Privileged and Confidential

INTRODUCTION

Capitalised terms used herein have the meaning ascribed to such terms in the chapter titled “Glossary of Terms”.

We have prepared this red flag report (the “Report”) for the Client in connection with the Proposed Transaction. The Report contains the issues
identified by us pursuant to the legal due diligence conducted on the Company based on the information provided till the Cut Off Date.

The Report is addressed to, and is solely for the benefit of, the Client. The Client may, subject to confidentiality and other similar obligations,
share this Report with its internal teams, affiliates or the Company. However, no person (other than the Client) shall, except with consent of [law
firm] rely upon the Report or any part thereof.

We do not, through the Report or otherwise, purport to make any comments or statements relating to technical issues, accounting, tax,
environmental, title to property, operational and commercial aspects. The scope, methodology and limitations of this Report are set out in [ ].
 Privileged and Confidential

GLOSSARY OF TERMS

AOA Articles of association of the Company

Board Board of directors of the Company

CA2013 Companies Act 2013

Client Sorting Hat Technologies Private Limited

Company/ Target Leagle Technologies Private Limited

Completion Completion of the Proposed Transaction

Defined Term A word or an expression carrying a precise meaning in a particular document

Documents Documents uploaded on the virtual data room hosted at

Founders Sanjay Krishna and Saahil Dama

INR Indian Rupee

MoA Memorandum of Association of the Company

MoU Memorandum of Understanding

POSH Act Prevention of Sexual Harassment at Workplace (Prevention, Prohibition and Redressal) Act 2013

Proposed Transaction 100% Share acquisition of the Company by the Client

Review Period 2020-till date

 Privileged and Confidential

CORPORATE INFORMATION

NAME : Leagle Technologies Private Limited

CORPORATE :
U72900MH2020PTC336630
IDENTITY
NUMBER

DATE AND : 27/01/2020

PLACE OF AURANGABAD, MAHARASHTRA
INCORPORATION

REGISTERED : ABHANG, PLOT NO. 93, SURVEY NO. 70/P N2 CIDCO, AURANGABAD, Aurangabad, Maharashtra, India
OFFICE 431001

SHAREHOLDING 9900 shares held by Saahil Jayraj Dama, 100 shares held by Jayraj Shivraj Dama

DIRECTORS : NAME DESIGNATION

JAYRAJ SHIVRAJ DAMA DIRECTOR

SAAHIL JAYRAJ DAMA DIRECTOR

CLASS OF : Private company limited by shares

COMPANY
 Privileged and Confidential

A. KEY FINDINGS

LEGEND

: Significant legal risk/actionable. Impact on the Proposed Transaction to be considered immediately

: Material legal risk/actionable. To be addressed on priority, prior to, or after, Completion
: No material legal risk. To be considered going forward and may be addressed after Completion

1. INTELLECTUAL PROPERTY

# SUMMARY OBSERVATION IMPLICATIONS RECOMMENDATION RISK

LEVEL

1.1 The Company has not registered its logo, An intellectual property, such as a logo, Company must apply for registration
WorldWise as a trade mark.
not registered under the Trade Marks as per section 18 of the Trade Marks
Act, 1999 can result in the following for Act with the Trade Marks Registry, as
the Company-
a condition precedent to Completion.
i.No right of exclusive use
ii.No right to seek statutory remedy
against infringement
iii.No right to assign some other entity
the rights over the intellectual property

2. CORPORATE
# SUMMARY OBSERVATION
2.1 The Company had to draft a Sexual
Harassment Policy, in order to create
awareness, as per the POSH Act, the
Company failed to do so.
2.2 The Company has not stamped the AoA
executed by the Company for its
incorporation, as required under
Schedule 1 of the Indian Stamp Act,
1899.
IMPLICATIONS
Failure to comply with the provisions of
the Act can lead to fines of up to fifty
thousand rupees under section 26 of the
Act.
Failure to adequately stamp an
instrument: (a) renders the such
instrument inadmissible as evidence
unless the deficient stamp duty along
with a penalty of up to 10 times the
deficient stamp duty is paid, and (b) may
result in the governmental authorities
impounding such instrument and
imposing a penalty of up to 10 times the
deficient portion of the stamp duty
payable.
Privileged and Confidential
RECOMMENDATION RISK
LEVE
L
Since the Company is responsible for
creating awareness and disseminating
information via a detailed framework
under the Act, it must have a policy
against Sexual Harassment, as a
condition subsequent to the
Completion.
Additionally, the policy must account
for the interns that the Company takes
and include monitoring of the
occasional live sessions through the
platform.
The Company must re-execute the
AoA and ensure that the re-executed
AoA is duly stamped under the
applicable law, as a condition
subsequent to Completion.
Additionally, if the Company has
taken a commercial call on not
stamping the AoA, appropriate
indemnities may be obtained by the
Client in relation to any losses that
may arise on account thereof.
 Privileged and Confidential

2. CORPORATE

# SUMMARY OBSERVATION IMPLICATIONS RECOMMENDATION RISK

LEVE
L

Additionally, any person who executes

an instrument which is not duly stamped
is punishable with a fine of up to
INR 500. Further, such an agreement is
not admissible as evidence in a court of
law, subject to limited exceptions.

2.3 The Company has not stamped the
MoA executed by the Company for its
incorporation, as required under
Schedule 1 of the Indian Stamp Act,
1899.
Failure to adequately stamp an
instrument: (a) renders the such
instrument inadmissible as evidence
unless the deficient stamp duty along
with a penalty of up to 10 times the
deficient stamp duty is paid, and (b) may
result in the governmental authorities
impounding such instrument and
imposing a penalty of up to 10 times the
deficient portion of the stamp duty
payable.
Additionally, any person who executes
an instrument which is not duly stamped
is punishable with a fine of up to
INR 500. Further, such an agreement is
not admissible as evidence in a court of
law, subject to limited exceptions.
The Company must re-execute the
MoA and ensure that the re-executed
MoA is duly stamped under the
applicable law, as a condition
subsequent to Completion.
Additionally, if the Company has
taken a commercial call on not
stamping the MoA, appropriate
indemnities may be obtained by the
Client in relation to any losses that
may arise on account thereof.

2. CORPORATE
# SUMMARY OBSERVATION
2.4 The Company has not duly signed and
stamped the share certificates of the
Directors, as required under Schedule 1
of the Indian Stamp Act, 1899.
2.5 The Company has not registered all of
its members in the Register of
Members, as required under the CA
2013.
Privileged and Confidential
IMPLICATIONS RECOMMENDATION RISK
LEVE
L
Failure to adequately stamp an The Company must re-execute the
instrument: (a) renders the such share certificates and ensure that the
instrument inadmissible as evidence re-executed share certificates are duly
unless the deficient stamp duty along stamped under the applicable law, as a
with a penalty of up to 10 times the condition subsequent to Completion.
deficient stamp duty is paid, and (b) mayAdditionally, if the Company has
result in the governmental authorities taken a commercial call on not
impounding such instrument and stamping the share certificates,
imposing a penalty of up to 10 times the appropriate indemnities may be
deficient portion of the stamp duty obtained by the Client in relation to
payable. any losses that may arise on account
Additionally, any person who executes thereof.
an instrument which is not duly stamped
is punishable with a fine of up to
INR 500. Further, such an agreement is
not admissible as evidence in a court of
law, subject to limited exceptions.
If a company does not maintain a The Company must register the co-
register of members or fails to maintain founder mentioned on its website,
them in accordance with the provisions Sanjay Krishna, as a member, as a
of section 88 of the Act, the company condition precedent to Completion.
and every officer of the company who is
in default shall be punishable with fine
which shall not be less than fifty
thousand rupees but which may extend

2. CORPORATE
# SUMMARY OBSERVATION IMPLICATIONS
to three lakh rupees and where the
failure is a continuing one, with a further
fine which may extend to one thousand
rupees for every day, after the first
during which the failure continues.
2.6 The Company has failed to amend the The Object clause in the MoA of the
Object clause in its MoA as required Company tells the scope and powers
under the CA 2013. within which the Company can operate.
Any act done beyond the one stated in
the MoA would be deemed ultra vires
and hence, would be null and void as per
the CA 2013.
Privileged and Confidential
RECOMMENDATION RISK
LEVE
L
The Company must make the
necessary changes, as discussed with
the Director, to its Object clause in the
MoA. Since the Company is run by
two directors who make the decisions
for the Company and expanding the
purpose is a result of this arrangement,
the Company may treat this
recommendation as a condition
subsequent to Completion.
Furthermore, the Company may call
for a Special Resolution under section
13 of the Act to alter the
Memorandum.
 Privileged and Confidential

3. MATERIAL AGREEMENTS

# SUMMARY OBSERVATION IMPLICATIONS RECOMMENDATION RISK

LEVEL

3.1 In the Internship Agreement, the
Company has included the Entire
Agreement clause within the Effect of
Termination clause. The relevant section
of the Effect of Termination clause deals
with the parts that survive termination.
Within the Agreement the Effect of The Company must make this minor
Termination clause mentions certain modification to the Internship
sections of the Agreement to remain Agreement as a condition subsequent
valid even after the termination of the to Completion
Agreement. However, including Entire
Agreement clause under this would
result in all the rights and liabilities,
arising out of the Agreement, to remain
valid even after the termination.

3.2 In the Internship Agreement, the
Company has included the provision of
Termination for Cause which serves as
an exit provision provided there is a
Cause for seeking Termination.
However, the Company has failed to
define the term ‘Cause’.
A Defined Term is mutually agreed upon The Company must make necessary
by the parties to an agreement. In the changes in the Agreement where the
event where a dispute arises because a Defined Terms have been explained. It
Defined Term has been used but its must do so as a condition subsequent
meaning has not been given in the to Completion.
Agreement, the court having exclusive
jurisdiction is free to adjudge the
situation to the advantage or
disadvantage of either or both the parties.
Additionally, it may also read the clause
against the drafter of the Agreement
(here, the Company) as per the rule of
Contra proferentem.

3.3 In the MoU, the Company has included A Defined Term is mutually agreed upon The Company must make necessary
the provision of Specific Performance by the parties to an agreement. In the changes in the Agreement where the
which is specifically enforceable at the event where a dispute arises because a Defined Terms have been explained. It

3. MATERIAL AGREEMENTS
# SUMMARY OBSERVATION
instance of either Party provided there is
a material breach of the Agreement.
However, the Company has failed to
define what constitutes as ‘material
breach’.
Privileged and Confidential
IMPLICATIONS RECOMMENDATION RISK
LEVEL
term has been used in the Agreement but must do so as a condition subsequent
has not been defined, the court having to Completion.
exclusive jurisdiction is free to adjudge
the situation to the disadvantage of the
drafter of the Agreement (here, the
Company) as per the rule of Contra
proferentem.