

Shareholders that:

(a)

Have absolute power and authority to execute and deliver,


and to perform its obligations under, this Deed.

(b)

To sign the Transfer Forms, Deeds etc., for transferring the


shares held by the Covenantor.

(c)

The execution and delivery by it of this Deed and the


performance of its obligations hereunder do not and will not
violate any provision of its corporate charter or regulations or
any agreement to which it is a party or by which it or any of
its properties are bound.

(d)

No authorisation or approval of any governmental agency is


required to enable it to lawfully perform its obligation
hereunder.

5.

The Covenantor and the Incoming Shareholders recognise the


allotment of shares has been permitted by the Company.

IN WITNESS WHEREOF, the parties hereto have caused this Deed of


Adherence to be duly executed by their respective authorized officers

SIGNED AND DELIVERED by the

withinnamed the Covenantor

(1) DR. BADRINARAYAN MUNDADA

(2) MR. BALAPRASAD KARWA

(3) BADRINARAYAN MUNDADA (HUF)

through DR. BADRINARAYAN MUNDADA]

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60
(4) MR. SHRIDHAR REDDY

(5) MR. NAMDEV PAUL AND

(6) MRS. SORJABAI SADAFULE

in the presence of

SIGNED AND DELIVERED by the

withinnamed the Company

GORJA HEALTH CARE &

RESEARCH CENTRE PRIVATE

LIMITED

pursuant to board resolution dated ]


through its ]
authorized signatory

DR. BADRINARAYAN MUNDADA

in the presence of

SIGNED AND DELIVERED by the

withinnamed the Incoming

Shareholders

(1) MR.________________________

(2) MR. ANAND BIRBICHAND

BALAI

(3) MR. SHREEDHAR GANGADHAR]


BHANWAR

(4) MR. VIJAY PARSHURAM

KADAM

(5) DR. ABHIJEEET MANIKRAO

DIKLE

(6) DR. SANJAY HIMATRAO

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61
BAVALE

(7) MR. SANJAY UDHAVRAO

ADSUL AND

(8) DR. RAMESH DHANRAJ

JADHAVAR

in the presence of

]
)

61

62
SCHEDULE C

REPRESENTATIONS, WARRANTIES, AND CONVENANTS OF THE


COMPANY

The Company hereby represents, covenants and agrees with Investor


that:

Status of Company

1.

The Company is a private limited company as defined under the


provisions of the Companies Act, 1956, and is duly organised,
legally existing in good standing under the laws of India and has all
requisite corporate power and authority to own its assets and carry
on its business in the manner in which they are now conducted.
The Company has obtained governmental licenses, permits and
approvals necessary to conduct its business as currently operated
as per Annexure 6 attached to the Principal agreement
executed on 00/00/00, and these permits and licenses are and
will be kept in full force and effect. The Company neither have any
subsidiaries nor any branches outside India.

2.

The copies of the Certificate of Incorporation, the Memorandum


and the Articles of Association of the Company, which have been
certified and initialed by an officer on behalf of the Company and
furnished to Investor, are correct and complete and reflect all
amendments

made

thereto

prior

to

the

execution

of

this

Agreement.

3.

The Company has filed, submitted and furnished all statements,


return, records and information in prescribed manner to the
prescribed authorities as required under law, and that it has no
outstanding claims or liabilities other than those disclosed in the
published Financial Statements for the fiscal year ended March 31,

62

63
2010, provisional balance sheet as on May 31, 2010 and those now
disclosed and certified by the Company.

4.

The Company has not (i) guaranteed, (ii) provided any letter of
comfort (iii) made any representation or (iv) taken any other action
in order to support the obligations or solvency of, or to otherwise
provide financial assistance (whether directly or by inducing a
third

party

to

provide

financial

assistance),

except

the

representations and warranties which are the subject matters of


this Agreement and the Share Purchase Agreement.

5.

Neither the Company nor the promoters have (i) guaranteed, (ii)
provided any letter of comfort (iii) made any representation or (iv)
taken any other action in order to support the obligations or
solvency of, or to otherwise provide financial assistance (whether
directly or by inducing a third party to provide financial assistance)
in relation to the Company, except the representations and
warranties which are the subject matters of this Agreement and
the Share Purchase Agreement.

6.

Save as set out in the financial statements for the year ended
March 31, 2010, the Company hereby declares that the company
would clear all the statutory obligations and liability as applicable
till the date of execution of this agreement by end of this financial
year March 31, 2010 in respect of demands such as income-tax,
corporation tax and all other taxes and revenues or any other
statutory dues payable to the Central or State Governments or any
local or other authority.

7.

The Company has duly and properly complied with all applicable
environmental regulations and standards and is not subject to any
present or future liability arising out of environmental noncompliance.

8.

The

Company

is

in

compliance

with

all

regulations

and

requirements prescribed by any Governmental or other authority,


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64
and is not subject to any present or future liability by reason of
non-compliance with such regulations.

9.

The Company has duly and properly maintained all books, records,
documents etc. including the books of accounts and all of them
duly, correctly, completely and truly incorporate all particulars
relating to the business of the Company.

10.

The Company's use of any intellectual property, or Trade Secrets,


will not expose the Company to any infringement claims and the
Company has the right to all concessions, trademarks, copy rights,
trade names, patents and license agreements necessary for the
conduct of its business as now conducted and as proposed to be
conducted, without any known conflict with the rights of others.

11.

None of the following has occurred and is subsisting and no notice


in connection therewith has been served in relation to the
Company:

(a)

An application to a court for an order, or the making of any


order, that the Company be wound up, that a liquidator,
receiver or custodian be appointed of the Company or any of
its assets or that the Company be placed in bankruptcy.

(b)

A resolution for winding up of the Company.

(c)

The convening of a meeting or passing of a resolution to


appoint a liquidator.

(d)

A scheme of arrangement, amalgamation or reconstruction


of the Company or arrangement or composition with or
assignment for the benefit of, all or a class of creditors.

(e)

The taking of any action to seize, attach, take possession of


or appoint a custodian, receiver, liquidator or manager in

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65
respect of the Company or any shares or property of the
Company.

12.

The Company confirms, repeats and reiterates the representation,


warranties and covenants set out in the Share Subscription
Agreement.

The Shares

13.

The Company has not taken on record, received any declaration or


notice and is not aware of or sought to be made aware of any
beneficial interest in the shares or securities issued by the
Company and / or of any person holding shares or securities
issued by the Company being held in the capacity of a trustee or in
trust.

14.

The Company has not created nor noted any pledge, charge, lien or
encumbrance whatsoever over or in respect of the shares of the
Company, whether equity or preference shares, or any part thereof.

15.

The Company has full legal right, power, and authority to issue,
allot and deliver the Shares. Allotment of the Shares to Investor
will result in the creation of lawful and valid title to those shares in
favour of Investor, free and clear of any and all liens, pledges,
encumbrances, charges, agreements, interest, or claims of any
kind.

The Company has not been prohibited, restrained or

otherwise

prevented

under

any

order,

judgment,

decree,

prohibition, injunction, attachment, mandatory orders, awards of


processes issued by any court of law, statutory authorities or any
other person acting under provisions of any law for the time being
in force from issue, allotment and delivery of the Shares to
Investor.

16.

The Company is not a party to or otherwise bound by any


Agreement which would in any way affect its performance of its
obligations under this Agreement.
65

66

17.

There are not now, threatened, any legal proceedings, suits,


appeals or other actions in law, whether judicial, fiscal or
administrative or any claims which may give rise to such
proceedings, to which the Company or any of its directors or
officers was, were, is or are likely to be, a party or parties, and
which affect, or may thereafter affect the Business or the assets or
any right, title or interest to or in the Shares or any part thereof
has been or is likely to be claimed by any other person.

The

Company is not aware of any facts, information, or circumstances


whatsoever that would adversely affect the Company's right or
power to issue or allot the Shares to Investors.

18.

The Company is empowered by provisions of the applicable laws


and its Memorandum and Articles of Association to:

(a)

implement the Company Business;

(b)

issue and allot the Shares to Investor.

Approvals and licenses

The company

19. The Company is holding all the necessary permission, licenses

which are required to establish the factory. A list of such licenses


and permissions are given in separate list attached to this
Agreement as Annexure 6 hereto. Gorja Company will obtain
remaining permissions and licenses required for commencing the
operations of the company will be applied and shall be obtained
by ABL as and when required.

Miscellaneous
66

67

19.

The Company shall observe on a continuing basis all applicable


laws relating to child labour, acceptable work conditions, minimum
wages, work hours, occupational health and safety, applicable to
the business in which the Company is engaged.

20.

The Company shall not use forced labour or prevent employees


from lawfully exercising their right of free association and to
organise and bargain collectively.

21.

The Company shall maintain in full force and effect, public liability
and other insurance cover in respect of all its assets in accordance
with sound commercial practice for the business in which the
Company is engaged.

22.

The Company hereby confirms that in accordance with the


provisions of its Articles of Association resignation by any director
appointed by the Investor is not required to be approved by the
Board of Directors for the same becoming effective.

23.

The Company shall comply on a continuing basis with the


provisions of all the Indian environmental, health and safety laws,
rules and regulations as applicable to the business in which the
Company is engaged.

24.

The Company has, with a view to invite Investor to invest in the


Shares and provide loan furnished certain information, data,
particulars, documents and records which are correct, complete,
true and up-to-date. No part of such information etc. is untrue or
incorrect and no material information which may have materially
adverse

effect

on

Investors'

investment

decision,

has

been

suppressed or omitted or has remained to be furnished.

25.

The Company and the Promoters have the power and authority to
enter into this Agreement and the execution and delivery of this
Agreement.

The Company has been duly authorised by all


67

68
requisite corporate action on its part. This Agreement, when duly
executed, will constitute the legal, valid and binding obligation
between the Company, the Promoters and Investor, enforceable
against each of the Parties.

26.

The

rights

and

remedies

of

Investor

in

relation

to

any

misrepresentation or breach of warranty on the part of the


Company shall not be prejudiced by any investigation by or on
behalf of Investor in to the affairs of the Company, the execution or
the performance of this Agreement or by any other act or thing
which may be done by or on behalf of Investor in connection with
this Agreement, and which might, apart from this paragraph,
prejudice such rights or remedies.

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69
SCHEDULE D

REPRESENTATIONS AND COVENANTS OF THE ES GROUP

The ES Group hereby jointly and severally represent, covenant and agree
with Gorja Company that:

1.

The ES Group are fully aware of, and hereby, confirms, each and
every one of the representations and covenants of the Company as
stated herein and they have verified that all the representations
and covenants are true, accurate, complete and correct and are not
misleading, and no material information, particulars or details
have been omitted, concealed or otherwise no disclosed or have
remained to be furnished to the Investor.

2.

The ES Group agree and undertake to observe, comply with and


carry out all their obligations hereunder to be performed and
complied with by them.

3.

The responsibility to comply with the Agreement shall be joint and


several amongst the ES Group.

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70

SCHEDULE E

REPRESENTATIONS AND COVENANTS OF THE PI GROUP

The PI Group hereby jointly and severally represent, covenant and agree
with Gorja Company that:

1.

The PI Group are fully aware of, and hereby, confirms, each and
every one of the representations and covenants of the Company as
stated herein and they have verified that all the representations
and covenants are true, accurate, complete and correct and are not
misleading, and no material information, particulars or details
have been omitted, concealed or otherwise no disclosed or have
remained to be furnished to the Investor.

E. The Pi Group agree and undertake to observe, comply with and


carry out all their obligations hereunder to be performed and
complied with by them.

F. The responsibility to comply with the Agreement shall be joint and


several amongst the PI Group.

70

71
SHARE TRANSFER AGREEMENT

AGREEMENT

THIS SHARE TRANSFER AGREEMENT is made at _____________


this _____ day of _______________ 2010

BETWEEN

(1) DR. BADRINARAYAN MUNDADA (2) MR. BALAPRASAD KARWA, (3)


BADRINARAYAN MUNDADA (HUF) through DR. BADRINARAYAN
MUNDADA, (4) MR. SHRIDHAR REDDY, (5) MR. NAMDEV PAUL AND
(6) MRS. SORJABAI SADAFULE All of Dist Osmanabad, (Herein after
referred to as The Transferors (which expression shall unless
repugnant to the context or meaning thereof shall mean and include
their respective heirs, executors, administrators and permitted assigns)
of the First Part

AND

(1) MR.________________________ (2) MR. ANAND BIRBICHAND BALAI,


(3)

MR. SHREEDHAR GANGADHAR BHANWAR, (4) MR. VIJAY

PARSHURAM KADAM, (5) DR. ABHIJEEET MANIKRAO DIKLE, (6) DR.


SANJAY HIMATRAO BAVALE (7) MR. SANJAY UDHAVRAO ADSUL
AND (8) DR. RAMESH DHANRAJ JADHAVAR, All of Taluka Kallamb,
District Osmanabad (Herein after referred to as The Transferees
(which expression shall unless repugnant to the context or meaning
thereof shall mean and include their respective heirs, executors,
administrators and permitted assigns) of the Second Part

AND

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72

GORJA HEALTH CARE & RESEARCH CENTRE PRIVATE LIMITED, a


company incorporated under the companies Act, 1956 having its
registered office at Gorja, Main Road, Taluka Kallamb, District
Osmanabad (hereinafter referred to a the Gorja Company (Which
expression shall, unless it be repugnant to the context or meaning
thereof be deemed to include its successors and assigns) of the Third
Part

Collectively referred to as Parties and individually as Party and


include its successor or permitted assignees.

WHEREAS:

(A) The Gorja Company is carrying on the business of running a 29


bed hospital and has its main object to establish, maintain, run,
manage, develop, own, acquire, purchase, undertake, improve,
equip, promote, initiate, encourage, subsidise and organise,
hospitals, dispensaries, polyclinics, for reception and treatment of
persons suffering from illness or mental defect or of persons
requiring medical attention or rehabilitation or for treatment of
gynaelogical problems and to promote medical relief to the public
in all branches of medical sciences by conducting and running day
care centre, clinics, hospitals, dispensaries, mobile dispensaries
etc., and other incidental objects of the company.

(B) The authorized share capital of Gorja Company is Rs.25,00,000]/divided into [2.50] Lac Equity Shares of the face value of Rs.10/each. The issued, subscribed and paid up equity share capital of
Gorja Company is Rs.10,00,000/- divided into 1,00,000 Equity
Shares of the face value of Rs.10/- each. These shares are held by
the Transferors Group as follows:
72

73

73

74

Name of the Transferors

Number of

Percentage

shares of Rs.

held in the

10/- each

total paid up

Mr. Badrinarayan Mundada


Mr. Balaprasad Karwa
Badrinarayan Mundada (HUF)
Mr. Shridhar Reddy
Mr. Namdev Paul
Mrs. Sorjabai Sadafule
Total

(C)

6,500
27,000
50,500
6,000
5,000
5,000
1,00,000

capital
_6.5_____%
27______%
50.5______%
6______%
5______%
5______%
_100_____%

The Transferors are the promoters and majority shareholders of


Gorja company and the legal and beneficial owner of 1,00,000 fully
paid up Equity Shares of the face value of Rs.10/- each of Gorja
Company, representing in the aggregate 100% of the total issued,
subscribed and paid-up equity share capital of Gorja Company.

(D)

By an Agreement dated ___________________ (hereinafter referred to


as the Principal Agreement), the Transferees herein have agreed
to purchase 100% of the Equity shares of the Transferors herein of
the

Gorja

company

on

the

terms

and

conditions

therein

mentioned. It was agreed between the Transferors, Transferees and


the Gorja Company therein that shares in proportion of the
payment made by the Transferees under the principal agreement
shall be simultaneously transferred unto the Transferees and after
completion of the transfer of shares as contemplated by the said
agreement, the shareholding pattern of Gorja company would be as
follows:

Name of the shareholder

Number of

Percentage

shares of Rs.

held in the

74

75
10/- each

total paid up

allotted at a

capital

premium of
Rs.115/- per
share
Mr.
Mr. Anand Birbichand Balai

8600

Age 44 years r/o Main Road, Kallamb,


Dist Osmanabad
Mr. Shreedhar Gangadhar Bhanwar

8600

Age 47 years r/o Punvarsan, Swaragaon,


Kallamb, Dist Osmanabad
Mr. Vijay Parshuram Kadam

4300

Age ___ years r/o Shramik Niwas,


Datanagar, Kallamb, Dist Osmanabad
Dr. Abhijeeet Manikrao Dikle

4300

Age 24 years r/o Moha Road, Kallamb,


Dist Osmanabad
Dr. Sanjay Himatrao Bavale

4300

Age 40 years r/o Baba Nagar, Kallamb,


Dist Osmanabad
Mr. Sanjay Udhavrao Adsul

4300

Age 30 years r/o Adsul Complex, Dhoki


Road, Kallamb, Dist Osmanabad
Dr. Ramesh Dhanraj Jadhavar

4300

Age 28 years r/o Tadgaon Poghargaon,


Kallamb, Dist Osmanabad
Total

(E) The Transferors have has offered to the Transferees _______________


shares of the Company of Rs.10/- each valued at Rs.10/- per
share for a lumpsum consideration price of Rs.10,00,000/(Rupees Ten Lacs only) and the Transferees has agreed to acquire
the shares of the said Gorja Company on the terms and conditions
hereinafter mentioned. Hereto annexed and marked as Annexure
1 is the valuation report dated _______________ certified by M/s.
_____________________, Chartered Accountants.

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76
(F) The parties hereto are desirous of recording into writing the terms
and conditions in the manner hereinafter appearing.

NOW IT IS AGREED BY AND BETWEEN THE PARTIES HERETO AS


FOLLOWS :-

1.

The Transferors hereby grant, assign, transfer and assure unto the

Transferees all their right, title and interest in the said 1,00,000 Equity
shares of the Company of Rs.10/- each valued at Rs.10/- per share as
per the details of the list of shares, distinctive nos and share certificate
nos mentioned in Annexure 2 for a

total

consideration

of

Rs.10,00,000/- (Rupees Ten Lacs only) as mentioned hereunder.

2.

The said consideration price of Rs.10,00,000/- (Rupees Ten Lacs

only) has been paid by the Transferees to the Transferors herein. (the
payment and receipt whereof, the Transferors doth hereby admit and
acknowledge and shall release and discharge the Transferees forever)

3.

It is hereby agreed and declared that the executed Transfer Forms

along with the original share certificates have been handed over by the
Transferors to the Transferees as per list (Annexure 1 hereto).

4.

It is hereby agreed between the parties hereto, that the Transferees

shall be entitled to have and hold the said shares for, unto and to the use
and benefit

of the Transferees, their respective heirs, executors,

administrators and assigns without any lien, charge, interest, demand or


claim of whatsoever nature from the Transferor or any person or persons
claiming through them.

5.

It is hereby agreed between the parties hereto, that the Transferees

shall be entitled to apply to the membership of the said ABL Company


and for the transfer of the shares to their names. The Transferors hereby

76

77
agrees to sign, execute and file all such forms, documents or writings
as may be required for the said purpose in the office of the Registrar of
Companies.

6.

The Transferors hereby agrees to sign, execute and file all such

forms, documents or writings as may be required for the said purpose in


the office of the Registrar of Companies.

7.

The Transferors hereby represents and covenants with the

Transferees as follows:-

a)

That the Transferors are the absolute owners of the said shares of
the said Gorja Company and that no other person or persons have
any right, title, interest,

claim

or

demand

of

any nature

whatsoever into or upon the said shares by way of sale, exchange,


mortgage,

possession,

inheritance,

charge,

lien,

gift,

trust,

easement or otherwise howsoever.

b)

That the Transferors have not contracted to sell or mortgage the


said shares or any part thereof to any person or persons.

c)

That the Transferors have good right, full power and independent
authority to sell and transfer the said shares to the Transferees.

d)

That the Transferors have signed the transfer forms and handed
over the original Share Certificates to the Transferees herein.

8.

The Transferees hereby covenant with the Transferors as

follows :-

a) That the Transferees shall observe and perform and abide by the
Memorandum and Articles of Association

of the said Gorja

Company from time to time in force.

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78
b) No shares shall be transferred by the Transferees to a person who
is not a member of the company, so long as the any person selected
by the Board of Directors as one to whom it is desirable in the
interest of the Gorja Company to admit to membership, is willing to
purchase the same at the fair value.

9.

The transfer charges/fees/expenses/stamp duty payable in respect

of this agreement and the transfer of the said shares to the names of
the Transferees shall be borne and paid by the Transferors and the
Transferees in equal shares save and except that each party shall bear
and pay the fees of their respective Solicitors/Advocates.

IN WITNESS WHEREOF the parties have hereto set and subscribed their
hands to this writing the day and year first hereinabove written.

SIGNED AND DELIVERED by the


withinnamed the Transferors

]
]

(1) DR. BADRINARAYAN MUNDADA

(2) MR. BALAPRASAD KARWA

(3) BADRINARAYAN MUNDADA (HUF)

through DR. BADRINARAYAN MUNDADA]


(4) MR. SHRIDHAR REDDY

(5) MR. NAMDEV PAUL AND

(6) MRS. SORJABAI SADAFULE

in the presence of

SIGNED AND DELIVERED by the

withinnamed the Transferees

(1) MR.________________________

(2) MR. ANAND BIRBICHAND

BALAI

78

79
(3) MR. SHREEDHAR GANGADHAR

BHANWAR

(4) MR. VIJAY PARSHURAM

KADAM

(5) DR. ABHIJEEET MANIKRAO

DIKLE

(6) DR. SANJAY HIMATRAO

BAVALE

(7) MR. SANJAY UDHAVRAO

ADSUL AND

(8) DR. RAMESH DHANRAJ

JADHAVAR

in the presence of

]
RECEIPT

RECEIVED of and from the withinnamed )


Transferees a sum of Rs.10,00,000/-

(Rupees Ten Lacs Only) being the

lumpsum consideration price payable by

the Transferees to the Transferors herein

for 1,00,000 Equity shares of the Gorja

Company which is being

paid vide Cheque bearing No.

dated

drawn on

Branch for Rs.___________/

Cheque bearing No.

dated

drawn on

Branch for Rs.___________/

Cheque bearing No.

79

80
dated

drawn on

Branch for Rs.___________/

Cheque bearing No.

dated

drawn on

Branch for Rs.___________/

Cheque bearing No.

dated

drawn on

Branch for Rs.___________/

Cheque bearing No.

dated

drawn on

Branch for Rs.___________/

Aggregating to Rs.10,00,000/- as

Withinmentioned

)Rs.10,00,000/(Rupees Ten Lacs only)

WITNESS:

WE SAY RECEIVED.

(1) DR. BADRINARAYAN MUNDADA

(2) MR. BALAPRASAD KARWA

(3) BADRINARAYAN MUNDADA (HUF)


through DR. BADRINARAYAN MUNDADA

(4) MR. SHRIDHAR REDDY

(5) MR. NAMDEV PAUL


(6) MRS. SORJABAI SADAFULE

80

81
(Transferors)

81

82

82

83

ANNEXURE 1

Valuation Report

ANNEXURE 2

Details of Shares

83

84

*******************************************
Dated this

day of

2010

*******************************************

BETWEEN

DR. BADRINARAYAN MUNDADA &


ORS
..... The Transferors

AND

MR.____________________________

&

ORS
... The Transferees

SHARE TRANSFER AGREEMENT

84

85

85

86

86